BiggerPockets Money Podcast - 94: LIVE from BPCon2019: Ask Us Anything!

Episode Date: October 13, 2019

All the BiggerPockets podcast hosts on stage in one place!  This bonus episode was recorded at the BiggerPockets Conference 2019 on October 7th in front of a live audience of more than 1,000 people at the Gaylord Opryland Resort in Nashville, Tenn. We turned the mics over to our members, who fired a bunch of great questions at Scott Trench and Mindy Jensen, Brandon Turner and David Greene, Joshua Dorkin, and J and Carol Scott. Our panelists covered some nitty gritty real estate topics, like tackling vacancy and how to invest IRA funds, as well as big-picture concepts like motivation, marketing, and teaching family members the importance of investing at an early age. Also, everyone reveals which animal they would be if they had to choose, and a member of the audience challenges David Greene to produce an analogy on the spot. Listen to find out whether he performed under pressure!  Our first conference in seven years was a big success, and we’re so thankful to everyone who came out to learn, network, and have a great time. Download this bonus episode, and be sure to subscribe to all three shows BiggerPockets Real Estate Podcast, BiggerPockets Money Podcast, and BiggerPockets Business Podcast so you won't miss an episode. Learn more about your ad choices. Visit megaphone.fm/adchoices

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This show is for anyone who has money or wants more. This is the Bigger Pockets Money Podcast. How's it going, everybody? I'm Scott, and she's Mindy, and today's episode is a bit of a departure from our usual show. That's right, Scott. just got back from Nashville, Tennessee, where we held our, I don't want to say inaugural conference, because I guess we did actually have one in 2012, but that was so long ago. So this is kind of our

first, kind of our second conference. This one was so much fun. I had such a great time meeting all the members that I talked to. It was a whirlwind, and I am so excited for Bigger Pockets Conference 2020, which has not yet been announced, but when it is announced, when we've decided, excited on a location, you can bet your sweet Bippy that we will be advertising it and announcing it all over everywhere. It was such a great time. Did you have a good time, Scott? I had a great time. We're actually recording this a few days after the conference because we had no voices left during that conference because we spent the whole time talking loudly about real estate over a thousand people that are packed room screaming at the top of their lungs about their

real estate businesses. So I guess I'm kind of like Ron Burgundy today where we're actually not recording live from Nashville, for the intro at least. The rest of the show is. Yes. But if you put things in front of me to read as a prompt at the beginning of the show, I'm just going to read, I'm like, I'm Ron Burgundy. Anyways. He's not Ron Burgundy.

He's Scott Trench. That's right. All right. And shall we kind of segue into the show here? Yes. So this show was recorded live with all six podcast hosts across the three different podcasts that Bigger Pockets has. If you have already listened to this on the Bigger Pockets Real Estate Podcast or the Bigger Pockets

Business Podcast, this is going to be the same content that you have from those other shows. However, if you have not listened to it, this is going to be an awesome show. We talk about real estate. We talk about money. Brandon Turner and David Green from the Bigger Pockets Real Estate Investing Podcasts are here. Carol Scott and Jay Scott from the Bigger Pockets Business Podcasts. join us. And we are hosted by our VP of Growth, Dave Meyer, who I think does a very great job. At the very end of the show, they ask a question of me, would I rather do X or Y? I would rather

do neither. They are both equally distasteful to me. But if I had to do one, I think it would be the eating one. And now you have to listen all the way to the end to find that. But it's a good show. It was a lot of fun to record live. And at Bigger Pockets Conference 2020, we'll be doing another one. So make sure you get your tickets as soon as they're announced. Scott? Let's do it. Okay.

This is the live taping of the Bigger Pockets Conference podcast. All right. How's everyone doing? Awesome, awesome. Well, welcome to this very special recording of the Bigger Pockets podcast. is a really new thing for us. We're really excited to have all six of our awesome Bigger Pockets podcast hosts here, as well as founder Josh Dorkin.

We have seven awesome guests for you. The format is going to be a little free-flowing. We've never done anything like this before, but we would love if you could come up with some questions and come stand at the microphones in either aisle, and we will have our esteemed panelists answer for you. So start thinking of some questions. questions while we're getting rolling here. First, I'm going to introduce everyone, even though

you probably know who these people are. We have Scott Trench, host of the Bigger Pockets Money podcast, along with his co-hosts Mindy Jensen. Hosts of the real estate podcast, Brandon Turner and David Green. Founder of Bigger Pockets, an honorary podcast host, Josh Dorkin. He's going to cry. And the host of our newest podcast, Jay and Carol Scott. All right. So I would love to start by just getting a sense of who here listens to the Bigger Pockets real estate podcast. Yeah. Okay.

Every single person here. That's what we thought. How about the money show? All right. Pretty good. How about our newest show, the business show? Awesome. All right.

Great. Not as many. Well, all that's not an insult at all. I want to give Jay and Carol an opportunity because of this to explain a little bit about the business podcast for those of you here, as well as everyone who's listening at home because it is an incredible show, and we'd love you all to learn more about it. Yeah, so the Bigger Pockets Business Podcast hosted by my lovely wife, Carol, myself. Every week, we interview, found.

and entrepreneurs of everything from small to very large businesses, as well as experts in the business field, sales experts, marketing experts, operations and process experts. So if you run a business and anybody that runs a real estate business runs a business, the show is for you. And we've had some amazing guests. We've had some really new and small entrepreneurs who are just getting their businesses off the ground, all the way up to folks like Barbara Corcoran from Shark Tank, Jay Papazon, who wrote the one thing, and everything in between. So we've had some amazing guests. And, oh, Brandon Turner and David Green, we're both guests.

And our inaugural guest, our very first guest, who talked all about building bigger pockets, Joshua Dorkin. Nice. And if you haven't subscribed right now, get out your phone. Subscribe to the Bigger Pockets Business Podcast. Seriously, every single time we talk to one of these entrepreneurs, we are so encouraging. incredibly inspired. Their stories are so relatable. They're just like you and me. They made great decisions. They took big risks and they've grown amazing businesses. You will absolutely love it. So tune in. So if you guys have some questions, you can start lining up. But while you're doing that,

I'd love to just get a show of hands here for people. How many of you out there have yet to do your first real estate deal? A handful of you. Awesome. Great to know. How many of you have done? like one to five. Wow. Me too. And then five plus. Wow. Great.

Awesome. So we have a real wide gamut of people here, which is excellent. Hopefully you all are networking and meeting each other. And yeah, hopefully, is everyone having a great time in the conference so far? All right. Great. So before we go on, I should introduce myself. My name is Dave Meyer.

I am the VP of Growth at Bigger Pockets. I am also a real estate investor, and I am the one person charged with trying to keep seven people with large egos in check during this. Yeah, during this podcast. So we'd love to open it up to the audience. So, sir, in the aisle here on the right, what is your question for our panel? Hi. I'm looking to invest some funds I've got in IRA and Roth IRA. Are there specific products that work better for the tax-sheltered or tax-advantaged accounts than others?

Anything to avoid or anything that works exceptionally well there? I thought about note investing. Great. Jay, did you want to take this one? Sure, I'm happy to take it. I'm not a tax. I'm not a tax professional. I'm not a legal professional. I'll start with that.

So don't rely on anything I say. but the nice thing about a Roth or a traditional IRA is it's either tax deferred or tax-free or pre-taxed. So essentially, the first recommendation is focus on any investments that would otherwise have a high tax burden. So you don't want to take investments that are already taxed advantage like rental properties, rental properties you're typically going to pay low tax. And I'm not saying don't do those in your IRA, but don't necessarily make those

your first choice because the benefit of a tax-free or a tax-deferred retirement plan is that you're not paying taxes. So focus on those investments that you would otherwise pay ordinary income taxes, higher-income taxes. So things like lending, things like notes, flips in some cases. There are obviously rules around doing your own flips. You want to be careful there. But first things first, focus on those things that otherwise would have a high tax burden. Next, because of the rules around IRAs, you can't be overly involved. You can have certain involvement in your investments, but you can't have day-to-day active involvement in your investments. So typically what I tell people is focus on those types of investments that don't require

you to have day-to-day active involvement. Something like a flip, there are ways to do flips out of an IRA, but you put yourself at risk if you find yourself managing contractors or buying materials. So it's a lot easier to get in trouble when you're doing active investments have an IRA. So I typically recommend focus on those investments that are passive or more passive. So notes are a great investment out of an IRA. Lending is a great investment. I do all of my lending out of my IRA. So those are the two big things I would say. Passive and high taxed or high, high, otherwise high taxed. Great. Awesome. So in addition to the people who are lining up and thank you. We'll get to all your questions. We did have a survey where we asked all of the attendees to submit some questions. So I have some up here that will also be interjecting. And the first one here, we'll go with you, David, is how does being a realtor help you as a real estate investor? How do you deal with the balance between the two professions?

Well, I'm in kind of a unique situation in the sense that I'm a realtor, but I don't do much investing in my own market. So most people think about getting their license because I think it's going to help them find deals where they live. And it's probably not going to do that nearly as much as what you would think. Access to the MLS is something a buyer's agent can give you very, very easily. I mean, it's almost like just as easy as it can be. You don't need your license to be able to get into that. Being a realtor can hurt you in a sense when you go after a deal because you have to disclose to the person you're buying the house that you are doing this with the intention of making a profit.

And you can set yourself up to get a lot of trouble because if they're looking at you as a fiduciary that's telling them this is what their house is worth and you're trying to get it for the best price that you possibly can, there's a big conflict of interest, and as a licensed agent, you're not supposed to do that. So in a lot of ways, if you're trying to invest in your own market, having a license is a bad idea. What I tell people is that you shouldn't be an agent unless you want to learn the job of being an agent. If you want to commit to that craft and mastering that craft and representing people, then you should go for it. Now, I love doing that because I love

real estate. So why wouldn't I want to go be a real estate agent? I like looking about it. I like talking about it. It's kind of my whole life in a lot of ways. So of course I do it. It does help you when I invest in other markets because I understand the language of real estate. I know how to talk to other real estate agents and I know what motivates them. I know what they care about. When that agent isn't getting me what I need, I know that I can say, well, why don't you let me talk to your broker and I can ask questions of that person who's going to go tell the agent this is what you have to do. I recognize when an agent's good faster than some of you might because I work in that industry all the time and I know what questions they should be answering. I know what they should be

giving me. And I know when they're pushing back, that's a good sign. If that agent is, agent's just saying yes, yes, yes to everything I ask. They're telling me yes, but they're doing no. They're not doing anything. If they're pushing back and they're saying, no, that's just not something I'm going to do. I recognize that that's a really good agent. So if you love real estate and you don't love your job, you should honestly look at if being a real estate agent is the best move for you. You might like it a lot more than what you do. It puts you around real estate. You will learn more by proxy just because you're around it. And the stuff that you're studying will actually help you to make money. You can make good money as real estate agent if you're good. And if you guys are here,

you've flown from all across the country to come learn about real estate. There's probably a very good chance that you like it just as much as I do. Putting that passion to play in your job is an awesome feeling. You'll enjoy going to work every day. But it works better to take your investing knowledge and make money as a real estate agent than it does to take your real estate agent knowledge and try to apply that to investing. Awesome. Great. Can I also throw out.

Yeah, you can leave now. I want to throw out one more thing. For anybody here that might be interested in growing a real estate, estate sales team. David Green, he doesn't talk about this a whole lot, but has a tremendously successful real estate sales team in Northern California under Keller Williams. He was on an episode, I don't remember, it might have been episode 15 or 16 of the business podcast. So just to plug it, but seriously, he talks in detail about how and what it takes to grow a tremendously successful real estate sales career and sales team. So if you're interested in that, definitely check

out David's episode on the business podcast. Awesome. Great. All right. That's very smooth, Jay, that you gave me a compliment that got people to tune into your podcast. That's what we're here for that. Well done, Jay. Awesome. Sir, in the back there.

Thanks. Steve Schaefer from Fargo, North Dakota. First of all, thank you all so much. I've read your stuff. I've listened to the podcast. Plural. creepy amounts. So, thanks.

I can't. I'm like, giddy to wait here, David, turn this question into an analogy. Just gitty. But this one's maybe a little nitty-gritty. I know everybody's got different experiences. I'm in Fargo, North Dakota. I'm a multifamily guy.

Love the market. Things are going awesome. But we have kind of an interesting problem where we've had an overbuilt, you know, a lot of permits granted in the last couple of years, and mainly A-class, really, really nice apartments, which is awesome. So we've got this, you know, great new availability, these wonderful apartments in Fargo. They have pretty significant vacancy right now as that market. market adjusts. And so overall market vacancies between 8 and 11 percent. We in the BNC classes

get compressed, of course, right, as the A people move down. Things that I have done to stand out, places that should have a laminate countertop, we put in butcher block, tiled bath surrounds that are normally fiberglass, that kind of stuff. And then catering to pets. So putting like, you know, a fence up and now we have a dog run. And so some lower cost amenities and some things that make sense. Any other suggestions in a market that has maybe slightly than higher normal vacancy, all the metrics are awesome. It's going to balance out in time to stand out to have your vacancy much lower than the average. Any strong suggestions in that way? Brandon, you want to take that one? Sure. I mean, my thought goes to 95% of all landlords are absolutely horrible at marketing.

So I mean, I'm a marketing guy, so I like, that's where I approach it from is I'm just going to do a better job than everybody else marketing. Because it's everything, if you listen to the podcast or webinars, everything's a funnel to me, like everything. So if there are a million tenants in your area, how many know about you, how many are calling you, how many are signing an application, how many are moving in. So I would personally approach it from a marketing standpoint. And I mean, everything else I would say is the line I say oftentimes is even C-Class tenants watch Chip and Joanna Gaines. So they love the butcher block counters and stuff. So as long as you're competing in that area, then it just comes down to a marketing thing for me.

But anybody else want to jump in on it? I'll throw out one thing. So I had lunch today with Chris Clothier from Memphis Invest. And for those that don't know Chris's business, they are a turnkey company and they do management. They manage the properties that they sell. They have 6,000 properties under management in the Southeast. And I asked him what his typical turnover was.

And it's not multifamily, they're all single family, and they're probably not A-class. But I asked him what his turnover was, and he said, in a typical year, their turnover is 18%. So for those that aren't familiar, typical turnover is a tenant about every 22 months or about 45%. So the fact that he has such low turnover, my obvious next question was, what are you doing differently? And he basically attributed it to two things. One, properties were nicely renovated. So he renovated properties before he put tenants in. So tenants walked in, their first impression was good,

and they didn't have a lot of maintenance issues. That wanted to keep them around. But he said the big one was simply good tenant landlord relationship. He said, good customer service is the differentiator. Landlording is a commodity. Property management is a commodity business. And if you can differentiate yourself with amazing customer service, your tenants are going to stay because they know that most landlords aren't going to do that.

So I'm not saying it would necessarily work in your business or make a difference, but for somebody that has 6,000 units under management and 18% turnover, he's somebody worth listening to. Awesome, thanks. And I'm going to piggyback on what Jay just said. You know, one of the reasons that people in this industry get a bad name is because we don't provide that service. You know, the folks who stand out are the folks who are taking care of their tenants. They're doing good flips. They're not putting lipstick on a pig. They're not just slapping stuff around.

This industry, you need to have pride. You walk out. We all look good, right? You guys are all dressed nice and everything else. But you may have a property and you let it run like crap, right? Because it's cheaper or it's easier. But that's not going to help you grow. That's not going to help you grow.

That's why one of the big things of bigger pockets that we've always emphasized was be good to each other, be good to the community, take care of one another, and take care of each other. your clients. So if you start doing that and you start talking to other folks out there, you're going to notice other people don't care. They really don't. So if you guys commit to that and you say, hey, listen, you know, I'm going to be the best. I'm going to communicate with them, give them multiple ways to communicate, whether it's text, whatever it is, right? Create forms, create platforms and ways for your people to complain and then actually deal with those. Don't just

pass it aside. This stuff is really, really important. It's really. really not difficult, but it is the difference between that low and high turnover, and it's also a difference in a good and a bad reputation. And I think some of the best landlords that I happen to know are the ones who've grown their business through word of mouth. You know, hey, listen, I've got this building. We just got a new property. I know that this person wants to move up from the C to the B, and I've got the C and I'm about to pick up the B. I have that relationship with my tenant, I can move them up, right? You're not going to have that vacancy over there and that B. You may have it in the C, which is probably a little better than this and having

in the B. Anyway, point being, I think it was a great point, Jay, and yeah, be there for your folks. Did you still want an analogy? Absolutely. I think Mindy wanted to jump in as well. Can it be involved in you falling down? I want to jump in really quick. I'm surprised nobody said short-term rentals. What is the short-term rental market?

I'm not familiar with Fargo, but there's short-term and there's like longer short-term. So traveling nurses, they have oil and gas up there, right? We do. Yep. So the workers that are there, if you can provide furnished rentals for short or slightly longer term, like corporate housing, that's also a very – could be a viable option. Yeah, that's a great suggestion. And it works really well for us in the winter. We do use that some.

So, yeah, excellent suggestion, though. Thanks. All right, great. So you got a B-class, C-class unit, and you're worried about losing your tenants to A-class. right yes you got to think that you got a girlfriend and you're cool but he's got a six-pack he's got a Ferrari right he's got a jaw like a Greek god and and you're like you're cool are you describing me you'll loser if you don't take extra good care of her that's what everybody's telling you you better be buying flowers you better be telling

how you feel, you better be writing love letters. If you put more effort into it, you can keep that tenant. But you're not the Italian stuntman with a Ferrari and the six-pack who's just going to show up and wave a shiny object, right? You nailed it. I think, I think, I thought under all that pressure, you might not live up to the expectation, but you crush that one. All right, sir, over here on the right.

Eric Delaney, Lincoln, Nebraska. I want to house hack and preferably be our, or, for myself and my kids, right? Why is that funny? For myself and my kids to get a foothold, right? So I've got a partner, and we've got a little bit of money in a couple different sources. So in order to do that, we've got to go a little bit higher in the market and cobble together our finances to buy that piece, right? But in our market, the best way to find something like that so far, to me, has been on the MLS, right?

And so there, and in our market again, those sellers are asking for pre-approval immediately, right? You've got to have that. You're not even in the game, right? So cobbling together finances like that or funding like that becomes tricky when I'm trying to do that. So what I'm looking for is a strategy ethically to have that piece of paper or some kind of evidence going in the door on my first offer. I can say, hey, look, I got it. Here's my answer. Did you talk to a lender by getting a pre-approval?

Yes, yes, right. But that's the thing. Our resources don't evolve around traditional conventional. You can't get pre-approved is what you're saying, right? Not for the number that we need, no. Okay. Can you get a hard money lender to give you a pre-approval and buy it that way and then refinance into the traditional one later?

Part of it. That's what I mean. So it's like I'd have to get... So think of it from the seller's perspective. They don't really care where the money comes from. They just want to know you have the money. If you have the cash, that's fine. If you can get proof of funds from some friends

and note saying we'll let him borrow the money, that's fine. If it's a hard money lender, if it's a traditional financing, they just want to know that you have the ability to close. But you want to know that I can get into the cheapest interest rate that I possibly can. So what I tell people when they're in that kind of a situation is don't try to hit a home run on every pitch. You don't have to get, I just said it again, didn't I? Sorry. You don't have to get the perfect financing for you and the perfect situation for the seller all wrapped up in the same move. Break it into small pieces. get them the assurance that they need so that they know you can close on the deal. You close on the deal.

Then at the same time, you're working with the lender to figure out what do you need for me so that I can get this interest rate and break that into three or four smaller steps. Right. Thanks. How confident are you that you're going to close on that deal? Any particular deal? On any deal? I'm confused.

So you make an offer to a seller. A seller accepts. It's a financed offer. How confident are you that you'll come up with the money? Absolutely, totally confident. Okay. It's not a question. Then put down as big of a non-refundable earnest money deposit as possible,

and the seller is going to think, okay, I hope he walks. I'll take the 20K and go find another buyer. So put down a big enough EM deposit that they're hoping you don't follow through, and they'll accept that offer in a heartbeat. Gotcha. Thanks. Awesome. All right. So, Scott, I have a question for you.

You were a famously frugal person, are you not? I hope that's not. Yes. All right. So, we have a question from the audience here. If you had to spend $10,000 on yourself, you weren't allowed to invest it. What would you spend it on? All right.

First, I would, the grocery bill. Lots of fruit, nice and healthy food. I'm a huge nut for that. Second, I'm, you know, there's one thing that you know about somebody who does CrossFit is that they will tell you that they do CrossFit. So I would spend it on my CrossFit membership. that I'm working on there. And then I put probably the rest towards

I'm getting married next year, so the wedding. That's probably... I think... Even when forced to splurred on yourself, you do like the healthiest, most positive things that you could possibly do. By my audible membership. The entire collective works of bigger pockets.

Just try and learn as much as you can. Awesome. All right, Carol, I have a question for you. Oh, boy. So if you could start over in investing, what would you wish you knew at the beginning that you know now? Different husband. Oh, my gosh, don't say that out loud.

Wow. What would we do different in the beginning? I'll tell you what, we've talked a lot about this in a lot of the different sessions. And Brandon talked about it this morning, the whole concept of just, because Jay and I have worked together since the very beginning. And in the very beginning, I knew absolutely nothing about any of this. He knew absolutely nothing about any of this. But we were both convinced we knew absolutely everything about everything.

So we decided that we were just going to both run the show. And we fought like crazy. I'm just going to be thrown out there. We had a tough couple of years. So I wish in the very beginning that we would have understood this whole concept of not only in real estate investing, but in any business, of really figuring out what it is that I really, really like to do and I'm really, really good at doing. and what he likes to do and he's really, really good at doing. And then taking that a step further and actually just let him do what he's good at doing.

And so deciding that I was really better at it than he was. So for me, the biggest thing that would have made all the difference would have been just to trust each other in the specific roles that we had. One other thing that I think was specific to our situation, it's a hindsight is 2020 type of thing. Like many, I think it took us a while to get started. and we fell into this whole situation in Atlanta in 2008. And we basically walked right into a gold mine and did not realize it. So what I wish we would have done differently is purchased every single house that was available out there and that sold them for a really long time.

And how that translates to right now is when you're on your investing journey, yes, you run the numbers. Yes, you analyze and come up with exit strategy. after exit strategy to make sure it's a safe investment. But also trust your gut. Go with what you know is going to work. Trust in yourself and know that these risks are worth it and ask yourself, what's the absolute worst scenario that could happen? So you lose some money. You know what? It's not the end of the world. Worst case, you go back and get a regular job, right? Your health is all that matters. Your health, your family, having financial freedom and having the ability to do what you want with

your time. So go with your heart, go with your gut, and not just with the numbers. Nice. That's great. Josh, I'm curious if you have anything to add sort of as a, from an entrepreneurial perspective, sort of what do you wish you knew at the beginning of starting bigger pockets that you know now? Oh, that's a good one. I think Carol picked out a really good point about trusting your gut. I'm going to talk about this tomorrow. I definitely would have hired my first employee way, way, away sooner than eight years in. But truthfully, there were a lot of reasons that I waited for that amount of time, and a lot of it had to do with confidence.

I didn't want to take out debt to build my business, and I couldn't afford Brandon Turner. Look at them. But that was one of the big things, was hire more quickly, grow up more quickly, have more confidence in what I was building, The fear stuff is a really big one. And I think over the years, you know, the thousands and thousands of people I've spoken to, you know, in Bigger Pockets community, fear is the thing that stops everybody.

And that fear is not only stopping somebody from getting started, it's also stopping the next person from scaling. And it's stopping the person from scaling who suddenly, you know, is facing objections because the market's shifting from actually shifting their business as well. And so, as Carol said, one of the biggest things, I think really would be to do that, to trust your gut. That knowledge, you're never going to know everything. You look at these people on the stage here, and you think, hey, these guys know everything.

I'm sorry, we're all still learning. And if anyone ever tells you that they know everything, run. Because they don't know what they're talking about and they're full of shit. So I think that would be some little trinkets of advice. Mindy knows everything, though. Yeah, she does. Before we get back to the audience questions, Jay, you said that you and Brandon had prepared an interpretive dance for us when we are getting ready. Now's a good time.

That's just for the VIPs. We'll do that. We'll do that. After the cocktail party? Private sessions. Okay, great. We were going to do it over on Little Beach. Okay.

All right, yeah. Check in with them at the cocktail party about that. All right. So let's get back to some of the audience questions, sir, over here. Thanks again for this conference. This is Kyle Mast, CFP and real estate investor from Oregon. I'm going to go to the next generation here, and anyone can take this. What is the most important thing that you will teach your children or have taught your children

or wish you would have taught your children about real estate investing? I have a two-year-old son. Very selfish question. Go for it. I'm going to take it and then I'm going to hand it over. So honestly, I think the best advice was not necessarily. one that I would teach my child, but it's advice that I would take for those people who are about to have a child. And this is where I handed over to Brandon, who, at the birth of each child, acquires a property in their name.

Why don't you explain kind of your strategy? Yeah, a lot of you know this already, but when Rosie was born, I bought her a fourplex the week she was born. Now, it's in my name. I get the cash flow from it, but we put it on an 18-year mortgage. So in 18 years, it's paid off to zero, and that it will be worth three to 400. $100,000 at that time, that funds her whole college. But more importantly, is to answer your question is from the, I mean, she already knows. Every time we're visiting the area now, because we moved, but when we're down that area, I take her buy it, and I say, this is your property, and this is yours.

And then when she's probably five years old, she's going to start seeing this is the money that came in, and this is how much money went out. And then when she's a little older, I'm a teacher, you know, this is all of the expenses and all the income. And by the time she's in college, I hope she doesn't go to college, right? I hope that will be the lesson that she's taught of 18 years. And our little boy who's born, you know, December 7-ish, I will do the same thing for him.

And he'll get a property as well. And it's cool about the strategy as a matter where you can just pretty much buy any property, anywhere in the country. It doesn't even technically have to cash flow and just put on a 15-year mortgage and your tenants will pay for your kids' college education. So anyway, it's not about the college education. It's about that lesson. And I'll follow up one more second thing is when Rosie is 11-year-old.

old and my little boy is nine or eight or whatever the math is. I'm not good at math. But however that works. Don't tell people that. That's why I use the bigger pockets rental property kind of. And if you sign up today, I'll give you a discount. So I want when their friends wonder why their dad can't go on the field trip with them. And when their friends wonder why their dad isn't at the ball game. And Rosie starts to wonder, why is dad always at my stuff?

Like in a good way, right? I want, like, that is the impact I want to make. Because we can't teach somebody that. You can't tell somebody that. But that's something that they'll just know that there's something different. I want to add to that, Brandon. It's exactly what you said, because Jay and I, we do this full time now. And our boys are 15 months apart, eight and one just turn 10.

And in addition to it just being something that they know, we make sure we remind them all the time. Like we talk about it. We're like, we're here. Yep, get used to it because we're going to be every little last thing. And why is that? Because we don't spend all of our money. We invest our money and we put it towards other things. And so they get that on a daily basis. The other thing that we tell our boys constantly, and I was having this conversation with Shannon at lunch today, is that they are living in such an amazing time, right? With all of this technology that's available out there. Anything you could ever possibly want to learn to do, any person that you could ever want to mentor you or anyone you want to connect with learn from is available at your

fingertips, right? So we remind them every single day. You want to learn how to do origami. Great. Go online and figure it out. Oh, and while you're doing that, why don't you start making them into Christmas ornaments and selling them? So just continuously letting them realize they're just growing up in such an amazing time where the world truly is at their fingertips and they can do whatever the heck they want to do with hard work and if they make some sacrifices, they don't have to have these amazing video games and clothes in all of those things that there are so many better ways to invest your money. We've been telling them that since they were babies. And just to add to that, I know Carol and I kind of grew up in similar situations. Our families

had very little money. Our families didn't talk about money. I never knew how much money my family made. I didn't know where it went. I didn't know how much things cost. I didn't know how to balance a checkbook when I got out of high school. And we've always vowed that with our kids, we're not going to make that same mistake. And money is not a taboo subject in our house. Our kids know how much money we make. They know how much we spend. They know how much things cost. And we're very purposeful about communicating that and letting them know they can ask those questions. Everything we do, we try to bring back to the real world. And our kids, like Carol said, are eight and nine, or I guess eight and ten now. And a lot of people look at our kids and go,

well, they're too young to really understand investing, but they're not. They can start to learn simple concepts. And so a couple of the things we do is a couple years ago, I started borrowing money from my kids. So my kids would get money for birthdays or holidays or something like that. And they always know they take some of that money and they donate it. They take some of that money and they put it in the bank. They take some of that money and they spend it. And what we talked about was that money you're going to take and put in the bank, how about this? Why don't you lend it to mom and dad? Mom and dad will pay you interest. And not just are we going to pay you interest, but we're going to do this the correct way. We're going to write up what's called a

promissory note. It's going to say, Chase, my son, is lending dad this much money for this amount of time at this interest rate with payments paid at these at this scheduled time and very large interest payments. Generally, it's 100% interest like every other month. Because let's be realistic. As adults, how exciting is it to get a $5 check or a $5 interest payment on your savings account every month? Even if it's 10% interest, if you only have $1,000 in there and you're only making

$50 a month, it's not exciting. And so for kids, you have to add that excitement. It has to feel like it's adding up. So we give them high interest rates. But they actually sign this promissory note. They take this promissory note. They have a little kids. It's like a piggy bank.

It's a safe. And they put the promissory note in there. And it's their job every month. Well, it's my job every month to pay them. But if I forget to pay them, it's their job to come tell me, you owe me money. Oh, and there's a penalty on there if you're not paying me by the fifth of every month. Completely seriously. And so they're excited.

I'll sometimes purposely not pay them because they get really. excited. Like you can tell by the third or fourth of the month, they're like, kind of like, hey, dad, you dad. And then the fifth of the month, they're like, you owe me extra. And so things like that. Last summer, they started, they did their first lemonade stand. And instead of just giving them money or buying them lemonade, we talked about, okay, we need to figure out how much the materials cost. And we need to do a cost of goods. And mom and dad are going to let you borrow $50. You're going to buy cups. You're going to buy lemonade. You're going to buy the tablecloth and the sign and all of that. And by the way, here's an IOU, you owe us $50. They went out, they sold lemonade,

they came back in, and I said, okay, now we're going to do a profit and loss statement. We're going to figure out how much money you have in your little box, and that's your income, minus the cost of goods. How much did you spend on lemonade and all this? What were your other expenses? And then your bottom line, that's how much money you made. And every day that they go out and do a lemonade stand, they come in and they do a profit and loss statement. And it's obviously a lot simpler than the profit and loss statement that we do in our business. But it starts to get them thinking about the fact that you don't just, somebody doesn't just give you lemonade and you just make money and you keep all the money,

that you actually have to spend money into business to make money. And if you spend too much, my kids asked me a couple years ago, like, so if I want to sell more, why don't I just lower the price? Like, I can just make it really low and people will buy lots of it. And, well, they don't understand necessarily if you make the price too low, you're going to lose money. And so this actually puts it in terms that they can understand. So start doing those things with your kids.

Even if they're really young, even if it's just in a really small scale, start doing real world things with them. Talk about money. Talk about how much things cost. And don't be scared to have those conversations because my parents were scared to have them with me. And it took me a long time to kind of learn all of this and get out of debt. Jay, I will lend you money at 100% interest.

as much as you want. So I make my kids negotiate that interest. And so they can also practice. We talk about negotiation. 95%. Is this a new financial independence strategy where you just teach your kids to work and then you don't have to anymore? It sounds great.

Okay, so Jay took most of my answer. Talk to your kids about money, but you ask what would we, what would I teach them? I'm trying to impart upon them that they need to become real estate agents at the age of 18. All right. So, sir, over here. Hey, I wanted to ask a little bit more of a fun question and give Jay a plug. It's episode 20, David's episode, or I did interview questions, and I thought it was awesome. So, David, this plays to you a little bit with the analogies.

The question is, imagine a world where there's no humans left and only animals. and what animal would you be and why? This is great. Wait, what, can we answer or just see? This is exactly the kind of question I was hoping people would ask. Please start asking more of these questions. I think we should just go down the line on this one. I'm Jacob from Ann Arbor, Michigan.

Scott? I'd go with an eagle. Who wouldn't want to soar on the updrafts and hang around and be above everything else? Go with that. You want to have any idea? All right, we'll come back to you, Brandon. I want to be a super chicken. There are chickens out there,

and then there are super chickens, which are like the best chickens. I want to be a super chicken. Like the fluffy ones? They dominate the field, but they also shelter everybody and make sure everyone is protected from the foxes. And the Eagles.

You're a warrior chicken. I'm a warrior chicken. So are we turning into animals like human beings are not allowed? And we can morph into what we want to be morphed into? Or are we reborn as an animal? I need more clarity. Yeah, reborn is a good way. Put it.

Does that matter? He needs backstory. He needs context. Honestly. Because this is hard, right? If you give yourself a lame animal, everyone will look at you lame. Brandon just called himself a chicken. A lot of you are going to come talk to me instead of Brandon now because you're like,

well, you kind of suck. But if you go with a cool animal that's kind of arrogant, right? And you just kind of made yourself a D-bag. So I really did have to stall. And I'm a little too tired to stall any longer. So. Yeah, for those I didn't know, David's flight was canceled last night or messed up. And so he ended up sleeping an hour and then getting here this morning at like whatever.

So he had an adventure to. get here. So you should be a... So what's an animal that sleeps? Yeah, what's an animal? A lot of that does sloths. I think, yeah. The sloth is actually really intelligent, because they can actually swim, which most people don't know. That's not me. It's a zoologist over here. I think I would be an animal that, I just like to win everything. I'm really, really competitive. And I'm okay if I'm not the best at first, but I have to end up being the best at the end. So maybe some of the audience can tell me an animal that It's like that.

If that makes any sense, it's almost like... A bear? A bear? Lion? Yeah, I would be a lion. I really like taking on new challenges. And I'm also kind of lazy at times. Like, male, I don't really do a lot of work.

They let the female lions go do all the hunting. I use accountants like Ben to be my lioness to do all the heavy lifting. And I just get all the credit. So, yeah, a lion would probably be a good bet. Wow. How do you follow that, Josh? You know, being like five, foot two and, you know, weighing six pounds soaking wet.

I want something really big and tall so I can feel what it's like to be like that. So I'd say giraffe. Yeah, giraffe. That's a good one. I'm going to go with the bear. I'm lazy. I like to, if I could sleep six months at a time, I would, knowing there are no predators out there.

so I can just eat all I want. Yeah, that's the life. I totally agree with you, Jay, just for the record. I just want to be a unicorn. You guys can love you unicorn. Before you go, what would you be? I knew that was going to be a rhetorical question. Actually, this is an interview question I asked people

when I interview for my job. And after getting lots of answers, the one that I reflected most against, and I think, okay, that's kind of like who I want to be. And that was an elephant, because an elephant is very sturdy, calm, centered, and intelligent. Nice. Wow. Higher that man. What are the odds that he just asked that question so he could tell us all he wanted to be an elephant?

That's just like when someone comes up to you and says, yeah, how do you work out? Yeah, how do you work out? I do CrossFit. That's awesome. All right. What's that? Oh, Mindy. Oh, I almost. I really like ant eaters.

That's the weirdest answer. Why are you whispering? I really like ant eaters. I'm going to yell that. I'm an ant eater. They're just, they're really beautiful. And they're really, like, their hair is. So, and they've got that weird.

I don't know. Not an answer. I think anyone is expecting. All right. Do we have another audience question over here? Yes, Daryl Putnam from Mountain Dew, and I'd be a chimpanzee because I like to get in trouble. This is going to be all the conversation at the Costco party now. I think it's a requirement now at the mic.

So earlier today, Tarle Yarbrard talked about how successfully he was at flipping homes, and then one day he woke up and he found himself really miserable, and his wife, they weren't connecting. He had to take a beat and kind of redefine his business, and he's led it into a beautiful life. So I'd love to hear from the panel what it is how they define their business so that they can better define their life. Great question.

So I didn't catch the last bit of that. Could you repeat, how you define your business? So how do you find your business so you can better define your life? Yeah, I mean, I think for, me, it starts completely with the mission has to align with my personal mission, right? And then the second piece is, you know, everyone's got a different personality, right? We talked about disc profiles earlier today. And one of the profile, other components, is the C, which is the consistency, or not the S, which is the steadiness piece, right? It's the green bar if you're

familiar with it. And mine, like, I have to be doing something different every day. If I'm doing the same thing day after day, I get bored immediately and I'm no, I'm no longer good at it. So So that part of the business, one of the things that gets me going every day at bigger pockets, is there's always a new challenge to solve, a new skill set that needs to be applied, a new book that needs to be read, a new concept, a new mental model I need to unpack. And so I'm happiest doing that and having a clear plan to grow and move forward and accelerate. So for me, the work that I found myself going into is something that fulfills me in that capacity, where I'm able to go against. apply my skills in that passion. So my investing business is

live in flipping, and I do that because I'm cheap and I don't want to pay taxes, and that allows me to pay no taxes. So more, I mean, so what's driving? So more of the mission is what I'm looking for. What is that key component

that drives you to make sure that your business is working well, so it's not taking over your life? So at the end of the day, when you kick your feet up, you're content, and you're loving the person sitting next to you. My business kind of takes over my life because I live in my construction zone. Maybe I'm doing it wrong. On that, people assume that I'm like the busiest person of all time, which I think is funny,

because like every day I'll finish up work around 6, 6.30, and then I go home, and I don't touch any of it for the rest of the night. I almost never touch it on the weekends. I'm available if something's needed, but there's a time in place for business. I do it there, and then I do not bring it home, which is very anti-millennial of me, I know, but that's how I like to go about things. And for me, that keeps me sane and consistent. And I've been able to continually apply myself to my work for the last five years straight

without getting bored at all because I have that complete separation there. So I think that's a sustainability, and you can get that or not have that, no matter how big or small your business is, in my opinion. All right, great. Sir, over here on the left. So my name is Dave Ever from Los Angeles. And first of all, I like to commend you for being leaders and educators in real estate investment in financial literacy. So my question is, and you guys speak to this on the money podcast, the rising cost of education and the national student debt crisis. I'm just wondering with these students, these young and repressible kids taking out more debt for education, how is that going to eventually impact the real estate industry?

because they can barely afford the loan payments as it is right now. So I've actually got an opinion on this one. What? Yeah, I got a very strong. And I've been meaning to make this a weekend project, what are these weekends? But at some point I want to model out, what's the value add for a college education against the median college graduate versus the median non-college graduate? And what's the cost of that education, right?

And at some point, at some discount rate, that is going to intersect. if it hasn't already, where there's no value add from the average or median college degree. And at that point, a major shift is going to happen in the economy, one way or another, regardless of the politics of the situation with all the student loan debt, because it's not going to be economical anymore. Prices are going to have to come down, and demand is going to shift to something else. So that's going to have an interesting ramification of the economy, and I have no idea how that's going to impact everything else.

But as far as real estate prices are going, what you're seeing is millennials are, you know, a portion of millennials, one in six millennials, has $100,000 saved, right? The remaining portion are famously bad with money, which I'm sure has been cited over and over again. But that portion is going to really dictate, I think, the housing market over the next 20 years. So those are your home buyers. We're the biggest generation in American history. So, you know, I'm not 100% concerned that that will impact your home buyers, but I also think you're going to see a continuation of this long-term trend of housing shifting to that rental segment. So single-family homes converting into single-family rentals because the people with more money

are going to be able to buy more and more rental properties and out-compete the first-time homebuyer. So I don't know if that's a helpful concept on that. And that's already happening. And I'm going to butcher the data, but I just was reading something the other day about how corporate ownership of single-family homes is all-time, highs. And what you're starting to see is almost like the Europeification. Is that a word? I made it up. It's my first word. It's good. Yeah. The Europeification of the U.S. housing stock, which is, as Scott said, you're seeing less and less individual owners and more and more owners of multiple properties. And so, you know, across Europe, you've got really a rental population.

But at the same time that that's happening, I think to kind of piggyback on the college thing, I've got a 10-year-old turning 11. We're seven years out, and my wife and I constantly talk. I taught high school for a while. And we talk about education for our kids and college and the value of college. One of the coolest things that I've seen through growing my business was, you don't actually need a college degree to be successful. How many people are?

I'm actually curious. Who here does not have a college degree? I mean, that's a pretty good number. And of those people, I'm going to pledge that you're probably all fairly successful in your own way, shape, or form. So more and more, if I ask that question next year, in two years and five years, those numbers are probably going to go up. And there's reasons for that. You know, the reasons are if you're on the engineering side, for example, there's coding schools if you want to learn how to code, technical schools that are providing skills that you're, needed a college degree for before, but you may not need a college degree for now.

And so we're getting to this really funny inflection point where, you know, hey, listen, you know, to my kids, what I say is work hard, study hard, but when the time comes, you know, if you want to just go for kind of general studies, I'm not going to, you know, pay or I'm not going to offer to help to send you to some very expensive school. You can go to a local school, you know, until you figure out what you want to do. because, you know, and we're fortunate enough to not have the debt be as much of an issue, but, you know, for the average person, like, you can go, you know, if you go to Harvard, obviously you can study whatever the hell you want, you're probably going to do pretty well in your life, right?

If you go to the Ives, you're going to, you know, Stanford, MIT, you go to these places, your life is pretty taken care of. But if you go and you study, you know, philosophy at where I went, Washington University, a great school, you know, you're going to be burdened with a hell of a lot of debt, and you're going to get out of school making $30,000 a year saying, why the hell did I do that? And then all of a sudden, now, how are you going to own a property? How are you going to do this? You've got these crazy payments.

So that shift I think we're starting to move towards, and I think it's going to accelerate this technology makes it easy and easier to get educated in these different areas. Awesome. So to tackle the question from a slightly different perspective, but to answer the question of what's going to happen, just something to think about. I don't obviously know what's going to happen, but something to think about from an economic perspective.

So the economy, as a lot of us know, especially if you've read my book, Recession Proof, Real Estate Investing, the economy works in cycles. Goes up, goes up, goes down, goes down. One of the main drivers of that going up and going down is debt. And so we often refer to this five, six, seven, eight-year cycle as a business cycle, but we also refer to it as the debt cycle, because one of the things we see is,

as the economy goes up, Americans, both personal and corporate, build debt. And eventually we get to the inflection point at the top and the market starts to turn and we have a recession, and it goes down. And one of the things we tend to see in a recession is we see a de-leveraging of that debt.

That debt goes away. People, companies file for bankruptcy or they restructure their debt. So at the end of a recession, at the bottom, before we start that now, expansion, we tend to see a very relatively low amount of debt, both personally and corporate. And that's worked for 160 years. Now, the problem we're seeing today is that historically that debt has been revolving debt. It's been non-government college debt. The interesting thing

with college debt is you can't bankruptcy it away. It doesn't go away in a bankruptcy. And we have $9 trillion in personal debt these days, and a very high percentage of that for the first time is college debt. So what we're likely to see is in the next recession, while a lot of that personal debt goes away, the college debt's not going to go away. And so what we're going to see is we're going to get to the bottom of that recession, and debt's going to be disproportionately high compared to previous recessions. And so we're not going to be able to dig our way out of the recession yearly as well. We're not going to see that bottom as nice, defined as we typically do.

And I think at that point, the government's going to have to step in, and they're going to have to change something policy-wise. They're either going to have to say, we're going to get rid of some of this debt, we're going to allow people to restructure this debt, we're going to allow this debt to be discharged in bankruptcy. But I think it's going to actually impact the U.S. economy negatively over the next couple economic cycles if the government doesn't change policy. Don't know exactly what they're going to do, but I think that it's going to have a big

impact and something's going to have to be done. Thank you. Awesome. Great, sir. My name is Mark. I'm from Fort Lauderdale. We're in real estate and restaurants. I just want to say one thing to Scott first.

Don't let your wife list or your future wife listen to this podcast. You chose fruit. You're going to get a lot of crap when you go home. So I have a business that's about two hours away that I have to visit about once a week. and about four or five years ago, I actually changed the payroll day to Thursday so I can coincide it with the podcast. And I tell you, and we love,

Brandon, you've been great and a great inspiration. Now I have to find two more properties that are two hours away so I can make sure I listen to Money Show on the business podcast. But question really is for Josh, and you guys have become our extended family knowing you and listening to you for so long.

How is your daughter? Thank you for asking. She's doing well, and I'm actually going to, tomorrow in my keynote, you'll learn more. Okay. Great. Thanks. I appreciate you asking. Great. Additionally, Josh, would you rather fight a thousand duck, horse-sized ducks?

Hey, did I screw it up? This was submitted. Would you rather fight one horse-sized duck or 100 duck-sized horses? Could I be a super chicken? Yes. A thousand duck-sized horses? Yes. Excellent.

All right. Over here on the left, please. Hi, I'm Cameron O'Connor out of Indianapolis, Indiana. 25 years old, currently house hacking. Just quit my job last week. And I wanted to ask you guys what would be the single most valuable tool or method or something that you would did or wish you would have taken advantage have to springboard yourself to financially being free?

Yeah. So for me, when I was 25, I quit my job and joined a startup called Bigger Pockets. And so, yeah, at that point, what I would say is, one, you got to find great mentors. So I had Josh, Brandon, some of the other folks on the stage here to learn from. Two, it was kind of a relentless obsession almost with self-education. I think I read 50 books a year on various topics, and I was constantly getting continual intense pressure from these two to learn conversion, Excel, and all the other online tools

and things that we needed to learn, right? And the third was the accumulation of capital that I could readily access, so the cash in my bank account that I could use for what I ended up using it for was a house hack, but regardless of that, some opportunity that I can take advantage of that I have complete control over. So those would be my three. I'd like to add one to that. First of all, congratulations on leaving your job. That is absolutely phenomenal. I'm so happy for you. I would recommend you network your butt off and specifically seek out other people who are already financially independent. Because you're in this unique situation right now where a lot of people,

frankly, that are outside of like these circles, people who are not financially independent, they are not going to have any idea what you're talking about. They're going to think you're kind of crazy. They're going to be like, oh, good luck with all that. You know, it's just people, if they're, if they're not like-minded, they're just going to question every decision and you're going to start questioning yourself. So I would recommend a big action item to do as soon as possible is to leverage these relationships in here, find other people in your local community who have similar values in mindsets, in views on money and financial independence that you do. Yeah.

I would also say part of being an entrepreneur, part of being self-employed is it's a rollercoaster. You're going to have good days. You're going to have bad days. And you have to kind of take a perspective above the day to day. And you have to realize that every day you just need to move forward. And no matter what happens, there are going to be days you want to come. quick. There are going to be days you don't feel like getting out of bed. Get out of bed. Take one step forward. Take two steps forward. Just every day keep moving forward. And if you

ever question, say, I'll have that question tomorrow. If you don't, if you don't think you can do it, if you say, yeah, this isn't working, put that off for a day or two. Just say, for the next two days, I'm just going to keep moving forward. And I'll think about all the things that are going wrong in two or three days. And just keep moving forward because in two or three days, your perspective's going to change and things are going to get better. And so you just got to fight through the bad and the good will come. Don't give up. Create an LLC and then open up a self-directed solo 401K. Well, that's a good point, Jay, about having bad days. I'm curious if you guys have any

opinions on what part of being an investor is the hardest for you? Brandon? As an entrepreneur, as an investor, you are an entrepreneur. You're acting in that capacity, at least even if you have another job, you're investing world, you're an entrepreneur, don't have a boss telling you what to go do. And I think there's two huge struggles that I found when I got out of being a cop and I got into being an entrepreneur, a business owner, a full-time investor or whatever. The first is that I was not prepared for what Jay said very articulately, and I will say very crassly, is entrepreneurial bipolarism. You are going to go from, I am a lion and I can take down anything I want to, I am a loser, and I don't want anyone to see me

every single week. It's insane how your highs and lows make no sense and you go through this. And you'll just think something's wrong with you and I'm telling you that is like a part of the process. Every entrepreneur fills that. I guarantee you, I've never talked to Josh, but he would tell you there's times he thought

bigger pockets could take over the world and there's times he thought, I don't even want anyone to know that I made this website because it sucks that bad. And the truth is somewhere in the middle, right? And the second piece that nobody told me was that we all look, I shouldn't say we all.

We often look at a boss as a bad thing. A job is a bad thing. Structure is what we have to free ourselves from. That is the enemy. And we don't realize that oftentimes we operate our best within structure. The very best athletes have coaches. You know, like the Navy SEALs have a very tight system where they have to be at a certain place at a certain time and tons of training.

And the people who operate the best do it under discipline and structure. And when you lose that, it's very easy to start slacking off. but not recognizing your slacking off. So the advice that I would give you as an entrepreneur is to focus on what we call KPIs. That's a key performance indicator. What thing in your job, whatever it is, is the thing that will actually directly result

to you generating income. You can spend eight hours in an office, answering emails, designing a logo, creating a system, creating a spreadsheet, filling in boxes, and you will go home and you will have done zero work. You didn't do anything that moved you closer to your goal. You have to figure out however it is you make money,

what is the things that will actually result in making money? So for me, as a real estate agent, it is obvious. It is just talking to people. If I just talk to people and say, hey, let me know when someone wants to buy or sell a house, I made money, but just I haven't got it yet, right? Putting a listing in the MLS, taking the pictures, getting a form sign, that does nothing to make me money. That's just recognizing money that I've already made.

So if you're an investor, it's going to be telling everyone you know, will you tell me when someone has a distressed property? Will you keep me in mind when you hear about somebody who has a house? that they might add flip. How many wholesalers did I talk to today and ask them, what do I need to do to jump to the top of your list? How many contractors that I talked to and said, hey, when you come across a house that's in really bad shape and you can't get the deal, bring it to me.

If you let yourself slip away from KPIs and get caught up in all the other things in the business, you will look back over three months and say, where's all that money that I thought I was going to be making? It is so easy to do it when you don't have a boss and you don't have built-in accountability. I have a question. How much money do you want to make this next year? Threat of number $50,000.

$50,000. Okay, to make $50,000 next year, if you're working full-time, you need to make how much an hour? $25 an hour or so? If you work full-time, you're working about $2,000 a year. To make $50,000, you need to make $25 an hour. If you want to make $25 an hour,

you cannot focus on doing things that generate less than $25 an hour in your job, which means if you want to put a listing in the MLS, You can hire somebody to do that for $10 or $12 an hour. That's not the best use of your time. The best use of your time is the things that are generating you $25 an hour, at least, or $50 an hour, or $100 an hour, or $1,000 an hour. And those things are acquiring new clients. If you're in a service business, acquiring new properties,

if you're looking to buy new properties, finding deals, raising money. Those are the things that are going to generate $25, $500 an hour. So think about that every day. I need to make $25 an hour. I should not be doing anything right now myself that's generating less than $25 an hour. Go hire somebody that does the $12 an hour jobs. You make $50 an hour and you're netting more than $25. So always focus on that $25 number.

And when you want to make a half million dollars a year, don't do anything that's generating less than $250. Awesome. That's great advice. All right. So we do have about 10 minutes left, and I know we have two more audience. questions here. So, sir, what is your question? Mitch Klein, Evergreen, Colorado. And why all the hate for

dancing with the stars? But no, no, just kidding. So I, you know, I hear you ask all of your podcast guests, a couple in the famous for business book and real estate book. But if you only had the bandwidth to read one book in your entire life, what would you choose? That could be business, real estate, self-help, whatever you choose. I mean, I could do this one. For me, it's a book I read in a tough time. It's called The Monk Who Sold His Ferrari. A bit of a cheesy book, but it kind of follows the story of this attorney who is top performer.

You know, he's killing it, he's crushing it, he's driving the Lambo. You know, he's driving the Ferrari. and he's going through all this and all of a sudden he has this massive heart attack and he collapses and the story continues from the viewpoint of his mentee and who has been growing and becoming more and more successful and he's now overweight he's got all the things of life the luxuries but this young man comes into his office, and I'm going to ruin it for you, so you may not want to listen. But this young man comes in, and the young man was actually his former mentor, and he went off. You know, it's a fantasy of fable, but I love these fable stories like the richest man in Babylon and things like that.

And it just kind of walks him through all these rituals and different ways to think about how to improve upon his life. and it's things that we've had Hell Elrod on and other folks really dive into and talk about visioning, meditation, goal setting, things like that. But for me, that book has been fantastic. And if it's not that, that book, by the way, and Brandon can attest to this. Like, I was the biggest, like, those books are all BS. But as he and I've talked a lot over the years about different books and we've shared stories and things like that, you know, I have to say, that reading, besides being fundamental, is, no, reading, and Scott too, obviously.

Like, I mean, we all read a lot, a lot. And I've noticed that amongst the people that I believe are the most successful people and happiest people that I've met, they tend to read and consume books a lot. Anyway, check it out. Well, the correct answer is actually any book by Bigger Pockets Publishing.

That's what I was going to say. You got, like, 12 books. between the people up here. Anyone else? O the places you'll go. Awesome. All right. How not to die.

It's a great book, yeah. All right, so for our last audience question, ma'am. Hi, Lucia Russian Reliter in DFW. Has anybody on the panel made an investment with cryptocurrency, and to follow up from that, how do you feel that cryptocurrency will play a role in real estate moving forward? Brandon has a great YouTube video on this if you haven't seen it yet. I made a video once called Bitcoin of the Stupid Horrible, Terrible Investment. And then the next day it crashed.

And so you're welcome. Jay. I want to let Jay actually answer that. So I have some investments in some Bitcoin companies, equity investment. investments. I've all, or not Bitcoin, I'm sorry, crypto companies. I've also done a bunch of crypto investing. I'm not a huge believer in crypto. I'm a huge believer in blockchain, though. Blockchain is the underlying technology for crypto. It's kind of like back in 1999, people saying, so what do you think about pets.com? Or what do you think about Amazon.com?

There were a lot of websites back then, and I couldn't have said this one was going to do well or this one was going to do poorly, but I think it was safe to say at that point that the underlying technology and the Internet in general was going to do well. I think it's the same way with crypto today. Bitcoin might do well. Ethereum might do well. They all might do poorly. Million cryptocurrencies out there. Who knows how they're going to do. But the underlying technology, blockchain, I think, is going to be a foundational technology moving.

forward in terms of how I think it's going to affect real estate. I think the biggest way is that there are a number of companies that are focused on technology around fractional ownership. So imagine a situation where you own a Picasso painting and you want to raise some money. You don't want to sell your Picasso painting for $200 million, but you'd love to raise $10 million. So you want to sell 5% of your Picasso painting. blockchain and basically something like cryptocurrency on top of it could make it easy for you to sell fractional shares or shares of your painting to other people in a way that they can trust that they actually own it, they can sell it, they can trade it,

and eventually get paid for it, and blockchain provides the ability to do that. I think we'll see a lot in the real estate and fractional ownership space with blockchain moving forward where syndicators will be able to use blockchain and that type of technology to raise money. People like you and me will be able to buy a single family house and say, hey, I want to sell 25% of that on the open market to raise some money so I can buy my next house. Instead of going to a private lender or a portfolio lender

or getting a Fannie Mae loan, you may just sell 70% of that in equity or you may use it to get debt. So I think blockchain, and again, separate from cryptocurrency, I think blockchain is going to be foundational in technology, and I think it's going to have a big impact on the real estate space. Crypto in general, I think it's, I don't know. Yeah.

With cryptocurrency, you're investing in a store of value, right, a new currency. Right. And we live in the United States of America. And so if you try to pay me in Bitcoin, I can refuse. But I can't refuse payment in dollars, right? So why Bitcoin versus Ethereum versus another currency? or another currency. You're betting when you buy that,

that currency is going to be adopted and people are going to accept that as a store of value in the future. So to me, that doesn't, you know, for an investment for long-term wealth, it's got to generate cash flow and have a chance to get long-term appreciation, which, you know, to me,

these cryptos don't offer either. So it has to be one, you know, you have to hope that everybody adopts that currency for it to work out. So, you know, and even in that, case, if it becomes a widely accepted currency at a larger scale, then it becomes more like any other currency, like gold, right? Gold is not an appreciating asset. Gold is a store of value, right, that is kind of used as a hedge against inflation. And one of my favorite Warren Buffett

quotes is, you know, do you invest in gold war? And he says, well, you know, if you took all the gold in the world, you could pile it up into a cube, about 64 feet in length and height and all that all that good stuff. And that would be worth $7 trillion at the time. Instead, I could buy all the farmland in the United States and ExxonMobil seven times over. And which is the better way to build wealth long term? You know, it's the same thought experiment I think extended all the way to cryptocurrency. So for me, it's, if you think it's going to go up and you want to bet on it, that's great, but how are you going to make a level, how are you going to retire on Bitcoin? I don't know. I can give you a good way to look at it that will bring some clarity if you'd

Like, of course. During the gold rush, the amateur said, where am I going to go strike gold? I'm going to go check that load. I'm going to go to that mountain. I'm going to go to that river. And they spent a lot of money and they invested money into trying to strike it rich. There is no way you could have known where the gold was going to be, just like what Scott was saying, which cryptocurrency is going to be big. You'll drive yourself mad trying to figure that out. And it's not a KPI. It will make you think that you're doing some kind of work, but you're really not getting anywhere. You know who guaranteed to make money during the gold rush? the people who sold the materials to the miners or the 49ers, that's what you want to be a part of.

And that's really what Jay is saying, whether it was the internet or it was blockchain, it was being a part of the infrastructure, you're not going to miss if you do that. And one of the reasons that I love real estate is if for some reason Ethereum or Bitcoin takes off and I couldn't have known, I don't care, pay me my rent in that thing. Right?

Like, I win. You guys can try to figure out where the gold's going to be. you all got to bring it to me at the end of the day and pay me for these supplies. Great analogy to end on. But just piggyback in just to clarify, people are buying houses using Bitcoin. But we don't know the value of Bitcoin shifts every single day by vast percentages. So, you know, if you accept Bitcoin as your form of payment,

you're going to get paid on a million dollar house, and tomorrow that payment is worth $950,000. Right now it's a gimmick. If you're accepting that until there's any form of stability in that currency, you're gambling. And it's fine, go ahead and gamble. But, you know, can you not make as much on that property selling it for cash? So I would just say, you know, I think it's exceptionally risky.

You might as well, you know, accept rubles or, you know, Zimbabwean dollars. Thank you. Sure. All right. Thank you. We do have one more right-in question, and it's for you, Mindy. You love bigger pockets. Do you not?

I love bigger pockets. Okay. Oh, my God. And you also hate mushrooms. Is that true? More than life itself. So that's more than, no. I love more than, I love life.

I hate mushrooms with the, with the. So this question... With the burning passion of 10,000 sons. This question comes all the way from Hillary C. from Denver, Colorado. And she'd like to know if you had to choose to never go on bigger pockets ever again in your life

or eat a mushroom, what would you choose? Hillary! I think we have a mushroom for you. First of all, this is a horrible question. We won't make you answer, so. answer. How about this? Do you hate mushrooms more than

Josh hates pickles? Oh, I don't know. Nobody hates anything more than Josh hates pickles. We got stories. We have lots of stories. So many stories. All right.

Well, thank you guys so much for being here. We really appreciate this. Can we give everyone a round of applause? Awesome. Well, thank you guys for doing this with us. This was a lot of fun. It was our first time doing a live podcast. Hopefully it went pretty well in all your minds.

I had a good time. Just a bit of housekeeping. we do have a cocktail party right after this, sponsored by Memphis Invest. It's right out of these doors. After that, there is also a after party at Jason L. Deans downtown. If you guys look in your bags that we gave you, there is an Uber code that you can use to Uber down there

and also put on that yellow Bigger Pockets Premium Risk Band that will get you free drinks at Jason Aldeens this evening. And then tomorrow morning we'll be starting again at 9 a.m. with Josh's keynote so make sure to be there as well