From 9th Grade Dropout to Early Retirement with 150 Real Estate Units

0:00Those first deals were horrible. — They were horrible. They were absolutely — usually the case. — Yeah. Yeah. So, you know, so I needed to buy I needed a place to live and so it was very utilitarian. I had to have a place to live and you know, working the software look working the software job. I had to find a place to live. So I I basically I find a place to live and I'm like, "Okay, cool. I've got a place to live and I go to try and get a mortgage because I was able to save my money back up because I was saving to, you know, put a down payment on a house.

0:30I'm 23 years old. I'm ready to go buy something. And the loan officer laughs at me. He goes, "Dude, do you know how to do math? There's you can't afford this place." And I was like, "What do you mean I can't afford this place?" He goes, "You don't have income for long enough and you it's it's generally speaking it's too much and it's going to be all your money for a down payment." And I was like, "all right." I said, 'All right, so then how do I do it, smart guy, since you know all the answers? And he goes, 'Well, I mean, you got to get a renter in there. And I go, "What do you mean?" He goes, "Rent out a room." And I go, "Okay, I'm listening." And then I put out a literally send call all my friends because I don't think test me much of a thing.

1:07Then call all my friends and I'm like, "Hey, listen. Would you want to live in this area?" And a couple of them were like, "Yeah." And then one of them was like, "Yeah, in fact, my lease is coming up and my lease is, you know, 1,400 bucks a month or something for, you know, whatever we're living in." And I was like, "This is a nice luxury condo like on the water. It's going to be expensive." But we go back and forth and sure enough, he's signs on for a,000 bucks. My mortgage payment was going to be 2,400. I was paying 1,400 bucks a month to live there. He was paying a,000. But I was living in a condo on the water where everybody in the building was old enough to be my parents. — you know, I'm doing it at, you know, 23 years old.

1:41And then that just continued when I when I then got out of that house and I sold it. I got hit with a $70,000 condo fee assessment because they used the wrong material on the outside of the building and so it was all deteriorating from the salt there. And so I would I literally went from I'm going to make 80 grand to I made 10,000 bucks. I was going to make 80 and I made 10 instead. And so I was like, "All right, that's fine. I can still buy something else for three and a half% down." So I did. I bought another property and then signed in a couple of tenants that were going again roommates. They're going to live with me.

2:11And then I was like, "Hey, this is this actually really works. Like this could be a business thing. And so that's what ended up happening. I was I am one of seven people on the planet that has not read Rich Dad Poor Dad. I haven't read the book. But I'm one of those seven people that haven't done it. And people like, "Well, why don't you read it now?" And I go, "No, I can't. I got to die on that hill. I I haven't read it. I won't read it." I was like, I I don't know. — It's It's funny because I read it recently and it's it doesn't have the same impact. For some reason it's when you're when you're new — like and it's the first time you're kind of experiencing that mental model it's like has this huge impact and I I had Kiasaki on my podcast actually for the hundth episode and I asked him — why why does it you know have that impact on because everybody that comes on says oh the same thing you know and — he said when you figure that out give me a call because I've been trying to you know catch lightning

3:00In a bottle again ever since and it hasn't worked so — yeah exactly I I think he has enough gold and silver to sink a battleship so I think he'll be okay. Not to mention all the property. But yeah, I just kind of found the model worked. And so as as I was working and and I said, you know, I love my career. It was paying me a lot of money. I want to be able to continue to work in my job and grow my career. And it took, you know, 10 years and I got into executive management. And then I was in executive management for about 14 years before I retired. I retired last year from it. But I really love my job.

3:31Really enjoyed it. But rentals is what allowed me to essentially walk away at 46 and say, "I'm done. I want to be at home with my kids." but how you get all the way there is literally by just starting with one. And you know, you start with one and we house hack. You house hack as well. I mean, you have an Airbnb on the other side of your place, right? — Exactly. In our barn here. — Yeah. Like, why not? Like, I'm not so special that I can't share a wall or a driveway. It's I tell people it's the the single best personal finance decision almost anyone can make to eliminate your cost of living forever.

4:08Because it just pays you over and over. It's not like you get this onetime payment, right? — Like when that $2,000 or $3,000 a month mortgage is gone because someone else is paying it. — It it it changes things. — Absolutely. And I think the way that you've done it is even better. I think you guys have, you know, kind of supercharged it, right? Which is we have our own dwelling. We have our own space. We have our own barn. This is on the other side of a barn. Like, we're not managing it or taking care. We don't have to do anything for that. And I think that that's the key. I think you can start with the roommate thing and then once you get old enough, that's not cool anymore.

4:42And then you just get to renting out the other side and then you get to, hey, I have my own personal residence, but I have an asset that's there as well. We're going to eventually do that with our house. You know, we want to build, you know, a couple ADUs there that we can actually either put family in, or we're in a country setting where we abut 500 acres. You know, it's pretty easy where if people want to go get right with nature, then they can do that there. So, yeah, to to that that fast forward from nth grade dropout to that's how I got into real estate investing was I wanted something safe. I wanted something that I couldn't be cheated like the stock market.

5:15You know, if you're not if you're not in Manhattan having dinners and hobnobbing with these people, you're at a disadvantage. You just are. You're at a disadvantage, — you know. — Yeah. Yeah. It's interesting how politicians portfolios grow so much faster that — I think they're just skilled investors. They teach them a investment course. Maybe Warren Buffett comes in after they get elected and teaches them how to invest. That's probably what explains it. It's nothing to do with — insider trading. It's a miracle. They go to Congress and they're making 100. They're worth 150 grand and then within 10 years they're worth 20 million.

5:47— Yeah. — Amazing. Exactly. Amazing. What benefits? What benefits? — so I want to talk about the deals that you've done, but I also you you mentioned something. So you mentioned that you left your your corporate job a year ago, and I'm I'm curious, a lot of people obviously have that as a goal. This is called living off rentals. So that was something that that we did eventually. And and so for you, what was that like? Did you did you set like a line in the sand of like I'm going to get to this amount of cash flow first or you know what was what was the u marker for you that you felt comfortable leaving and then did it go as planned or did you have do you feel like you could have left sooner or you should have held out longer or how'd that how'd that work for you?

6:33— I mean those are all amazing questions. So, yeah, I mean, so I left, I left, it was the Valentine's Day present to myself in 2024. That that was my present to myself was you get to retire. And so how I got there was I could have retired at 35. I had enough income off the rentals. But I loved what I did. I love what I did. I loved who I worked for. I loved who I worked with. And so was really blessed at the situation that I had. And so, you know, never to never to look a gift horse in the mouse.

7:06It wasn't it wasn't always it wasn't only about money. It was about do I enjoy what I'm doing? Is this fun? Am I having fun? And that was kind of that. And I loved to win and I got to be an integral part to an organization because I was in charge of global sales and strategy for the company. And so I got to be an intricral part of the success. I touched 86% of the revenue that came in the door there. And so it was a lot of fun to be, you know, working on all those and and helping all those different hospitals that I was helping and what I was doing. So, I really enjoyed that piece. And then, you know, went to ownership and just said, hey, I I I think I'm ready to be done.

7:41I was kind of done. I was kind of done up here. I was just kind of like, I feel like I want just something new and something different. And so, it's cool, but I don't want to abandon them because they were loyal to me and they gave me a shot and I didn't want to be disloyal to them. So, we then put the company up and a year later the company sells. I'm enjoying the my time in the company. It gets bought by a big huge hedge fund. And they're, you know, telling me all the things and you're amazing and we want we see you as a as a as a management guy and, you know, being able to come on and and turn around other companies and and we love that about you.

8:16And I was like, that sounds all super awesome. And then they renegotiated my and then they negotiated my contract just after the first of the year. And they were like, "Well, we don't want you to look at it as a pay cut. We just want you to look it as an adjustment." And I was like, "I bet you don't want me to look at it as a pay cut." — An adjustment in the downward direction. — Exactly. Yeah. I was like, "It is adjusting, just not in a way that I would ever subscribe to." So, I literally walked out of my home office and I went to my wife and I just said, "I think I'm going to retire tomorrow." And she goes, "Are you joking?" And I go, "Nope." She goes, "Okay." I was like, "That's it?" And she goes, "Yeah, like you know our finances, you know the building." She's like, "You know the business we built?" She's like, "Whatever." I was like, "Man, I was expecting to have a bigger conversation about that, but I guess not."

9:04And so literally the next morning I called my boss and I said, "I need 10 minutes of your time." And he said, "Sounds good." And we had it on we had it on a Zoom meeting or a team's meeting. And I told him, I said, "I'm going to retire." And he was like, "What?" I said, "I'm going to retire." He goes, "What?" Said it four times. And he's like, I don't think you want you don't retire. Like people at your age don't retire. And I was like, I'm not quitting. I'm retiring. I'm not going to go somewhere else. I'm leaving the business, the industry. And I did. I left. And I could have done it 11 years earlier.

9:35I'm glad that I didn't. I just enjoyed my time. And then it was really I felt like and I knew what ended up happening was I was going to retire two years earlier and my daughter got cancer. And that flipped our world upside down. And so we needed the health care, we needed the support, we needed all the things that we needed in order to be able to go through that. And so she delayed it a couple of years, but you know, that was God's plan. And you know, the delay and so it just came to that on the other side where it's like, nah, it's time. It's time to move on and do something different.

10:07— Yeah. Yeah. Wow. Wow. Yeah. And what a I mean so great to be able to be in that position. You know, I I I I've talked to other people about that, too. I just had a a student of mine on the podcast recently who worked in a tech job when we started working together and he was real worried because at that time tech was kind of struggling a little bit and there was a lot of layoffs with you know all the big tech companies and he was a little concerned and so started building up cash flow and then when he came on the podcast he said you know I'm I asked him when are you going to get to financial freedom and he's like well I'm there you know but I like what I do and so — you know but that you carry yourself different, I think, when you come to work every day knowing — that I'm here because I want to be here, not

10:55Because you you're forcing me to be here and I'm not going to do anything that I don't agree with just because I have to, you know, and so so to be in that position is just, you know, I don't think people understand the freedom that that gives you. What what what's life been like since you left? I mean, what's changed or how how do you you know, how what what do your days look like now? — I spent a lot more time buying baseball cards. — Yeah. — Nice. — and you know, so the YouTube channel was part of that.

11:28It was part of the transition, right? I never wanted to do a YouTube channel, but I was watching this one guy and I just said, "Man, you need an East Coast perspective because I'm tired of listening to all these boneheads out on the West Coast." Yeah. — You know, and he was he was laughing. And I was like, it's just a different market in California. It's just completely different. And in every market, people make money. It's just how you crack the code for how to make market in that money and my money in that market. And so the days mostly consist of now, I mean, I run my entire company from my phone. That's it. I only need my phone to run my entire company.

11:59I have one employee to manage 53 buildings andund we're now 153 units and 400 tenants. So that's how we manage everything. I just manage it from my phone. It's really systems and processes. You know, what we teach a lot about in the course is everybody can teach you how to buy something. Most people never spend the time to teach people how to manage it. And so we, you know, I remember being at the closing table, my first property that I bought that was only to be a landlord. And I literally said out loud in front of the attorney and in front of the seller, I was a little bit embarrassing.

12:34And in front of the agents, too. I was like, "Oh I'm a landlord. Now what? And I had no one had any contact information for the tenants. No one had any of the, you know, hey, was this permit finished or hey, was this t like there were a bunch of loose ends and I was the idiot who just kept on robo signing, you know, so I'm cranking out the robo sign. And I was really realizing I didn't have anything that I needed to be an actual good landlord. And so I've spent the last, you know, 24 years perfecting the craft. Gotten really good at it.

13:07But that's how I can run my entire company from my phone. So, you know, I'm never a never further than a phone away from being able to solve a problem because we have systems, processes, and people in place that allow me to kind of do whatever I want. And I just have to I I like to say I'm the world's best paid professional email forwarder. Because that's all I really do. I just forward stuff to making sure it goes to the right people and it gets taken care of. But, I think everybody can be in that position. And I think I remember how hard it was when I started and how lost I felt buying my first one and I was like, I've bought my first one and then you're like, oh my word, now the work begins.

13:45I'm in trouble. — Yeah, — I have no idea where to begin. Like if something breaks tomorrow, I have no idea how to fix it or who to call to get it fixed. I was in deep trouble. So that's why we kind of did the course is because I think the buy side happens here and I think that the management side is what happens here, right? For 20 years, you're managing that asset in most cases, but for 60 days is what it took you to find it, do the deal, and close it. So, but everybody focuses on the buy. What they need to focus on is the management of the asset.

14:16And people need to start using that. Stop using property management. Start using asset management because that's what you're doing. This is an asset. — Yeah. — If you don't properly take care of it, in 20 years, you're going to have something you're going to have a property that isn't worth as much. — Yeah. In 20 years, I want to have an asset that has that updated roof, the updated heating system. We've done all the different things, maybe kitchens, this, that, and the other. — and now my asset's worth a whole lot more money, and the tenants paid for that to be upgraded through the years. And now I have an asset that I can sell, trade, or continue to hold on to and continue to bring money in on.

14:50— Yeah. Yeah. You can buy the best deal in the world, but if it's not operated correctly, correct, it can lose money every every single month. So, yeah, that's such a great point. I'm curious what you feel like a deal is like as you've expanded and grown. What metric everyone answers this differently and so I'm curious from your perspective like what makes you pull the trigger on a new new deal? — Wow, that's a great question. You're really good at this. What makes me pull the pull the trigger on a deal?

15:21So, I like to keep my guys busy in the winter time. So, I almost always will buy some really inexpensive single family house to make sure that they have work all winter long. — I like to make sure to take care of the people who take care of me. — Yeah. — So, that means making sure that if they're like, "Hey, I had a job cancel or I had this happen or whatever." And our carry costs over the course of an entire winter, not the big a deal. Now, we can bang that house out in 30 days if we wanted to, but we take six months. Why do we take six months? Because I want to make sure my guys have work in the winter time. That I can always point them over there and go, "Hey, you can go over to the project house and do X, Y, or Z." — Yeah.

15:54— and so they do that, but it takes six months instead of 30 days to do that. So, I get a reduced rate, but they still get to make some money through the winter time when they have when they have dry spells. — But when I look at market, and so that's for kind of keeping the guys busy in the winter time. When I look at a deal that we're going to hold, very often now, it's a deal that when you get to the size that we are, we don't need the next deal. We need another great deal. — So when people say, "How big are you going to get?" I don't know. Depends on how many great deals I can find. So really, every deal that we do now is one that just comes across, we are like, "Holy cow, is the cash printer in the basement." and so we just bought a building.

16:33We bought it from a city and it was an old retired police station that was just sitting there rotting. We were able to buy that 8,000 foot building for only $200,000. We will spend a million bucks. We'll spend a million bucks redoing that building, but when it's all said and done, that building will rent out for about $18,000 a month with debt of about $7,800. — Wow. — Nothing wrong with $10,000 buildings in your pro in your portfolio.

17:06— Yeah. Yeah. Exactly. — I can afford a lot of life. So, what I look for now is kind of those unique weird opportunities where somebody's just like completely fatigued and they're just absolutely done. But we're not out there actively going, "Hey, we really need to find the next deal." Like, we just don't really do a whole lot of that. It's much more you build up like you have, you build up your reputation, you see enough things hit MLS, you see enough agents, you see enough lo other local investors, and that eventually just starts to you're like, "Oh, wow. That deal kind of sticks out as something interesting." So now we play a lot more of the zoning game, you know, where it's like, no one's using.

17:45So we bought a piece of property, it had a duplex on it. So because it's not just raw land, we could actually finance it because it had a had a duplex on it. And we do the research or I do the research and I find that it can actually take a 20 unit building. And right now it's got a duplex on it. — Yeah. — So I go through the process and I'm like, yeah. So we buy it, we make a strong offer. We weren't the top offer. I teach something called the reverse offer strategy, which I'm rarely the top offer, but I always win deals that I want. And it's the reverse offer strategy, which is a a long process, but long story short is it's basically engaging on a human level and having the agent describe to you what the three top priorities are of the seller.

18:28— No one ever asks that. Everyone just — you go directly to the listing agent. — Yes. — Yeah. — Yep. Or or even with my agent, we just sit down. And we just say, "Hey, we just want a quick 10-minute meeting with you if we could." — Okay. — Like, "Yeah, sure." So, we just do a joint phone call. We just say, "What are the three most important things to the seller?" And they're just like, "What do you mean? How do you not know this? You're the listing agent. Like, do they need to leave quickly? Do they need help emptying the house? Are they worried about repairs? Do they not want to do inspections?

19:00What are they worried about? What are the three things?" And we did that deal buying that piece of property because the woman was like, "I have no idea. I've been here for 30 years. I have no idea how to get dumpsters and how to get it unloaded." We literally told her, we said, "We'll get you dumpsters." We put two 40-yard dumpsters on site. We said, you know, she's like, "Everybody wants to close in two weeks." She was like, "I really need 90 days." We gave her 90 days. — And then we said, "After the 90 days, do this. Tag everything. Basically take everything that you're not going to that you're not going to keep and everything that you leave behind we'll fill the dumpsters with.

19:36— And that's what we did. — Nice. — And that's how and we were the number nine priced deal. We were the number nine offer. — But we won because we took into account that she was just a person and that we're just people and we wanted to lighten the load for her and not get her stressed out. But we bought that asset and that was a duplex. I paid 227,000 bucks for it. And as a duplex now, it's worth 500. But as the piece of land that I can build a 20unit property on that the agent didn't do a very good job of doing the research to find out what the zoning was, it's it's a million dollar piece of land. — Jeez.