How to Turn Cheap Land Into "Forever Cash" and Build Smarter Income Streams

0:00So, the couple of ways that we protect ourselves is that we actually usually don't buy the land, but we only put it under contract with like about a 6-month close of escrow. So, again, we're dealing with people that don't care. They're They're signing. They don't care if you tell them like you you tell them I'm going to close as soon as possible, but I but it just in case there's some title issues and other things, I need like 100 day 180-day close of escrow time. So, you give yourself half a year to resell that property. So, we put it under contract for up to half a year, and after half a year, the contract expires, and so that means you have half a year to sell it.

0:38We're using our marketing strategies that we have defined refined and learned and mastered over the years, that should be very well possible to sell that actually a well a well-priced and well-marketed piece of land should sell between 14 and 60 days. So, between 2 weeks and about 2 months it should sell. And if it doesn't sell, then then you have priced it wrong or you have advertised it wrong. That's kind of our experience. So, with that said, number one, we are we don't buy them, we just put them under contract, so the responsibility stay with the seller for the time that's in escrow.

1:14Number two, we we actually reserve the right in our contract to actually cancel the agreement. So, we literally have a provision in there that says we can cancel the contract anytime for any reason. So, if we find something that we don't like, like for example, we once we have it under contract, we do all kinds of research. We We check, for example, with the Environmental Protection Agency. We check if there is any kind of like chemical spills in the neighborhood that might have negatively affect that property. It's usually not the case in In over 5,000 deals that I've done, there's there's I've never I found one property like that, and that was actually a wasn't even a piece of land, it was a former chemical factory that was burned up and abandoned, and obviously just by the fact that it was a chemical factory, it raises all kinds of alarm flags.

1:59That's the only one. Never again had never never otherwise had any issues. But, let's just say you find something like that, and you say like, "Ooh, I don't want to deal with that deal." You simply cancel the agreement, so you back out. The second the third thing is that we actually don't usually put earnest money deposits down. Or if we do, we put like 20 bucks, 50 bucks, 100 bucks. So, worst case scenario, if you put 50 bucks as an earnest money deposit and you cancel the agreement, you lose $50. So, let's say if you do 10 deals under contract and you cancel one, you make nine times 10, 20, 30 thousand dollars, and one time you lose 50 bucks.

2:35I think that's a that's a trade-off that everyone is kind of okay with, right? And so So, we you do that, so you really got nothing to lose on the deal, and you're never going to get stuck with a property, and it never actually becomes your problem. And then the moment you have it, you then use our our marketing strategies, which first of all is there's lots of different websites that you can put it out there, Facebook Marketplace, Zillow, land.com, but then nowadays actually, particularly today today these days, realtors have actually caught on to the fact that land is actually an asset class that's the up-and-coming, and there is every market usually has several really good land realtors, and they they can sell these properties very very quickly if the price is right, because they know how to properly market it.

3:22So, you don't even have to market it yourself anymore these days. We had to do again, we had to do all the hard work. There was zero realtors out there that knew how to sell land, and to and so we had to figure it out how to do this ourselves. Now, all we need to teach you is how to find a really good realtor in the area, a land realtor, we use even AI for that, and then we can we can we can we can list it, and the realtor sells it very quickly, and and gets a nice commission, and but you still make the majority of the money on the deal.

3:52So, in other words, it's really the downside is pretty much almost risk-free. And the upside is is is is obviously immense. — Yeah, that's super interesting that you can just put it under contract and you know, it gives you the ability to sell it and everyone's going to work to sell it, but if not, you know, that's the agreement. And that makes sense. It's funny cuz we just built a couple of duplexes in Southwest Florida and one of the things we had to do was a study for tortoises.

4:24So, if if a tortoise makes its house — with them. — Yeah, yeah, so it's like I think it's like five grand to to relocate a tortoise to a new home. And so, if they find like multiple tortoise houses on your your property, then basically the deal doesn't make any sense anymore. — make sense, yeah. — Yeah. — Tortoises, also Southwest Florida, there's a bird called the scrub jay, which if that nest's there, you're done. You can't you can't you basically you you're not allowed to cut trees and things.

4:55You're not allowed to really build there. There is in California has certain tortoises, too. That that that's some of these environmental things that you got to be aware of and then and and that sometimes kills a deal. But in that case, usually like you you you you cancel the deal and you even get your 50 bucks back on those deals, yeah. — Yeah. I'm curious what what this forever cash model is. I love the sound of that. And I'm sure other people would be interested. Can you kind of define what that how that works? — Yeah, it came really out of out of out of that same strategy of land flipping, we started realizing that that there's really three kinds of we call it three kinds of cash, but it's really three kinds of way like if you have three dollar bills, they all look the same, but how they were

5:43Generated makes It's difference. And so, the first general the first dollar bill is the what we call one-time cash. And one-time cash is really how most people operate. And that is like you go exchange dollars for hours. You go work work 8 hours, you get paid for 8 hours. You work 40 hours, you get paid 40 hours. And and if you don't go to work, you get fired. Or if you go don't go to work, you don't get paid. Like obviously, this is very clear if you go like as a waiter or something you get paid hourly, that's very clear. But most salary jobs are the same thing.

6:15Even though people say like, "But well, I'm I'm on a salary. I get paid every week." Well, like try not showing up for a few days without excuse, and you know very quickly how how la- how long that last. You're fired and and the paycheck stops. So, it's one-time cash because you you you work do the work one time and you get paid once. The second kind of cash that we talk about is like the second dollar bill represents what we call temporary cash. And temporary cash is cash that you work for once, but you get paid again and again and again and again, but it ends.

6:46So, when we started doing these seller financing deals or money lending in general, is is is is is is that is temporary cash because you sell the property once, they put $10,000 down, they sign a loan servicing loan agreement that the remaining $40,000 they're going to pay in five and you charge interest, they're going to pay the remaining $40,000 in monthly payments of $500 a month, let's say I don't know, 15% interest for the next 15 years, and they pay monthly payments, then you just generated cash flow.

7:18You only had to do the sale once. But the cash flow comes in again and again and again and again without you ever having to do anything until it's paid off or if they default. Well, in that case, you foreclose, and then you resell it again. But it's still you you work for that. Also, contract work would work operate like that. You sign a contract that you that for the next year you're going to provide XYZ services. That's like recurring businesses, recurring revenue businesses that kind of operate like that. You sign a 12-month contract and all they do is install a security system at home and have somebody monitor it.

7:53There's no real day hourly effort involved in it anymore, but the cash flow keeps going for for 12 months until you can cancel. Like gym memberships, you pay monthly, you locked in for that. For the gym membership, it's it's temporary cash because they locked you in for a year and most people don't even show up at the gym. So, it's not like they're So, so that those things are all temporary cash and in case for us, we particularly look at it from our cash flow from land sales with seller financing. And then the third kind of cash is is forever cash.

8:26And forever cash is really you do the work once and you get paid forever. Now, what is that? Patents, royalties, like patents that you actually sell to somebody, you get royalties, even though that could even be temporary cash if it's limited in time. But it's really rental properties. Like like rentals, short-term rentals, long-term rentals, apartment complexes, things like that where you own the property forever and you just put a new tenant in on an ongoing basis and you get and you get cash flow from there forever.

8:57So, one is is different from each other and there's qualitative differences. The None of them is bad. I mean, if you can do what I if you can pull off like I if you can be Michael Jordan and and get a million dollars to show up at somebody's birthday, well, great. That's perfect. That's great one-time cra- cash. It's much better one-time cash than mowing the neighbor's lawn and getting 20 bucks to mow the lawn. Both is one-time cash though. Like if if you stop like flipping, the house flippers.

9:29Like the whole the wholesalers of the house, the fixer flippers, they're all one-time cash. You're talking about to have a business, yes, but But moment you stop flipping, the income stops. Right? So, that that more that that is the definition of of one-time cash. So, one-time cash is good and there's different qualities of one-time cash. But what's better is temporary cash because you do the work once and you get paid for a year, for 2 years, for 10 years, for 15 years, for 30 years, whatever it may be. And the best of all is forever cash.

10:00So, what we have basically what what we have what what what the book is about, which is out of print right now, but you can get copies. It's called Forever Cash. You can copies on Amazon as a used copies. And I need to actually republish it one of these days, but haven't had the time to do that. But the book is really about is talks about, "Well, how do I move from one to the other?" And and what you eventually want to move towards is forever cash. So, the reason we have apartment units and commercial properties and we own even a hotel and we own car repair shop and we own single-family rentals.

10:35And we have an Airbnb, just one, not many, but just just one. Is very simply that we take in the money, we look at what we do on a daily basis. All our active income businesses, which are one-time cash businesses, like coaching business, our land flipping business, any other businesses I either own a piece of or I'm actively involved in, and we're taking as much cash from those as we can and moving them directly always over to buy forever cash assets.

11:09So, we're looking at it. You need the basically the premise of the book is that first understand the three kinds of cash and then the second part is build what's called what we call a cash machine. Build something that for most people that's not your job unless you're an executive somewhere making hundreds of thousands of dollars. For most or a medical doctor or something that is making like a specialist making a million dollars. Like for most people the job just pays your bills and you need to do something outside of your job that can explode your income and then you keep your living This is a key.

11:43You don't expand your lifestyle along with the income. You keep your lifestyle. You just live off your job, period. You keep the same that apartment. You stay in that small house. You keep the old car. You don't go crazy. You just take every single dime of that extra income and move that into forever cash assets. Again and again and again until you build what we call the security plan where you basically the income from the forever cash assets allows you to in a worst-case scenario if something dramatic happens, you lose your job and you need to retire on the absolute minimum, it covers that.

12:19And then you keep going at that point. You keep going until you have what we call a comfort plan in place. And a comfort plan is when the cash flow of that lets you live comfortably. And if And at that point you can quit and you can stop and you can upgrade a little bit or you keep going until you have your luxury plan in place, which means that your cash flow from these forever cash assets is so much that really you can do whatever the heck you want in life and it doesn't affect your your your your life. It doesn't affect your life. — I love that.

12:50I love You are speaking my language. There's a book called Effortless. Have you read that by McKeown is his last name. Drawing a blank on his first name right now. Greg McKeown. — Greg McKeown. Yeah, yeah, yeah. I have not. I've read He wrote a different book, I think. I've I've — Yeah. He wrote Essentialism, yeah. — Yes, I I read that. Love Essentialism. Have not read Effortless. I will put that on my list, but yeah. Yeah, this is This is just the core strategy that we've lived.

13:22I mean, now I'm driving a beautiful as a new car that was a almost a $300,000 car, a a 911 Turbo Convertible. And but you know when I bought it, I could have bought that thing 25 years ago. And 25 years ago it would have killed me. It would have taken all that seed money that I have created and would have just burned it, right? Because the car 25 years later would probably worth 50 grand or something like that now. But instead, I moved that money over there and now I drive the car that and it doesn't affect my finances whatsoever at all, right?

14:02I had to wait for the car. Mhm. But now I can buy myself a car like that once a year if I want to, right? Just not that I would, but but but the point is by you most people have it backwards. The moment they make money, they upgrade their lifestyle. And what you need to do is the moment you make money, you need to invest that money so that later on you can live a lifestyle without work. — Yes. — Yeah. It's I I think it's such an important distinction that people need to understand is that a dollar is not a dollar, you know, that dollar that is made one time is so different from the dollars that you're making from your dollars because you buy that that Porsche from the dollars from your dollars and they just keep showing up.

14:43But you're right, it's it's gone if you bought it from that one time dollar. So yeah, I love that. I love that and that's exactly what I teach too with living off rentals is just, you know, that that's why you're creating these streams of income so that you can actually live off the recurring income over time. So — But you're right, I'm a big We we we believing in the exact same thing. We're speaking each other's language, yeah. — Yeah. Yeah, it's so important. I'm curious about a few different things, but I want to I I I want to get your perspective on something.

15:16You You said you met your wife when you came over here to the US and you guys have been working together ever since. So it sounds like you got a a spouse and a business partner at the same time. I'm curious what your experience has been like working with your spouse over the last 25 years or so. And then also what advice you have cuz I have I have a lot of listeners who who are in that same boat where they want to be in that same boat you know, work with their spouse and build build wealth together. But I know there can be obviously challenges that come up, too. — Yeah, absolutely.

15:47I mean, it's the most beautiful thing I think we've done and the hardest thing we've done. So, is working together because first of all, we are the weird kind of couple that loves being together 24/7 to the to this day. 24 like we are we're like we are together. We I'm I'm here at home. I'm in the home office. My wife is right now the doctor's appointment and she's going to be back later on and going to have dinner together with our daughter. We're very tight with our daughter. She's she we have only one child and it's usually three of us.

16:19And sometimes sometimes we take off and we go travel 2 months a month one between one and three months to Europe and we're literally 100% together 24/7. The most we're separate from each other might be 45 minutes. And we love it. So, this is weird. Some people like I'm describing your worst nightmare some some people. But but I would assume that if you work with your spouse all day long, this is not your worst nightmare because otherwise you you wouldn't work with your spouse. So, if whoever does that is a So, lessons learned or the challenge is very simple is that what we have learned is that your roles need to be very clearly defined.

16:54You need to be very clearly what who's who's area of responsibility is what. And in our case, something strange has happened. It used to be that I was the CEO and she was the COO. In other words, like she would be she's she's very detail-oriented. She's very fact-finder. So, and very great in organizing. And so, she used to be like the one or like running all the operations and I used to be the one more in charge in the land business or in the land business first of all she used to be the one in charge of acquisition I used I'm the one in charge of disposition.

17:29So so that's how we split things and so I and I was selecting the new areas we want to go into the areas we want to market to the list we download the who we contact and things like that but then as as offers were made and and offers came in all the all the all the part to to getting these properties doing the due diligence and everything checked and so that was all by her. So so that was our role separation and that worked really well it worked really well as we added additional businesses we we also made sure that we have those roles really separated however then something interesting in our case happened is that my wife actually got sick and she got Lyme disease so you got bitten by a tick somewhere and this is one of the most under under

18:18Reported in my opinion illnesses out there and she ended up literally being bedridden for two years and and almost like operating on two hours a day the rest of the time she was in bed and and it affected her all kinds of different areas luckily we have our business luckily we have now this forever cash we were able to afford the best doctors we were able to get her to a six week treatment in Europe that cost almost 100 grand and and she came back bouncing back she came back of energy she's operational she's great she's doing well but the point is the but her style changed like this experience she went from super detailed and so on to to a little bit more of that CEO kind of person with a visionary and more things and so actually over the years it shifted and I became more the CEO and she became

19:07The CEO of the company so she's basically she's much better at the vision and at the strategy and things like that. And I basically had jumped into the area of then running the day-to-day and running all these kind of things because simply she couldn't. And and I think the lessons learned is that we enjoy working together. We always clash if we both try to do the exact same thing because we're both very strong-headed and very kind of type A personalities. But the moment it is clear that one has has what who who who has what role and we agree on on what to do, it became very easy to operate together.

19:42So my my my my my advice to everyone is like make sure that you have your your areas of responsibility, your decision authorities very clearly defined. And then and then and then it shouldn't be a problem cuz then everyone can operate in their own area fully without having to constantly ask the other one and and and constantly like get into get into problems with each other of of now I wanted to do this. No, you should do this. No, this. And that's where you kind of like clash heads left and right.

20:13And we've done plenty of that, let me tell you.