BiggerPockets Money Podcast - 181: A Slow, Steady, and Sustainable Way to Buy Rentals with Julie

Episode Date: March 22, 2021

You may hear of 20 year olds with $1,000,000 in real estate, or a novice flipper doing 50 flips a year, or even a wholesaler who made six figures on one deal. What about the everyday investor who slowly grinds and acquires a steady stream of passive income all while building hundreds of thousands in equity overtime? Those are the real people in real estate, and that is a success story worth sharing. Julie, software engineer and former BiggerPockets employee bought her first house after realizing that a mortgage would be cheaper than her rent. After getting together with her (then) boyfriend, they decided to buy a bigger house. As her first house sat on the market, she waited for an offer, and then made the decision to rent it out.  A few months after buying her second home, she broke up with her boyfriend. Problem? They were both on the title and mortgage. Julie had enough money in her cash reserve to buy him out of the property. Now the property was all Julie’s and she rented out a room to help her pay off the mortgage. Now Julie has 7 properties, spread out across Iowa, Tennessee, and Kentucky. All with very interesting stories, and all pay her passive income, every month. Julie is proof that with some financial restraint, you can slowly build a real estate empire, without even trying to do so in the first place! In This Episode We Cover When you should own and when you should rent a house The dangers of buying a house with someone who may not be in your future Why you should borrow less than you’re approved for The importance of keeping a substantial cash reserve available for investments  Never rent to someone who has no credit, no references, and no job Diving into real estate, even if you don’t know all the tips and tricks yet And So Much More! Learn more about your ad choices. Visit megaphone.fm/adchoices

Welcome to the Bigger Pockets Money podcast show number 181, where we interview Julie Kent, a software engineer from Nashville, and talk about keeping up with the Joneses and purchasing on your timeline from a position of financial strength. I think when you get into real estate, it's so very, it can be very exciting, can be very daunting. And there's kind of similarly with everything in life, there's always going to be someone that has amassed more wealth than you. Like anything in life, there's someone that's better than you in every. thing. And at some point, you've got to, like, not let that bother you, I guess. And I'm as guilty

as that as anyone. I read stories about the people, like, the headlines of like, this person's 26, and they didn't. A million dollars of real estate deals last year. And I'm like, crap, what am I doing with my life, you know? Clearly, you're just a big loser with only having seven properties. Yeah. So, but, yeah, I think, like, celebrating, like, small wins is important. And, and, and also like learning to love the journey. Hello, hello, hello. My name is Mindy Jensen. And with me, as always, is my,

I've recently discovered scotch, but I only like the gross peatiescotches that taste like I'm drinking dirt. Co-host, Scott Trench. Your intros are just always on the rocks, Mindy. Let's keep moving. Scott and I are here to make financial independence less scary, less just for somebody else.

To introduce you to every money story, because we truly believe financial freedom is attainable for everyone, no matter when or where you're starting. That's right. Whether you want to retire early and travel the world, go on to make big time investments in assets like real estate, start your own business, or just slowly buy a handful of rental properties over the course of a decade. We'll help you reach your financial goals and get money out of the way so you can launch yourself towards those dreams. Scott, I am so excited to talk to Julie today. She is a former Bigger Pockets employee,

so it's always nice to catch up with them. And she has a really great story about investing. in real estate, as you alluded to, by buying a handful of properties over the course of a decade. And I like her story because she focuses on buying when she's comfortable, not because somebody else thinks that she should or because she thinks she should because somebody else just bought. And I think that's a point that gets a little bit lost sometimes. Absolutely. Mindy and I are friends with Julie. She used to work at bigger pockets. And she's got a great story that I think is really what is the story of the story of real estate investing in America is for most people. We always hear about these folks who are buying

a million properties at once and doing a bunch of burrs or whatever. But most rental properties are owned by people like Julie, not by people that are doing dozens or hundreds of deals and own a ton of properties. Most properties are owned by, I will call small millionaires. See how that one to two to three million dollar net worth range accumulated over a long period of time. We don't actually get to know Julie's specific net worth at this moment in time. But if she's not there yet, she'll be there soon. And she's doing really well. And it's fantastic. And this is a perfectly appropriate, wonderful way to invest in real estate and build wealth over time. It's exactly what I've been doing and what I intend to do with my portfolio over time.

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podcasts, and a massive back catalog across business, health, parenting, and more, all accessible in one app. If you're looking to turn everyday moments into real progress, audible has been indispensable for me over over 10 years. Kickstart your well-being journey with your first audiobook for your first audiobook for free when you sign up for a free 30-day trial at audible.com slash BP money. Julie Kent, welcome to the Bigger Pockets Money podcast. It's so good to see you. So good to see you too. It's been a while. It has been a while. Julie Kent is a former developer for Bigger Pockets, and she now lives in Nashville, or just outside of Nashville, where she is amassing a real estate

empire, courtesy of all the information she learned during her time at Bigger Pockets. So Julie, let's get started on your money story. Where does your journey with money begin? Yeah, so I grew up with a family structure that definitely instilled frugality and saving and not spending more than you make, which I feel very lucky to have had good role models in my life. And that kind of helped put me in a good position for when I did want to start getting into real estate. I had some capital available to do that. So yeah, I bought my first. property in 2010 graduated college and the government was offering the first-time homebuyers tax credit. And so I got a job out of college, had some money lying around, and decided to take advantage

of that. And that's kind of where it's where at least my real estate journey started. You walk us through the house and how that contributed to your wealth story? Yeah. So I seem to get myself in situations a lot where I'm moving to places that I've never been before and like buying properties where I've never lived before. So yeah, I just kind of like found a house that looked reasonable that was in budget and just did it. And it was kind of scary. Where was it located? It was located in Windsor Heights, Iowa, which is like kind of a suburb of Des Moines. And did you have a job there? Yeah, I had accepted a job and had thought about renting. just decided with that tax credit that I should buy a house.

And did you do any, like, running of the numbers, or did you just decide, hey, I can afford this much house, so that's how much house I'm going to buy? Yeah, I, you know, kind of thought about what the monthly payment would be and how much I, you know, felt like I could afford comfortably. I definitely wasn't looking to purchase anything extravagant, just being, one person. I knew I didn't need a huge house. And at that time, I mean, real estate in Des Moines is still fairly affordable. So it wasn't super difficult at that time, especially given economic conditions, to find something that, you know, wasn't too expensive. I think I paid $129,000 for that first house. Okay. And what could you have bought if you had qualified or maxed out to your debt to income? I don't remember for that house, but I do remember when I went to buy my second house. I was dating someone at the time. And we got pre-approved for like $575,000. And I was just like, this is insane.

I imagine that when you started out your career, it was in software development. Is that right? No, my first job out of college was more in kind of like business finance work. Okay, can you give us a ballpark of the income in that first job? My starting salary was $50,000. Okay, so for context, when I bought my first property in 2014, I was making a little under $50,000 a year. And I qualified for like $250,000. And so the point I'm trying to make is that, hey, yeah, maybe this wasn't like a super intentional

or, you know, a thing with your first purchase. But the one thing you did really well is you bought probably at less than 50% of your purchasing power on this property. So it wasn't really a big gamble in a sense compared to what a lot of people do when they buy at the top of their purchasing price range. Yeah, I kind of compared what I would have wanted to spend on rent and then was pleasantly surprised that I could buy a house and my mortgage payment would be less than that. what I would have paid on rent. And so that, to me, it was a win, and I didn't want to go over that.

That's how I did it with my first one, too. It was rent was, this was 100 years ago, rent was $410. And my mortgage payment with the $200 a month HOA was $417. So I was like, oh, this is a win. And the HOA was ridiculous and I should have run the numbers and all of that. But it was really nice to be able to go right next to each other and compare it like that. So what was your mortgage payment on that property? I believe it was around 800, 700, 800 bucks. So what happens next? You graduate college. You've got a good, it sounds like good credit. You've got some savings. You've got now this house. You've got a $50,000 of your job. How do things progress from there? And your journey continue? Yeah. So I lived in that house for, I think about two years.

years. And then I was dating someone and we decided that we wanted to have a bigger space. And so I tried to sell that property and it just sat on the market and would not sell. And I was having lunch with a coworker one day and kind of complaining about that. And he just said that would be the perfect rental property. You should rent that out. And me being like early 20s, I was like, oh, you're crazy. like I can't I can't do that so I let it sit on the market for another couple of months and my boyfriend and I at the time were just getting you know frustrated and so I finally emailed that guy again and was like hey talk to me more about this and he was super helpful he provided me like sample leases sample application kind of walked me through the whole process and so I put that house up for rent and then

we bought the bigger house that we naively thought was going to make our relationship so much better. We moved into that house and then about like, about like two bathrooms. Yes, there's more than one bathroom. Yeah, we moved into that house and then like three months later, we promptly broke up. And so I stayed living in that house for a while. I got a roommate. Did you buy that property together or is that, is it in your name? Or how does it, that work? We unfortunately bought that together. Also, not the smartest thing to do. Okay, so we're going to have to spend some time here, unfortunately. So with the first property, before we get to that, how much it were able to rent it for? And what was the mortgage?

So I rented it for $1,200. And yeah, the mortgage was like $700, $700, $800. Great. And so you are probably a little cash flow positive, maybe break even after all the expenses and that kind of stuff, but solid little rental property on the first purchase, a great option because you bought below your means on the first one. Let's talk about what's the second property like and how did you mechanically jointly purchase the property together and then what was the outcome? Yeah. So we applied to be on the mortgage together. The house, I believe we purchased for $292,000. It was like a, it's like a five bedroom for bath house. and another suburb of Des Moines.

And I ended up putting definitely more down for the down payment than he did. But I think, I don't know, maybe he contributed like 10 or 15,000 bucks or something like that. So, yeah, we were both on the mortgage. And so then when we broke up, he stayed on the mortgage for quite some time. But then eventually he wanted off the mortgage because him and his new girlfriend wanted to buy a house. And so then it sucked because I had to refinance the whole thing. I actually refinanced to a higher interest rate, which really sucked. And yeah, I won't do that again.

Well, I just want to know mechanically because this is something that a lot of people do. You're not alone in making this decision to do this. And I would love to spend just a moment more here understanding like, okay, so you're both on the deed, you both own the property jointly and you're both on the mortgage. He wants off the mortgage. And so how does that work to see, is he out of the property now? Does he continue to own any equitable interest in the property following your refinance? Or what happens there? So when we broke up, I immediately like bought him out of what he had put down. So I was like, here's your $10,000 or $15,000 back. I like that. I like that because it's, it's only been three months

way back in, what was this, 2010, 2012? This would have been, yeah, 2012 about. So back then, houses weren't appreciating. Like right now, your house is worth more tomorrow than when you bought it today. It's ridiculous. So it hasn't really appreciated that much. Here's all the money. Now you're square.

And now you own the house, but he's still on the mortgage. So is there no way to just extricate him from the mortgage without a refi? Why would the lender do that, I guess, right? Well, exactly. Although Julie is a well-qualified applicant because she was... Well, let's check that, actually. So prior to buying this, you bought a house for 130, which is well within your means. You're already on that mortgage. And now you're buying a property for $292,000. Is that what we said? And that might be right at the bubble or even slightly beyond your means at that point for all we know. How would you say you're into, you as an individual

were qualified to buy that property. Yeah. So, yeah, the fact that with both of our incomes, I think it was fine. But, yeah, the mortgage on that property, while it's $1,600 a month. So, yeah, that's, you know, that's a pretty good-sized mortgage payment. So when we broke up and he moved out, I did find a roommate to pay me a little bit of rent and because I just didn't need that big a, yeah, and I didn't need that big of a space. So that definitely helped.

Yeah, I don't think there's a way to get someone off a mortgage without refinancing and then doing like the quit claim deed or whatever it is. Okay, I think that's important to note because like Scott said, I see a lot of people asking, oh, I want to buy a house with my significant other that I am not married to. Well, okay, then you need to really consider all of the things and you should be able to qualify for that mortgage by yourself should you break up. And it's unfortunate that you break up. But when you're going to buy the house, you're not thinking, ooh, I want to

what's going to happen if we break up. And you should be thinking that. Yeah. And I want to point out that this is a best case scenario for an exit for one of these situations. If there's any hostility in the, it doesn't sound like there was, or it sounds like you guys are at least able to communicate rationally and manage the situation. But if there's hostility, how much more difficult does that become? And you're forced to sell that property to clean things up and take a big loss, most likely in that situation. Yeah, for sure. Yeah. If I, I think I was lucky enough to have enough cash to buy him out. If I hadn't have been able to do that, then we probably would have had to sell the house and lose a bunch of money. That's even if you can't sell the house. Right. Yeah.

Well, let's walk through that cash situation. So it sounds like you graduated from college in a relatively debt-free situation with a reasonable amount of cash. Is that just from having saved up during childhood and working during college? I don't know, how did you accumulate that cash to get started and then how did that expand over the time period we just discussed? Yeah, so I think when I went to college, I opened up a bank account when I got to college and I think I had like $4,000. And then, yeah, I worked throughout college full time and just saved a lot of that money. I was lucky enough that I didn't end up having to take out any student debt. So I didn't have that to worry about. So yeah, I had a reasonable amount of money when I graduated college.

And then once I started working, I've always just grown up, like, very frugal. And so I just saved a lot. I saved just a lot of money. I did not spend a lot. Are we talking to like 20,000 savings per year kind of deal, more or less? What's kind of like a ballpark you would put that at? Yeah. So when I graduate, I've never been really like a budgeter.

I've kind of just always had some like basic kind of mantras and themes. And then that just kind of allows me to save a reasonable amount of money. I don't really keep track of it though. But even I think pretty much my entire life, I've always worked like more than one job as well. So when I got that $50,000 year job, like I was doing other other work as well and just pocketing that money too. Okay, but what I want to point out is that another advantage or another thing that bail you out of the situation was the fact that you did this and you were strongly capitalized

because you have this cash likely due to just how you conduct your life and how you preserve your income, those types of things. And again, how much more difficult does the situation get if you don't have the option to throw down cash and understand the basic economics of the situation? Yeah. Yeah. First, I think the first lesson is don't buy a house with as a good thing. another that is not part of a very long-term relationship. You know, get into this whole thing about married or not and that kind of thing, but, you know, it sounds like that was too short of a relationship to be by at a house. But from there, all of these other problems are made that much easier if you have cash

with which to deploy to throw against them, because now you have an option besides selling the property in a rush, in a hurry, with a former ex. So maybe we need a new term, Scott. We keep talking about financial independence and people equate that with, then I can quit my job. But we need to be like financial options. Like Julie has so many options. She can choose this or this or this or this or this because she doesn't spend every dollar that comes in. Because she has other streams of income.

So even if she lost her job tomorrow, she would still be able to pay the rent, pay the mortgage, pay all the bills. and she has this giant fund if all of her streams of income dried up. I know folks who at this point in life were making the same amount of money as Julie. And one of the roommates isn't paying the rent on like a $2,000 rent or something like that. And so they just all aside not to pay the rent and get evicted and have an eviction on their record. And oh, like jointly and severally all the money. It's like, come on. If you're like Julie, you're just like, okay, these guys, you know, I was thinking of a polite adjective,

these guys can go and do whatever. And I'm just going to pay it and move on with my life and those kinds of things. And that's the option that good financial habits give you rather than, oh, I'm going to just like allow myself to now get evicted because I'm too spiteful or don't have enough cash to just get myself out of this situation. Julie has a great story. I want to go back to your, in the application, to be on the show, you said that you've always been frugal and a saver. And then you said, my dad taught me a lot

in that regard. And you said, I worked full time throughout college and ended up graduating in three years so I could save a year of tuition. Working full time and taking a what, time and a quarter load so you can get done quicker, more than time in a quarter, time in a third load. That's huge. How did your dad teach you about saving? And what made you? think that you should graduate in three years? So growing up, my dad still to this day has never bought a new car. It's always, you know, the five-year-old Honda Civic. My parents still live in the same house that they lived in for 30, 40 years.

We did not take extravagant vacations. We stayed at Super 8 and Motel 6. But we still took tons of vacations. I mean, we just, but we drove. We did not fly very often. We would drive and just kind of do these road trips and stay at cheap hotels. And even Christmases, I remember it used to bother me. Like, I always felt like my friends were getting more Christmas gifts than I was getting.

And for the longest time, probably until I was like 13 or 14 and had a better understanding of what my dad did for work. Like, I thought we were broke. Like, I thought we just didn't have a lot of money. And then when I finally, I finally figured out, like, okay, my dad's an electrical engineer. Like, I think he's making a reasonable amount money. And so then I would start bothering him, like, come on, let's go to California or something. I'm hearing so many parallels to your story and my story. We drove always, but I'm a little older than you.

And I was traveling and vacationing before the deregulation of the airlines when airline tickets were $800 a piece. there were no cheap airlines. So we would drive because it's way cheaper to drive across the country than it is to fly across the country. My parents, my dad drove the same car from 1970 to 1992. He bought it brand new, though, for $2,000, AMC, the ugliest car company on the planet. And it was embarrassing to drive this, you know, awful car. I won third place in worst car at high school. And now that's like, I'm proud of that.

Todd Kinesovic was number one. and he was number one. He had the worst car ever. I can't remember who came in number two. And that's okay. But you said something that's so interesting until you were like 13. You were like, oh, I thought we were broke. All my friends get more toys than I do.

And that's really hard from a parent standpoint to not give your kid everything they want. My kids come home from school after Christmas. And they're like, oh, so-and-so got an iPod and an iPad and an iPhone. And they got a computer. And they got all this stuff. And I'm like, well, okay, you didn't get all of that. I'm sorry. And you'll thank me for it later, but it's hard.

Yeah. But then all those kids that got the iPhone and all the eye stuff, they're not going to be super awesome with money. That's not so judgy. I'm such a bad person. But still, like, they're not going to be as good with money as my kids are because my kids are because my kids are conscious of what things cost. And I don't know. I just think that's really important to share with them. Let's move on to you.

It's not my show. It's your show. I worked full time throughout college and ended up graduating in three years so I could save a year of tuition. That, you deserve an award for that. Good job, Julie. Why did you think to do that? That was a hard and slightly painful decision that at the time I wasn't exactly sure that I wanted to do that. But I just thought about it and I was like, look, I've got, I've had my college experience.

I kind of had gotten everything that I needed about, like, from the college experience. And it just seemed silly to throw another, like, $25,000 down the drain just so I can have another year of, like, because if I could graduate in three years and get the education, then, like, I'm basically paying the $25,000 to have fun and hang out on campus with my friends. And ultimately, I really wanted to do that. But when it came down to it, I just decided that that was not a good, good rational justification. Here's where our stories diverge because you made the smart choice and I went for another year. Okay, so let's get to your post second house experience. You have now bought him out. You've refinanced at a higher rate, which stinks.

But now you're done with him. completely finished, whatever. You've got a rental property and you've got a roommate and you've got a, I imagine, still a pile of cash even after buying them out. Is that right? Yeah, I didn't have a ton after. I mean, yeah, I definitely had to kind of regroup and start resaving after that. But I wasn't broke.

So how old are you now with two rental properties, $500,000 in real estate assets, a little bit of cash left over. Do you have any retirement accounts? What's the career status? How's the outlook in general at this point? Yeah, so let's see. That would have probably been like 2013-ish, maybe 2012 when I bought that second property. And yeah, as far as retirement savings go, I also another thing that I can attribute to my dad is I opened a Roth IRA when I was 18 years old and did my very best to put the max in that every single year. And then, of course, when I started working at my first job out of college, they had a 401k with a match.

So I would put that in. And yeah, like my career was going pretty well. I still wasn't making like a ton of money by any means. But yeah, things are going pretty well. Awesome. So what happens next? So I, ended up eventually moving out of that, that large house and turning that just into a straight rental. And then I think at that time, I moved. How did you do that? Because that was a bigger

house that seems less well suited to being a rental right there. So how did, how did you do that? And turn that, you said four beds, five baths or five beds, four baths? Yeah, I was kind of skeptical that I would be able to rent it out, just given the size. But it's been a, I've never had trouble renting that property out. And I've had, I think since 2012, I've also only had to have two tenants. Awesome. Can you give us an idea about the numbers on that? You said the mortgage is $1,600. How much are you getting for rent? So when I first started renting it, I was at $2,100 a month. And now through just kind of increases, it's, I believe I get $24.50 for it a month. That's wonderful. Yeah, those are good numbers.

especially for having two tenants. Yeah, it's been really good and it's a newer house. So there hasn't really been. I've started to kind of put my taxes together for 2020. And I was looking at my expenses for that property. And it's like I bought a microwave. But let's let's go look at your reserve fund. You only had to buy a microwave, but you have enough money in your reserve fund to replace the furnace, replace the AC, replace the roof, replace the appliances, because you are so smart with money. I have harped on this a lot on the show, but when March 2020 happened, that was March 13th, I think they shut down the United States. And people were on bigger pockets in the forums like the next day. How am I going to pay my April mortgage payment? Well, you should have already had your April mortgage payment in the bank and May and June

and July. you should have this reserve very comfortably sitting there doing absolutely nothing waiting for an emergency. So I've said this too. I think when you buy a house, something always breaks. And it's the cost of that repair is inversely proportionate to how much you have in your bank account. So if you've got a very well-funded bank account, you need like a new light switch. But if you're barely scraping by and you're putting down every dollar you have to buy this house, you're going to need a new furnace or a new roof or a new something that's going to happen after you own it. and it's going to be a huge financial crush. And Murphy's law...

And it's all going to happen at the worst time when your tenant is moving out, and that's when the problem is exposed, that you have to deal with before you get the new tenant in, and you're not getting any income, and that's just how it goes. That's the point of the reserve is because you don't need it until you need it. So, again, Julie is perfect in every way. That's right.

Okay. So we've rented out the place. We're getting $2,100. What's going on? What's the next milestone, the next part of the journey here? Yeah, so at that point, I've got those two rentals and they're going pretty well. And so then this is when I kind of decided that like, hey, this is a nice way to make some extra money. So the next house I bought was the first property I bought strictly as an investment property from the get-go

and did not live in myself. And how long after you paying out, you buying out your ex from the mortgage and those types of things, are we talking here? Is this like a year out, six months? It took me a while. I think I bought the third house, I believe, in 2015. So it was probably a good three years after. And during that period, you're just accumulating more cash and rebuilding your financial fortress position, those types of things, continuing with the 401K, all that kind of good stuff? Yep. I just want to chime in and say that that's the grind here. Like, we always gloss over this, but between these periods of activity for almost everybody, when we look back over a story that's a couple years out, there are these periods. of inactivity where it's just slowly, month by month, accumulating 1,000 or 1,500 or whatever it is, and piling up the bank account and then building a position of strength from which you then

make this great investment from. Can you walk us through the decision point? What was that like? Was it an intention to become retire early? Was it an intention to build wealth through rentals? What did that look like? I want to chime in really quick and say to all the people who are listening and saying, you know, oh, well, she should have used other people's money and, you know, build up as fast as she could. Julie made smart decisions based on her comfort level. And it doesn't matter what Scott Trench does or what Mindy Jensen does. Julie has to make decisions that Julie is comfortable with.

And jumping in and trying to keep up with the Jones is because all these other people are saying, oh, you should buy more and more quickly and, you know, move into it. So you only have to put 3.5% down. If all you have is 3.5% in your bank account for the down payment, you're not ready to buy a house. In my opinion, I'm rather opinionated, but this is my show so I can give my opinion. But I just want to say, Julie, good job at being comfortable before you made the next purchase. Okay, now let's talk about that next purchase. What did that decision point look like?

And what was the mentality? Like, when did that mentality shift happen? because it sounds like it was not intentional until this point. Yeah, I just think it was going so well with the first two properties. And I kind of had been saving. And I realized, like, I've got a pretty significant chunk of cash that I'm sitting on that's not really working for me. You know, I was doing some stock investing and things like that. But it just felt like it was really underutilized.

And so I was just like, well, I should just buy another, you know, another property. And yeah, the idea at that point still probably for me wasn't like retire early. At that point, I still, it was just another way to make some extra money. What'd that look like? So I ended up buying a little bungalow, two bed one bath, $75,000 in Des Moines. And it's been a terrible property. Absolutely terrible. Oh, why? Yeah. It's way cheaper than the other. properties. I'm wondering if that has anything to do with this. Yeah, it should be, it should be kicking off tons of cash. So my first mistake I made was, I bought the house and I was, I needed to have some work down on

it. And so I found this guy on Craigslist to do the work for a reasonable price. And, you know, as I kind of was communicating with this guy, he was a really good salesman and gave me kind of this sob story of like, well, I, you know, me and my family could move into this house. And he didn't have, like, he had been living with his parents. He was a handyman that did a lot of work like under the table. So it's not like he had like, when I ran his background check and credit check, it was like, he didn't have any credit. He didn't have anything on his background check. But I didn't have a great way to like verify income. I didn't have landlords to call because he'd been living with his parents. but I was excited that, you know, I've got this little rental and I rushed to get someone in it.

And I also just got my emotions tied into it. I wanted to give this guy a chance. And it didn't end well. Yeah, it did not end well. So I want to stop you right there just for a moment to say, you are not alone. This is not a unique experience to you, unfortunately. And not unfortunately, like, you should have all the bad experiences, but just unfortunately, this happens a lot. And I like to say, never go with your gut instead of checking somebody's references.

Always go with your gut when their references are good and you still have this feeling that something's off. Go with your gut then and say no. But I think a lot of people when they run a background check are looking for reasons to say yes. and instead they should be looking for reasons to say no. Why should I not rent to Julie? Oh, Julie doesn't have a job. That's easy. No.

Julie has no credit. Unless you have a really good Dave Ramsey story about how you don't have any credit, but you have like these giant bank accounts and you're really, really helpful or you're really, really qualified in other ways. You know, I would not say yes to that person either. But this is also a really common first or second, you know, landlord. mistake. And you learn a lot from that experience. So how long did this handyman stay in the house? And did he do any work on the house? He did do some work on the house. But yeah, I think he started

running in the winter months. And as a handyman in Iowa, like that kind of work kind of dries up in the winter. And so he immediately was falling behind on rent. And it was just like, I don't know. He kept telling me when the spring picks up, he'll be able to get caught up. And so I kind of just let him fall behind and rent for a few months and did not evict him. And then I think it probably was until like maybe April May that I finally kind of bit the bullet and was like, I'm going to have to evict this person. And so I did. And he then promptly trashed my house. So yeah. Yeah. There's another not just Julie experience. That's unfortunate. And I think a lot of landlords when they first start out, they're like, oh, I don't want to evict them. That's such a horrible process. I'll just wait.

I'll wait. I'll wait. And my time in the Bigger Pockets forums has told me that the moment that they're late, rent is due on the first. It's late on the second. If you have a grace period at your state, that doesn't matter. It's still late on the second. You just can't charge late rent until like the fifth or the tenth or whatever. You file for eviction the very first day that you can. And then you follow through. And if they're going to trash your house, let them trash your house month one instead of after five months of not paying rent.

And then they trash your house. If you are too nice to somebody, then you make an enemy over time with this kind of stuff. If you have this situation and you evict immediately and don't set a tolerance point, it's over. It moves on. But when you have a situation like this, they become your enemy because you're giving to them. And it's a weird dynamic of human nature or whatever this is where when you are,

like you are allowing this person to live behind on rent. And every month, you're being lenient. And every month, they are getting more and more angry with you because they owe you that money and you're being nice about it. And then they trash your house at the end of it. And it's like that is the dynamic that goes on here. If you're going to be charitable, give to charity. do not do that and do not write a check to some random tenant that is not able to pay your rent

and you can write that to a charity instead, right? That's not the time and place to be giving. It's just that this is the business of real estate. Yeah, definitely agree. Okay, so how much time did, or how much damage did he cause? Did he just make a big mess or did he cause actual damage to the physical property? He mostly made a big mess. He did break some windows. And yeah, but mostly, yeah, and I mean, it was in bad. It was in, it was in bad shape. And one of the biggest issues was he had just left a bunch of, there was like 10 mattresses in the house, like lots of just food.

And so there was quite a bug problem for quite some time that took a very long time to get, to get eradicated. And, and yeah, just I think I called one. 800 got junk to have them take all the stuff out of the house. And I think they filled like three or four 30-yard dumpsters. Oh. This is when you get cat-friendly in your rental. Sorry, bad joke. Okay. He, it looks like he threw like five Goodwill stores into the, into the house. Wow. That is, that is impressive. So I used to live next, across the street from somebody who was renting the house and he was a horrible person. And I was friendly at first. And he would show me all the like free furniture he got on Craigslist. And there was all that heavy,

heavy, heavy oak stuff that nobody ever wants. And he left it all there when he got evicted. I'm like, man, that's going to take forever to get out. It's just so heavy. Yeah, the weird thing was I had gone to that property probably two weeks before the guy got evicted. And, all that stuff was not in there. And so it's like he called all of his buddies and just said, hey, if you have any, like, trash or stuff that you don't want, just come and bring it and throw it into this house. That's petty. Yeah.

That's petty. Okay. So you evicted him in May. When did you next rent out that property? I think it took a good four months to get it rentable again. Like, I think I rented it in, like, August of that year. Was that a good experience or was that also, you said you've had a terrible experience with this house? It's never attracted great tenants. And I think that's because of its size. So I've never bought another property that is that small. I've had a lot of single moms that have rented it. It's like kind of, I feel like it's the type of house that you rent when it's, you don't want to rent in an apartment anymore and you want to move up to like a small house. But,

living in an apartment mindset is not the same as like renting a house mindset. And so people get in there and they're just hitting me up for all these little things. And yeah, just don't really know how to take care of a house. Do you own this house still? I do. I do. Have you considered selling it? Right now it's a hot market in a lot of parts of the world.

Is it hot in Iowa too? It is. And I have thought about selling it. I've got a tenant in there right now that has been. there for a couple years. And she has not been great, but she hasn't been, like, terrible. And so I've just been kind of like, when she decides she wants to not resign, I'll think about selling it. Okay. I'm going to put on my finance review hat right now. We have started a new episode of the Bigger Pockets Money podcast called The Finance Review. And it comes out on Fridays. I'm going to look at

this rental house and say, Julie, you are a smart girl who makes amazing money decisions. Cut your losses, put it on the market, get rid of this property. You can sell it with the tenant. The lease runs with the property. You advertise it as a tenanted property. You said she's not great. She's not horrible. She's just kind of there. How much mental bandwidth does this house take up? Yeah, 85% of my headaches is this property. Sell it. Scott, what is your recommendation? Well, I mean, there's other details to know, but in general, the picture looks strongly towards selling. There are. I. I. I, I imagine you make a good money now and life is good and you've got a large portfolio. And I can't imagine that a property with this profile is generating more than like two or

$300 a month in cash flow or net wealth accumulation for you. So like that is chunk change. Even if it is technically a good IRA, it's just nothing compared to your overall position. And it's all your headache. So I don't like to disagree with you, Scott, but you're wrong. There is no other information that you need about this property. It takes up 85% of her mental bank. bandwidth on problems and it's not awesome. Sell it, Julie. It is okay. Take the money and run in this

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Okay, so this was your third property purchased specifically to be a rental. You own seven properties. What happened with number four? Number four was also a property that I decided to buy strictly as an investment. And it was basically the same situation. I had been saving money and found myself with money that was just kind of sitting there. And so I thought, okay, time to buy another one. This one is in Marion, Iowa, which is like Eastern Iowa. And it's actually a block and a half away from my parents' house, which is extremely convenient because my dad can help with, you know, maintenance issues that arise. Yeah.

And I think so I think I bought that one in 2017. So like two years after I bought the disaster house. And again, again, we're seeing this like long period of inactivity. and what we're missing here is grind. There is a career development going on. There are 401K contributions that are continuing to stockpile. There is a savings rate that is continuing to compound, I would imagine, based on what you've told us previous to this. And then we've got the next purchase.

Is that right? Yeah. And I think by this point, I really did, I would say, like, grind pretty hard when I first graduated college, probably the first four or five years, just saving a lot of money, like not taking vacations just being super, super frugal. And I think by this point, I was finally starting to like feel able to like ease up a little bit and, you know, enjoy myself a little bit more and not feel so. The passive income was like really felt like a great safety net for me. What was your passive income at that point? With those three houses, I was probably making like

$1,600. Between your rent and the mortgage. some of which was allocated to or was that where you're after expense cash flow? That would probably, so that would just be the cash flow after mortgage taxes and insurance. So not not deducting any for the maintenance things that would come up. Or disasters like your tenant tax on your property. Or disasters, yeah. Okay. So if we say if we even cut that in half, though, $800 a month in cash flow is no joke at that point with a couple of properties.

It sounds like things are going well. and you're probably also seeing continued increases in your salary from your career growth and those types of things. Yeah. And this is actually probably around the time when I had the opportunity to work on a startup full-time. And one of the reasons why I, so I ended up, I think it would have been 2016, 2017. I quit my job and I worked full-time on a startup making no money for about nine months. And one of the reasons why I felt like I could take that risk was because at least I was making some money through the real estate. Whereas had I not had that, I don't think I would have been able to make that work. How many months of expenses did you have in your reserve fund at that point as well?

Oh, like at least a year. Yeah. See, I think those things are directly related. And you can't take that chance if you don't have a little bit of passive income and or a huge reserve fund. And so what is the ROI on that reserve fund? Well, okay, it's a half a percent, one percent, whatever it is. I'd be interested to hear where you keep your cash. But it's really thousands of percent or, you know, tens, 20, 50, 100 percent ROI because

you can take that shot. And even if it doesn't work out, the career implications can be huge by having taken that shot. Right. Yeah. It was definitely a, it was going to be greater. It wasn't going to be great. but I was really thankful that I was able to have that, put myself in a position where I could focus my time and energy on that,

not have to be like stressing over, not making any money, which I think, you know, some startups get in trouble because they've got to make money if the, you know, startup founders aren't taking home a paycheck, and they kind of have to rush to monetization. So, yeah, it was a fun time. So how does that work out? And then how do things, what's the other parts of the story that we're missing between now and the closing on that, that fourth property that we, that you just mentioned?

Yeah. So the startup did not work out, at least as far as it being successful. And actually now this is the point where I start looking for a new job. And I get a job at bigger pockets. All right. Yeah. So we'll walk us through this. Yeah.

So I just, the startup shut down and I wanted to get back into a day job doing software engineering. And I think I had actually applied for a job at bigger pockets, maybe like a couple of years prior and like didn't, had it, didn't hear anything. And for whatever reason, I just decided to go back and check the jobs page again and apply it again. And I think I put in my cover letter like, hey, guys, I applied two years ago. I think I've gained some good knowledge and skills since then give me another look. And yeah, so I had been living in Des Moines, Iowa, and I would say one of the biggest apprehensions I had at that point was up until that point, I had been a landlord that lived, at least in the state where my properties were. And so then when I took the job in Denver, I was a little bit worried about having to transition to being like an out-of-state landlord. But yeah, that hasn't been too bad. All right. Well, how does the bunny story evolve from there after you moved to Denver and joined BP? Yeah, so I ended up renting an apartment in Denver. I thought about buying a property, but as you guys are aware, it's very expensive to buy there. And so I just, I didn't know how long I was going to stay. So I just ended up renting and still, you know, trying to save as much money as I could. And yeah, now I'm trying to think. Took a couple of side hustles.

Like, I think you did very well in our fantasy football league. I don't recall correctly. Unlike some. And Craig, Craig got me renting my car on Turo when I was in Denver. Craig Curlop. Episode 35 talks about renting his car on Turo. How did your Turo renting car story end? Successful or in a car crash?

No, it works really well. It worked really well for me. Since my apartment was so close to the Bigger Pockets Office, like I would walk to work every day. And so having my car rent it out was like, no problem whatsoever. Yeah, it was great. Of all the, yeah, Craig, Craig did some crazy things to make money and I was, I could not make all the sacrifices that he did. But that was one that I was very thankful that he told me about. And that just served to generate more income for you to save for your

next rental property. Let me ask you, because this is another question that comes up all the time in the forums, where do you put the money that you are saving for your next down payment? Where do you keep that? So I have like a basic checking

account through Bank of America that I try to keep at a reasonable level, maybe like $20,000 or something like that, just like liquid cash. And then otherwise, if I have any excess, then I have money in a like options trading account. And I try to make money on that money through that. Oh, like calls and puts options? Calls and puts, yeah. Oh. You a seller or a buyer? I am a seller of premium for sure. Yeah. Okay. Well, let's talk about this a little bit.

Options are, first of all, I'm going to say that options are something that you should not dabble in just because you heard Julie making a great buck on options. Options are something that can cost you a lot of money or cost you a lot of opportunity. Let's say you bought Tesla at $100 a share. You throw an option on there to, let's see, you sell a call, which means I am selling Julie the right to buy the property, that the stock at $105 because I think the price is going to go down. Clearly, I am wrong. And the price has shot up to 110.

Julie can call me out of my purchase. And now I have to sell it to her at 105, even though it's trading at 110. So you don't lose money in the sense that, like, you bought it at 100 and you're selling at 105. You lose money because you could have sold at 110. So I am saying that this is not something you should take lightly. This is something you should do a lot of research and investigation into. However, sometimes you can make money on this.

So, Julie, let's talk about your options. That was a great explanation, by the way, Mindy. I was trying to explain it to someone recently, and I did not do that good of job. So, yeah, so I like to think of it as if you're going to be investing in stocks, to me, I feel like you should be also investing in options. And so the strategy that I typically use is what's called a wheel strategy. So I've got stocks that I like and are bullish on. So I think that they're going to do well. And so I'll sell puts, which is the opposite of a call. So like, if I sell a put to you that gives you the right to sell me your shares at a certain price. And so I'll have this list of

stocks that I like, and every week I'll just sell puts on those tickers, like, you know, at a certain price that's under its current price. So if I like a stock that's at 50 bucks, I might sell a put each week at 45. And I'll get 50 bucks for that for selling that. And the way that works is at the end of the week, I'm either going to just keep the $50, which is great. and that's usually what happens. Or if for some reason the stock has gone down below $45, then I'm going to buy the 100 shares at $45. But it's a stock that I like and that I want to own,

so I don't feel bad about that. Like, if I liked it and I was going to buy it at $50, then buying it at $45 is not a bad deal for me. And then once I now have those 100 shares, I do exactly what you were talking about is I'll start selling calls. So I've got the shares at 45. I'll start selling calls at 50. And like you mentioned, you potentially are missing out on a gain.

But the way I look at it is most weeks, the options that you sell are not going to end up being what they say in the money. And so if I start selling calls every week at $50 and I'm collecting, you know, $20, $25 every week in premium, I'm like lowering my cost basis on that stock. So then if I do end up having to sell you my shares at 50, if I've been collecting this premium for the past two months, you know, if the stock's at 52, but I've got to sell it to you at 50, the premium that I've been collecting can kind of make up for that differential.

So I think that's a really great way to look at it. And then again, caution people that this is something you need to do a lot of research and before you start investing. Do you have to have a certain amount of money in your account when you're selling puts? Because like Julie said, she's selling me a put. I am now exercising the option to make her buy my stock at 45, even though it's only worth it's selling at 43. So you should have to have money in your account to cover that, right?

So this is not a beginner level strategy. No, right. You can do other. There's other strategies you can do. So there's stocks that I like, like Tesla, for example, and I don't have enough money in my account to cover 100 shares of Tesla by any means. And so you can do other things like it's called put spreads that you can do, that wouldn't require you to have that much money in your account to cover.

So I think this is an awesome strategy, and I don't really know too much about it. So we may have to bring an expert on and go through this in a lot of detail on a future episode, Mindy. I think that would be awesome. I think so too. Yeah, I think this is a way to potentially have your excess liquidity earn a little bit more of a premium over time with some risks to that. And you're going to probably earn a good return on a week-to-week or month-to-month basis.

And then you're going to have a big loss all of a sudden with a strategy like this. But over time, it probably yields a pretty good overall return for you on your savings with that. And this is, it sounds like something you do with a small portion of your cure cash. Yeah, so any excess that I have over like the 20K that I want to keep in liquid, I'll have in that account. But I'm not, I'm never really placing big bets. Like my goal is every week to make $100 selling premium. So 400 extra dollars a month. And I try to do that very safely. So I'm not, yeah, I'm not trying to like make huge big gains or anything like that because it can be risky. Yeah. And then. But yeah, that's pretty much, and then outside of just the normal retirements accounts, that's pretty much where all my money stays. Awesome. We should definitely look at that.

Can you give us a high-level overview of life after BP and what you've been doing in the last couple of years with your real estate and investing journey? Yeah, sure. So when I left bigger pockets, I got a job for Stitch Fix. And nothing against Bigger Pockets. The company Stitch Fix, they have always. they have always had a remote engineering team and I've always wanted to travel and just have more flexibility. So that was the main impetus for leaving. So I was dating someone. We ended up like

moving into his grandma's house and being able to live like basically rent free, which is really nice. So I was again being able to save a lot of money. And then in 2019 for Stitch Fix, I went to London on a and they were paying for my housing there, which was great. And so I was, again, able to save more money. And then when my time in London was coming to an end, I kind of was like, I don't want to go back to Iowa. I want to live somewhere else. And so while I was still in London, I just decided that I wanted to move to Nashville, having never been to Nashville before. And so again, I just like found a house. and bought it, site unseen, other than just like a FaceTime showing. And it had a separate unit basement apartment.

So it wasn't like a legitimate duplex. There had been like a handicapped guy that was living in the house with his caretakers and they had turned the basement into like its own little unit. And so when I moved to Nashville, I lived in that basement apartment. apartment and then rent it out the bedrooms and the upstairs to cover the mortgage. So that's the fifth property. It sounds like there's two more sandwich between the one you described earlier. So you're in a situation currently where you own seven properties and those are spread

across Iowa, Tennessee. And then the, so the sixth property that I bought was in August. of 2020, I bought a lakehouse in Eddieville, Kentucky. Which is an easy drive from Nashville. Yeah, it's like an hour and 45 minutes. And that has been my first like foray into Airbnb. So I kind of bought it as like a COVID-induced. Like I was just sitting around with my roommates one day.

and we were just like, it'd be so nice to have a lake house right now just to be able to get away. And we just kind of went on Zillow and found the closest, like, lake community. And then I was like, wow, the prices here aren't that bad. And I found a house that looked reasonable. It drove up like the next weekend to look at it. And then just like put in an offer and bought it, which was not super well planned out.

But luckily, it's actually been working out extremely well as an Airbnb. I just see this theme throughout your journey where you buy first and ask questions later. But you, and so some people might call that very risky, but you're doing that from a position with a financial fortress backing you up to allow you to learn and take that action in those risks, which I think is, you know, a lot of people will do a lot of research and be really cautious and all that kind of stuff and buy with no reserves and no financial position. and that's more risky than what you're doing, even though you're buying property seemingly on a whim one weekend with some friends after you look at a couple of pictures on Zillow. So I think that that's a really interesting potential takeaway from this, from your money story is that just by doing the basics right,

you're allowed to experiment and take these risks and have a couple of painful learning lessons alongside long-term snowball wins. Your RRR, I don't know what it, what it was over the course of these properties. It probably wasn't optimal, but you're rich at the end of it anyways because you've been doing the fundamentals correctly the whole time, I think. Is that, do you think that's fair? I don't know. Yeah, yeah. I've, I've had people that, you know, will contact me wanting to get in real estate and they've got these, like, very fancy Excel spreadsheets and they're really analyzing quite a bit. And I am kind of like, I've,

never really done any of this. I have a pretty simple strategy of like, I want to buy a house that I think is going to cash flow at least $500. And I do a little bit of research to see if that plays out. And then, yeah, and then if it doesn't, then I'll figure out something else. But I buy it between huge periods of inactivity after I snowball a gigantic cash position and clearly have enough cash, not only to make the down payment, but have that left over. And then I have, you know, and I'm constantly maintaining that cash position with this, this nice game you're playing with the options there to sell that premium. And so that works with those fundamentals in place.

Your strategy would be extremely dangerous if you're playing it close to the chest and putting all of your cat liquidity into those properties at once. And all of a sudden, all that stuff becomes necessary because any deviation from the plan wrecks you with that. It sounds like most of these properties she's purchasing as a primary residence. So she's using the lower interest rate. And it comes, so the primary residence comes with a one-year occupancy requirement in most cases. Please read your documents and speak to your lender. But that allows you to get in at less than 20% down if that's your option. It allows you to have the lower interest rate, although right now, like what's the difference between an owner occupant and a non-owner occupant,

like half a percent at 2 percent to start with or something? So it's maybe not as big a deal right now. But that's a big opportunity that we need to highlight. This is the market. This is how the world works in the world of real estate investing for most people. So we always hear about these folks who are buying lots of properties and aggressively scaling their portfolios because those are the folks who like the most to talk about real estate investing, which is why we're hearing about that. But the 90% of single-family rentals, duplexes, triplexes, and quads are owned by people like Julie who own less than 10 total structures and buy them over a period of a decade.

We just heard a decade's worth of real estate and purchases, starting in 2010 and finalizing with this last one, this lake house in 2020. That's seven properties over 10 years. That is normal. That is what most investors are doing in this market. And there's good reason for it, like Mindy said, because. you're able to use better financing options. And there's good reasons, like we just heard from Julie's story,

about how you're able to, again, stack up this cash, and there's periods of huge inactivity between these purchases, and then maybe a spurt here and there, but really a one to two to three-year time period between each purchase, especially in the beginning. And it's beginning to compress now that your snowball is probably quite large the amount of cash you're committing for a month. It's probably very different than it was when you first started.

Yeah, that's a great point. It feels like it has taken a long time to get here. But yeah, now everything's just moving, you know, super quickly where every six months I've got a chunk of cash that I need to figure out what I need, what I should do with. And it's not just real estate. It's your career and it's your other savings and other what you're spending and all those different types of things that are compounding to this. Or it goes from 1,000 to 2,000 to 3 to 4. I don't know how much you're saving now, but maybe it's in that ballpark. And that's fantastic. That's the journey. You're on the other side. So let's talk about keeping up with the Joneses for a moment. Because what Scott just said, he said periods of inactivity, which makes it sound like you're not doing anything. But you are making a purchase. And then you're not making a purchase. And then you're making a purchase. And I think a lot of people who are just starting out on their real estate journey are saying, oh, Julie has seven houses. I need to have seven houses because Julie has. has seven or Scott has eight units. I need to have eight because Scott has eight. Don't compare,

and this is not my quote. This is somebody else's who's, I can't remember. Don't compare the start of your journey to the middle of Julie's. Or if this is the end of Julie's, don't compare the start of your journey to the end of Julie's journey. Don't compare yourself to Scott. He's the CEO of bigger pockets. He's going to probably have more opportunity for real estate investing than you are if you're just starting out and you don't know anybody in real estate and you're like, ooh, this would be cool. So don't try to keep up with the Joneses when you're buying a property and put yourself in a position of financial weakness that is going to put your entire financial future in jeopardy because you had to buy one more house because you read somebody on bigger pockets saying,

oh, don't let that money sit in a bank account. You should use that as leverage. Use other people's money, blah, blah, blah. I cringe when I see those things because you don't know who you're talking to. And I don't know who I'm talking to when I'm saying this. I'm just talking to all of my listeners and saying, hey, purchase on your timeline. Don't worry about what Julie's doing or Scott's doing or that other person on Bigger Pockets is doing. Make a purchase when you are financially comfortable to make a purchase.

I support all of that. And I want to know how the outlook is for you now. And what's next before we get into the famous four? Yeah. So, Mindy, I really appreciate you bringing that up because I know we chatted a little bit about that as far as I think when you get into real estate, it's so very, it can be very exciting, can be very daunting. And there's kind of similarly with everything in life, there's always going to be someone that has amassed more wealth than you.

Like anything in life, there's someone that's better than you in everything. And at some point, you've got to, like, not let that bother you, I guess. And I'm as guilty as that as anyone. I read stories about the people, like, the headlines of like, this person's 26 and they didn't. a million dollars of real estate deals last year. And I'm like, crap, what am I doing with my life? You know? Clearly, you're just a big loser with only having seven properties. Yeah. So, but yeah, I think like celebrating like small wins is important and also like learning to love the journey. I recently started training jiu-jitsu and that's something that I'm having to

learn in that aspect of my life too. It's like it's going to take it's going to be a long road, but you got to love the journey and eventually you'll get to the end. So yeah, so I, my goal is to get to $7,000 in net, quote unquote, passive income from real estate in the next by the end of 2022. I don't know what I want to do with my life yet, but I want to have the flexibility and options to potentially pursue something different at that point. but I don't really know what that's going to be yet. So I plan on, Mindy, you kind of ruin my plan,

but I was planning on paying off the hellhouse. But maybe I'll be selling it. Maybe I'll be selling it. And then, yeah, just I'm going to turn the house that I'm currently living in into a rental and then just, yeah, probably purchased some more probably back in Iowa, honestly, because I know that market pretty well now, and I have good contacts and network there. That's great. Having contacts and networks and knowing the market makes it a lot

easier to, like, plant your money there while you're waiting for, you know, another lake house or another beach house. Yeah. Okay. Well, is there anything else you want to talk about before we move on to our famous four? Let's do the famous four that you sent me the questions and there is five. Yes, yes. That's joke that I always use and then somebody sent me in out, they're like, that's so dumb. Well, I think it's funny. Not everybody listens to every episode. I think it's funny that someone said you a note saying that it is dumb. I know, right?

It's time for our famous four. These are the same five questions. We ask of all of our guests. Julie, are you ready? Ready. Okay, Julie, what is your favorite finance book? Don't say set for life. Oh, my gosh.

That's what I have written down. Is it really? Yes, I went to my good. Reads.com and like filtered my recommendations by stars. And like the first five star book I had that was like a finance book was set for life. So wow. It's true. It's, you know what? It is such a good book. We need to shout out Scott's dad, Randy, for forcing him to rewrite the entire thing after the first time he wrote it, gave it his dad to read. His dad called it drivel. I would like to see. I didn't send it to him again. So, yeah, he still hasn't read the new one. I think he's scared too.

Well, we need to send him a copy. Randy, I will send you a copy. It is a great book. It's a wonderful book. I was just teasing because I thought you were going to have another book. That's great, though. Your first five-star review was set for life. If you have not checked out set for life, that is a book that Scott wrote, and it's brilliant to paraphrase every five-star review that he has. Well, thank you for the plug. I appreciate it. Yeah. Yeah. What was your biggest money mistake? I would say we've already talked about both of them. It was buying that crappy property and then also getting on a mortgage with someone that I was not married to.

All right. I like it. Well, I don't like the mistake. I like that as a mistake. It's not the most crushing financial mistake. But still, it's a good lesson to learn. What is your best piece of advice for people who are just starting out? I would say, again, I think we touched on this too, but at some point, like, just kind of jump into it and, like, think, I always like to think about, like, what's the worst thing that could happen? I really like a stoic philosophy. And so I think a lot of people get really interested in real estate. And then for whatever reason, they just listen to all the podcasts. They read all the books. and for whatever reason they don't pull the trigger. And I think just at some point, you got to jump in knowing that not everything's going to go your way. It's not going to be perfect. You're going to make mistakes.

But as long as you've got some escape plans, it will usually turn out okay. What is your favorite joke to tell at parties? So I got these questions slightly before this podcast aired. And four seconds before the podcast is. And so I don't have a joke, but I will say that if anyone has not seen the video with like the lawyer with the cat on Zoom, the Zoom filter cat, I'm not a cat. That, I watched that like 25 times last night. So that's going to be the funny thing I talk about for a long time. All right.

So we have two, we have two things we have to link to videos that we have to link to in the show notes here. is that video, and the second is the Saturday Live Zillow skits that aired, I think, last week, which was fantastic. Also hilarious. I resonated way too much with that. Zillow is real estate investor porn. The CEO of Zillow commented after that sketch, he said, have we been marketing Zillow all wrong?

That was really perfect. Okay, Julie, where can people find out more of? about you? I do not have a lot of presence on the internet, but I am on bigger pockets and the traditional social media sites and pretty much my username everywhere is Jay Kent, which is my last name, 2910. All right, we'll link to several of those in the show notes as well. Julie, this is a lot of fun. Thank you for sharing your story today. I think that people are going to get a lot a value out of this story. Yeah, it was so good to catch up with you guys in chat.

Yeah, it was great. You guys. Hopefully one day I'll be able to. I really have been wanting to come to Denver. And when and if COVID ever ends, I will be coming to Denver and saying hello. Perfect. Well, I hope to see you soon. Thanks.

Thanks, guys. Appreciate it. We'll talk to you soon. Bye-bye. See. Yeah. Okay, Scott, that was Julie Kent. It's always nice to catch up with her.

How did you like the show today? I thought it was great. I mentioned this in the intro, but I just again think that this is the story of how most people in America end up owning multiple rental properties over time. Fannie Mae, fixed rate, conventional mortgages, bought over a period of a decade or more, slowly, methodically, and then you find yourself very wealthy with a lot of options one day and very little stress. And that's a right way to do this. And I think it's great and I think it's worth learning from. You know, after we stopped recording with Julie, she said, oh, it might not be the most exciting story. No, this is the best story. All the stories that we have heard on this show are the boring stories, the repeatable stories, the I could do that too because there weren't special circumstances involved in her journey. And I think that's really important to note. I didn't win the lottery and bought 50 rental properties.

I worked slow and steady and saved. I invested. I did smart things with my money. And I just want to reiterate that the position of financial strength, as you always call it, is such an important place to be when you're starting to invest. Yep, absolutely. Okay, Scott, should we get out of here? Let's do it.

From episode 181 of the Bigger Pockets Money podcast, he is Scott Trench and I am Mindy Jensen saying, Sayonara, moutachos.