Tag Archives: biggerpockets

FEEL your way to Debt FREEDOM

**FEEL your way to Debt FREEDOM**



Views:5198

Rating:4.96

View Time:8:17Minutes

Likes:358

Dislikes:3

F.E.E.L. your way to debt freedom. It’s a four step process to get out of debt. In this video I outline the FEEL technique, and describe how you can use it to get (and keep) yourself on the path to being debt free.

#DebtFreeDana #FrugalLiving

How We Stopped Living Paycheck to Paycheck

Pregnant? We cloth diapered 3 of our 4 kids, and estimate we saved THOUSANDS of dollars. In fact I started my YouTube channel as “MsDiaperD”, sharing over 80 cloth diaper video tutorials.

Build Your Cloth Diaper Stash Here:
*

ツ S U B S C R I B E (it’s FREE)

Hey there! I’m Dana. I’m a wife and Mother to 4 kids, including twin boys and two girls. I work full time outside the home in finance as a Corporate Accountant, but enjoy sharing my personal and parenting journey online. We live in the Philadelphia area.

Follow Me on Instagram @DebtFreeDana

*Please be advised that some of the links above are affiliate links and I do receive a very small commission if you make a purchase using those links. I appreciate your support if you do, and if you don’t – no worries. We’re still buds. HUGS!

‘Marty Gots a Plan’ by Kevin MacLeod (incompetech.com)
Licensed under Creative Commons: By Attribution 3.0

(sighing) – Hey, guys, it's Dana and
it's time to talk about money and in this video I wanted to talk about how to FEEL your way to debt freedom. (bell ringing) Now, actually in our family,
I am not the feelings person. I am more of the practical one and my husband is the
sensitive, feelings based, one in our relationship,
so kids always say, mommy is the mean one and
daddy is the nice one, sort of something along those lines. So, anyway, feelings. Getting in touch with your feelings. That is not something
that I'm fantastic at. However, this is not about
that kind of feeling, this is an acronym, FEEL is an acronym. I find at work everywhere I go, there are acronyms everywhere and sometimes I cannot stand them, because everything has been
shortened down into an acronym. However, I was listening to
the "Bigger Pockets" podcast which is one of the
podcasts that I listen to and they were talking about this acronym that they had come up with
and they were using it in regards to real estate investing and I think it's really
relevant to getting out of debt. I find that this acronym
helped with that as well, I think it's the exact
same thing you need to do to get out of debt, to pay off everything as fast as you can. All right, so I wanted to
share this acronym with you. FEEL, which is F, F stands for focus. In order to get out of debt,
you really need to focus on what it is you're doing on your goal, your why, why are you doing it? Just like anything you're
trying to accomplish, absolutely anything, if
you do not focus on it, it is not going to happen. You must focus on it, just
like when you were dating your spouse, most likely
when you were dating them, you were really focused on them and you were spending
all your time with them, your friends were probably yelling at you, hey, you never spend time with me anymore, that's 'cause you were
focused on that person and you ended up marrying them, right? And when you first have a baby, you're focused on your
newborn baby as you should be, so, things, in order to do well at things or to get them accomplished,
you need to focus on them, so, if you're trying to pay off debt, then you have to focus on it. Not obsess over it, but
focus on it as a goal, every single day, it's
something you have to have top of mind and whether
that means putting up some kind of board in your house, carrying a piece of paper
around in your wallet with you or just having conversations
everyday, listening to different podcasts
that relate to money, watching "Debt Free Dana" on YouTube, however it is, that you can,
you need to focus on it. Have it be something
you're thinking about. Correct? 'Cause otherwise you're
just gonna be like, yeah, whatever and it's
just gonna slip away and you're not gonna ever get there. So, the first is F for focus. Second is E and that is
for educate yourself. Educate yourself on best practices. Listen to others who have done it. Listen to people or read books
on how to get out of debt, what's the best plan,
something that has worked for millions and millions of people, you need to educate yourself
on how others have gotten to where you wanna get. Same thing with getting debt free. I followed Dave Ramsey's "Baby Steps" and that has worked for our family, it's worked for millions of others, but of course there are
other programs out there that you could follow, but just make sure that you are educating yourself on how others have done it. And I really like to listen to
a lot of different podcasts, I like to learn as much as I can and I try to read non-fiction books. I'm trying to learn from others
who have been successful. And who have done things that I wanna do. If I wanna be a black belt in karate, I have to train with a black belt. Someone who's gotten there, how have they done it,
I can't just read a book and suddenly become a
black belt in karate. Correct? So I need to learn from those who have done it, best practices. The third E is to execute. You have to execute on that plan. You have to follow the steps. If you don't, if you just
listen to a lot of podcasts, which I will raise my hand and say that for about a year, I was listening to the Dave Ramsey podcast, and we were not doing the steps. We just, we weren't doing it. We were not following
it and for some reason, it didn't even occur to me to follow it, I just was like, oh, this is entertaining, that's for other people,
and we didn't do it and then until one day, if
you see that video of mine out there one day, I realized, oh my gosh, we have, we have to do
this, this is for us. We have to actually do the steps. So, this is the same thing, if you know how to do something, because you've read the books, you've listened to
others, and you're like, oh, yeah, I know how to do that, but if you're not
actually doing it yourself then it's not going to happen. You have to execute it as prescribed, follow the steps as
you are being taught to and don't skip steps, don't
try to do it your own way, because your own way has not been working, otherwise you wouldn't be
looking for help elsewhere, correct? So, you need to execute on the steps. All right and then the very
last one is to learn, it's L, learn from your mistakes. Because you are going to make mistakes. Absolutely, you're gonna make mistakes. And when you make those mistakes, don't beat yourself up. Just try to learn from it
and then you can pivot, make certain shifts, try to change, try to correct things that you don't make that same mistake again. Obviously you don't want to continue to make the same mistake. You need to learn from that mistake and correct things that you can continue to move forward. And then just repeat,
repeat, repeat, repeat. Just continue to do, to do it. Just keep on the path and
I heard someone recently, doing their "Debt Free
Scream" Monday, Ramsey show, and they were saying that they believe that the key to getting out of debt, which I actually really agree with this, 'cause I would say the key is persistence. You have to continue to
keep your foot on that path, because I fully believe
the enemy is going to try to pull you off, drag
you off, push you off, and you have to try to stay on it, but they were saying it's
not necessarily persistence, but it is patience. Patience is the key, because
it is going to take time. Some amount of time and it's
very hard for many of us to have that patience
to stick with the plan, even when we fall down, get knocked off and we screw up, it's very
difficult to stay patient and to stick with it and
keep going, keep going, keep going 'til you reach the end goal. And eventually, you'll reach
it if you just don't give up and you have that patience for it. So, yes, patience is the key, right? Repeat, repeat, repeat,
keep following the steps and keep going, keep moving
forward towards your goal. All right, so that's the
FEEL acronym, like I said, I just really liked it, I
think that it's very relevant and I think that, that's
exactly how you get outta debt. That is the roadmap for debt freedom. If you can follow those
steps then you'll get there and then why do you wanna get out of debt? We wanna get out of debt so
that we don't have payments, so that all the money you're
earning, your income is yours to do what you want to do
with it, gives you choices, you can invest, you can save for whatever you wanna save for, you're not giving your hard
earned money to the bank or to someone else, so, owing
money definitely is a form of slavery and I just, it is
something within your spirit and so, I think when you get out of debt, it just gives you so many
more choices, options in life, freedom, literal freedom. So that is exactly why, so, all right. Hope that is helpful to you in some way. If it's your first time
here, be sure to subscribe, I'm here every single Tuesday,
talking all about money and we are a family of six,
living in the Philadelphia area and that's it, I'll talk
to you guys next week, bye.

Managing Money: How To Save Money, Spend Money, And Live Happily Ever After | BP Money 80

**Managing Money: How To Save Money, Spend Money, And Live Happily Ever After | BP Money 80**



Views:

Rating:

View Time:Minutes

Likes:[vid_likes]

Dislikes:[vid_dislikes]

Kiersten and Julien came from two very different money backgrounds. She’s the naturally spendy one, and he’s …

Increasing Your Income Through Real Estate Commissions | BiggerPockets Money Podcast 72

**Increasing Your Income Through Real Estate Commissions | BiggerPockets Money Podcast 72**



Views:5540

Rating:4.72

View Time:1:14:19Minutes

Likes:101

Dislikes:6

Dawn Brenengen’s money story begins a bit differently than most. Dawn’s parents shared their finances with her. She knew what things cost, she knew her parents worked hard to pay off their mortgage, and she saw her mother writing checks to pay bills every month.

She went to college and graduated with relatively little debt—around $21,000 in student loans and credit cards combined. After graduation, she stayed at her low-paying college job until her father suggested she get a real estate license.

Dawn completed the work for the license and got a job making almost the same money, working for a builder and selling their new homes. But she was the assistant to the agents who were making the BIG BUCKS, and she knew that’s what she really wanted to be doing.

At the time, real estate agents were eligible to take the test to open up their own brokerage simultaneously with the licensing test, so she did that. While working as an assistant, she laid the groundwork to strike out on her own, eventually ramping up her income to multiple six-figures—with virtually limitless potential.

Here Dawn share her story of how hard work and determination paid off tenfold—and all in just four short years!

Check the full show notes here:
welcome to the bigger pockets money podcast show number 72 it's time for a new American Dream one that doesn't involve working in a cubicle for 40 years barely scraping by whether you're looking to get your financial house in order invest the money you already have or discover new paths for wealth creation you're in the right place this show is for anyone who has money or wants more this is the bigger pockets and money podcast how's it going everybody i'm scott trench i'm here with my co-host miss Minnie Jensen how are you doing today Mindy Scott I'm having a great day how are you doing I am doing fantastic I'm excited to interview dawn and you know she's a longtime BiggerPockets contributor has a fantastic career as a real estate agent we're gonna hear all about her transition from kind of dead-end career but not really because they helped prepare her to become a successful real estate agent and just kind of how she managed to build an incredible financial position on the income and wealth building fronts over the last couple years yeah and you know what I like about Dawn's story is you know I'm a frugal person on the path to well I've reached the end of financial independence but I'm a frugal person who does it she is showing us that you don't necessarily have to be frugal you don't have to you know eat rice and beans and peanut butter sandwiches and you know spend ten thousand dollars a year to continue to be financially independent or continue down the path to financial independence she's more of a fat fire story and I just really like that yeah I think it's fantastic well should we bring her in we should dawn brenigan welcome to the BiggerPockets money podcast how are you today I'm doing great Mandi how are you I am doing fantastic I'm really excited to hear about your story because not only are you gonna tell us how you grew up with money but you're also gonna share with you with us how you increase your income which is you know and on the path to financial independence you can either reduce your spending or increase your income or do a powerhouse combination of both Ryan and I really like how you increase your income because it's repeatable it isn't like you're you know nuclear physicist and you went to school for seven thousand years to become this you have a really great story and I'm super excited to jump into it so you know before I tell your whole story why do you with where your journey with money begins yeah I grew up in a really money financially literate household so my parents were really good at um you know making sure I just kind of knew the date in and day out things to know about money right so my mom would sit at the kitchen table and pay our bills so I knew our mortgage was $600 a month I knew when our mortgage was paid off you know they would take a car loan out to buy a car but then you know immediately would start knocking down that debt you know we don't think we ever had a car loan for more than six or six or seven months you know I knew how much electricity costs I knew what our food budget was I shopped with my mom she was stay home on for a long time and you know started working when I was a little bit on the older side and my dad he was in the army and then he was an entrepreneur after he retired from the Army so you know they just kept me very involved with stuff you know I helped my dad make deposits from his store and you know I worked in a store when I was 14 and 15 years old and for free because he wouldn't pay me to do [Laughter] that's right um you know but I learned you know obviously I was office I was also an only child and quite spoiled in other ways but you know he didn't let me trade time for money you know and so I think I had a big head start when I went to college I was able to you know make sure my rent was paid on time my credit card bills were paid on time but I still did those dumb things that 20 year olds do like go into debt or you know buy cars you don't need or you know go out to eat everyday for lunch and you know I made all of those financial mistakes along the way I think I just had enough financial education to know that they were mistakes you know and to put myself back on the right track and you know I worked a w-2 wage job when I graduated from college and made about $27,000 a year when I graduated back in 2001 so now we're 18 years ago and $27,000 a year was not very much back then either and I had roommates you know I had you know people to share expenses with and stuff and so I was always able to pay my bills but you know just never really had a whole lot to put away for savings and you know like I said I spent my 20s having a lot of fun I went out drinking all the time with my friends and we would go out to eat and we would go on vacations and you know it was definitely spending a lot more than I earned you know but kind of quickly figured out like hey I've got to figure this out I think when I graduated from college I thought that I would make a lot of money and therefore would be able to pay back all this stuff pretty easily it didn't happen that way what were you doing what did you go to school for I was a psychology major and I worked in a therapeutic foster care agency when I graduated so I managed their medical records and then I also worked one-on-one with some of the high-risk kids in their you know in their community what were the debts that you accumulated with it in this time period what were you paying off a lot of credit card debt I probably had by the time I graduated from college probably had about 10,000 in credit card debt I had a car loan and then after I graduated from college I had a little bit of a student loan – fortunately I was able to work my way through most of college and my student loans were only about I think eleven thousand dollars when I graduated but the reason I took out the student loan was not to pay for school is to pay for Spring Break so so again you know bad decisions along the way well bad decisions I'm gonna give you a little bit of a pass because it sounds like you graduated college with $21,000 in debt give or take yeah so that's I mean that's nothing compared to some of the people that we've talked to although when you're making $27,000 a year if I'm huge that's still huge so how did you pay off your loans and when did you pay off like all of this debt you know I kept everything um you know like student loans I just kept on the regular payment schedule because the interest rates were so cheap you know I actually I say I took out that loan for spring break I actually used part of it for spring break and actually invested the other part because I knew when I wouldn't have to pay my student loans back until after I graduated so I had a few years of you know being able to earn interest on the money and then I could pay it off when I graduated so so it stood you know at the time my parents had a mutual fund that they had started a IRA for me when I was a kid and so I put some more money into that you know and the idea was and would grow a little bit and then by the time I had to pay it back I would have some money to pay it back unfortunately I also just kept spending money along the way so again you know it was like a tug of war of being smart with your money and not smart with your money I you know I had big ideas just not everything would always work out the way I planned on that's a really interesting though do you think that other people could apply that where hey I could I can take out a student loan and then just invest it instead of using it for education or disciplined enough to not spend the money absolutely huh I think there are deferred loans right I didn't have to make any payments or pay any interest until after I graduated so theoretically if you could pull out loans that first year of college and let it grow for four years you know you obviously you're counting on being in a bull market or whatever it is you're gonna invest it in you know needs to have a return at the end yeah hey invested in real estate no okay I want it I want to call it time out here and say if you choose to invest in real estate or invest here for your student loan money just know that past performance is not indicative of future gains and you could lose it all and you know so and we're at the what ten years into a bear market bull market so you know and that's kind of how it worked out for me question you know this was you know I went to school from 1997 and graduated in 2001 that was not a great market to graduate into you know the dot-com bust had happened shortly after that so you know stock market kind of took a dive or well it just was very very flat in my years of early investing so you know I just felt like I like my 20s were almost the Lost Decade of not making very much money not having great returns in anything you know it's still kind of floating along you know spending more money than I should you know but just kind of slowly increasing my income there it wasn't until my 30s that I took off how long did you work at the foster-care place I worked there during college for a while but once I graduated and started working full-time it was only a year okay and then where did you go after that and how much were you making so I realized that I was not going to make any money at the foster care agency and so I started looking at things I could do and my dad suggests that I go get my real estate license and so I did that and I start you know once I had my license in hand I just started applying for every job that was real estate-related and ended up getting an assistant position in a new homes subdivision I didn't even know new homes were a thing I didn't know builders were out there building communities I you know I knew nothing about nothing I started working there and actually took a little bit of a pay cut to work there but I had the opportunity to make a little bit in bonuses as well so you know when you're not making very much money and you've learned I'll kind of live off on nothing you know you could kind of take a pay cut and not really affect you all that much so so was this a real estate like what kind of position was that you said it was an assistant position were you selling the new homes were you the agent there so there were two agents that worked as partners at the at the model and we work for a real estate company because it was a builder team so was a custom builder team and they hired the real estate company to go hang out at the model and sell homes for all 13 builders that were building in the neighborhood so those two they made awesome money so this was 2003 um and I was probably there for three years or so at that particular neighborhood and I remember looking in the home prices range from you know at the time probably 250 over a million because there's like a little lake and had some beautiful lake houses um and you know we get the breakdown of Commission for every house that we sell and you know I'm doing the math to see what these other ladies are making they're just paying me an hourly wage with a small bonus they're making $200,000 a year now it's like huh it's like okay I'm gonna keep doing this and try to work up and get my own neighborhood and you know try to do their job in this thing so would you that that that realization was the point where you kind of like got serious about making money and building your finished position or where did that kind of moment happen for you if that was not that was definitely my goal I wanted to have their job so you know the problem with new home communities though is that eventually they run out of lots and you have to move on to another and the some communities are better than others some are super popular you sell tons of homes and some are just small you know entry-level you know in today's market they would do really well but small entry level homes that you know don't sell as well especially when you hit the recession so 2008 brought the beginning of the recession around here and you know nothing was selling so I had moved from that assistant position to another assistant position in a very you know in a very active neighborhood where they were selling a ton of homes and my income increased there to probably you know depending on the year somewhere between 45 to 60 and my goal was still to get the job where you know I was making the bulk of the commissions and not just the assistant level of the Commission's so I did eventually get my own neighborhoods I think weren't like those kinds of neighborhoods where you made a ton of money so you know I kind of capped out doing new home sales around 60,000 and but it was a comfortable job right like you don't have to chase clients you know they you have a neighborhood full of listings you have a set schedule it was easy schedule 11:00 to 5:00 every day but you didn't have to work weekends I know 11:00 to 5:00 it's awesome expecially in your 20s and hanging out at night till 2:00 a.m. you'll have to roll into work till 11:00 yeah just fit my lifestyle for a while you know so I did that and then it comes the recession right so now we're sitting around not selling anything and I was bored and you know I was just used to being inactive neighborhoods were you know sullen homes left and right and you know just stayed busy all day long you know when the recession hit we just had very little to do and you're stuck in your office you can't go do other things though you know you're just sitting in a sales office and nobody's coming by so I wanted to open up a property management company and I approached my broker to see if they would allow me to do that separately from you know the company I was already working with and they wouldn't so I didn't quit right away but I started to kind of get my ducks together I spend a lot of that time sitting on site you know not having customers coming in and spending that time planning my exit so you know I was getting my LLC paperwork together and I was figuring out how I was gonna market you know just coming up with a lot of different plans and so when I finally pulled the trigger I was you know ready and hit the ground running so in my state and in several other states there's different levels of real estate agent certifications or qualifications and in Colorado there's the real estate agent and then there's the employing broker did does your state do that as well did you have to take additional coursework it's called different things so and it's changed since the time I got my license so when I first got my license the test was the same the state tests was the same for your salesperson or your broker license and I went ahead and took both classes so that when I got my license I was already a broker so the day I got my license I could have just run out and started my own company if I wanted to really yeah so somewhere along the way does they decided that was a bad idea so now you have to be now everybody is a broker but they call provisional brokers and then full brokers so if you get your license you're a provisional broker you have three years to take another 90 hours of coursework over those three years you can do it all the first year if you want to and then there's also a an employment requirement that you have to I think works two years full-time don't want me to that under somebody else before you can go hang your own shingle so and then there's just a broker in charge class that's what we call it once you take that broker in charge class then you can qualify to be an employing broker okay so you did it a little differently because they usually differently yeah the rules have changed and frankly I like the rules better in Colorado when I got my license I could have waited two years sold zero houses done zero work and then taken the coursework and pass the test to become a employing broker mm-hmm which I've never felt qualified to do so I haven't done and just recently they changed that now you actually have to have done a set number of deals and been in the business for a while and all of that which I think it's better because makes marks are helping somebody buy the most expensive purchase they're ever gonna make you should probably know a little bit yeah you should know what you're doing yeah and if you're like leading people who are doing this you should be an expert yeah but but you've had your license since what two thousand two three yeah so I got it right at the end of 2002 and started working in 2003 it start my own company until 2010 and that's when I became a broker in charge okay so you opened up your own business and then all of a sudden you're a millionaire actually you know took the time to go through all of my tax records I'm the kind of person who keeps everything right so I'm going from you know my tax records back when I graduated from college to what they were all I didn't do my 2018 taxes yeah but 2017 just to see like how it ramped up and yeah 2010 was a lean year you know I just gotten started and I was spending you know more time trying to get the business going than I was actually out there doing stuff and I was really scared when I started it because I didn't know if anyone would ever hire me um you know I just I felt unqualified you know I think I just had a big case of impostor syndrome going on and um you know but I started to get clients you know I remember the very first time my cell phone rang that I had bought separately as a business line so you know I hear this like bringing sound in my house and I was like what is that you know it's not my regular phone oh my god it's my work number hello trollwood Realty how can I help you I was so excited to get that first phone call and it's funny because I remember that phone call and you know she's actually still a client of mom I know now I don't know that she knows that she was my first but when I started my business I checked in that first year I only made sixteen thousand dollars but by my fourth year I was making six figures I had made about 125 thousand so four years after that I was able to ramp it up into a six-figure salary and I know 2017 I had hit about two hundred thousand and last year I haven't done my taxes yet but I did you know figure out all my income and stuff and and I did take on a business partner last year beginning of last year which I think has helped increase the business because now we have two people out there and we can kind of focus on things instead of me trying to do everything by myself and I was able to increase my income last year up to about three hundred thousand and 2019 should be about the same if not maybe a little bit better hopefully and you know I did all that in my 30s Oh 20s I spent being broke and having a good time 39 years old now and so when I started that business in 2010 you know I was 30 years old and part of why I felt I was able to take the leap at that time is I'd also gotten married my husband has a stable w2b job with health insurance and stuff so I felt a little bit more grounded and able to you know take a little bit of risk because he was there to catch me if I fell but fortunately that didn't happen and you know he's had some income increases along the way obviously mine has ramped up a lot in the last five years and you know I think now we're kind of sitting on a net worth of about it's about 1.2 and so if we wanted to retire today theoretically we probably could do it I personally know how I like to also spend money so I'm not ready to retire until I'm like a fat fire tire before I do this I don't have to like think about you know the money that I'm spending do you enjoy being a real estate agent I really like it um you know it definitely has some trials and tribulations sometimes um but I I love that no no two days are the same you know we're out there you know all over town you know I'm meeting people all the time you know I'm having conversations with people all the time and I like that you know I just get to meet new people and you know kind of and I've started working a lot of investors so you know it's kind of cool to like watch them grow their net worth and to grow their portfolios and stuff so it's very you know cool to be able to help people kind of achieve those same goals sorry going back to that be kind of beginning stage of building your business right like imagine imagine that with some of our our listeners are out there and they're thinking hey you know I I don't mind my job but it's not got that great of prospects I want to kind of go out and do something like this become an agent and building a a a a a brokerage business like if you went back and looked at those couple of years what did you need to have prepared it sounds like low expenses it sounds like the stable job from your husband was helpful in that with the health care but what kind of personal like business outline do you have to have what would be reasonable expectations for a new agent starting out yeah I went and you know tried to learn as much as I could before I started my own business so and I didn't have any money really to go out and pay people to figure these things out for me so you know I had to figure out the legal stuff you know how to create my own LLC and I had to build my own website I literally learned how to build a website and I am NOT a I mean I went back and looked at my website a few years after that you know I kind of built it and then just forgot about it and went back I looked at it five years later I was like oh it looks like a child built this website and uh you know so and I didn't have a CPA in the beginning so I made some financial mistakes you know trying to figure out you know the best way to do my taxes and record things and stuff so you know I kind of just really bootstrap stuff in the beginning to keep my expenses low some of that stuff I probably should have paid to get the professional help from the beginning so that's definitely I think a mistake that I made it's not finding the money to pay a CPA and make sure if things come correctly from the beginning because to pay somebody to come back and fix everything that you messed up is way more expensive than having them just do it from the beginning um you know fortunately you know the LLC paperwork and all that stuff was fine I was able to do that on my own but you know if you have any questions about that type of thing you don't you don't want to mess it up so you know I hire the right people that you need besides the CPA who else would you recommend people hire out from the start because I think the CPA and you know hiring somebody to do your taxes oh I've got turbo tax it's so easy well yeah if you work a w-2 job and you have no extra anything and it's just a straight boring tax return sure you should probably do a turbo tax or if you don't feel comfortable you don't go to H&R Block or whatever but once you start adding these weird things these special little things you have your own business you know there's a lot of things that you can write off but you can only write it off if you know what you're doing if you know that these are right off of all expenses you know so who else would you recommend – yeah the CPA was definitely the big one you know once I got in good with a good CPA and a bookkeeper actually know it now I have both and there are two different people I you know we changed the business and from an LLC to a subchapter S corporation and you know kind of figured out some tax strategies to make things a little bit better along the way you know that's not stuff I would have ever figured out on my own we hired a lawyer to create a partnership agreement so we spent probably I think three thousand dollars for them to come up with a good operating agreement so that my business partner and I knew exactly how we were gonna run this business from this point on and what happens if somebody wants to leave the business what happens if one of us dies what happens you know we really want to make sure we covered every base that we had and so it's good to hire a lawyer to come in and do that you know it's like you can do stuff off a LegalZoom but who you know that seems like a bad idea unless you already know what you're doing if you're certain this business is tomorrow right and you're you know you're from scratch I pretend you don't know anything about this but how much would you say would be needed from money and time commitment just to get the t's crossed and I's dotted from a legal accounting all that kind of stuff perspective well when I think about real estate is that it is such a low overhead business if you want it to be so you don't have to go out and Brent office space and create like a big brokerage you can work from home you know half the time you're out in the community anyway so you don't really meet clients very often in an office you know so it just doesn't take very much money and but the requirements are gonna be different in different states because filing paperwork is gonna be different fees and being a broker costs a little bit differently here versus if you are just working under somebody's brokerage you need to get proper insurance errors and omissions insurance since I also do property management I have a liability insurance so you know I would say probably a good five thousand dollar budget to just get some of those things off the ground is it would be reasonable but you don't really need too much I mean you know you don't have to get you know a brand new website done you don't have to get the fanciest business cards you know some of that stuff is just the fluff and you know not necessary but good to have along the way per marketing and then you know the the challenge here you know these are these are definitely hurdles you have to overcome to started but the challenge I think is gonna be in the production of revenue generating clients generating business all that kind of stuff so what did what did that journey look like for you in those first couple of years how did you you talked about the first call how'd you get more well how did you get that first call right so that is typically where I see people fail when they get their real estate license and not just you know open your own brokerage but people go through the classes they get their real estate license and I'm not sure exactly what they imagined it to be but you go out there and you work for you know a broker and you're kind of thrown into the mix right and I think that they think that brokers are going to give you leads or there's some salary or there's you know some hand-holding that comes along the way and it you know 99% of the time and it's just not like that you have to go out there and hunt your own food so you you have to build a big Network you know I am every mom's group I am in every neighborhood gathering I am at every BiggerPockets Meetup I'm you know I'm everywhere so you know if we're on Facebook you know I've got past clients and you know everyone's used me before the lot of them are friends of mine you know further in a mom's group and somebody's looking for an agent they're in there tagging me and saying call Don so you know your name comes up over and over and over again people start to recognize it so same thing with bigger pockets um you know I bicker practices and wonderful lead source for me to get in with investors and you know now I'm getting calls regularly because people I'm in the forums and I'm posting all the time and you know people will write me and say hey I saw something you wrote four years ago and I really liked it and you know wanted to ask you some questions about Raleigh and you know so it always you never know where that business is going to come from but just kind of going out there and making sure you're in the places that people are looking so if you want to work with investors you should be on bigger pockets if you want to work with retail buyers maybe you should be on Facebook and you should definitely be in your own neighborhood in your community getting to know other local businesses getting good with a lender my lender gives me leads um you know he's they have a good website and so if he gets leads through his website he sends them to me because he knows I'm sending him all of my business so you've got to make sure like you've got some good relationships built with other people and that's does take time to ramp up so I think what people think is that they're just gonna go out there and start working you know your first year you might only have three or four clients you might have no clients you know you've got to figure out a way to weather that as you get your name out there so if you're new to an area it's hard you know you don't have a big sphere of influence of people to trust you um you know if you've been a stay-at-home mom for the last 15 years it's hard to get your license and then have people see you differently than how they've always seen you so you know you got to go out there and put a very like professional face on and if that's not who you've been for the last 15 years it's hard to watch your friends or your family choose a different agent because they don't see you in that role so you got to have a thick skin to you know make sure that if somebody doesn't use you that you're you know that you're okay you've got the next person yeah you know all of that is super super important and I cannot agree enough with what you're saying because it isn't that hard to become an agent the coursework the tests especially if you're good at taking tests like I don't think that the coursework really taught me anything about real estate in general how to sell how to work with clients any of that it taught me how to measure a house when there's a rock over there and a tree over there and like the lot and block system and every agent listening is like yep yep yep and everybody else is like I don't understand that don't worry once you go through the coursework you'll know it too but yeah it doesn't teach you anything about that and I think people see this giant commission that the real estate agents are getting when they buy or sell a house and they're like oh I could do that well it's a lot more than that and it's not just you you become an agent all the sudden breeze like wow I didn't know an agent before yeah everybody you know is an agent yes I got for sure like in my social circle there's probably ten different real estate and so my friends could choose to use you know so I've got to make sure that I'm always out there looking like the most successful the busiest you know the one who's out there making stuff happen all the time you know because yeah people absolutely choose somebody else you know sometimes you're just in the right place at the right time or in the wrong place at the wrong time and somebody buys a house with somebody else you oh I didn't know you were looking real like hey I called you and you know you didn't answer your phone so I just called the listing agent you know and therefore then they bought a house and you're like wait what just happen it happened so you've got to be able to like not get you know not see those things as you know super detrimental and just be able to move on and go on to your next client so you know trying to build up that client base is absolutely the hardest part about real estate but if you've got a good social circle if you can go out there and be a professional it'll happen and to give you kind of a s to give you the listeners akka scope of what just what this looks like cumulatively over the years right I mean Don has posted to bigger pockets 2.1 thousand times over the course of how many years you've been on bigger pockets I mean I'd probably say three four years I don't I'm has a tendency to apply actually looks like it looks like a 2014 so two to two thousand times over the course of five years and that's just the posting on bigger pockets has not all the events that usually we she just mentioned that she's attended and the always on it sounds like in receiving these calls and recognizing have got to respond immediately are gonna lose business yeah person's gonna go next agent right that's just one component of your business is that is those posts on bigger pockets and and adding value relations in your area you know that's and it's just like that's the scope of activity it looks like that's needed to develop into this $300,000 a year real estate agent and and that by the way give more context that means you're selling about ten million dollars or more in real estate annually right now this all sounds like a lot of work oh wow you have to post two thousand times on bigger pockets you don't have to but I know that when I need somebody in Raleigh I see some because I'm in the forum's all the time that is my job outside of the podcast is to be in the forums and you know help people out and answer questions and I see somebody you know saying hey I'm thinking about investing in this area or Raleigh the anybody know about them I know to tag dawn brenigan hey you should reach out to dawn brenigan she knows the Rolly market or you know when I see people send me emails all the time hey do you know anybody I'm looking for an agent here check out dawn she can help you out she knows the area you know she's been there forever she's and I know this because I see you in there now all that said how much time do you spend working in your real estate business now let's say on an average week or month well now that I have a business card I actually work a lot less than I was the previous year I mean it was a grind you know I'm not gonna lie I'm not gonna say that ramping up your income like that is a breeze you know you do have to work hard when I first started my business and I wasn't making much at all I mean from the time I woke up to the time I fell asleep I was on my computer I was marketing I was you know trying to just come up with new ideas of how I was going to run my business or how it's gonna earn clients um you know so I I think I just kind of worked all the time at the beginning now I've been able to dial it back a little bit Therese my business partner she handles a lot more the property management stuff now so she can kind of take on the day-to-day operations of that and you know before she came on I was managing about a hundred properties on my own and I was selling about you know at that time probably 40 45 homes a year you know I brought Therese on last year I was able to sell 57 homes and then she sold a handful of homes too and she's doing the property management so you know and breathable I think the two of us combined just you know had an exponential force on what we were able to do together so I don't know how you do that I've got two deals going right now and I am the mortgage guy called me up this morning and I'm like uh wait what property well you also have another full time job at bigger pockets you know you've got kid it's like you know there's always all these balls in the air and I like that like I'm a I'm a busy person because I'd like to be a busy person and you know if I sit around for too long I think you know I start to grow roots and I don't get up so I like to just keep it moving you know but I like that every day I can go pick up my kids from school so three o'clock I tell clients I have an appointment I'm sorry I can't make it we'll have to do that showing a different time but I go and I pick up my kids and you know and then my husband doesn't come home from work till maybe five thirty six o'clock or so so if I need to show home in the evening he can cover the kids at that point but usually from like 3:00 to that time it's me and the kids we're hanging out we're on the front porch you know playing outside and and I just love that time so you know that's not always something I could do before I had my business partner before I had to always be on my computer okay kids you play outside but I'm gonna answer all these emails here you know type type type so having her and we also now have an assistant that we whose license and he's full-time with us so you know having his help means that if an investment property hit the market that I think looks good I can send him to go see it take a video of it you know I've taught him how to walk through and what to look for and then I'll you know pull constant stuff and send that to my clients so you know we're just being like leverage other people's time at this point you know but again that's something you build up to right you know I had a conversation with a Cody Berman from episode something on our show I saw him this weekend and he was telling me about his company and now that he has got it up and running it is running much smoother but in the beginning you know he was putting in all this time and now he's putting in ten hours a week and still making full time money which is just amazing and Cody was in episode 26 of the money show yeah I'm a big fan of the 4-hour work week concept you know I love the idea of leveraging out as much as he possibly can so you get your time back cuz that's the one thing we don't have you know we can't make more of yeah but it sounds like the the price of this outcome right is those years and years of 80 hour plus logs that you're going through optimizing and every front just working figuring it out experimenting all that kind of stuff is that right you know you say years and years but it was really only about three or four years of really having to put in the energy to get it going and then I had a couple years of it was going and now I'm just trying to keep all the balls in the air and you know that's when I started looking into getting an assistant and now now that America able to leverage other people's time you know can I kind of coast a little bit more which is nice I mean I'm 39 years old you know I think I've got a pretty good work-life balance at this point you know my kids are only in first grade so they've got 11 more years of school left I doubt that I'm gonna go anywhere between now and then so I have all this time that I can work the way I work now and be happy and then by the time they graduate from college my husband also be a little eligible for his pension at that point so you know worlds are always serious you know the kids graduate how are you applying all of this money that you're making in terms of your wealth building philosophy what you're you're buying real estate but how are you what's your kind of investment approach to back into that outcome you just described 11 years down the road we've got a few things going so I do invest in rental properties I've got five right now they probably cashflow they don't cashflow a lot you know the Raleigh market it's not a high cash flow market but when these homes are paid off they'll be bringing in you know in today's dollars about $8,000 worth of rent so you know obviously some of that would go to expenses but you know I'd say 60% of that I could live off of once everything's paid off and they're you know they're in various stages of being paid down we also I invest everything I can into any tax deferred account so before the S corporation I was able to invest in s CP IRA so I did that I've got the Ross now because of the income limitations where you're having to do the backdoor Roth's my husband has a 403b at work he's got a pension you know so basically any kind of tax advantage account that we can put money into we do we've got the real estate and then I've also gotten into doing a little bit of private lending so there's a couple of flippers in our area that I'd lend money to what when you're thinking about when you're kind of describing this investment philosophy let's back into like those early years so you start your business you have some debt right what is that what is your kind of approach look like in those first couple of years of your business formation in terms of how you're applying any surplus money so I was able to actually pay off most of the debt before I ever started my own business um you know combining mine and my husband's income I think kind of gave me enough breathing room that I was able to pay off what little debt I had back then so um you know the the student loans we just kept on track cuz a low interest rate but we knocked out the car and when I would say good thing about not making a lot of money as an assistant in the heyday of real estate before 2008 was that I made just enough money to pay off my debt I did not make enough money to run out and go get a brand-new house and a you know Mercedes or anything because I watched a lot of people do that you know you're making $200,000 a year and you inflate your lifestyle to accommodate that well you know 2008 nine comes and now you're making $40,000 a year like that's a big cut you know so I I was just making enough to aggressively pay off debt I bought my first house back in 2003 and I did that with like no money down at all because banks would still do that at that point and you know just started just sucking money away in little increments once the debt was paid off so you know I I'd live fairly frugally you know frugal for my standards versus you know when I was in my 20s my husband was pretty good about you know listening to me when I said hey we can't spend money okay this is why you know I had the spreadsheets going I had you know the payoffs here and you know the spending trackers here you know I just kind of kept track of everything that was coming in and out which was good because you could see the debt numbers getting smaller and you can see the bank accounts getting bigger and that is super motivating yeah I love it I think this is all fantastic fantastic stuff it sounds like you kind of approach this zero net worth position around the time you're starting your business or a little bit beforehand is that is that accurate or am i I think um I was definitely a zero net worth when well probably not a zero net worth that's not true because I had a couple of houses when I started my business so yeah I had I bought my first property in 2003 and I lived in that one and then I turned it into a rental property in 2006 and then I my parents buy two properties in 2004 that I eventually bought from them so you know I had a handful at that point and that's actually why I decided to get into property management is because the sales market was so flat and you know nothing was selling so I figured why don't I just made into properties for other people it's gone well for myself and you know so that's why I went in that direction so I ended up helping a bunch I accidentally in Laurens at that point and that's how I grew the business and the big in the beginning on the property management side okay let's take a moment on that first house then because you know that came up just a few minutes ago for the first time was that an important component of your wealth building overall approach or was that relatively minor in the scheme of things relative to your other investment approaches and income generation you know I I would say it helps on two fronts right you build equity in this house and then you're also not paying rent to somebody else right so my first house like literally I paid nothing to get into the property 2003 was a great year for being told to just you know do whatever when it came to getting a mortgage I had a first aunt I can't loan on it in 8020 and I paid $1,000 for my refrigerator because it's new construction and it didn't come with a fridge and that was all it took for me to get into that house but what I did was I got a couple of roommates so it was a 3-bedroom townhome and I rented out two of the rooms and you know I'm virtually would for free and the other one so I wasn't paying rent somewhere else I had roommates bring my mortgage I was building back witty and you know prices did go up after the recession so you know I think I paid 134 and now it's worth maybe about a hundred and eighty I'm and but that one's probably done might the worst out of everything that I've owned but because I put no money in it somebody else is paying my mortgage for me you know I'll take the 380 when it's done no or very low risk huge leverage and we heard this story before waiting journeys of entrepreneurs and people who were very early advice this sounds like she's talking about house hacking but Brandon didn't invent that term until 20 fifteen so I don't know what this is yep and then I moved out of that house and kept it as a rental property and because I had bought it as an owner-occupant I had those wonderful financing terms I moved out of that one and bought another house not too far away but a single-family house and my roommates with me and so they helped me pay down the second mortgage I refinance that one right before I moved out to shorten the loan term for that just for that it would be paid off by the time my kids graduated from high school so I'm trying to you know stagger some properties to be paid off at certain times so I should have to paid off by the time to graduate from high school and then I can start paying down the others should I want to but they're all 4% or less so I'm really in no hurry anything are your rents covering all the mortgage payments and yet plus them okay yeah they do cash flow you know of course I'm doing my own property management but you know I'd say between the five of them you know I'm probably cash flowing I mean it it doesn't work out to be a ton maybe twelve thousand dollars a year or so so but still over five properties that that includes the mortgage pay down and I'm assuming that you know how to calculate for expenses and capex and all of those other things that some people may forget to account for but what I will say is that you know yeah they're only cash flowing that much but I mean the appreciation and those has been awesome you know I don't think it's Denver level appreciation but it is definitely awesome for our area and you know my plan is to just keep these properties until I die and then my kids can sell them and they'll enjoy a wonderful stuffed-up basis and not have to pay any taxes and they can sell it and go live on an island some what so your your overall plan here it sounds like at least one proponent of is to pay off the mortgages on these properties over the next 10 years 11 years think you said is that here is that the bulk of your approach is that how you're applying all of the excess surplus in your life no I do not prepay any of those mortgages and I kind of regret getting a 15-year loan and its one-year loan on two of them that I um just because it creates a little bit more of a debt to income ratio problem if you're trying to get additional mortgages you know it hasn't been an issue so it's fine but you know if I really wanted to ramp up on that it could create an issue you know if your interest rate is 4% I mean there's literally just no reason to pay that off and you know on a rental property that is going to going against your income so of course you know that you know that's money you don't pay taxes on you know you get to account for depreciation so tax wise it's wonderful benefit for me to have these rental properties you know and if my kids can inherit them and not pay any taxes on them with that wonderful loophole you know there's you know that's just awesome what what so what are you doing with this the surplus cash then are you buying more rentals are you I started doing some private lending I have not find a great deal for a rental property that I've wanted to buy partly because I had so many investors that I'm working with that I have to find stuff for them so you know it's kind of the shoemaker has no shoes sometimes so I'm spending so much time helping other people find stuff I don't have a whole lot of time to find my own but I had a couple of flippers in my market approached me and you know did small amounts there was one who got like 50 I tuned another one I've got 40 out too and so I kind of just tested the waters with that a bit but you know it's 12 percent interest so it's like you know better than what most things would return and fairly low risk as compared to stock market um okay so I want to unpack this a little bit right now private lending is when you are acting as the bank mm-hmm so how did you meet these flippers you said it's a relatively low risk do you have a first position lien on the property there's like a thousand questions I throw at you when I have done a little bit of private lending as well and I lent more to the person than the deal I know the person isn't gonna default and if they do then I have an amazing property I just don't want to own that amazing property I'd rather have the money back you're lending out at 12% interest and the going rate is like four and a half or five ish at the time of this recording so how did you find these people and you know how is it low risk to you one it's in my market so I know these areas right as I know these houses I know the people and I actually did beat both of them I probably threw bigger pockets one of them was a client of mine who bought a property and he flipped it he was new at the time but he did well on he had taken on a partner for that he did well on it and then he just he decided to just quit his job he had a nice w2 job and just said forget it I'm going all-in on real estate and he started flipping full-time so um you know so I son lent some money to him to kind of keep a couple projects going I have a second position lean on two properties for that money it's not based on an individual project right now he just borrows it for six months at a time at a time I got a second position lean on two of his long-term rentals that he's holding and the first position loan is well under what he could sell the property for so if we had to foreclose on that there should be enough to pay off both first and second positions on those properties and then the other one that I'll m4q actually just got the check back today he closed on it on Friday and I got a check today and it was funny because it came like FedEx and you know open envelope it's from an attorney and I was like oh gosh what did I get today very important looking envelopes can be scary a lot of times I've noticed talking to investors that they'll do this kind of lending inside of an IRA are you doing that or is this with after-tax dollars this is with after-tax dollars I am interested in learning more about that though yeah I've got probably just now enough in any one individual account to be worthwhile to lend out to somebody else but because I do like to diversify you know all of those tax advantage accounts are mostly in VTS ax very simple I don't know enough about the stock market really to do anything different nope it makes perfect sense the the advantage to doing it with with a IRA is that you don't pay income tax that's equal interest always at a higher tax rate so so anything else besides the private lending or is that kind of your major approach with your surpluses right now so I am looking for a good flip property in our area to do myself so I've run quite a few renovations for clients who needed to renovate their rental properties or you know help somebody buy something that needs a lot of work and to get it rent ready so I've got plenty of experience and rehabbing homes but I have not found a good project for myself yet I've been making a lot of offers but nothing has come to fruition yet so I've actually got a pretty good cash position right now just waiting for a good deal to get into you the the flips are my favorite I really love walking into a house being like this is so gross I can't wait to make this pretty thing yeah yeah and you know it I think you're coming at it from a position of extreme advantage because you've run these properties for are you've run these projects for other people so you know oh this is the carpeting guy who never shows up on time I'm not gonna use him this is the you know the electrician who shows up early and is always on time and on budget and you know that's that's a huge advantage for you oh yeah I have great subcontractors that I can use you know just from the years of having the property management business I've vetted quite a few people um so yeah I've got some great subs to work with it really is just a matter of finding a deal that makes sense it is a very competitive market here so you know a lot of these are going for over where I can see anyone making any money so yeah I don't understand how some of these houses are being purchased right now but that's a different story okay is there anything else you want to talk about in increasing your income because this I mean I don't I don't know how to say this without making it sound like I'm belittling what you did but there's not a huge knowledge investment into becoming a real estate agent to actually getting your license there's a huge knowledge investment in to becoming a successful agent but to actually get your license is really just not that hard it's not that much work you're not going to school for four years to get a real estate license in Colorado which is one of the strictest it's a hundred and sixty eight hours that's like four weeks of you know rather leisurely time and somebody I did a big research project on in some states it's like 40 hours Wow so you know there's not a huge time commitment you said maybe $5,000 for the first year there's not a huge money commitment and you turned 5,000 dollars into $300,000 last year I do that yeah I take that all day yeah you're right I mean it's not huge you know there's a very low barrier to entry and you know I was thinking the other day and I was picturing all the people who live on my block and my block of homes probably goes for about you know 400 to 450 thousand dollars if you were to sell a house here and so you know good incomes but not great for a lot of people here and most of people bought them and uh I'd say low to mid 300s and everybody on my block is in some sort of sales position I mean there's a handful of you know accountants and teachers and stuff like that but for the most part at least one member of the household this isn't some form of sales and I've realized like you know I really think it's yeah to be able to increase your income there has to not be a ceiling on it so you know if you're a teacher there's ceiling on how much you're gonna make and somebody else is going to dictate how much that is you know but if you're an entrepreneur or if you're in sales where you get commissions and bonuses or whatever the case may be you know there's no ceiling on that and I think that those are the types of jobs that people should go out there and try to get if you really want to ramp it up to be able to increase your income there has to not be a ceiling that's like brilliant and sales there really is no ceiling you don't I think you should be to be a great real estate agent I think you should be knowledgeable about how a house works how a mortgage works how you know the area in general but you know you don't have to know a lot to be a really successful real estate agent and I don't please don't think that I'm talking smack about real estate agents I'm an agent – you know I see some really great agents out there who just have a really good knowledge of their local market they don't know how a house works and you know that's okay too but there's just you know it sales is wonderful obviously I'm partial to real estate but like real estate is just it's not that hard and there's so much income that could be made but you don't like like you pointed out you did the work upfront yeah you busted your butt you did all of this in the beginning and then you know once you get the ball rolling it's like a snowball down al why don't you get it rolling you can't even stop it people just call you all the time hey John can you help me buy a house mm-hmm yeah absolutely yeah once the ball gets rolling it's it's yeah I won't say easy but it is relatively easy to get the clients you know at that point it's just managing your time and you know making sure everything is serviced properly so and that's the hard part for somebody to get started it's just to get to that point but once you get to that point it's it's awesome you know it's very easy I think to kind of keep all that momentum going um you know I after you do a budget deal is you're gonna have the process down you're gonna know you know what the pitfalls are and you know how to guide your clients and stuff so you know I think for people who are just starting out it's it's maybe a good idea to be somebody's assistant or to work on a team where you have a little bit more support because if you're just kind of thrown out there and said all right you know go make it happen with no support you know I think a lot of people can't do that um and some people can but a lot of people cannot so you know sales in general and yes I'm partial also to real estate but you know I know pretty wealthy insurance sales people or software sales or pharmaceutical sales you know and they just have like I said no and no ceiling on their income so you know as hard as they're willing to work you know it's oh right there as hard as they're willing to work it doesn't just come to you you didn't just hang out your shingle and be like okay come on yeah and I'll also point out that I see a correlation here between your life choices and how you're spending just as a household can impact your ability to go after that because you're so there's no ceiling there's also no floor and a lot of these gigs that can have these unlimited unlimited potential or high income and so the fact that you guys had a household budget you know you talked about spreadsheets you touched on that very lately but you were able to keep your household running even on $16,000 just from your income down from what sounded like 60 a few years prior on that that's that's a set of life choices that most of middle-class America don't make right in terms of running their household on one income so you could go into that into this new role and now you're you know that that has led to a path in less than a decade where your household income is likely to be close to if not above the top one percent for all of America yeah right and and that's the difference I think that that comes in there that allowed you to propel towards that or at least that was a one important factor I think yeah you're right it wasn't just financial independence through the income side of it which is you know obviously probably where I was able to do the best job but you know in those early years you should have seen me Sunday mornings I was running around getting newspapers so I could grab all the coupons out and then I'm you know on the coupon blogs figuring out like what are the sales for the week and you know I had my grocery budget down to you know two hundred fifty dollars a month and you know I just I was very regimented about a lot of things saving money was you know like I said as frivolous as I was in certain areas of my 20s when I wanted to dial it in and take care of stuff like I really good yeah I mean if you hadn't house hacked right instead if you if you had a you had both making 60k are you and your husband right and you were spending a hundred and 111,000 right with the house and the two new cars and all that kind of stuff this wouldn't have been inconceivable and you'd be listening to the show right now thinking this person is full of it that's not even a potential outcome for me and my family because we've got bills to pay with these things right and that's the difference I think that you know this whole world of opportunity was available to you in part in one small part because of your discipline on the other side of the equation yeah I mean the big trick is right don't spend more than you make it really math problem and aim for a lot less mm-hmm I mean you're you're spending what is your annual spending do you know ish yeah it's probably around $100,000 a year between but you're making 300 yeah I would say I won't even say I mean some of that I think is also going into like you know Roth IRAs and things like that so so it's maybe a little bit less than that you know our mortgage is reasonable of seventeen hundred dollars a month which to me when I was 20 I thought that was insane I was like you know I I thought if you could commit $1,700 a month man you better be like a doctor now like I'm here it's very comfortable and I'm able to save money it is very relative to what you make of course well but you're also making like doctor level salaries today but the thing about real estate is that all of that could poof in an instant go away if we hit another recession I have to be very careful about what I spend and make sure we save that money and again you know when that last recession hit you know my co-workers were making in the 200 to 50 range per year they were doing awesome but they were spending that money just as fast as they could make it and so when that recession hit I mean you know their income may be dropped to 40 maybe $60,000 a year which is reasonable for most people to live off of but when you're used to making 200 and now you've got that $2,000 a month house payment and that's $600 a month carking and like you know that's you're not making enough to cover your you know to live that same lifestyle that you used to be accustomed to so you know just making sure you don't get accustomed to the two finer things in life I think is the key because yeah 300 you know I could afford to do a lot of things but I don't because I want to make sure that if my income drops to 100 next year that it's fine you know or if it drops to 50 or if I don't make anything if I lose my license for some crazy reason you know worst-case scenarios of what could possibly happen to you I want to make sure being broke is not gonna be the ultimate Inc outcome yeah and you know I'm glad you make that point I said you're making doctor level salaries like well it could go away yes it could and I hope it doesn't but right now you're making three hundred and spending one hundred so you are saving sixty six percent of your income plus her husband's income plus her has we're not even talking about him he's not on the show this is the dawn show sixty-six percent of your income you're saving you're not spending and you know IRAs and all that other stuff at least sixty six percent so if that 66 percent went away your life doesn't change if 70 percent went away your life isn't gonna be a huge difference than what it is right now and I think that you know that kind of well I'm I'm making 300 so I should be able to have fun with it well yeah that's great but that's not guaranteed right that's you know and that's in anybody's my salary isn't guaranteed because you know bigger pockets isn't gonna go to business tomorrow but what if it did like what if all of a sudden we decided you know we don't want to be here anymore sorry Mindy Thanks you know then my income isn't guaranteed having a cushion is so important because even with a regular w-2 job your income isn't guaranteed mm-hmm yeah I actually think one of probably the most positive things that happened to me was not making a lot of money in those early years because I learned and I could see what was going on around me and I learned from other people's mistakes instead instead of having to go out and make my own because I was kind of right there at that cusp you know like I had gotten my debts paid down the car was paid off you know suit loans get paid off everything gets paid off now you're starting to feel wealthier you're starting to feel like I can go out to eat today no big deal you know and I think once that happens is when that lifestyle inflation starts to happen yeah well then I had a very positive 20s – yeah okay so should we go on to the famous for now let's do it okay these are the same four questions and one command that we ask of all of our guests Don are you ready yes what is your favorite finance book I would say secrets of the millionaire mind I liked it because it was very it was about changing like your view on things you know basically if you view yourself as a poor person you will be a poor person if you view yourself as a millionaire you will act like one you know and it was really about changing like your mindset on how you truly see yourself you know if you find it you are just you know somebody who's never gonna get ahead because you know the world is out to get you then that is what is going to happen so I think it was a good like mind shift book awesome I'm off to check that out I hope to get read that one it's good all right so what was your biggest money mistake I would say by cars that I did not need to buy I have probably had five cars since I was 16 which at this point is not terrible because I'm 39 now so that's what 23 years of driving five cars doesn't sound awful well the first four group ribbon-like the first 10 years so well I guess I've had six Karsen six cars so you know I got rid of perfectly good working cars because I just didn't like them anymore or you know I got into real estate I had a Ford Explorer when I got into real estate and because it was a two-door car I decided I should get rid of it and get a four-door car to make it more comfortable for my clients except for I didn't drive clients around so it just really didn't make any sense videos are selling new home somebody no sense at all and so I I definitely could have made do with what I had for sure additional debt and making big car payments not not a good idea how much think that might have set you back you know my mom actually helped me out a few times along the way so if it weren't for her I probably a lot more setback but I probably spent at least $20,000 on one car that I just absolutely didn't need yeah so easily 20 thousand compounded over the last 20 years it's not work out so what kind of car do you drive now related question because you're a real estate agent I am a real estate and so I Drive to super fancy as Honda Odyssey minivan I generally don't have clients in my car you know we're meeting people you know places and stuff it's nobody really wants to get my car they can but I warn people it's sticky I've got kids you know they're seven they're kind of gross and that's what I Drive in so I don't look like a very successful like you know I see everyone else out there in their outies and their Mercedes and their BMWs and they're clean and they're fancy and it's lovely yes they do look successful but I confirm I paid off minivan it's like driving around in my living room it's wonderful they look successful but are they success you don't know they just maybe have a really car payment okay what is your best piece of advice for people who are just starting out and I'm gonna ask this as a two-part question starting out on their financial journey and starting out as a real estate agent I first as first starting out on your financial journey I would say to really work on your savings as a muscle I think mister money mustache talks about that like where he says you know your savings reflex is a muscle that needs to be worked out and I think if I had done a better job of just putting small amounts of money away you know like I said when I finally did do that seeing the bank account balances grow and the debt gets smaller was really really motivating you know which made me do better as time went on so you know we're spending a lot more money in the beginning as I saw the benefits of actually not going out to eat every day or spending money on cars that I didn't need to buy and putting that money into something that would actually grow a little bit made me want to do it more so it is kind of like working out like when you start to see the benefits it becomes less of a chore and a hassle and more of something you really want to do and then as far as starting out on real estate I really think you should start out working with somebody else so that you have a really good support system so whether it's an assistant or under a team or even just under a good broker who provides a lot of support and training you know I think a lot of times people want to rush out and you know work for a hundred percent commission companies or something like that that you know don't take a big piece of the pie but when they do that if they if that comes along with a lack of training you know it's a huge mistake because like you said when you go and get your license all they do is really teach you how to stay at a real estate jail they don't really tell you how to run a business you know so you might know the legalities and the ins and outs of that but they don't tell you how to get a client or how to take a contract from contract to close and who do you need to hire you know where the inspectors who are the good inspectors you know all that kind of stuff is just things you learn over time and it's better and stuff trying to figure out that stuff on your own to you know work with somebody else who's already a pro I would second that or than third that and vote for you a hundred times if there smoting available on a podcast because I was that person I was oh I'm not going to go and get my real estate license because they're gonna take 50% of my commission but then 50% of a deal is better than 0% of a deal and when you first get into that contract you're like oh god what do I do now and we got you know maybe you've got an experienced agent who's asking you for things and you're like I don't even know what those words mean working with it you don't have to sign on for a team and be there for the rest of your life right indentured servitude you're there to learn and you're not learning anything in real estate school you're learning how to pass the licensing test and that's kind of really all that you're learning and I wish they'd revamp it you know cuz this is such a huge part of somebody's you know if financial picture helping somebody buy a house that you know if you're I helped somebody buy a house I got a nine thousand dollar Commission I should know what I'm doing if you're gonna pay me nine thousand dollars mm-hmm yep okay Scott all right what is the most difficult question of the famous four here what is your favorite joke to tell at parties oh this is the whole reason I wanted to do the podcast nice yes all right what do you call a cow with no legs I don't know what ground beef what do you call a cat with two legs I don't know what lean beef nice that lives next door to me I haven't heard the lean beef I heard the ground beef but I forgot the answer okay all right I've got what I've got one this this week two actually so this kid goes it goes to swallow some coins and gets taken to the hospital right and the parents are worried sick but they have to go home for the night little kid stays over and so they call in the morning and the doctor says and they say how's my kid doing and doctor says no change yet okay Scott you need to have some kids so you can share with these yesterday Daphne said dad your dad jokes are terrible like yeah that's kind of the definition of a dad Jeffrey aha so my kids in the neighbor's kid doesn't they ask Alexa all the time for jokes and so we've come up with a handful of good ones yeah we just got a one of those things maybe it's Alexa and the girls are just sitting there all the time table okay dawn where can people find out more about you all right so my website is trailwood Realty comm I'm always on bigger pockets I'm a moderator there now so that's part of my job also is to be in the forums and chatting with people and really the only social media I use regularly is Facebook I have the Instagram and Twitter and all that stuff but on Facebook is where I will actually spend some time in my profile is Gio but that o is a zero so G zero heels yes in chocolate all Tarheels nice it's awesome okay done thank you so much for your time today this was really awesome I love this story because not just I'm a real estate agent but I love the story because it's an easy way it can be an easy easy it's not the right word Scott I didn't say repeatable way it is a repeatable way that does not cost a lot in time or money to get started that you can increase your income with no ceiling yeah it's a great alternative if you're feeling stuck like your career has a ceiling or something like that you know it tooks to begin exploring maybe moving one spouse into this type of of career with this kind of in this type of commission thing and what a great place to become learn how to become an agent when we're already talking about real estate all day long anyways great well and this is you know we didn't even get into this you don't have to quit your job to become a real estate agent you could take your coursework over the nights and weekends you can I mean when are you working as a real estate agent nights and weekends because you're helping people who have jobs buy houses and when do those people have time to go look at how is not in during the weekday it's nights and weekends and you know this goes it's just you know you can start off you can figure it out you have one closing maybe two closings and you have made all of your money back yep so you just really have to have that first one and it's you can represent yourself in your own first property deal and then figure out hey I like this I hate this you know whatever but you're you kind of make back everything and then your ongoing costs are not that expensive yeah outside of you've got like licensing fees and MLS dues and stuff like that so the cost the ongoing costs are are not terrible it's you know maybe very basic at least our area between licensing and paying your board dues and stuff maybe $2,000 a year you know you got to take continuing education credits you got to renew your license you've got to pay your MLS – I was trying to think I'm like I know I have expenses no yeah so very little upfront cost very little ongoing cost you know it's just if it's interesting try it out at least look and see how much time it's gonna take you to get licensed mm-hmm but this is absolutely repeatable so okay done thank you so much for your time today we really appreciate it thank you guys it was great talking to you it was awesome talking to you too and I'll see you around the forums yes you will okay bye bye great bye all right that was dawn brenigan Mindy what you think you know Scott I love her story I love that she didn't decide to just stay in this comfortable job that wasn't really making a lot of money she decided to go out and get a real estate job she didn't stay in that comfortable position where she was making what like $30,000 a year she saw that other people could make a lot more money and she took the leap she made all the all the choices that she had to make to get to the point where she is now at multiple six figures is that how you say $300,000 a year multiple six figures while still spending very low six figures I mean is she she doesn't have to limit herself to you know $10,000 a year or $25,000 a year and still on the path financial independence yep well then and I think you know I definitely point out also the the frugality component and the basic money management that I think was helpful contributor enabling her to pursue this career yeah the foundation that her parents gave her by not hiding how much things cost really put her leaps and bounds ahead of where everybody else was and you know she still made poor money choices but she made smaller poor money choices then probably a lot of her friends did yeah absolutely and that just all builds up and leads you to this financial position of peace and security well should we get out of here we should from episode 72 of the bigger pockets money podcast this is mr. Scott wrench and me Mindy Jensen signing off

How to Save Money on THE BIG 3 Expenses

**How to Save Money on THE BIG 3 Expenses**



Views:5137

Rating:4.30

View Time:4:32Minutes

Likes:111

Dislikes:18

In this video, you’ll learn how you can save money by cutting expenses on THE BIG 3 – housing, transportation, and food.

Craig Curelop shares the best ways to save the most money on what are commonly more than 50% of your monthly expenses with simple tricks and personal finance tips.

Cut expenses and start saving money to jump start your path towards financial freedom with these personal finance hacks!

———————————–

Join BiggerPockets –

Check out Erin Chase from 5 Dollar Dinners –
what's up bigger pockets in this video I'm gonna show you how you can save and what likely are your three largest expenses housing transportation and food here is a chart of the average Americans expenses as you can see 33% of that is housing 15.8% is transportation and 12.8% is food take a quick second and look at your own life this seemed pretty accurate to you now let's get into how we can lower these monthly expenses first up housing housing is by far the largest expense but also probably the easiest to cut down if not fully eliminate house hacking is when you purchase a 1 to 4 unit property you live in one part of the property and rent the remaining parts out in many cases the rent you collect will cover your mortgage and thereby completely erase your housing expense there are many different ways you can house HACC whether its buying a duplex living in one unit renting the other or buying a single family living in one room and renting the others there is likely a strategy out there for you and check out this video in the comments for the 5 different ways that you can house HACC next is transportation transportation at 15.8% is the second largest expense for most Americans the average American has a 10-mile commute how do you reduce this the best would be to kill two birds with one stone buy a house hack close to where you work close enough where you can get there by either foot bike or public transportation once you free up your car you can then take it a step further and put it on this car sharing site called Toro Toro is the Airbnb for cars so you can rent your car to other people when you are not using it after your house hack and eliminate the need for your car you will likely have completely eliminated what are your two largest expenses and last but not least food unless you work at Facebook or Google where food is always free is nearly impossible to fully eliminate your food costs though I bet you can reduce them quite a bit first things first limit the number of times you go out to eat and limit the amount you drink meals out are typically three times more expensive and if you were just to cook them at home on the rare occasion that you do have to eat keep it light when I go out I usually eat before I go and so when everyone else orders their meal I will typically just get a water and maybe an appetizer the experience is the same but the bill is much cheaper okay so now that you know to limit the restaurant eating we will show you on how to save on groceries Aaron chase at five dollar dinners and guests with a bigger pockets of money podcast show number three talks about a ton of ways to save on groceries I highly recommend checking out her site at WWF intercom at a high level the idea here is that there are three ways to save on groceries before you go into the store while you're in the store and when you leave the store before you go into the grocery store download your grocery store's app see what main meal items are for sale and cater your weekly meal plan to what is on sale and create your shopping list based on what you find while you're in the grocery store this is the easiest to say but the hardest to do only buy what is on your list grocery stores are designed to make you walk by all the foods you do not need to get the ones you do every notice how milk and eggs are always in the back corner be mindful of this don't let them win get in get what you need and get out after you leave when you leave the store you can download the apps like checkout 51 in Nevada these are apps designed to give you cash back after you buy certain items once the app is downloaded pick the store you shopped at take a photo in your of your receipt and the money will flow into your bank account there you have it by taking action on any of these items you are sure to save a significant portion of your income if you take all three you will likely be saving up to 50 percent or more remember reducing your expenses and living frugally is the first step towards financial independence it's definitely not easy and not for everyone if it was then everyone would do it my suggestion is to buckle down for a few years completely eliminate your housing and transportation costs while reducing your grocery bill as explained in this video save the difference and let the nest egg build if you like this video be sure to hit the like button below and subscribe to the BiggerPockets youtube channel for more videos on building wealth and attaining financial freedom you