Tag: retire early
Mastering the FIRE Method: The Ultimate Guide to Early Retirement & Financial Independence
Harvey 0 Comments Planning your Retirement Retire Wealthy & Wise Retiree Tips and Tricks
There are several permutations and also mixes you can look at however my suggestion is attempt to be a little traditional in your price quotes specifically when it comes to return on financial investment the inflation price and also the post retirement monthly expenses currently for your advantage I have enclosed the web link of this worksheet in the video clip'' s description it ' s a downloadable sheet all the formulas are open so really feel cost-free to transform the numbers boost the formula if called for add your very own modification if it assists you yet have a clear idea on when as well as where you require to be on the path to economic Self-reliance so when I initially listened to and also read concerning fire I was not a huge follower of it I suggest saving 50 to 7 20 percent of one income is virtually following to Difficult and also I would have shut sharp had I not recognized that as a method fire is quite adaptable as well as can be used in numerous various methods so the calculator is one means as well as you can make a tailored version of it yet then there are a lot more strategies there are more versions of the fire strategy and if you are interested after that do read up on lean fire fat fire Coast fire and also a couple of even more of these in relevant posts that I'' ve Linked In the video'' s summary the factor is as well as I myself realized a really late in life that numerous of us wear'' t recognize when to retire exactly how much is required to retire which is why we proceed functioning in a function or line of work that we don'' t delight in much and'that ' s where I assume fire as an approach could be the remedy and it'' s simply three points right raise your revenue as well as financial savings reduced your expenditures as well as get your Investments right so review up even more concerning this concept in the Articles and also internet sites I'' ve added in the description as well as I truly wish you practice some sort of fire going forward if you found this video clip useful then do push the like button do subscribe to my channel share this video clip as well as I'' ll see you 3 days from now up until after that foreign
How to Retire in 7 Years Starting with $0
Harvey 0 Comments Planning your Retirement Retire Wealthy & Wise Retiree Tips and Tricks
hi men it'' s mark i believe the largest reason most individuals wear'' t attain early retirement is that they were never given a step-by-step guide the only course that appears to be pushed in schools is to get a 9 to 5 job save your money work until you'' re 65 as well as ultimately retire when you ' re as well old to enjoy it the good news is one of the business owners i looked up to discussed it in a somewhat different method he stated the word retirement should be changed with words flexibility due to the fact that as soon as you get to a tipping factor when you have sufficient money to stop functioning you have real freedom daily you can do precisely what you desire no inquiries asked perhaps that'' s loosening up on a beach sipping a pina colada or building organizations that change the globe like elon musk when you have the capability to retire it'' s completely as much as you exactly how you spend your time so on that note today we'' re going to talk about the strategy i utilize to reach my retired life objective in my late 20s beginning with absolutely no dollars this may be a little extreme for some people but that'' s just me i ' m either 100 in or i ' m not in at all clearly you can take this strategy at your own pace and also who recognizes maybe you ' ll even defeat me we'' ll get into every one of this right after you hit that like button for the l2 buga rhythm as it really assists push this video to even more individuals likewise make certain to subscribe if you want to grow your wealth phase one is all about your freedom number this is the target you have to get to in order to have full control of your life this is something you must know even if you'' ve obtained absolutely no bucks in the bank if you don'' t know your freedom figure then it ' s a bit like being blindfolded in a running race you can'' t see where you ' re going so you may wind up putting all your efforts in going in the wrong instructions and even floundering and also dropping level on your face the truth is there are three types of individuals in this globe there are doers dreamers and drifters or else called the 3ds really considering it when i was at school they gave me a cap with d on it they should have recognized i was a doer so allow'' s start with drifters they experience life living paycheck to paycheck with no economic objectives they put on'' t truly see the point of saving or spending cash as retired life seems like it'' s not something a young person needs to be believing about daydreamers do have financial objectives however they put on'' t have any plans in area to actually achieve them so they will certainly forever simply remain desires and finally doers they have economic goals but most significantly have a strategy to reach them which'' s where your freedom number is available in this is a really private point and also it all depends on exactly how much you wish to pay on your own annually when you retire it'' s really a great way to figure this out and also it'' s called the times'25 regulation so let ' s to start with assume you intend to make fifty thousand dollars per year without working secondly we would certainly need to increase 50 000 by 25 which gives us 1.25 million bucks the concept is that you'' re able to take out 4 percent of this annually without ever running out of cash and you presumed it 4 percent of 1.25 million bucks is 50 000 1.25 million bucks just how am i ever going to get that in 7 years this video'' s a lie i understand this might sound difficult especially if you ' re beginning with no dollars yet it is feasible no one stated it'' s going to be simple yet with the best approach it can be done i suggest if i can do it then so can you in the beginning of your retired life plan the way you believe regarding cash is critical it'' s everything about getting the ideal frame of mind in area the secret is to prioritize structure wide range over cash money flow this is since developing riches is about securing your cash away in possessions that raise in worth whereas capital offers you more money streaming into your pocket now this might seem excellent yet it can cause a variety of troubles such as way of life inflation as well as sky high taxes capital is extremely essential yet extra so later on in life as soon as you begin to unwind this is why whenever i made some added cash when i was younger i seen to it to reinvest most of it naturally i obtain it in some cases it can feel truly nice to safeguard some earnings and also secure it away in your checking account it can provide you a full sense of protection understanding you'' ve obtained all your money beinged in your represent whenever you require it but the reality is you typically wear'' t requirement as much cash as you believe creating a behavior of reinvesting your capital is definitely crucial when it concerns developing wide range as fast as feasible and hitting your freedom number phase two is laying the structures this is sort of like building a home you require to lay a solid structure to ensure your residence doesn'' t crumble the first sign of a quake however seventy percent of millennials currently live income to income which implies they'' re constructing their lives on an unstable base similar to developing a home on mire if you discover that unbelievable after that this is also a lot more stunning forty percent of americans with an earnings higher than a hundred thousand bucks a year are still living income to paycheck this simply mosts likely to show exactly how crucial laying the foundations are as well as despite the fact that it might appear simple numerous people are failing at this phase there are 4 phases i taken into consideration when i remained in this stage throughout my early 20s the very first phase is settling high interest debt it'' s crucial to pay this off prior to you even think about investing your money as high passion financial debt is holding you back but claiming this it is extremely important to comprehend the difference between great debt and poor financial debt great financial obligation is anything low rate of interest that makes you cash for instance the home loan on a rental residential or commercial property or low rate of interest money on a laptop computer to develop an on the internet business uncollectable loan is high passion financial obligation that doesn'' t make you any type of cash for instance buying clothing on get it now pay later charge card debt or even a normal small business loan all of this financial debt needs paying off immediately i remained in rather a lot of debt when i was 18 as well as in order to get from it i made use of the debt avalanche technique which entailed making the minimal payments on all my high rate of interest financial obligation after that i made use of any money to pay off the debt with the highest rate of interest initially which was my store credit history card at 32 crazy i know signing up for that was a significant error which i'' ve chatted regarding in some of my past videos i then functioned my method via the poor financial obligation with the least expensive rates of interest which was my auto loan at around 15 of the moment within a year i'' d procured whatever paid off the large lesson below is you can'' t spend to build riches when being bore down by uncollectable bill stage two is placing aside a reserve this is necessary for your structures as if you begin investing without a reserve you might locate a few months down the line you get involved in a place of trouble with an unanticipated cost as well as no money to pay for it you will then have to draw your financial investments bent on cover the cost and after that you'' ll lose out on the prospective revenues stage three is constructing a great credit history a credit history is a bit like your resume it follows you around in life is on a regular basis upgraded and it helps lenders choose whether you'' re a worthwhile consumer having an excellent credit rating rating is specifically important if you ever before wish to obtain a financing in the future for instance to buy your desire residence you simply never ever know when you'' re going to require it i needs to have actually started constructing my credit report a lot sooner than i did since it'' s so very easy to begin all you require to do as quickly as you turn 18 is obtain a charge card start placing a few little expenditures on it like gas as well as pay that baby off completely at the end of every month in this manner you pay no passion and verify to the lending institutions that you'' re a reliable customer phase 4 is lowering your tax responsibility every dollar you make has concealed prices of all the costs however taxes can hurt the most and take the biggest attack out of your money noah suches as the tax man the bright side is that tax efficient accounts can decrease just how much tax obligation you have to pay and maximize your savings in my very early twenties my revenue was really starting to get eaten up by taxes so i began trying to find the most effective means to conserve as long as possible i after that found if i opened up a pension after that i can save money i hadn'' t paid tax on this is understood as a 401k in the U.S.A. and also a sip in the uk naturally i will ultimately have to pay tax obligation on this however as i'' ll be older i ' ll remain in a much lower tax brace since i'' ll be making less so hence i need to conserve fairly a great deal of cash yet i didn'' t stop there i opened another account that permitted me to conserve cash that i'' d paid tax on however in the future i wouldn'' t have to pay tax obligation on my capital gains or in other words all the cash that the cash generated this is called a roth individual retirement account in the usa and also an isa in the uk i firmly think that everyone must establish up both of these accounts asap as i recognize it really decreased my tax burden so once you'' ve built up these strong structures it'' s time to start expanding phase 3 is constructing several earnings streams i like to think concerning it similar to this think of spider-man is you the platform is your life and the skittle is your day-to-day job if you obtain discharged hunch what'' s happening now envision this spider-man is you the system'' s your life today you have several income streams the stock market can collapse you might shed your work or your side hustle could fall short but your life is supported by your other earnings streams this makes it really hard for somebody or something to find along and also strike you out a safe and secure task is nowhere near as common as it once was with the ordinary person now functioning 12 tasks in a life time there isn'' t one excellent solution for everyone however something that has helped me throughout the years is to choose side hustles that capitalize on my existing skills as i put on'' t need to learn something entirely brand-new this will certainly frequently end up being something you'' re enthusiastic regarding as you create the abilities without also knowing it often we can lean towards what will certainly pay one of the most yet when aiming to develop lasting wide range sustainability is essential so when awakening every morning being enthusiastic concerning your kind of work is a great suggestion as richard branson once told me over lunch there is no greater thing you can do with your life as well as your work than follow your passions in such a way that serves the globe and also you well that'' s actually among his most renowned quotes yet he did claim something along those lines it had to do with 20 years ago however one point i do keep in mind all the information concerning was the wonderful pastas bolognese he made for me there are many various side hustles you can start such as affiliate marketing shopping coming to be an influencer drop delivery as well as even great old-fashioned window cleaning container cleaning driveway cleaning photography the listing goes on the major takeaway right here is the higher perceived worth you have according to society the much more you will certainly earn money if you do the bare minimum or your service doesn'' t really help individuals you'' ll be paid the bare minimum it'' s crucial to exceed and beyond and give value as best you can to optimize your profits which can then be spent to get to the end objective of your deluxe retired life stage four is producing easy revenue once you have your side rushes as well as earnings in check it'' s time to start considering passive revenue streams side rush money doesn ' t last forever that ' s why you desire easy earnings streams so your money can make more cash while you sleep this is why the rich get richer this phase is everything about multiplying your cash money and also not chasing high returns this is why i constantly speak concerning the relevance of regular long-term spending completion goal is to be on the coastline sipping a great drink not fretting about anything cash connected now i do always say that no income is genuinely passive everything needs a little bit of job here as well as there yet the suggestion is to obtain your cash benefiting you instead of marketing your time there is only numerous tasks you can suit one week as well as that'' s why trading time for money has its limitations i was working a nine to five work plus all the overtime flipping autos on the weekday nights operating in a shop on saturdays and tutoring people on sundays i in fact had no more time to sell to make sure that'' s when i started checking into ways to create passive income with the marketplaces i'' m talking stocks genuine estate as well as cryptocurrencies well perhaps not crypto at that time it wasn'' t around yet i ' m definitely thinking about it now the stock exchange is probably the easiest to obtain associated with specifically nowadays possibly not when i was younger as you needed to contact your broker on the phone as well as do all your trades that method currently it'' s all done on spending applications these apps also have great subscribe bonuses public.com are currently providing you a cost-free stock worth all the method up to a thousand bucks if you reside in the U.S.A. and open market are providing away a totally free stock well worth up to 200 pounds if you live in the uk i'' ll leave the web links down listed below if you intend to choose those up both these applications likewise offer fractional investing which suggests you can spend with as little as 2 dollars this has actually made it much simpler for the everyday financier to get involved in the stock market it'' s constantly a great suggestion to max out your tax advantaged accounts before spending in other places i personally like to put the bulk of my money right into simple inexpensive index funds which are essentially baskets of supplies and like i claimed earlier i like to reduce cash flow so i constantly activate automatic dividend reinvesting cryptocurrency is the 2nd mistake i would focus on as it also has rather a reduced obstacle to entrance with apps like coinbase making it much easier than ever to purchase crypto coins nonetheless it'' s absolutely riskier incidentally coinbase are providing you ten bucks a cost-free bitcoin i'' ll leave the web link listed below if you'' re thinking about that i personally just have five percent of my money in popular crypto coins such as bitcoin ethereum and cardano i think that these are the coins that will stand to test the moment as well as i'' m not prepared to take the danger of betting on a random coin that might flourish like i stated before my method is to get modest easy revenue from the marketplaces and make quick money from my companies realty is the last on the listing and this is truthfully the holy grail of wide range structure however it is a little harder to get right into if you'' re able to conserve sufficient for a deposit on a rental residential or commercial property after that you can actually start unlocking the power of utilize this is since you can get a lessee to lease the home which ought to cover the home mortgage or while hopefully the residence enhances in worth you'' re basically getting your house paid for by somebody else undoubtedly the earlier you can do this the earlier the financial debt will certainly be paid and also the house will certainly be your own utilize is an impressive tactic made use of by great deals of rich individuals but it can be really unsafe if not done properly this is since you can come to be over leverage which means if things spoil and also you can'' t satisfy payments your residential or commercial property might be repossessed most individuals won'' t tell you this yet i ' m mosting likely to be sincere this step-by-step strategy will certainly be hard to achieve if you wear'' t take your very own campaign and start a revenue producing side hustle it'' s still feasible with a nine-to-five work yet possibly not in seven years unless you have an incredibly highly paid job that is also secure a nine-to-five isn'' t in all poor it ' s just many individuals require a side rush to kick-start that riches structure also just a warning for me this is not gon na be very easy any individual that tells you or else is existing to you you'' re gon na have to knuckle down like i did and also function hard for a couple of years to have a lifetime of freedom besides if it was easy after that every person will be doing it when you strike your very first barricade as well as i'' m certain you will certainly simply believe of it as a difficulty to get rid of and not as a complete calamity this plan will just function if you remain consistent as well as disciplined i'' m positive that after you get to phase 4 you should be in a respectable location to attain monetary freedom as well as retire early so i'' m going to leave the following video right up there however wear'' t click it right now ensure to subscribe if you desire to grow your wealth and wear'' t forget to get your free supplies as well as bitcoin with the web links listed below alright i'' ll see you over there
How To Retire Early Through Property Investing | A Retirement Planning Pension Strategy
Harvey 0 Comments Planning your Retirement
– Impossible is probably the
response most people will have when they see the
thumbnail for this video, but let me show you how, by taking action, you really can retire in
two years by investing in a certain type of property. (upbeat music) Hi, my name's Tony Law from
Your First Four Houses, and I teach people how to build
a small property portfolio that generates a great income
for them so they can give up their day job if they
wish because they're now financially free. So for 21 years, I ran a kitchen
business where I exchanged my time for money, but
in less than two years, I managed to replace that
kitchen income with a passive, or relatively passive, rental
income, and I want to show you how you can do exactly the same. So for this exercise, I'm not
gonna assume that you need 10,000 pounds a month to
retire and live comfortably. In fact, depending on
where you live in the U.K., the average household
incomes seems to be somewhere between 28 to 35,000 pounds
a year, although personally, I might struggle to live on
that if I'm being really honest, so let's just round that
up to 42,000 pounds a with an IRA for investment year which quite conveniently
helps me with the maths because it means that's 3,500
pounds a month that you need as a passive rental income. Now, for some that may seem
a little on the low side, but I think most people
could probably retire and live quite well on that
if they're being really honest if you had no other bills to pay. So we now have a clear goal. We need to earn 3,500
pounds a month passively moving forward, so let's
just break this down. How many rental units does
that actually equate to? Well, it obviously depends
on the type of deals that you're doing and the
strategy that you're following. In fact, to be honest, I've
got a property that by itself, one single property, after
all bills have been taken off, would cover that amount of
money, although for transparency, I've also got other properties
that only cashflow a couple of hundred pounds a month give or take, and it always surprises me,
there are people out there that have got properties
that simply don't cashflow at all, I just don't understand
that, but let's just say, for the sake of this
exercise, that on average, my property portfolio cashflows
about 500 pounds a month after all bills, so if you
wanted to hit 3,500 pounds a month, how many properties do you need? Well it's seven, isn't
it, nice and simple. It's seven at 500 pounds a
month, but can you acquire seven properties in two years? Yes, I know you can. Maybe in year number one
you might do two or three which will leave you maybe
four or five in year number two as your experience and
confidence grows, but I know that you can do it. Is it gonna be easy? No, you're gonna have to
put in some massive effort to hit this target. You're gonna have to
take a tonne of action, but I know that you can do
it, and if you want a list of 15 tasks that you can
do in the next seven days, check out this video because
I'll run you through exactly what you need to do in
order to hit that target. You see, the thing about
property investing that is quite magical, quite amazing
actually, is that you need to work really, really
hard for a couple of years, and if you do, you can replace
your income in its entirety after just maybe a
couple of years of work, and if I can in some way
help you in your journey, well that would make me very happy. I recently updated my 50 point
checklist that will run you through all the tasks you need to take before buying that next
investment property. If you'd like a copy, simply
click on the link here or in the description box
below and I'll send it straight out to you.
As found on Youtube
Read MoreHow we Retired at 40 – 7 tips to succeed for Early Retirement
Harvey 0 Comments Retire Wealthy & Wise
Hey guys retired at 40 I'm going on a little road trip today just me and Murph and last week I reached a milestone on my channel and I hit a million views total and 10,000 subscribers in the same week since I've been getting requests for quite a long time about how I retired at 40 and I'm on a long road trip right now I figured what better time to share the story so without further ado here's the retired at 40 story so before I get started I want to say that this is not in any way a brag story in fact I'm definitely not a showy type guy I enjoy very simple things in life and money to me is more of just a vehicle to be able to retire young and have my family live a comfortable and an easy life and to be able to enjoy lots of life experiences and be comfortable in life before I'm old and gray so really the retirement journey began in about 2002 graduated from Iowa State University with a degree in marketing and business and by that point I have met my wife Kelly she had already graduated from school and she was kind of waiting for me and we wanted to move west out of the Midwest to move west see some new territory and get closer to the outdoors so I grabbed my degree ran out the door packed up my 1987 Ranger fully equipped with eight foot hay racks full of all of my personal belongings and we drove to Littleton Colorado and at this point in my life I had $200 in my pocket and Kelly had about the same so being completely naive and basically completely broke but with a degree I was on the search for the best suit and tie job that I could possibly find so I bounced around for a couple months just working some kind of halfway jobs and I quickly realized that I did not want to wear a suit and tie and I wanted nothing to do with the man and working a nine-to-five job well Kelly had found a job in a real estate office working the front desk and she had become friends with a couple of the big-time Realtors there one of which you caught wind that I had some handyman type skills but he made me a deal that if he paid cash for a house and I fixed it up that he would split the profit with us 50/50 and at this point in my life all I saw was dollar signs if I was completely blown away that there was someone that could pay cash for a house this is coming from a guy who had less than $200 in his pocket at this point it was pretty much scraping by I tried to hold back my excitement to him but naturally I said yes please let's do that I was working the graveyard shift at Target stocking shelves I'd worked for 10 hours I would go home grab a little bit of breakfast and I'd head over to the property and work on it for another five or six hours I try and catch a few hours of sleep and then I would rinse and repeat it was at this point in my life that I learned a few different things one you really have to dig deep to reach your goals in life because I was not getting paid by the hour and at this point I didn't know how much money I was gonna make I didn't know if I would make $500 when this was all done or if I was going to make $5,000 when this is all done so I learned that a lot of things that can benefit you financially you have to put in the work upfront without knowing what your final outcome is going to be after about three months which seemed like an eternity of working seven days a week for sometimes 15 sometimes 20 hours a day on this house the house was ready to go on the market and it was all finished it looked great and then before you knew it it's sold and then the house closed and at this point I still didn't know what we were gonna make off it but for me it didn't matter the hard part was done I didn't have any of my own money into it I just had my time basically so the guy we were doing the investment with hands me an envelope and I opened it up and at $8,000 being twenty-two years old and having $8,000 I might as well have hit the lottery and that brings me to my second valuable lesson that I learned and that is being responsible with money so when you have $8,000 and you're 22 years old a lot of people would go buy a new car they'd go buy some flashy things some pretty things but to me I had realized that if I can make $8,000 once I can make $8,000 again and again and again and again so I can either go p*&% the $8,000 away that I had worked my a#* off for or I can take that $8,000 and do exactly what he did but do it myself and potentially make twice or three times as much money so my wife being in a real estate office we became acquainted with quite a few smart people financially smart people we learned a lot about real estate very quickly because we were willing to learn which is my next valuable life lesson is that you never stop learning so we took our $8,000 we put a small down payment on a condo in Littleton because we realized that giving someone else our money was you might as well be throwing it away we wanted to be working towards something and it own something on our own so we took our other four or five thousand dollars and we started our search for a real estate investment that we could do all of our all on her own and get a hundred percent of the profits so after some searching we did find a place we found a small town home it was not in as nice of area as we were living it was smaller it needed lots of work but that takes us to our next light life lesson that we learned and that is to sacrifice for a greater payoff in the future so we had only lived in our condo for a very short time but we realized that if we moved into the real estate investment that we could rent out the place that we are living at and move into the place that we were fixing up that we'd have to be paying a mortgage on anyway we had our first real estate investment and we had our first rental so being 22 years old and owning two properties and carrying two mortgages and at this point I'm still working at Target was a pretty scary proposition in life but all I could see was that $8,000 check they had started to change our lives I also want to point out and kind of give a shout-out to my parents and to my wife's parents because neither one of our parents ever handed us anything in life they always made us work for what we achieved in fact when we move we tried to convince my parents to co-sign on our mortgage for the condo that we bought and they said no way at the time I was very very mad at them and I thought I would never forgive them in hindsight it was one of the best things they've ever done for me because it just made me have that fire in my belly and really just want to work to get what I wanted so back to having two mortgages that was a completely scary thing in my life I was making something like 10 dollars an hour at Target I think Kelly was making $13 an hour at the real estate office she was working at we could barely afford the condo we had but now he had two.
God bless the banks lending money to anyone at that point on the very plus side of that we learned that someone else can pay our mortgage and we're basically getting that money for free and then later we figured out that there are many many many tax benefits and huge benefits of owning a rental property so we quickly learned that trying to pay for materials and the things needed to fix up an investment property on just barely over minimum wage is not easy to do the thing that happened next couldn't have come at a more perfect time so all of a sudden I had money to spend to fix up this house and it would just get me to that next big paycheck that much quicker so that's what we did we fixed up the house we doubled our money we rolled it into the next one so we kept bouncing from house to house quite a few times and that sacrifice of from going from a nice house to live in to going to a crappy house to live in to fix up to making it nice again to going to another crappy house to fix up it became pretty stressful but we always had our eyes on the prize “are you still with me Murph?” after doing this two or three times I remember getting a check for the last one and the check was forty one thousand dollars so at that point it didn't make sense to work at Target anymore so I just started doing it full-time but we never took the big proceeds from the real estate and put it into our actual living we always rolled it into the next property and that kind of gave us the baseline of even how we live today we always live well below our means we take the money that we make and we put it into things that will make us an income not into something that will lose us money but you do have to treat yourself every once in a while otherwise there's no reason to make the money in the first place Kelly saw many of the high producing Realtors making large amounts of money so she decided to get a real estate license and she created her own real estate business so now we really felt like we had the world by the balls because we were getting paid a commission to buy the property and then we were saving half of the Commission when we sold the property and I was fixing him up so we just get rolling our profits in rolling our profits in rolling our profits in until family we were able to buy a house and now that we could get a house we were playing with the big boys the profits were much larger but so was the risk and we really didn't want to lose all the way it worked for for the last couple of years so we did a few houses and we made some great money but instead of selling them and pulling out our profits we kept them as rentals and it was at this point that we really started building up our rental inventory at this point it was about 2006 or 2007 and real estate was starting to slow down a little bit but we have purchased a large house I'm a courage that was really a big risk for us it was a large house to fix up it was our biggest project for sure it took us the most money to fix it up and we had the most money into it so we lived in this house for about 8 months while we were fixing it up and we kind of decided after doing about 12 properties that the moving all the time was starting to get kind of old and we were kind of getting older ourselves and we decided that we wanted to have kids and kind of settle down a little bit Murph are you with me? sometimes I feel like I'm just talking to myself so after the eight months was up we finished the house we sold it and shortly after the real estate market completely crashed the bubble had burst and Colorado was one of the hardest hit States we got out of the house just in the nick of time and not only did the real-estate market bubble burst we found out that we couldn't have kids and it seemed like a real low point in our lives but around 2007 when all this happened we realized our next lesson with every negative there is a big positive that can be gained from it and you can just use it as fuel for your fire so the recession was tough we thought our great life had come to an end we thought we were gonna have to get regular jobs you know people were losing their jobs left and right people were losing their houses Colorado was hit very very hard one of the worst states during the recession and we learned that what goes up must come down and in this case it came down hard in many cases not just real estate when things are bad that's the time to invest and if you're smart with your money and you've been saving while everyone else spending that's the time to benefit though from about 2008 to 2012 we were buying rentals so we were able to adapt I started doing contracting because that's pretty much what I was doing before but now I had to be doing work for someone else and Kelly's always been a mover and a shaker and even a bad real estate market she was able to keep her business moving we were buying things for pennies on a dollar and even though we were not making great money and in some cases losing a little bit of money on rentals we were able to stick it out and after lots of lots of years of lots of lots of heartache and lots of lots of doctors we were able to have two boys so about 2014/2015 real estate started creeping back up again prices kept going through the roof and just when he thought it was the peak they just kept going up stuff was flying off the shelves you could list a house and it would have multiple offers within 24 hours so we had about age 35 we were completely debt-free we had several rentals that we were cash flowing we didn't owe any money on the rentals so all that money was just rolling into a bank account when you have no bills and you have an income coming in your net worth starts to grow very quickly so we rode out the storm Kelly's business was doing great my contracting business was doing great we have liquidated a lot of our real estate in Colorado we had capital to play with we had two beautiful young boys and then I fell to my knees crying like a little baby I had herniated a disc in my back and I was on a walker for about a month contracting for me was out of the question I didn't even want to think about picking something up so I took some time off and I raised our kids which at first I thought would just be for a few months and then a year passed and then another year passed and I decided that I kind of liked it we had rental income coming in Kelley's business was doing better than it had ever been in fact she had started her own she had several people working for her and just as a little side income I got to do what I love to do which is antiques I was just buying and selling antiques so we were trying to be very strategic at this point because we owned a fair amount of property in Colorado but we knew that our ultimate goal was to retire at 40 and at the rate things were going up we didn't want to sell too early because we didn't want to miss out on that upside but we didn't want to sell too late because we didn't want to risk the chance of taking a step back so as some regret we sold the majority of our properties in around 2017 but this was a game-changer because we were able to make cash for every rental that we purchased so we loaded up on rentals in Iowa we actually purchased our property that we're going to move into which is actually where I'm headed now and that kind of brings us up to speed to current date I take care of our 10 rentals which keep which keeps me pretty busy just in itself i buy and sell antiques i get to see my kids all the time we have a good rental income coming in now we do youtube oh yeah we also do a couple fix and flips every year Kelly has her real estate team with about 10 employees and in June of 2020 we're going to retire at 40 so all in all life is great I have a wonderful family I have enough assets and passive income to live a comfortable life
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Hey, what's up? John Sonmez here from simpleprogrammer.com. Tired of pushy recruiters sending you LinkedIn requests for jobs you have no interest in? Tired of blasting out resumes into the dark? If so, you should check out Hired.com. Hired.com flips job searching on its head by having top employers like Facebook come to you after you fill out one simple application. You also get your own job coach to help you on your next job search. If you haven't checked it out, I highly recommend you at least fill out the application. Just go to Hired.com/simpleprogrammer. When you get hired with Hired, you'll get double the normal sign-on bonus for using that link. Today we're going to be talking about real estate.
Yes. I have done some videos on real estate. Some of you are like, “What the heck? Why is this guy talking about real estate?” Well, I've done fairly well in the real estate realm. If you're interested, you can always check out my playlist on real estate investment and investment in general. I'm not going to go into all the details here, but occasionally I like to answer a few real estate questions on this channel. I got one here from Jonathan and he says, “I'm 21 and set a goal that I want to retire by 40 to 45.” Cool. “With 20K of passive rental property income.” Man, that's awesome. I like that. I love that goal. That's a good goal. “Currently saving money to buy my first property and hopefully, when I get a web development job I can speed up the process. My question is how do I plan for this goal?” This is good.
So, 21, Jonathan is 21 and he's thinking this way and he's got this plan by 40 to 45 to make 20K of passive income from rental properties. I love this. This is great. “Thanks for everything you do and have a beautiful day.” I am having a beautiful day. Thank you, Jonathan. “P.S. I was thinking of buying a duplex and live in one and I rent out the other one so basically the tenant pays my mortgage.” So, okay, there's a lot of ways to approach this. I think Jonathan has got his head screwed on right. Well, I'll start with the last, the P.S. of renting out a duplex and living in one side. I think that's a great idea. This is a fantastic thing. More people should do this. A lot of you young people out there that are thinking about renting or buying a house, consider buying a duplex and renting out one side and if you find the right deal which—it's out there, you could actually have the renters pay your rent.
You see what I'm saying? You could actually live for totally free by having a duplex and renting out one side. I'm not going to say it's going to be super easy. I'm not going to say that those deals are everywhere. It depends on where you're at. You're not going to find that deal in California or New York, San Francisco, not going to happen, but if you're in the Midwest you might be able to find that deal. I've seen it before. I think that's a great idea, but let's talk about the plan. 21, you want to retire by 40 to 45. You want to get 20K of passive real estate income. It's not going to be easy, but it's certainly doable. What you need to do is you need to calculate backwards where you need to be and have a real solid plan for this.
I can give you a general outline, but I haven't run the numbers so I can't tell you exactly. There are going to be some factors in here, but you actually need to take a spreadsheet and actually need to calculate this and figure this out. It's going to be fairly complex, but you don't have to be super detailed. You can kind of ballpark this, but you do need a spreadsheet. You can get some rough answers here, but calculate this out, 20K of passive income from real estate. Let's say 45. What does your gross need to be? You're going to have expenses, you're going to have rents, I mean you're going to have property management, you're going to have a bunch of things here. That can give you an idea of what kind of wrench you need to be pulling in. It's not going to be a 20K wrench, you're not just getting 20K. It might be like 30 or 40K a month of rents. In order to get 40K a month of rent how many properties do you need and how much will those properties cost? How can you divide that over time and put inflation into the equation a little bit here over that period of time? Work backwards and make a spreadsheet and run some scenarios.
This is going to take time and some planning. Like I said, you can rough ballpark it. If I were just going to give you what I think would probably work for you, it also depends on how big your budget is. How much money are you investing every year? How much money do you have to invest every year. If you can put 10K down onto a rental property every year that's different than, “Hey, I've got 50K to invest in real estate every year.” That's different. Or 100K. Those are all different scenarios. What you're planning based on your current scenario might—there may not be—there might be this gap and you might be like, “Well, how do I get there?” It might not be apparent.
You might have to do some other things. You might need to make more money in your job or start a side business in order to fuel that. I had to do that to reach some of my real estate goals. Think about that and calculate that out. I'll give you kind of a rough timeline, a rough plan that I would have if I were you which would be something like—and this was the plan I initially developed when I was doing this which would be to buy one property every year, regardless. The nice thing I like about this plan is that it's scalable.
The size of the property depends—is dependent upon how much money that you have in that year. When I first started in real estate investment when I was close to your age, I think I bought my first house at 19, but I really started doing investments around 21 and started this plan of buying one house per year. I think the first house that I bought I was able to put $10,000 down. It was like a $100,000 house or $120,000 house. The next year it was probably about the same and then probably like the third or fourth year I had more money. I was able to put $20,000 or $30,000 down. I got to the point where I was buying properties and I was putting about $20, $30, $40,000 down every year on a property when I buy it. Some of that was because of the real estate that I was already making me money. Some of it was because I was making more money in my job and I had businesses and side things going on which helped me to do that. That's the kind of plan that I would—it's not going to happen magically. I think that's the key thing. You actually have to have a solid plan for this and you can run these numbers and calculate this out.
There's actually a really good book that I recommend called The Millionaire Real Estate Investor. I think that's by Garry Keller, the founder of Keller Williams if I recall correctly. I don't recommend very many real estate books, simply because a lot of them are crap. The reason why I'm really going to recommend that book to you is because it has these charts that show you—it gives you a realistic expectation over 20 years what the value of a property is likely to be, how much money you're likely to make from it, cashflow and all that. Again, it's as complex equation. You're not going to be able to nail this down perfectly, but at least if you run the numbers and you do the best job that you can, you can have a ballpark idea and you can always adjust the plan. You've got to have—you've got to know where you are and where you need to go in order to reach these goals. I'll also recommend for you—I have a course that I created called Simple Real Estate Investing for Software Developers.
You can check that out here. If you buy that course, obviously it has a money back guarantee on it, but that's going to help you to give you the basics of everything I know about investing. Just to give you a background, I have about 26 rental properties. They are all paid off. I started investing when I was 19. I kind of know what I'm talking about here. I don't give a lot of bull shit advice about this. I give you exactly—practical advice on how to get started and how to do this.
The reason why I created the course, even though it might not seem like it goes along with a lot of my other content, it was just simply because I was tired of so many people giving BS real estate advice and doing all these kind of scamming, no money down, speculative moves that just doesn't make sense. You need some kind of practical advice so that's what I put together there. Go check that out. This is good. I think you've got a good plan here. You just need to develop the plan further and it's going to be very dependent on your individual factors and—I think you have information though to say, “Okay, can you do this in 45—by the time you're 45?” absolutely! I believe that you can. It's not going to be easy, it's going to be hard to do. 20K is a pretty big number but it's certainly possible, but you're going to have to start moving now, which it seems like you're going to do, and you have to have a plan and it's going to take a lot of work and a lot of effort and you got to find good deals in order to be able to do this in that time frame.
All right, I hope that is helpful to you. If you have a question for me, you can email me at [email protected]. Don't forget to click the subscribe button if you haven't already. Click that Subscribe. Click the bell to make sure you don't miss any videos especially if you like the real estate stuff because, hey, those videos might not show up and then you'd miss it and then you wouldn't find out the secret to life and how to make millions of dollars. All right, I'll talk to you next time. Take care .
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Read MoreHow to Retire by 40
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Hey everybody welcome in on this snowy snowy Wednesday wherever you're joining us from let us know where you joining us from today hey everybody welcome in to the investing in real estate show today we're gonna have some fun talking about how to retire at 40 how to retire by 40 Sean says hello from Brooklyn New York how much snow are you getting out there Sean we get this massive nor'easter once again and once again so the kids are off school just I'm over it I am over it I know there's gonna be people are there I'm right in here and say they're there joining us from there out in California and they're living living large yeah Aaron is running us from Miami Florida there you go Wong from Miami thanks so much rub it in rub it in rub it in everybody so we're gonna get this show started in just about three minutes South Africa Indianapolis Moses welcome Pottstown you're getting hit with some snow right now Matthew Bishop Lakeland Florida hey Matthew yeah I guess California you guys are getting hit with some crazy stuff out there today too huh yeah they cancelled school last night I don't know I you know growing up I don't ever remember them canceling school like the night before did you guys ever have that growing up it was like he'd wake up and he would sit and listen to the radio and you would wait you know I was in Pennsylvania I would be all be waiting to listen for our school if it was canceled I'd be in one-hour delay a two-hour delay and you were hoping that they would cancel it but I never had the night before they send out a text message letting you know that hey your school was cancelled and that was never the case for me never never did you do all right we're gonna get started in just a moment here it's gonna pull up this today we're gonna talk about how to retire by 40 and we'll start here in just about one minute one minute one minute Jerome aramid says hey a guy you talked to me more than two weeks you never came back to me you can take care of this later I know you're alive nobody emailed me the first appointment Jerome who did you talk to on my team let me know and we've got some people in from our team right here in the chat thread as well we can Mike you know a lot of times people will send follow-up emails it goes to your spam folder sometimes people when they initially signup for phone calls with our team they put in the wrong phone number and then they later writes it well I put the wrong phone number in and so our team will be calling and they can't get ahold of you so I apologize for that and Rudy Rudy please check your spam folder please please please because our team is very good about follow-up and we have hundreds of clients around the world so I apologize for that you know because if someone sends you a PDF it might go right to your spam folder and then you're like oh I never emailed me just check your junk folder and who are you talking to please let us know we'll make sure we get you all squared away we have a waiting list for people to get on the phone with us for like a few weeks so I don't ever want anyone to feel like we don't get proper follow-up from our team that's very important so I've got our team right now who is in our chat thread we'll go through and make sure that we get you all taken care of so I apologize for that all right so we are live it is it is a.m.
And we're gonna kick off the show after the show I'm gonna do you know to talk about this article talk about how to retire at 40 and then after the show we'll kind of open it up for a few minutes of Q&A if that works for all of you and we'll just kind of answer some real estate questions some of the things you're struggling with you're hoping to achieve and we'll talk we'll do that all right Forrest wants to knows are still owners software coming out for Morrison fest yes indeed in fact we've been working on it for for since like August it's all custom it's been a lot of tweaking we want it to just be perfect Peter Cook says I've had very good follow-up thank you Peter appreciate it and James Frederico o1r from our team is right in here he says hey Jerome I got you all reach back out to you and take care of you good good good all right so we're gonna get started here and we're going to talk about this in a second so first so again at the end of the show we'll take some QA and we'll do that as well let me just get this all dialed in we're recording we got the audio up and running is everything sound ok guys you guys can hear me give me a thumbs up you guys are all good Brandon yes absolutely because some of those beat class properties you're asking about the verb method absolutely because you know buying those 60 70 thousand dollar homes those the banks love they're able to do you know easy refinances on those because there's easy comps to pull in the neighborhood because there's retail sales so I would stay away from like the 3040 thousand dollar stuff if you want to really do like a solid brr-brr method stuff if that's what you're looking for all right sounds good alright so we're gonna get started all right all right and let's get this show started all right today on today's show we're talking about how to retire by 40 a news article from the mainstream media it's kind of total garbage that's today's show let's dive into it hey everyone I'm Clayton Morris longtime real estate investor founder of Morris invest if you're new to the channel thank you so much for joining us and subscribing I hope that you're a subscriber because there's where we talk about passive income building legacy wealth for you and your family that's the goal right and the vehicle that we use is buy and hold real estate but I don't care about the real estate right I don't care about the four walls and a roof I just bought 15 houses this week that we're about to rehab okay I don't care what they look like because once we get them it doesn't matter what I'm buying as a tax shelter and that's what you should be focusing on buying a tax shelter that's what this show is all about on today's show I want to talk about how to retire by 40 and I want to preface this by saying that I got this from an email from a listener a viewer of our show who is getting involved in real estate investing Jesse Daley sent me this email and he said hey Clayton I hope you're doing well man I thought you'd find this article interesting especially how the writer literally doesn't mention anything about investing in real estate there's only a one quick mention of a condo adding to net worth and nothing else in this article I'm so happy that your podcast teaches people how to truly invest properly and retire by the age of 40 this they should have interviewed you for this article so thank you Jesse I promised I would give you a shout out here on the show and I want to go into this article so again I have lampooned some of these CNNMoney articles over the past few years have done shows about these things because I just find them ridiculous I find them ridiculous that they're telling people to invest in their 401k and then that's the way that you build retirement that's the way that you're able to retire by 40 years old I mean how many people are you know you just like a show of hands you're listening right now how many of you think you could actually retire by 40 years old just with your 401k of course you can it's ridiculous the average 401k retirement in this country guess what according to Time magazine is 90 thousand dollars can you retire on that no way so I want to go through this article because it's a lot of fun and Jesse sent it to me so these are tips from CNN money on how to retire by forty three proven tips three proven tips so let's go Chris reading isn't your average retiree he said goodbye to his working years at 37 and is now financially independent living his life on his own terms that's great now he had 4500 dollars in debt and when he started working he got through all of that he finally found a well-paying job working cyber security took out a mortgage bought a condo and financed a BMW okay alright took out a mortgage on a home bought a condo and financed a BMW on our way to success but then he started to wonder is this all there is he finally said I can't do this for 40 years in his late 20s he started searching for alternatives and he read the book your money your life by Joe da Menendez and Vicki Robin and he said look there's other ways of becoming financially independent so he then felt that he had enough to live the rest of his life on his savings and investments without having to work again it took two more years of showing up the cubicle for him to be sure than a 37 he finally walked away so what did he do okay here were his strategies here where his strategies for becoming financially independent and retiring at 40 years old number one save more save more okay so his strategy according to the CNN Money article is cut he cut back on going out to dinner and he cut back on buying lattes so he just started saving more really so let me get this straight that's the way that you can sustain yourself for the rest of your life by retiring at 40 years old from your job it's just having enough in the bank you think that you're gonna have if the average 401k retirement is ninety thousand dollars can you really live the lifestyle that you want so now you're cutting back on dinners in order to save some money you're not buying coffee so what Natalie and I've talked about here on the show repeatedly is the idea of not having to shrink your lifestyle why not find out what your freedom number is using real estate find out what your freedom number is and actually have enough passive income every month coming in the cash flows you're creating a tax shelter for yourself and enabling you to live the life that you want so you can't go buy a latte I find that ridiculous you know David Bach wrote about that in his book the automatic millionaire a years ago and look if you're $40,000 in debt yes maybe not buying a five-dollar coffee every day is probably not a smart strategy you know also if you're a smoker you know spending ten bucks a day on cigarettes or whatever it's probably you know not a smart strategy if you want to claw your way out of debt I get that part of it but as a way of sustaining yourself and retiring at forty years old just saving more savers are losers that money in a bank account is doing nothing for you what about buying performing assets that are actually producing cash flow I mean come on so when he says look where people get into trouble with savings that they think they have to use reusable toilet paper and eat chicken broth but real basically you just you'll never spend zero dollars find a level of living that you're come with and work on earning more without increasing your expenses so he's just saying earn more save more cut out lattes and you can retire at 40 I don't buy that for a second number to earn more okay that's his second tip earn more great so let's save more and earn more again a paycheck job the tax code is written for wealthy people the tax code is written for entrepreneurs who own businesses who own real estate that's what the tax code is written for it's not written for a w-2 employee so earn more so what he says is your actual jobs only part of your work in order to earn the kind of money where you can live on only half or less of your salary so take that extra money socket away that's what he's saying so work harder right work for a paycheck get taxed as like in the highest tax bracket by the federal government right because we know that paycheck employees under the new tax code or hurt the worst he says this career-boosting work can include earning advanced degrees oh that's great so his other bit of advice on this is go out and spend a hundred thousand dollars on getting an advanced degree so go get your master's degree that's only what a hundred thousand dollars that's only a hundred thousand dollars right just go get it a master's degree so that's smart so save more earn more by spending more on getting an advanced degree or certifications and then that way you'll have people who will look at you more favorably in the office and be able to elevate you higher that's great so it's important understand the weak areas and he says look I finding mentors okay that's good yes definitely finding mentors as a very smart move finding mentors who can help propel you and then number three he says invest more so he says the most powerful mechanism for investment right now it's built into their job it's the 401k invest in your 401 K and a two or three percent return contributing at the level where you get the employer match is a must and that's your biggest benefit and that's how you can retire by 40 that's the article unbelievable so okay ridiculous right that's how you could retire at 40 no no that's not how you can retire it 40 and that's not how you could live comfortably and live the life that you want and be able to produce legacy wealth for your family for the rest of your life so he's now retired he's living off of savings but he's got no assets that are actually performing for him for the rest of his life he's got a V BMW that he bought financed and he has a mortgage on a condo that he lives in he has no performing assets that is not financial intelligence any way you slice it wouldn't it have made more sense instead of saving that money while he was working for that cybersecurity company to take that money and invest it in real estate by a performing asset that cash flows that's how you control and move your family forward that's how you can build true legacy wealth for you and your family but actually taking money and buying a BMW buying a liability remember all you need to remember is if you're buying liabilities a liability is something that does not produce cashflow now if he bought that BMW and used it as an uber driver that was producing cash flow that's a different scenario or if he rented out that BMW that's a different scenario but I love these I love these articles and again this is all sort of couched around the idea of the mainstream media right the mainstream media wants you to believe that a paycheck employer job is the way to go that getting a 401 K having their company sort of automatically do it for you because you're too dumb to do it yourself have them handle it have them streamline it and that's how you that's how you have a strong safety net we've been trained to believe that being secure is having a paycheck job you know again I come back to the I keep seeing this commercial and I'm sure so many of you have seen this commercial over the past few weeks I saw it first during the World Series and they continue to run this stupid thing where it shows a couple you know they're in their late 60's and they're sitting there with a how it's a Merrill Lynch advisor and the Merrill Lynch adviser says well it looks like the plan worked and you're gonna be able to have that retirement you wanted and I looked at you look on the iPad app that they're handing to the couple and he's like honey we did it we can do it we can live that life we wanted retirement and it shows that their income is enough they're gonna have about seventy thousand dollars to work with like if you look at if you actually look at the numbers on that screen seventy thousand dollars so now they're almost at retirement and then the next clip it shows them in a boat with their granddaughter right there sailing off into the sunset like some small little boat with their granddaughter and the little girl says aye aye captain you know and she she's driving the boat so this is their retirement they finally did it right they had a wait till they're 70 to buy a boat and to be able to sleep in and spend a little bit of time with her grandkids be all because they had their month their money managed by a financial advisor that was taken out big fees and investing in a stock market and not investing in real estate and cash flowing assets so there you go that's my frustration there you go that's my my little my little two cents my little rant about these types of mainstream media articles and when you see them on TV just roll your eyes think about it for a second saving more earning more get an advanced degree spend $100,000 on a master's degree and then use a 401k that's how you're able to retire at 40 that is total garbage that is total garbage unless maybe the guy wants to go live in like Thailand by himself with no kids and he wants to live like in a hut somewhere for the rest of his life and he doesn't care about actually having any income or cash to be able to buy anything or any food or live the life that he wants I find it to be total garbage I'd love to hear your comments and your reactions to this please send them to us and I really thank you so much so that's gonna do it for that and thank you so much for subscribing to the show I really appreciate it this is the investing in real estate show you can please subscribe share it with your friends and and you know please go out there take action become a real estate investor because I believe it's the number one way to build wealth we'll see you next time everyone all right now with that that's the show so anyone who wanted to get just the shortened version of that but hey now we're gonna open up this agree to some Q&A here in the show we got so much so I saw so many chat threads coming through here asking questions alright so fire them up here alright alright Joel says I've also had an email a few times hit reschedule my call but no response and said ok Joel no worries we'll get you all straightened out I apologize like if people miss their phone appointments cuz like I said we Deanna with our team we have like calls are booked out I think about two weeks and so if we call them like goes to voicemail and then we're trying to reschedule it so we really try to make sure we can get on the get on the same get on the same on the same page Jinger I'm sorry again what's going on Jinger we'll get to the bottom of this so I'm gonna make a list of anyone who didn't get a call back so I apologize alright so can you guys tell me Arum says Glen and Nicole from your team have been great awesome ok so we will dial some of the stuff in ginger and I'm sorry I will get some of these people on your on your team to make sure we get it all taken care of thank you guys let's see all right you know I'm glad you're not upset no I just you know we if sometimes emails get back and forth and we're trying to make sure that everyone gets taken care of okay are Tuffle get you back on your property okay let's the ad tapper says what do you think about joint ventures they have the money I do appraisals marketing and brother does the renovations hey jayvees are great right you need to build a great team for real estate investing that's very important you have to have a great team to do real estate investing well Kelly just uh Kelly Cheatham says I want to hear more about your program great just booked a call with our team Kelly and Morris invest comm we're doing some great things and I'm really excited about some of the new properties that that we purchased that we're about to do we've already designed our contractors to dive in and start rehabbing see Charlie 18 says our new Hara Sean wants to know one of the price of the new house is being built our new houses the three-bedroom two-bathroom right around seventy seventy thousand okay Charlie eighteen I'm gonna answer this question how does it LLC save you on your taxes on your rental how does it LLC save you taxes on your rental properties a lot of the stuff I've been reading times about pass-through income I never thought I thought that that was taxed the same way as a sole proprietor yes however remember that under the new tax law as a pass-through entity as a pastor entity you're now getting an additional 20% deduction 20% and remember when you have your your properties in an LLC you're being taxed as a business and you're able then to depreciate spread that money over all those other your w-2 income and those other things so I've just an all series of videos on understanding tax shelters and remember what you're buying as a tax shelter so forget about buying real estate you know I have talked about Lane I like for repairs so repairs add to your tax shelter helps mitigate your overall cash flow because remember what you're buying in the beginning in a 3-stage is a real estate investing right buy own and cashflow what you're buying in the beginning you're adding to your net worth so I don't care about the cashflow necessarily until years later but you're buying and adding to your net worth you're creating a tax shelter for yourself you're able to mitigate your w2 income you're able to offset all of those things so I would love to hear what you guys thought about today's show and the article please let me know I'd love to hear you which you you know what you thought about that Kelly are speaking of the computer program Oh Kelly yeah we're building a personal owner portal for our clients that the software I mean it's just it's and make it much easier so that we don't like our team doesn't have to send out Purchase Agreements it'll be right there because we have so many clients it like we'll have like three or four clients and want the same house and so a little like yeah give you a purchase agreement and it's kind of like first-come first-serve and then our team has to send out a purchase agreement wait till it's signed and all that BS so this will make it very easy for them to be able to click right on it and then open up DocuSign and be able to do it and pretty great Ryan Millie says okay what are the mechanics after purchasing one property to purchase another property or two and repeat the process over and over again where does that money come from well ideally it could come from a bank right or it could come from private money it could come from you know we we talked about a company that we work with called fund and grow less you know if you go to our if you go to our website Morris and vest com slash funding you don't pay them any money until they actually if they get you money zero percent Interest but why would look at okay so let's just take the mechanics of that to answer your question so I would say you know buying like a sixty seventy thousand dollar rental property and then leveraging that right so maybe putting or or if you have the cash to do that right that ideally if you could come out of the gate you have the cash to purchase your first one free and clear that's more of a B Class play you know that's sort of B minus like 60 65 70 K place play that's kind of maybe you know it's transitioning up to sort of an a-class neighborhood and it you know coud appraised in a few years at 80 or 75 that's the play right so buying that if you could buy that with cash right and then refinancing a pull some equity back out of that and then be able to roll that next amount of cash the bank just gave you into your next property into your second property and then into your third property a buddy of mine here in New Jersey started and did that on an eighty thousand dollar property he now has over two thousand units here our DNA and money when he started and he bought that first property that first property allowed him the snowball and all of these other properties and identity jjh yeah unfortunately JJ was said you purchase second property in Indy in November we'll hopefully get an answer for you an update on where we're at with the rehab and we'll also make sure we connect you with the right management team if you're having some issues you know we work with a 8 different property management teams so what gets you sort it out so just you know email our team you know the team you know our team at Morris invest email us we had a really really really unusually harsh winter that set us back about four or five weeks on construction this year with like a deep freeze we had stuff all the way through Michigan into Indiana down into Pennsylvania where we just had all kinds of problems Ryan you are absolutely welcome thank you so much Sean says you weren't able to pull cash off the cards they got through funding to grow yeah that's unfortunate we have literally funny grows enabled our clients to raise over 20 million dollars for purchases of real estate so I'm not sure why that person had an issue they're very very good at walking you through step by step I just would say reach out to them and make sure that you're working with them they they have a thing with gold money so basically they use the cards to buy gold and then you transfer the gold into cash it's like a little bit of a few hoops to jump through but hey it's 0% interest for a year you know hey beggars can't be choosers right we were able to get a hundred and seventy six thousand dollars in cash because of them in order to purchase real estate so it's an amazing strategy so again and you'll save like five hundred bucks if you go through our website because we've asked them to do that for people who watch us and who listen to us so if you go to Morris invest com slash funding check it out it might not be for you if it is great just check them out you know I have a phone call with them Joe Joe wants to know what appliances do you provide actually I don't do any appliances in our properties now that is to say if we move into some of the b-class properties we some we will sometimes put in a fridge and stove and things like that but far as a washer and dryer we have I made that mistake when I first started in Michigan I bought all appliances and found out that I didn't need to that it's commonplace that tenants will provide all of their appliances they will usually typically go down to a local you know like a little scratch and dent company etc or that's where I bought my first appliances when I had my first condo in Florida I went to a local scratch and dent place they're brand new that may have like a tiny little little scratchy scratch on the side and you get a great deal on a bundle of appliances so that's what most client most tenants will do and then they'll keep them for many many years so you don't have to worry about it so Daniel wants to know what's the fee for you guys to do investing for me there is no fee with us at all I know some other companies charge like ten percent all that stuff we don't do that you're just buying the house we just you know and try to get it all stabilized for you with property management team and cash flowing so you don't have any additional fees you own the property free and clear Jimmy says how do you organize your banking system for your real estate business great question Jimmy you know we have a couple of podcast episodes Natalie and I do where we talk about how to run your you know your family business and finances for real estate investing if you want to check out the investing in real estate podcast you can do so and we have some of those episodes you know the short answer is that you want to have bank accounts set up for your taxes you want to have bank accounts set up for your LLC that owns your rental property and personally so I have LLC's that own my rental properties those LLC's have their own bank account so when the cash flow from the tenant comes in I Clayton Morris don't touch that money that goes into the business then I can pull that money out but you can't commingle money like you don't if it's a business that owns your real estate you don't want that money coming in to your personal bank account that's called commingling that's illegal the IRS does not look favorably upon that so you want to do everything aboveboard making sure that everything is flowing the way that it should Bobby yes what's the best way to start a property management team no cash but at the time and looking to help investors well I would say to start a property management company takes about a hundred and fifty thousand dollars I know this to be the case so right away to be spending one hundred and fifty thousand dollars to set everything up okay you're gonna need you're gonna need to pay for software things like rent manager appFolio those types of things you're gonna want to hire an accountant you're gonna want to hire an office manager you're gonna need to hire leasing agent you also need to get a brokerage right you need to have a brokerage license to make sure that you can manage property so all those things cost some money so to start a property management company that's what about that's what it roughly costs and then about if you have more than 100 properties the rule of thumb is for every hundred properties or so you're gonna want to add another human being to your to your company to facilitate those properties that came to me as a friend of mine who ran his own property management company those are the exact numbers that he used James wants so what's the area oh it's just on the website to find the gold funding option so just go to Morris and Vess comm slash funding it's sort of a hidden page because we don't like promote it but it's there if you sign up like I said you'll save 500 bucks once they get you the money you don't pay anything until they get you the cards Peter said spoke briefly with your guy Justin have a self-directed IRA I was interested that was a month ago he was going to keep an eye out for a property and haven't heard back Peter I will follow up with Justin or you can just you know feel free to reach out to Justin as well from our team because we we can set up a whole dashboard for you for the self direction so I'll make sure that Justin gets back to you Peter I'll have our team make sure we go through this comment thread to take care of it okay how can you cash out on a $40,000 property well so $40,000 homes are tricky because banks are lazy or appraisers are lazy so a bank is going to hire an appraiser to go in and they're going to those types of properties they're being sold every day to investors like I might buy thirty of them right but guess what they're all off market so they're not being sold on a multiple listing service like you buy a house for a hundred thousand right with a realtor and so when an appraiser goes to pull comps in order to appraise the property they don't have any comps to work with the only cops they have are ones that are on the MLS the ones that they end up pulling end up being ones that are like foreclosures or pre rehab so you might have a forty thousand dollar house and you know it's worth forty forty three forty two but they might appraise it at twenty because the only thing they could find that sold recently on that street was a foreclosure that's not been rehabbed yet so you can't you kind of at a crapshoot if you're planning to do a refinance here's my suggestion it's just move up into those sixty sixty-five seventy thousand dollar homes and then you're putting like you know then you're able to pull almost like the full equity out of that house or close to it if the bank then cuts you a check for fifty fifty five great then you can roll that into your next property so I just would say told code don't try to go super cheap if you're planning on doing a refinance banks are lazy and you're frankly just at the mercy of these banks you know I can pull up sales disclosures with hundreds of sales where the house is selling for forty three forty five but guess what the appraiser will not look at that and so then you're at the mercy of like a foreclosure that's on the Multiple Listing Service and unfortunately it's it's just difficult now we've had people who've done refinances on forty thousand dollar homes and you know like one of our clients recently bought one for forty three it appraised for fifty five but again it's a crapshoot he could have just as easily had the appraiser come back and say you know well we think that house is worth twenty two so remember what you're buying is cash flow when you're buying that low and you're trying for that high of are a lie you're you're sort of like the investor that's buying 50 properties like that they don't care about ever refinancing they just want the ROI they want the cash flow I hope that makes sense sure our Lara says I've got a shooter I think I missed it sorry zip past it Ahmad it's kind of invest the United States if I'm not a US citizen yes you can you know just book a call with our team we have people I mean we have a lot of investors Canada and New Zealand all over the world who invest with us do I see Florida getting to California prices within 10 years seeing a lot of new construction and price hikes there in Tampa yeah a lot of those coastal areas you know Tampa those types of places Clearwater Miami of course I don't see them getting to California craziness you wanted let me tell you a California story the reason it's ridiculous so like the same house that I might do in Michigan or Indiana and then our clients would buy maybe like a 3-bedroom 1-bath in the $50,000 range right well there was a 3-bedroom 1-bath last week on the market in the bay area for $900,000 and guess what it was condemned it's a condemned house selling for $900,000 in the bay area that's California it's crazy absolutely crazy Mario says I was thinking about buying houses in my name under a HELOC on my primary residence and then when I get to three to five houses to a portfolio loan and all three to five and an LLC is that okay yeah I mean but why would you need to buy them if you're using a HELOC to buy them just buy them in an LLC now you know there's no reason you should buy them in your own name at all ever buy them buy them in an LLC if you're using the HELOC it doesn't matter how you use the he lock key lock is cash right you could go out and buy a boat if you wanted to with your he lock the bank doesn't care you're just writing a check from your he lock so why not buy them in your own name now I've started buy them in an LLC today you're using the he lock on your primary residence it doesn't matter the bank doesn't care what you're doing with that money you just have to pay it back but I to me having a HELOC is one of the killer strategies I love a key lock on my primary residence I use it to buy properties all day long Michele says what are your thoughts on using quicken loans to buy a house I've never done it you know hey if you can get good rates and good terms from a bank to buy to buy a house great go for it I don't see why not video teaching can you recommend a bank for a HELOC on a New Jersey property lakeland la ke Lakeland Bank we love them they're fantastic smh ninja on the funding Grove fees no notice he you're refinancing very quickly so you're gonna refinance very very quickly by that fifty sixty thousand dollar home and then get it into a long-term 30-year note and you pay off the you pay off the zero interest credit cards and then you recycle them so that's what fund and grow does they recycle and get you more zero percent and then you can just rinse and repeat that's why it's a great strategy so you're not keeping those cards for you know with like you bought a house on a credit card for twenty years you're refinancing it within that first twelve eighteen months and yes you can quit claim deed you can move a property to an LLC Kevin wants to know thoughts on an umbrella insurance versus LLC well that's well I say you have both I mean I would definitely have insurance and also have your properties in a limited liability company the reason you have your properties in a limited liability company is so that people will come after you personally that's the key right you don't want people if tenant slips and falls because a handrail wasn't fixed on your one property and this happened to a buddy of mine in Philadelphia he has a property and a girl was drinking one night she came home to the condo she slipped outside because the sidewalk had like this much of a differential and sued him fortunately you know he had insurance but fortunately the case got dismissed or dwindled down where he only had to pay like seventeen thousand can't come out of pocket seventeen thousand to pay for this girl slipping and falling at his property because he had the property at his own name so don't put properties in your own name if you don't need to there's no reason to forest so to have a bank you recommend for refine 50k rentals I guess it just depends yeah I mean there's a couple you know State Farm actually the insurance company has a refinance program a national program Northpoint Bank all one word with an e at the end North Point also has a refinance program they're a national company as well you could look into them Daniel says how do you tell if a property is a B or C class that's a great question I've got a whole video series here on our YouTube channel about how to understand that so you can if you want to look that up right here on the channel it goes more deeply into that but the short answer is an a-class neighborhood I like to avoid an 8 class neighborhood or those two you know two hundred three hundred thousand dollar homes two-car garages maybe they have a swimming pool they're in the best neighborhoods I stay away from those as an investment property because you're gonna have the most moving parts that break you're gonna have the most entitled tenants that cause the biggest headaches and cause you the biggest problems so garage door openers that break garbage disposals that break multiple heating and air systems that break you know avoid those those also have the most volatility those tend to be the areas where those in a big recession lose their job the a-class neighborhoods we saw that across the country right these a class neighborhoods where people lost their jobs and all these houses went into foreclosure and people couldn't pay their rent or the value plummeted significantly so let's say they're renting it from you for $3,000 a month in an a-class neighborhood and everyone loses their job all around that a class neighborhood now the rent is you know you're gonna have to go down like 20 2022 hundred a month or even 1800 a month we saw that in Manhattan right people renting Manhattan apartments for thirty five hundred bucks a month the recession hits and guess what all these Wall Street people lose their jobs etc and those went down significantly you could rent a place in Manhattan for eighteen hundred a month instead of the 35 that you could before the recession but guess what those C class neighborhoods say the same those C and B class neighborhoods roughly stayed the same it's consistent cash flow those are the people that tend not to lose their jobs those are the people that are working blue-collar b-class is kind of moving towards an a-class it has better schools slightly lower ROI but I've been buying a lot more B class properties lately personally because you know when you get to a point of having find enough cash flow you really want to start thinking about buying those more expensive B class because you're creating more of a tax shelter for yourself you're creating that bigger spread that bigger tax shelter and you're adding to your net worth more significantly so but C and B are my favorites so I've been a lot of C and I'm starting to buy a lot more B yeah lisa says that's why I like condos no outside maintenance but then I don't like the associations right I do not like HOA fees and I've got a whole video on HOAs because HOAs honestly you're sort of at the mercy of these people I mean you're literally at the mercy of these people and you never know when they're going to decide to change the bylaws and make it so that you can't rent the place or they're gonna hit you with a big roof assessment you're gonna have to pay you know $5,000 for a new roof on the property you have no control over that so homeowners associations I'm not a fan of Daniel we don't we don't have a number for you to call us because we want to be able to schedule it with you so just go to our website click on the schedule a consultation button you literally answer like eight questions like your first name last name best email address to get a hold of you make sure you type in your phone number correctly and then we just ask you a few quick questions like how many properties do you currently have what are your goals and then you pick on the calendar the time that you want to schedule a call with us it's very simple so it's up to you you know that you got the kids from to p.m.
We don't write so we want you to pick the time that best serves your needs it'll go on your calendar we'll send you an email reminder about ten minutes before your call and we'll jump on the phone with you and talk to you for like thirty minutes Chad boys wants to know how is Capp West you know I heard good things about them years ago but then I think I heard things kind of fell off and I haven't really actually heard many people using them so I don't know I've never used cap West what if you want to live duplex a class neighborhood your thoughts well Rodney I mean some few if you want to live in the property that's up to you right because that's a different animal than investing in a property but if you want to live in a duplex than in a class neighborhood great you buy it I would rent out the other side so that they're paying your mortgage that's an investment right that's an investment property in a class neighborhood so you know go for it you know just a matter of whether if you're in an a class neighborhood are you likely to have a higher turnover on the rent because people want to have their own single-family home they might not necessarily want to split a house with somebody if they're in a class neighborhood you know when I was younger I was fine kind of having a shared wall with somebody but now that I've got three kids and I'm an adult there's no way I want to share a wall with somebody else you know I want my own place I want my own yard what do I think about a land trust well it's funny you mention that as our tax accountant thinks that they are a total mistake so I do not do anything in the land trust sam says I spoke to Glenn a few minutes ago awesome
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Read More5 Easy Tips To 💰Save Money💰…Money Saving Hacks
Harvey 0 Comments Retiree Tips and Tricks
I'm going to do a video on 5 simple things you can do to help your financial situation and I realized that I need to do a follow-up to the retired at 40 story video because there's a huge need for financial education in this country and really everywhere it pertains to every single person doesn't matter what your financial status is you can always use help and there's always little tip tips and tricks that and things that you can do to better your status it always amazes me how scared people are to talk about their finances to put something on paper to basically take a look at where their money is going what's getting saved and how everything is getting spent and I've met people time and time again that are highly educated very smart people but they know nothing about finances and they are terrible with money management so before we get into the 5 tips I want to strongly urge you to make a financial statement for yourself figure out where your money is going currently and figure out how much you're saving and basically figure out where you can trim the fat for so many people a financial statement or just finances in general is like a bad word they're just terrified of it but the only way that you're gonna be able to improve your finances is to face the music alright so now that you've had a chance to go through your financial statement you definitely know where your money is going but how can we save more and what you really need to aim for is about 6 months of reserves especially if you're getting ready to invest money into something or if you're doing some kind of career change or some life-changing thing and all of these five tips will more than likely be a line-item on your financial statement so let's go to financial tip number one hey I'm going to have to call you back I'm shooting a video right now so this first thing is something that we've all become very very accustomed to in the last 10 to 15 years and that is a cell phone and people tend to spend absurd amounts on their cell phones whether it's the bill or the cell phone itself mainly the cell phone itself so that's my first financial tip is shop on eBay or Amazon for a cell phone that's refurbished or used or one this may be just a couple years old I actually just purchased a cell phone on ebay because I'm having trouble with my current one and I got on to my cell phone providers website and the most expensive phone that's like mine now is $1,200 that's insane to me so I got on eBay I found one that's similar to the one I have right now it's new but it's a couple years old and I got it for less than $200 another thing that you can do is ask for some kind of loyalty benefit from your cell phone provider cell phone providers are constantly trying to earn your business and if you've been with them for a long time and you can convince them to keep you around by offering you some kind of benefit they'll jump on the chance just by going into my provider recently I have a cell phone bill that was about a hundred and ten dollars a month I told them that I've been with them for close to 15 years they knocked it down to sixty-seven dollars and I have unlimited everything now tip number two is what I call going to youtube University or getting a YouTube education we live in the most amazing time ever right now there is information everywhere and it's so easily accessible don't ever stop educating yourself it's so easy to find out how to do things these days you're doing yourself a huge disservice if you don't take advantage of that so how does that pertain to saving money well you can save money by doing tons and tons of things yourself instead of paying someone else to do it just look at the platform that you're watching right now for instance you're watching a video on how to do something so that how-to can be anything from changing brake pads on your car to changing the oil on your car to fixing a leaky faucet or the toilet flapper not working on your toilet all the way to how to the meal which brings me to my next point number three so food is a necessity in life but is it a necessity to go out to eat or go to Starbucks once or twice or every day the amount of money that people spend on food and going out to eat fast food Starbucks McDonald's it really adds up quick and I don't think that people realize how much money they're actually spending on it because it's just five or six or seven dollars here and there but if you add that up over the course of a month or a year or five years or ten years I think the result would be pretty staggering cook your meals at home pack your lunch for work make that fancy coffee at home it's not that tough to do there's so many great ideas and resources on YouTube and Pinterest and vlogs and blogs this channel included if you need a place to start scroll through my channel I have lots of cooking videos if you want to take that a step farther you can start growing your own food and if you don't have a big green house like this you can grow a lot of food just in five gallon buckets even on a little deck if you don't know where to get started see tip two number four is something that really hits home for me because me and my wife are both self-employed and we have been for 15 plus years so number four is insurance and although I don't like insurance companies because I think they're a giant scam it's a necessary evil and you can also use that to your advantage you can put them against each other insurance companies much like cell phone companies are begging for your business and they're constantly trying to outdo each other with with certain benefits or promotions so make them put their money where their mouth is and put them up against each other constantly and not just insurance companies you can do this with all kinds of different companies you should always be price checking these companies the ball is in your court make them earn your business all right I'd saved the best for last tip number five is taking advantage of bank account and credit card bonuses and this tip is begging for a separate video all on its own because I could go on about this for a long time but if you're not taking advantage of credit card bonuses for sign ups or credit card cash back or travel miles or if you sign up for a bank account a lot of them will give you a large sum just for putting your money with them now I want to be clear I'm not promoting just going out and spending a bunch of money on a credit card but more putting the things that you already spend money on into the credit card it's money that you're spending anyways put your mortgage on a credit card if you can insurance is a good one it's not super expensive but at least we'll get you a couple hundred bucks on your credit card unless of course it's health insurance and then you're talking in my case thousand to twelve hundred dollars a month here's another good one groceries it's something that you always have to have and depending on how much you go to the grocery store it could add up to three or four hundred bucks a month sometimes six hundred maybe even more no-brainer here put your gas on a credit card you can always put your utilities on your credit card too if your utility company will allow it next from tip one your cell phone bill now depending on how much some of these are and if you are allowed to actually put them on your credit card you're talking some pretty major money that you can get a bonus from if you're getting two percent cashback that really adds up not only that but you're increasing your credit score while you're doing that so as long as you're financially responsible and you pay this every month you're reaping a large benefit a lot of credit cards will give you a 2% cashback they'll give you a $500 signup bonus that's free money in my opinion the free bank bonuses or even better than the credit card in my opinion because the bank account is something that you have to have anyway a lot of them will give you $500 for a small deposit as long as you put your direct deposit with them all the way up to I've seen $1,000 before and if you have a little bit more money to play with some of the online money market accounts like Capital One will pay you up to 2% or some even up to 2.5% just for keeping your money with them so some of these things may not seem like it's saving you a ton of money but when you take up those extra fives and tens and occasional hundreds and you put them to work for you as opposed to something that you're normally spending you're not only saving the money because you're not spending it but you're putting it to work and doing something else with it and you'll find that your your finances will start to collect very quickly so if you found the video helpful and you enjoyed the content take a second to give me a thumbs up it really helps out the channel and it helps the YouTube algorithm get this video out to people who actually need to see it also don't forget to subscribe we do some gardening some frugal living some food preservation and cooking some gardening and you get to join me and my family on our retirement at the age of 40 after you've clicked subscribe click the bell notification also and it will notify you every time a new video comes out and it'll keep you in the loop of the community all right I appreciate you sticking with me through this whole video so I'm gonna give you an extra bonus tip with an extra 100 or 200 or 300 or more dollars per month that you're saving with just cutting back on a few things you take that extra money and you pay down debt with it the faster you get out of debt the closer you're going to become to financial freedom and whenever you're paying off debt always choose the smallest balance first because it gives you that extra little boost and if you can pay it off faster it gives you that extra bit of confidence to rock into the next one so once you've paid down your smallest debt move on to your next smallest debt take that money that you're saving from the smallest debt that you're not having to pay any more and add it to the money you're saving from the 5 tips that I'm giving you and apply it to the next smallest debt and when that one's paid off you roll it into the next one you roll that one into the next one and so on and so on in the meantime this is retired at 40 check out these other helpful videos if you have a minute remember to live a life simple and we'll catch you next week oh hey I'm gonna have to call you back and shooting a video right now this is right my god get out of debt
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