The Professionalist Real Estate Investing Podcast
The Professionalist Real Estate Investing Podcast will help individuals get into investing in real estate and provide you with the knowledge and skills to accomplish your goals. We will be discussing all different aspects of investing, such as tools and tips to guide you through the steps. We will be having experts in the real estate field, syndicators and people with an abundance of knowledge who have succeeded in investing. Be sure to subscribe so you never miss an episode.
The Professionalist Real Estate Investing Podcast
Real Estate Investing Secrets for Full-Time Workers
Ever wondered how you can leverage your 9-to-5 job to achieve financial independence through real estate investing? This episode of the Professionals Real Estate Investing Podcast offers an enlightening guide specifically for W-2 workers. We start by sharing essential steps to evaluate your financial health, emphasizing the importance of a good credit score and robust credit history. Through personal stories, we illustrate how these factors influence loan approvals and explore various loan options, including those specially designed for healthcare professionals.
We dive deep into the mindset and strategies needed to succeed in real estate investing. From house hacking to buy-and-hold strategies, we share valuable insights gained from attending real estate seminars. We also critique traditional financial plans like 401ks, advocating instead for continuous education and smart investments. Our discussion highlights the significance of finding a mentor and surrounding yourself with like-minded individuals to keep motivated and informed.
To round out the episode, we discuss the financial strategies that can transform your W-2 income into a powerful tool for real estate investments. Learn how to set long-term financial goals, turn liabilities into assets, and take advantage of various tax breaks. A compelling personal anecdote about receiving real estate tips from an unexpected source underscores the value of networking. Tune in to discover how you can maximize your W-2 job to pave the way for financial independence and success in real estate investing.
Podcast Intro
Welcome to the Professionals Real Estate Investing Podcast. I'm with my guy, Rocky. How you doing today, Rocky, Doing good man.
Speaker 1:Thanks for having me. Hey, no problem, it's been a minute. I want to get you back on here for one episode, and this one's going to be dealing with how can an average W-2 worker get into real estate investing. I know you've been trying to get into this, which you will. I tell people speak of it, it will come about. And how to go about doing this is evaluate financial health. So the first one that talks about the topic is check your credit score. Is it a good credit score will help you secure favorable loan terms? Yeah, because when it comes to buying specialty homes and everything, they go by your credit. It seemed like the credit score of about 680 is the part where people usually go at. It just depends on which one, because there's so many different to get funding about into real estate investing.
Speaker 2:I would say they do go off of credit for sure. Uh, it just gives you, it gives them a foundation, like okay, he's good with his money. The credit is what basically shows right. And then when I went to go get my first house, it was credit and then it was my income and at the time I was making zero because I just became a nurse. So they're like zero income basically for the last year. I was making zero because I just became a nurse. So they were like zero income basically for the last year. I was in nursing, the nursing program. Yes, so income was a huge one. Um, but the credit, she's like the credit really only helps you. You're like what the loan offers will explain to me.
Speaker 2:She's like we can, we can basically approve anybody yes, for our loan but the credit really helps us determine what kind of interest rate we can lock you in and how much you need to put down and, uh, what kind of uh loans you can be approved for, because you can have the best credit score ever.
Speaker 2:But you don't necessarily need a conventional loan if you're going into real estate to invest something like that, because what you want is someone else to pay, pay pay that mortgage, um anyway. So, uh, yeah, credit score does help get the initial loan. Uh, because it lets you, let's the loan officer, know that you're credible. Yeah, yeah, because when she told me that she's like these people come in here with like five something, six something, and we basically have like a quota that we make sure it has to be minimal, over like 650 or something like that, before we can consider you for this type of this type of loan, so she's like, but if you come in with for this type of loan, so she's like, but if you come in with all the money down that we need for this house, you'll probably get approved I'm like that's crazy. So I don't know.
Speaker 1:Credit card does play a role, but it's more like it's more just to see how well you're managing your money, I feel like yeah, exactly, they want to see what type of pattern you're working with, making sure you pay all your bills in time and making sure you know if you have closed accounts. I mean unforeseen occurrences yeah, those ones too.
Speaker 2:Yeah, yeah, yeah, that's the biggest thing. They're looking at my credit score. My overall credit score, let's say it was like 800 is perfect. But they're looking at all my credit, like four or five credit cards that were overdue and I paid them off like a couple years ago so, but I built my credit back up. I took tons of like personal loans out like oh, what'd you take those?
Speaker 2:out for, oh, I bought them one second, oh, I bought this boat, or they're like right, your credit score looks good, but man, your credit history is. Who knows what's gonna happen this guy? So yeah that was the biggest thing.
Speaker 2:It was like, yeah, my credit score was great, but, um, my credit history wasn't the best that was my wife like I went in there, she, she let's say I had like a 700, she had like a 780 or 790. Like how does she get a better credit? You know credit score than me and they're just like you have. Uh, you, she has a better credit score than you, but you have better credit because you have uh, personal loans, student loans. Uh, you bought three cars, paid them off, you know all your credit cards are never been overdue. She's like she has a better credit score but you have a better credit and they, they went with mine because you have a better credit history History.
Speaker 2:Yeah, so I was like credit score doesn't necessarily mean that you can't get qualified, but yeah, having the down payment and everything aligned in your credit history up to par really plays a huge difference too, and what kind of loan you want to get Exactly, because there's so many different ones out there.
Speaker 1:I tell everybody because, like on the next point, it says safe or out there. I tell everybody because, like on the next point, it says, say for a down payment. I mean you can get between 30 to 20 percent down on a property. So when it comes to what type of loan, I would definitely talk to a loan officer because they always have the avenues as to which one. I know some here in town where we live at, like you can get certain this one is really hard In some areas. You can get a loan for land, even for dealing with the medical field, even with the doctors there's actually loans for them. There's all different types of loans that people have no idea about, that are out there, that hardly ever get even used, because I mean the information's out there but it's not broadcast like that.
Speaker 2:Yeah, and a lot of those specific loans for, like I don't know. There's loans like oh, if you're a nurse or you're in the healthcare field, or if you're a doctor or something like that, uh, or you're in the military, those things, those loans aren't the best loans for the, for the banks, because they have right, they have lower interest rates and, um, you know, and a lot more companies are, uh, it's like an fha, I think it's built up, it's big, it's built up by three different loans into one. Those are three different companies that are getting a part of that, versus you go with one loan, conventional loan, through the bank, and they're getting the whole pie. They're getting all the benefits from you paying that loan on, usually a higher interest rate versus a little bit, and everyone else is getting a piece of it. That was my understanding, because I was like well, if that's the, case, I'm getting a lower interest rate.
Speaker 2:I gotta pay more companies, but it's a lower interest rate. Uh, why not go that way? And then she was explaining to me well, if you mess up with one company, all other companies can come after you and for us, it's just us doing with you one-on-one. So it was, it was, uh, yeah it, I don't know right, yeah, exactly what you're saying there the the moment after the lingo, I was like what?
Speaker 1:yeah, there's, so why wouldn't I?
Speaker 2:go with them, like well, there's we don't make money for you.
Speaker 1:You go that way and then the next one, when it comes to after evaluating your financial health, is educate yourself. And then it mentions here about a couple of books which so many people have read is the Rich Dad Poor Dad from Robert Kiyosaki. And then I actually have this. I've actually had both books, that one and this one with the Millionaire Real Estate Investor by Kelly Keller that's Gary Keller. That's really good. Yeah, the one about Rich Dad Poor Dad, which is really good is basically it opens up your mind to how, basically, how money is dealt with, especially with real estate investing. And then the number one thing that I got from it when I first started reading it is about the middle class. They get taxed more than any other class known to existence because they always pay for everything. They get that hefty tax. But I mean, it's 2024 now. That's why a lot of people have little hobbies and little things that are going on to offset those taxes.
Speaker 2:What I got from that book and it's the one thing that really stood out to me in the book is when he when he talked about going to see his friend's dad yes, and he was sitting in the dad's living room, whatever for his friend and all these men and women are coming in and out of this his dad's, his friend's dad's office and basically his dad. His friend's dad was the, the owner or CEO of whatever company it was. He was the manager and managing all these other people. He's like wow, he's not a college educator or whatever and he's doing all this stuff having a business and having all these employees and stuff like that.
Speaker 2:For me, the biggest thing of that book that Ray sent out to me was anybody can do it. Yes, so for me, the biggest thing of that book that we set out to do is anybody can do it. The work you put in will eventually hopefully get you there, but anyone can do it. You don't have to have a college degree to do it. You have to have the mindset kind of go through the process to learn and learn by your mistakes and actually go to. I think we're going to talk about seminars and read books and stuff and if you really want to be your own business person, then you have to learn about that and how to start it. And just start it, because you learn on the fly.
Speaker 1:Yeah, a lot of times, because this right here, this rose in investing. They don't teach you this in school. No one teaches you. You don't know you general way.
Speaker 2:Cheryl wealth, no right that they want, you know they want you to work in nine five.
Speaker 1:You know we're like a robot all the time. So what's your? Yeah, five years old and you're broken and you can't't enjoy life. That's it nine to five 401k that's all I knew growing up me too what?
Speaker 2:the 401k. Oh, you invest money and then, once you're done, you get the money. Then, oh, amazing exactly.
Speaker 1:That's so amazing, but then that don't happen that that you know who.
Speaker 2:Who said it's like why, why would you? Why would you want to put on your 401k? Could you? People like oh, because it's pre-tax, you put it in there. So you said you're not paying taxes on your 401k, now, right. Then they're like and the guy's like um, do you think taxes are going to be higher or lower in 50 years? He's like it was like it's probably go higher, you know inflation, everything. He's like yeah, so right now you have the lowest tax break you can be, but you're putting that money into something that's gonna make you more money and then, when you pull that out, they're gonna be taxed like crazy again. So you're still gonna get taxed on it. So why not take the money that you earn and do something with it, right.
Speaker 2:The biggest killer for middle class is that we say, we say, say, say for what they're like, for what? Exactly what you know if you're not paying off, your paying off debt and getting you out of debt and getting you to a better spot, to where you can invest. Like don't sit on 100k and be like, yes, that's my nest egg.
Speaker 1:It's like what's been said. They said when they said no person's been a millionaire just by saving money. Nope, nope, invest, you invest, you have to, you have to. And what was I going to say? It was when you said about that oh, with the 401k, I tell people like, is it really a trap? I view it as a trap because this Trap, so it's a trap. So when you take it out early, you get taxed. When you take it out on time, you get taxed. If you take it out after you're supposed to take it out, you still get taxed. So, no matter what, you get taxed on your own money.
Speaker 2:Yeah, and that money is not money that you're, the money that you put in is not just your money you put in. The money that you put in, it's not just your money you put in. You put in your money into a big pool of other millions of people that put their money in and they can lose it, gain or whatever it is all together at once. It's not like, oh, that's all me, no, it's you and everyone else.
Speaker 2:Exactly so when you watch on TV and like the Star Wars is going to crash, you might as well call all your friends up and be like, hey, our money's gone.
Speaker 1:It's gone right. It's at zero.
Speaker 2:Because we're all doing the same thing. If it's all 401k, you're all 0.001% owner of whatever it is.
Speaker 1:Yes, oh man, that 401k is a whole different subject. Oh man, my goodness, remember we was talking about someone that we used to work with and she never checked her.
Speaker 2:She's like I don't know how much money.
Speaker 1:I have in my 401k.
Speaker 2:She had no idea how much 401k. She had no idea how much money she had put into her 401k, let alone what she was making yearly. She only knew that if I put 6% in or 3% in my or 6% in my company, it's going to match that 6% or something like that. That's all she knew. It's like. So you put more money into something you don't know what's going on. I was like do you just really give away money? Cause, if that's the case, hook me up.
Speaker 1:Exactly yeah.
Speaker 2:Give me a hundred dollars and I'll invest it for you.
Speaker 1:Yeah, and this is the time. Wasn't this the time just before COVID or during COVID? Before during yeah, and not knowing, and just letting it just dwindle down, that's crazy.
Speaker 2:I met someone that had $800,000 in her bank account and then when COVID hit, it went down to like $6,500. And she was supposed to retire in a couple years and I was like you should have pulled that out a long time ago.
Speaker 1:Yeah, when you see a trend going down, there might be a good advice to get it out. Yeah, yeah.
Speaker 1:All right. So, yeah, next one would be, you know, besides reading books, podcasts, like with us, the professional estate investing podcast. Other blogs, real estate investing podcast. Other blogs, um, the ones I like, uh is uh. I love, um, besides my one show, think media, but they really don't deal with real estate invest. Sometimes they do deal with real estate investing how they go about it, because they deal with tax repairs. Uh is uh, bigger pockets, because that's the biggest investing investment platform that we do have and they have so much information and forms. Um, the community is huge. So that's that's one of my favorite podcasts when it comes to the real estate investing part.
Speaker 1:And then the next uh would be 10 local seminars, webinars, with me and this gentleman right here. We just went to a seminar. First one yeah, yes, it was amazing in our homes, but it dealt with multi-family. But it opened up our eyes. We understood the, the language that was spoken. If a person from the outside came in and they didn't understand the vocabulary, like they would be completely lost, but we knew everything he was talking about like you know how he said oh, you know, look at uh, podcasts and blogs.
Speaker 2:Like like for me, sitting out from watching like a huge long podcast was almost like draining, like ah. So I watched like a bunch of like five minute, 10, 15 minute clips or whatever and just watching that like keep myself fired up, like I want to invest, you know. And some people like, oh, if you invest, you know, if you do an llc, watch out for this. Like now is it okay, that's something to watch out for. I'll just keep those little mental checks in my head. But those lingo like LLC, roi, internet and all this stuff different lingo, just watching those little clips and blogs and little podcasts it helped me with my lingo. So when we went to that seminar, everything they said, everything they said everything they said, as far as you know the main terminology we knew we knew exactly and you know the biggest thing, the whole thing was like knowing what they were talking about helped us understand what, where we, where we were at.
Speaker 1:Yes.
Speaker 2:Cause I felt like we walked out of there going like, oh, I'm ready, yeah, I need some money. Yes Cause we go, we gotta go get some money, we gotta go get something invested right now. But that seminar I think it took us a while to get a seminar locked in the books and gone. But, uh, the biggest thing, I feel, like a lot of seminars, like a lot of people and I was one too that going to these big, huge seminars, you got to know what you're going into and how seminars work, because if you don't, then then you're not, you're gonna lose what they're trying to teach you.
Speaker 2:Like, for us, we do, okay, this is multi-investing they're gonna talk about, you know, uh, uh, get money out, multiple investors um time frames, you know payouts and all this different stuff and, um, you know, knowing that the investment is not gonna be in your backyard, it it's going to be all over the country, who knows where. So we knew that stuff. But if someone came in there and they knew about multi-vesting, I think for the average person they're like, okay, you're going to buy a duplex or fourplex or whatever and it's going to be local. No, it's going to be like they said, they don't deal with anything under like $. Doors, something like that, yeah, 90 to 100 doors yeah.
Speaker 1:They don't do it.
Speaker 2:Yeah, they don't mess with the state of.
Speaker 1:Illinois, yeah.
Speaker 2:A couple of states are like we don't mess with these. So, knowing all that stuff and what they're saying, it really helps us understand what they're saying, but not only understand, like help us track. Like okay, that's how they do it and that makes sense. Yeah, versus walking in there, because I walked in there and I felt like for a second there I felt like, is this a pyramid scheme? Yeah, is that? Yeah, I know what you're saying.
Speaker 2:I know exactly what you're saying. They're about to get us, or something. Oh, okay, well, I need everyone to give me $100. What? I need everyone to give me $100. And people are like what, what's going on here?
Speaker 2:But it did not feel that way, because I knew exactly what they were talking about. I knew exactly what route they were going. I knew exactly what I had to do as far as like my end right. So that was cool. Going in there knowing what, because I know people that go and buy. This is what I equate it to.
Speaker 2:I go to seminars and they go time shares. What's a time share? And my friends that have some? They can't even tell you exactly what it is. So you tell me you own a piece of property. No, we don't own it, we just kind of rent it. How much food do you rent with? I think it's like 4 or 5, you think. So you rent it with 4 or 5 food you rent with. I think it's like four or five. You think, right, so you rent it. You think four or five people. Oh well, when can you go visit anytime? No, we don't. We can't visit any time. We, it's a schedule and we visit like, uh, four times a year and we have to split up other people. I'm like so you're like they. They knew enough to where they can get on a plane and go visit their place, but they didn't know. Okay, who's paying for this? How is it getting paid for? Did you take a loan out? Like who's capitalizing on this?
Speaker 1:They didn't know nothing.
Speaker 2:They just know we pay this much money. We can go there on these days. I'm like that's how they get you.
Speaker 1:Yeah, that's how they get you. What happens?
Speaker 2:when you lose it. What happens when you lose it? What happens if you die? Who takes it? Or can you transfer it over? I don't know. I don't know.
Speaker 1:You're right. You might want to check that out. And the thing is, I'm glad we went to the seminar because people see I know a lot of people see it advertising emails, youtube, all different types of social media. If it's a credible one, go to it. The one we went to I got hit up in social media about it and an email. It was amazing. I would do it again, in fact, definitely going back next year.
Speaker 1:I was telling Marcus I'll be part of that syndication because at least I got the information, we know what we're working with, Then we can go full throttle on it. But it's just up to what's going to be beneficial for you If you want to do homes, if you want to do multifamily, if you want it like. I'm not going to jump the gun, but well, actually it's. The next topic is I explore different real estate strategies the house hacking, buying whole the Ritz wholesaling. The house hacking, buying whole, the Ritz wholesaling. It just depends what you want to do in your real estate journey and what's going to be more comfortable for you. And if you, if you don't feel comfortable, find a person, find a mentor that is able to, you know you can be side by side with him and you learn all the techniques and all the strategies to be used and whatever classification that's being used.
Speaker 2:Well, you know what? That's the biggest thing. You hear it a thousand times mindset and then find a mentor. So you and I both can agree, if we had a mentor for what we want to do, let's say, someone to mentor you for your podcast, me just trying to get my first real estate, uh, investment, yeah, yeah, yeah, it'd be amazing, oh yes. But finding a good mentor, something you click with, is almost impossible if you're not out going to these seminars or reading about it and talking to people about what you want to do. It's almost impossible because, uh, I met someone through a facebook market. I picked up like a fire pit from somebody. I was like man, you live in a beautiful home, um, what do you do? And he's like, oh, I, I'm a pharmacist, but I, I am, I'm a real estate investor too.
Speaker 2:I was like, oh, and I started talking we started talking for like 30, 40 minutes about, about his investments and what he, how he did it and all this stuff. And I was just there to go buy a fire pit so I was like, oh, this is amazing I was like this close, like can I? Get your number and just. But it wasn't that kind of he. He just wanted to chit chat. But it was nice talking to him and I got his perspective. But my point was you can't always find a mentor, so what's the next best thing?
Speaker 2:Surround yourself with people that are like-minded, same thing with me and you man. It's a process and going to that seminar was super beneficial for my mindset, for what I want to do. If I could do it in my options and stuff. Going with you, it makes it 10 times more better because we can converse about it. We can fire each other up.
Speaker 1:What do you think about that?
Speaker 2:He said something about this. What do you think? I don't know either. Is that me too?
Speaker 1:Exactly.
Speaker 2:It was so good. If I wasn't there by myself, I'd just be driving home by myself.
Speaker 1:So many questions, so good, if I wasn't there by myself.
Speaker 2:You know I just be my eyes be driving home by the world yeah, so much questions. Yeah, so that's, that's the best is that yourself. First of all, get yourself, get your mind ready and then, as you get my guess, race myself like my people, and then you know, hopefully.
Speaker 1:Oh, she only has an amazing mentor, but you know, yeah, I can't find it and that's these things and anything is like you said, with the mindset, that I believe the mindset is the hardest part, because you have to adjust your mind, like, and that's saying you're better than someone else, but you have to change it completely different. You have to sit back, you have to think and adjust. You're like, ok, what direction do I want to come from? Think and adjust, you're like, okay, what direction do I want to come from? Come at, do I do? I want to do this for myself. I want a better life. I want to, you know, create generational wealth for, for my kids and for my grandkids, like that's a whole different avenue.
Speaker 1:Right there it sometimes it could be a beast, because some you know you've got to get over that big hurdle. You need to sit back and just ponder and like, ok, what's my next step? Next step, what do I want for the future? Don't go by that. That 401k, yeah, because that's really not going to do a whole lot for you.
Speaker 1:Oh, yeah, Like you know, uncle Sam is going to get his share of taxes. Like, hey, thank you for. You know, thank you for putting this money in, but we don't get our. We don't, we're gonna get our pie. Yeah, like someone told me one time, it's kind of what the 401k kind of reminds me of this. Um, they say I remember listening to a podcast, I remember who it was, and he's like oh, do you know why? Uh, the government doesn't allow you to pay, uh, your taxes off of each check. And I was like man, why did he say that?
Speaker 1:for he said the reason why he said that for is like because the government doesn't trust you. So the government is already gonna take their pieces of pie before you. That money, can you? That's it. And I was like, man, that's, isn't that, that's just. That's exactly like the 401k, yeah.
Speaker 2:I remember I got my first check when I'm going to be Donald's my first job, right to be done. I got my share, I did the math and everything. I make six dollars an hour. I'm with this much hours. I'm gonna get a five hundred dollars check and I go over my check. Why am I only at 325 hours? Mama, she's like that's uncle sam. I was like I don't know who the hell uncle sam is. I gotta find him. Oh man, oh man. I was like what's this?
Speaker 2:ssi, what's this cal cA thing? My mom was like boy, you're going to learn today.
Speaker 1:Yes, you are, and it was rough Right. That starts life right there when you get a first check. I always I told my daughters, I said yeah, when you pay that first bill. Sorry, you're a doll, that's it. That's like a job, you just got your tax number.
Speaker 2:Exactly Into the government internet yep, they say sweet, got another one. They're like got another one paying taxes all right.
Speaker 1:The next one is uh, when it came to, like, evaluate financial health, it's like, uh, get approved, um, be pre-approved, for a loan, and that's when you talk to you. You, you know your mortgage lender and they'll let you know exactly what you're working with with your credit score and your finances and how to go about getting the places. Yeah, that's right there. That's like a more personal level and there's nothing wrong with that. You can just tell the loan officer exactly what you're working with, what you're striving for. If you're for a house, or if it's going to be a duplex triplex, you can go from there. A duplex triplex, um, you can go from there, but, um, don't let you know now, and I've always said if, if it's if it's five doors or more, then that's when you do it. The commercial yeah, go by the the. You know the rent roll and how much you can make off the investment yeah, going, yeah, going to your loan officer uh, to any loan officer.
Speaker 2:Don't, don't set up for the first one. If you go to any loan officer, don't set up for the first one. If you go to any loan officer and you tell them okay, this is how much I make, here's my credit score, here's my goal, here's what I want to do, they will break down the math and they will tell you this is well, if you want to do this, they'll give you options because they want your business, even if you can. Only you want a $500,000 home. Even if you want a $500,000 home, they'll make it work Versus if you only want a $100,000 home. They'll make it work Because they need your business. They want your business, but they got to make sure it works for them first and then, if it works for you.
Speaker 1:Because they're going to get paid.
Speaker 2:Yeah, they're like okay, I know you said the max amount you want to pay on your on your loan is fifteen hundred dollars, but we're gonna get you a loan for 15.95.
Speaker 2:Can you afford that? Even though you just told her 1500 is my max, in their head they're like, okay, we got on my 15, let's see if we get some more out of them and they'll make. They'll squeeze you to get to get what they have. So they want, they want to make sure they can make their money and then as much as they can off you and then then you have to, like you said, it's a personal thing that. Can you do it? Can you work and get that extra 95 bucks?
Speaker 2:but um yeah, but don't settle for the first loan officer. I went to four or five before I bought my, my first house because each loan officer, uh, has their own set of rates. Um, each bank has their own set of rates.
Speaker 2:Each bank has their own sets of rates and fees that they go with, but usually for the W-2 employee, that's where you're going to go yes, I mean, you could have someone that has a ton of money that can help you invest private lender or something like that or you can go to a bank, which usually that's where you're going to go. So that's what I would say You're going to go. The regular person, a W-2 employee, is usually going to go to a bank with all their cards laid out and say I want to invest, what do I need, how much do I need to bring down, or whatever, and then you go from there, Because that's how I do it, and even with a bank a good advisor bank get familiar for wherever you're at.
Speaker 1:Get familiar with the credit unions, Because usually with the credit unions the interest rate is way lower.
Speaker 2:Yes, yeah, yeah, whatever loan officer you're talking to, credit loan business, whatever it is, go to multiple places and get multiple because they want your business. They're all in competition.
Speaker 1:Yes.
Speaker 2:I got a buddy, he bought a house and I was like well, how many loan officers do you talk to? How many banks do you go to? Oh, one. I was like what, what? I went through four of them and you know what happened at the very end. The first one beat, the second one, the third one, I went to beat the second one, the fourth one, I went to the very, very last one. He beat all of them. Then the third one. I was like, hey, I went with you. I was going to go with you. But I went to another bank. They said they're going to beat it by 0.001%. I'm going to go with them. He's like wait, wait, wait, I'll be at my 0.1 or 0.2%. I was like done deal, he sold.
Speaker 2:That just saved me over the course of 30 years for conventional loan. It saved me almost $20,000 or something like that. I was like, yeah, let's do it. That was just me telling them okay, I'm with you, I'm with you, I'm gonna go someone on top of someone else and toss up. And they all want business. Because if they did want buzz, they're like okay, you don't want to talk to me, you don't want this, fine, you want yeah now they called me every day, so did you decide to go with me?
Speaker 1:Yeah, they don't want that business to go. Yeah, they know you, you need it.
Speaker 2:Yeah, so I said I recommend go to all, all the credit unions, all the banks. Let it cause me to, because I recommend go to all the credit unions, all the banks. Lay the cards on your table because they're going to dig through your history anyways. Yes, they are yeah, they're going to dig through your credit, they're going to dig through your employment how much you get paid and all that stuff.
Speaker 1:Yeah. And then the next one is I would advise a lot of people to do is start small, purchase a starter property and then make sure you cap. You want to make sure that somewhere or another you get some type of cash flow from it. Because I view it like this it just depends on your situation. I know my situation. Definitely next year I'm going to do a multifamily because that's what I love and I see all the avenues and the benefits and everything for it. But, yeah, start off small, like everything that you do, especially in life. Start off small to get where you need to be at.
Speaker 2:Yeah, yeah, just something sparks your interest. Read a book, yeah, a podcast. Go to a seminar. Da-da-da, the slowly steps and, who knows, next year you'll be in the office talking to a loan officer going. I was really thinking about investing. What's my options? Then you know, the next year you might be looking at property with somebody, or something like that. Start small, start slow.
Speaker 2:It's a process, for sure, but yeah if you can purchase or be a part of an investment property, no matter how small it is, maybe a part of something, that's just the ball getting started. Just like anything You're not going to play the saxophone. Amazing off the bat. It's going to be horrible the first time you touch your lips, but as you take your time, you learn it. You learn the chords, you learn how to read the notes and everything. It's going to sound smoother and better. It just takes time, just like in real estate.
Speaker 1:Exactly. But trust me, that's what I got for my birthday last year was a saxophone. Oh yeah, what I got for my birthday last year was a saxophone. Oh yeah, I got. I actually got the gentleman's name on the board. Yeah, I go with them. Yeah, I remember the first time I blew the saxophone I was like why is it not making any noise?
Speaker 1:Yeah, yeah, and the next one you want to you want to network with other investors and the next one you want to you want to network with other investors. Another place I just found out that you can meet, especially with seminars, or, if you have, you can do a webinar on, or you can go to wherever physically is. Go to. It's called meetupcom and put under put in the search bar real estate investing or real estate investors and it will generate.
Speaker 2:Okay, yeah.
Speaker 1:Yeah, and I've been dealing with that. I'm like this is amazing because it shows you where or if they have a webinar. You know it has a link and everything. It'll tell you what time, yeah, and I found that very interesting because I was like you know what other? Because you know, because we're so far up here, yeah, and I was like because I know they don't have that many, but because we have to go down, in fact you know Sacramento or Fairfield, where we did go to, but I know that's another one If anybody want to do some type of meetup, go on that website.
Speaker 1:It's called meetupcom. You don't even have to register, just put in the search bar and it will generate all the meetups around your area. Yeah, yeah, so, and then you got to leverage your W2 stability. So I remember the gentleman Doug Pete. He was on the social proof podcast and he was talking about his journey into real estate investing and I will never forget it. And he was working for Verizon and he was giving he was like, I think, 60 to 70 hours a week at Verizon. I will never forget this.
Speaker 1:But he said and he had his annual evaluation. And it was crazy, because I'll never forget this and he was in the supervisor told him. He said oh, how are you doing, doug? You're doing great and everything, just to let you know that you meet all expectations. He said, no, he says you're a meets-meets person. He's like it meets-meets. He said, yeah, you meet expectations here. You meet expectations here. You meet expectations here. And for that reason, for where we're at with the state of the economy here at Verizon, we're not going to be able to give you a bonus, but keep up the good work he's. He's, he's saying what I give up 60 to 70 hours a week at this place. He's like all right, I, I know what to do. And then, uh, he was. He told people you know his, uh, his, uh, the companions he works around and they're like aren't you should be upset? He said no. He said you don't understand. This is the mindset right here what he said he says you don't, you don't understand this.
Speaker 1:He said these people are help funding my business. Yes, yeah, and I was like when he said that that was golden, I was like you got that's the, that's that mindset, that that changed everything. He said that I felt like I was there with him. When he said that, when he said that he said you understand, he's like they can do whatever to me as long as they pay me, but they're funding my business, I was like, yeah, that's where we're at right there.
Speaker 2:There's so much people that get locked in there with you and they get paid like. This is it, which is if you love your job and that's what you want to do you know, keep doing that. But I would say, don't rely on any other financial institutes to help you financially as far as, like you know, ssi, retirement disability, all that stuff, 401k, roth IRAs and stuff, unless you got some really good returns. But yeah, working your W-2 is totally fine.
Speaker 1:Yes, it is there's nothing wrong with it.
Speaker 2:What we're talking about is your w2 job is supposed to be helping you achieve um financial financial stability for the long term. I would say right, it's a long term, because you can work your w2 all day, every day, till the day you die, and you'll be financially stable, right? What I'm talking? Yeah, so what I'm talking about is invest your money. You know, because I know people that you know they buy I don't know what do people buy that just like whatever a boat.
Speaker 2:Oh yeah, I'm going to work my butt off to get this boat.
Speaker 1:Jet skis.
Speaker 2:A boat, a jet ski and I'm just going to work my butt off for that. I was like that is not a good idea because that is not an asset, that's a liability, right, because you just buy a boat. But then I know other people are like yeah, I'm working my butt off so I can buy a boat, so I can start my tour guide, yeah, my fishing guide.
Speaker 1:I know, I know well, dude, remember Carlton? Awesome. I remember the episode with Carlton Dennis and he said that it was about a boat and he he had a client had to buy a boat and like, well, what do you use that boat for? And the the the client was actually a real estate agent and he used that boat as a write-off. Because, why? Because they literally would have to go along the lake and see the back end of homes so there's all different ways and avenues, yeah but.
Speaker 2:But he used his w-2 to fund his his side hustle at the time, to you know, to get this boat. That wasn't a liability because he turned that into an asset yes, his business which how you gonna be a fish guy if you don't have no boat like, oh man, that makes such more sense versus the other guys.
Speaker 2:I'm gonna buy a boat, I'm gonna take my family out, we have fun going on vacations and stuff like that. I was like in my head I see all his money is going away, versus the other guy spending the same amount of money, time, energy and effort, but at the end he he might be able to be financially free because you know what, he might be on the on the lake all day, every day, yeah, but making money because he's doing total guys versus I got on the lake all day, every day, but he has to go back home or he has to go back to the w2 job and then, and with that boat, with that boat company, he could actually meet an investor, talk to the investor and for you know what?
Speaker 1:yeah, be in the deal. Oh yeah, it only takes one person sitting on the boat fishing.
Speaker 2:He's like, hey, man, you just started fishing, you start this whole fishing thing. Like, yeah, you know, I'm interested in investing in something like this. Like what? What next? You know you got, yeah, five, six boats up the river with your name on it, exactly change yourself. It takes one, it takes one good deal let's talk about that. Just tell that one good deal, you change your life?
Speaker 2:yes, right, but yeah, working towards something, use your job, work towards something, because everyone else, everyone else. I, when I talk to people like, what is your goal working here, right, what is your goal? And a lot of people are like you know, I enjoy what I do, it's fine, you know, get my kids to college, live a comfortable life, you know, and retire. I'm like, okay, that's totally fine.
Speaker 2:But a lot of people don't have a goal when they go to work, because? But a lot of people don't have a goal when they go to work, because I remember when I was in school, when I first got my job at Dallas, my goal was to buy some new shoes. That was my goal. I need new shoes, right. And then eventually I need a car. So I had to work, get a car. Eventually I did it. Now I see people they go to work and they don't have no goals. They just stack that money, pay their bills and go on vacations.
Speaker 2:there's no more goals, no more no there isn't, you know, and like it's crazy to me now because I come, I'm starting to come into money with my job now and like all this extra money that I have is I did what I'm gonna do with this. I can go buy a boat, you know, or I can invest it and make me more money. I feel like the W-2 person needs to know what's your goal when you go to work, what's?
Speaker 1:the goal. I talk to someone and she always plays I work hard for my money. And I was like well, I said mine is averse, she goes what. I want my money to work hard for me, oh yeah.
Speaker 2:I'll make that. You got to put a shirt on.
Speaker 1:That is that right, is that right? And I told her that and she just froze up. She goes don't you speak truth, oh man. And then and then the next part. The next part that uh, people need to understand it when you come into real estate investing. Also, the consideration of the taxes, which I love, because why the government allows it. They allow you to get, uh, depreciation and deductions when you own real estate investing. There's so much. I mean, people have what the roof appliances. There's so much that's involved. Just the average person doesn't know. And then that's when you get to. When you get to, it's different. You don't want to go to the H&R blocks, the turbo tax or anything. You want to go to.
Speaker 2:If anything, you want to go to a tax strategist yes because the tax strategist would tell you exactly what you're going to be working with, especially especially that, like the middle, middle, you know, when you start I don't know you start making money. So let's say middle class, the middle class W2 person, like we talk about, they're paying the max amount of taxes and they do that every year without blinking an eye. They're like, yeah, I pay my taxes, I work more hours, I don't get taxed more. I pay my taxes, I work more hours, I don't get taxed more. But like going to a tax professional that can actually sit you down and tell you, hey, because so I hear this a lot of times I don't want to work extra hours because I'm going to go into the next tax break and pay way more taxes. It's not even worth it. But then I tell them like, well, you're not going to make more money if you don't work more.
Speaker 2:Yes, so you're not going to make more money if you don't work more? Yes, so you're telling me this is the max you're ever going to work, so you're never going to make more than this because you can get taxed more. So the only way to beat that is to work more, more, more, so when you do get taxed you can actually get some money back.
Speaker 2:But then I was like that's one part. The other part is well, why don't you just lower your taxable income down? Yeah, what are you talking about? I'm like you heard about tax breaks, right, you always hear these big companies have tax break. Taxes, yeah, everyone can do it Everyone can do it. If you're a W-2 employee, everyone can get tax breaks.
Speaker 1:Yes.
Speaker 2:The most common ones right Child tax credit.
Speaker 1:Yes.
Speaker 2:Right, you have your home tax credit or renter's tax credit. Yes, right, you have your um home, home tax credit or renter's tax credit, all these ones, you know. Or you go to school and you, you, uh, you have a school tax credits too for um, for school, and stuff like that. So, uh, I was like, yeah, but there's so many more tax breaks that you can get that you aren't utilizing like what have you ever heard about an investment property? You know what tax breaks you can literally drop down an entire tax bracket while making the same amount of money if you have a home, the biggest one, depreciation oh, yes, depreciation, the hugest one, and they're like what are you talking about?
Speaker 2:Dude, you need to look at the podcast. You got to read the book. The book right and go talk to a tax professional to a person who's just coming into it it's foreign to them it's crazy.
Speaker 2:When I started opening my eyes to it and started reading more and learning more, I'm like oh. And started making more, I was like, oh, my, I should have been, I should have done have a real, probably long time ago, just just not only to make more money on the site, but just for the tax break. Because if you made 100k, uh, that year and you got taxed 20 percent or something or 120 percent or let's say, wait, you made 130 000 and you got taxed like almost 30, 40 000 of it, 30 000 of it, so you only made around what 90k or took home 90k, versus if you would have bought a house, a rental property, and made 60k because you rent it out, but then you actually made 60 000, but they're only going to tax you right, yeah 20 of that versus 20 30 of the whole overall amount.
Speaker 2:It's crazy how much money you save I'm not saved, but don't get taxed and and pay after paying taxes. Because you know the goal is to never pay taxes. You offset your taxes, yeah, so every year if you're not paying taxes, you know it's you're, you're saving that much, and that's how the wealthy do it, yeah.
Speaker 1:So a lot of them, uh, a lot of them too, like they, they, uh, they'll come and they'll have the oh, but then it like they'll have it. It's even so much. The government doesn't owe them, but it can carry it over the next year yeah, oh yeah, so much, so much can carry over.
Speaker 2:Yeah, even when we do our taxes, because a lot of people want our taxes, because a lot of people want to go to a lot of people that talk to don't want to go to, uh, a tax tax person that is higher up, like a cpa, a cpa and a ea, the ea, ea. So they want go to the other ones because they charge more, versus you're going to a terror tax or liberty tax or whatever. They charge limited 60 bucks, 100 bucks, and they do all your taxes versus someone else. You charge them, they charge you 250, they charge 250 and they're giving you all these extra options and they say, hey, I know, you notice, you have this, we can put this down on it, and that, versus the turbo term tax, is like put your information in there and here you go, you're done, and the other one's gonna actually break it down, and then they can just be like well, since you did this, you can and you have a business, you can use that 250 that you paid me today and write it off for next year.
Speaker 1:Exactly, and then next year that. For next year Exactly, Next year that.
Speaker 2:Next year that it's just a domino. It sucks, you have to pay the extra money out front to do it, but if you're making a decent amount of money, it behooves you to go up in the old tax. Professionalist yes, you make more money. You got to go to the better tax. You think Donald Trump's going to go to H&R Block? Uh? Professionalist yes, like you make more money, you gotta go with the better. Like you think you think Donald Trump's going to go to um H and R, h and R block? Nope, he probably got. He probably got four or five people working on his taxes, like every. You know he got. He probably got the best tax lowers, everything going on and stuff. Cause he's making that much more money, I feel like you start making money. If you go to McDonald's and you only made $10,000 a year, you don't need one.
Speaker 2:If you're making $100,000 more, he's like okay, you got to start realizing where you can get tax breaks. No one's going to tell you that unless you go to a professionalist.
Speaker 1:Exactly. That's the thing about it. No one's going to tell you the government is like, yeah, go ahead and give me all this money. We're not going to refund this money back to you yeah, yeah, yeah.
Speaker 2:They say, yeah, your taxes are done. Sweet, here's your little $500 check and you're good. Little did you know? They owed you like 5K, something like that. You're like what? That's how my money went to the wrong tax person and they just messed him up. They just messed them up. They just messed them up. He ended up owing a ton of money. He ended up getting back a ton of money and at the end he said, oh, the ton of money. I was like, oh my God, you got to go somewhere, right.
Speaker 1:Go somewhere that can deal with yourself. All right, I'm going to go down to this main one, this last one, to stay consistent. Consistent, I view it is definitely hard nowadays. The reason why it's hard nowadays? Because it's hard to keep people on track, because there's so many different distractions when it goes on. So, whatever you do, I always it's the old, it's so, it's old but it's so.
Speaker 1:Well, I always write stuff down. I always have them. You know you got the mental but then write stuff down. I always have them. You got the mental but then write it down so you don't forget where you want your real estate investing journey to go to. Yeah, I mean, because everybody, like I said, everyone's going to be different. You want to know what you want to do. Do you want you know for you, your family, for your children, generational wealth? Go by those two different avenues as to which way you want to go, because in the long run it's going to help. Investing is going to help you. Like I, I've looked into the stock market, I've listened, listened to other things and I'm like when I heard from, it was a when I was watching a million dollar scene with Josh Altman and he said, uh, god's not making any more land. God's not making more dirt, but what's being made is babies every day. So someone needs a place to live. Yeah, but why not get into real estate investing?
Speaker 2:and it was investing in something. Yes, you know, a lot of people invest in their health. Some feel best in education, invest in your family, stuff. That it's honestly it should. It should be one of those things like when you go to doctors like, do you smoke? No, you do you smoke. Do you smoke? Yes, well, you need to stop smoking. You eat good? No, you need to start starting good exercise? No, but you need to start excited.
Speaker 2:It's one of those things that, yeah, it's. It should be one of the things like the what you invest in should it should be. Uh, what you invest in should should benefit you versus, versus. Like, I'm gonna buy a boat and and just and just be fine. That's that, depending on what your end goal is, that could be great versus the other person that bought a boat for their business. Like, you have to invest in something that's going to be beneficial to you and, um, you know, stay, start small, being consistent, knowing and I think you you put a point on it uh, knowing, um, the end goal, right, yes, knowing the end goal for it. Know your why A lot of stories they start at the end.
Speaker 2:When you write a book or a story, you write the conclusion before they even write the whole book, just because they need to know where the end goal is. If you're going to invest in something, you're going to learn something. You're going to invest in your body. Your end goal is to be healthy so you can be, uh, there for your grandkids, or something like that. Right? Or your education is you invest in that so you can be smart enough to take the exam and become a doctor or something like that. So this is another thing. Like you invest, you invest in money so you can be financially free. You can have financial free, uh, um, stability or something. But be consistent, know what the end goal is and just follow through. That's the biggest thing. A lot of people oh, I'm going to go to GM. They never follow through.
Speaker 1:No, zach no, they get all lazy. These are some ways how a person can get into real estate investing. If you have a W-2 job, which a lot of people do have, it's just, you know, good mindset. Get that credit good, get a good loan officer. You surround yourself with like like-minded people who want to, you know, broaden their journey with real estate investing, because it's hard nowadays. Like I said, there's so many different distractions, yeah, and from that point on, like I mean, sky's the limit because there's so much out there. You know, I listen to the guys from earn your leisure and they said there's never a bad market time and I was like I had to think about that, the mindset thing, huh, and I was like, yeah, yeah, he's right, there is no bad time. I think about that too, because even the wealthy they love it, like recession time time periods like this. They love that because why they can get stuff at discount, because eventually they know eventually it will turn around and then they can produce profit off of whatever they're investing in.
Speaker 2:Yeah, oh, you know what you said too. You're like oh sorry, sorry sir, I like my people. No, the people that are doing this aren't doing it by themselves.
Speaker 1:No.
Speaker 2:I mean, you're investing, you're not doing it by yourself. You need to build a team, you need to build rapport and a network Because, even if you think you're doing it by yourself, you have your loan office you deal with, you have a real estate you deal with. If you're going to buy a flip a home, you have constructions, people to deal with, roofing people. So you got to build that network and no one does it alone.
Speaker 1:No.
Speaker 2:You can read and study all you want, but eventually you're going to come across someone and have to deal with them. And so it's start off by yourself, get your mindset ready. But you don't start your journey by yourself. But eventually you meet people like me and you and then you build that rapport and then, who knows, one day we might have a deal together. It'd be crazy.
Speaker 1:Exactly.
Speaker 2:Yeah, this is not a one-person thing. It's definitely, even if you think you're doing it by yourself, if you have a spouse, your wife's in it with you, your family's in it with you. If your investment probably blows up, then we all make money. If it goes down, we have to sell a house, or something like that.
Speaker 1:Or change up a strategy.
Speaker 2:Yeah, change it up. So it's a team. You always got to keep yourself around by multiple people that are on the same goal.
Speaker 1:Yeah, I'm glad you said that, because you definitely need a team. The stronger your team, the better everything can be, because everybody plays their position. They play their part to make things go in a positive direction and take advice everywhere, even if it's good or bad.
Speaker 2:I feel like yes because I have a lot of friends that are doing things, um, and I was like did you do this, did you look into that? And like no, no, no. And then they're like I don't know, I don't know how to do that. And then like later on you find out they did do it. I'm like did they learn? Did they just do that because? I told them or not, because sometimes the best advice you know comes from someone outside your circle.
Speaker 2:So, I don't know. Take advice and sometimes the advice might be horrible unless you know what your mindset says, Like that's great advice if I was going to tax fraud, do tax fraud, but I'm not going to do that. So now I know I'm not going to do that because I'm trying to do it right. Be legit.
Speaker 1:Yeah, so, side note, the best advice I ever was given was actually from a patient that I was taking care of, and he actually wrote the advice on the napkin and then I eventually wrote it on a piece of paper and I have it to this very day, and it talked about real estate investing and I was like I'll never forget this.
Speaker 2:yeah, so you never know who you're going to come across yep never know and that that could, just that, could just be a new person in your circle, in your network. Yes, our partner. So you're right, so you're not alone. Everyone else, everyone wants, everyone wants to make money, everyone wants, you know, hopefully, everyone wants to make money and no one usually wants to do it by themselves. No there's other people out there, I want to do it.
Speaker 1:I earn the same exact position. Yeah, there you are. Like I said, the old saying your net worth is your net worth. Yeah, that's the truth. All right, this is another episode of the Professor's Real Estate Investing Podcast. Subscribe, like you can actually even go on the on YouTube. Have a ton of videos with this gentleman right here.