BiggerPockets Real Estate Podcast - 149: Early Retirement, Real Estate Bubbles, and Dangerous Scams with Radio/TV Star Clark Howard!

Episode Date: November 19, 2015

Today on the BiggerPockets Podcast, we’re excited to sit down with an individual many people already know from television, radio, and the newspaper — Clark Howard. Besides being a nationally-syndicated radio and TV star, Clark Howard is also a real estate investor who has a unique outlook on the way real estate should fit into your financial picture, as well as numerous tips on avoiding scams, finding great locations to invest in, and much more! Don’t miss a second of this powerful episode! In This Episode We Cover: Who TV and Radio Personality Clark Howard is How he went from a beach bum to financially free His job at the radio station His investing portfolio A story about the real estate bust How he bought properties through the bust (2011) How to not get into the “investing hysteria“ Why you should avoid the “dare to be rich” pitch What the “smell test” is Why there’s no one magical way to invest Why understanding the local market is crucial How to farm neighborhoods Why you need to have a purpose behind how you’re investing Tips for investing in general And SO much more! Links from the Show BiggerPockets Analysis Tools Podcast Guesting Vanguard Books Mentioned in this Show 100 Questions Every First-Time Home Buyer Should Ask by Ilyce R. Glink Buy, Close, Move In! by Ilyce R. Glink The Wealthy Barber, Updated 3rd Edition by David Chilton The Power of Habit by Charles Duhigg Tweetable Topics: “It’s part of who we are that we want to believe in miracle stories.” (Tweet This!) Connect with Clark Clark’s Website The Clark Howard Podcast Learn more about your ad choices. Visit megaphone.fm/adchoices

This is the Bigger Pockets podcast show 149. This magical one way of creating wealth in whatever industry it is. There's no such thing. You're listening to Bigger Pockets Radio, simplifying real estate for investors large and small. If you're here looking to learn about real estate investing, without all the hype, you're in the right place. Stay tuned and be sure to join the millions of others who have benefited. from bigger pockets.com. Your home for real estate investing

online. What's going on, everybody? This is Josh Dorkin. Host to the Bigger Pockets podcast here with my co-host, the man, the myth, the... Yeah, he's not a legend. It's Brandon Turner. What's up, Josh? How you doing?

I'm good. I'm good, man. Very excited. I'm coming to you from the new studio, the new world headquarters of Bigger Pockets. We actually moved. we moved. We got a new office. That's right. I remember you talking about that last week. Congratulations. You moved. You haven't been around for like weeks because you've been putting IKEA furniture together and other stuff like that. That's just not true. That's just not true. Okay. There was one day you were putting IKEA furniture together. Yes. Yes. So yeah, things are good, man. We get where we're excited. The new office is great and things are good. You know, you're off to jet set yourself into, what is it, Ireland? I am going to Ireland. But by the time the show airs, I will be back home. But, I am going to Ireland tomorrow. I'm pretty excited about that.

Yeah. I'm going to go. I'm going to go play with some leprechauns and I don't know. Nice. Throw a rainbow or something. I don't know. Way to be stereotypical. That's awesome.

And drink Guinness while. Yeah, drink some Guinness while I'm playing with a lepercon. So, anyway, yeah. So things are good. Should we do today's quick tip? Quick tip. What is today's quick tip? Today's quick tip is something that we just introduced a couple weeks ago.

And I just wanted to share for those people who are using the Bigger Pockets analysis the software, like the rental property calculator or the house open calculator, the wholesale calculator, you now have the ability to share a link, a kind of a private link that you can get, it's on the bottom of the report page and like the, you know, on page four of the report. You can share that link with anybody, like a partner, spouse, lender, whatever. You just get this link, you copy it and you send it an email or whatever. And anybody can look at that link then that you send it to. It's just a nice way to be able to share your report.

So if you're doing a report, like I'll do one sometimes and send over the link to my wife and say, hey, check this out. And then she can go and look at that same report that I just generated and we can talk about that deal. So just kind of a quick, easy, simple way to get your analysis a little bit more, another set of eyes on it. Fantastic. Awesome. Awesome. Cool. I have an uncomfortable question for you. If your rent collection drop to 80% next month, how long would your cash flow hold up? What about 70% for the next three months? Would your cash reserves cover it? I talk all the time about scenario planning. Smart investors don't just model the upside. They also pressure test the downside. This is even more important in a down market. And that's why I like

Stessa's stress test report. It lets you model different rent collection scenarios, adjust expense assumptions, and instantly compare the results to your real bank balances. It's one of 12 professional grade reports inside Stessa Pro. Try it for yourself. Visit stessa.com slash mkTG slash bigger pockets and get six months of Stessa Pro for free because it's better to discover your risk in a report than in a recession. Have you ever lost a DSCR deal because the financing just took too long?

Red flags popped up late. The lender needed more time. The deal fell apart. Well, our friends at Dominion Financial just launched a program to help prevent that. With their new express rental loan, you can close in 10 days or less. And they still offer their price beat guarantee

so you can get great pricing and a timeline. you can count on. Fast, simple, reliable. That's Dominion Financial. Check them out at biggerpockets.com slash dominion. That's biggerpockets.com slash dominion. Here's why savvy real estate investors are obsessed with bonus depreciation. It lets you take that rental property or commercial building you own and depreciate most of the cost against your income. Legally, 100% IRS compliant. That's instant cash flow improvement. Cost segregation guys is the number one firm nationwide, specializing. in identifying these faster depreciating assets in your property. They've completed tens of thousands of studies across all 50 states from remote cabins to

apartment complexes. So if you own investment property, this is a no-brainer. So visit cost segregationguise.com slash BP for your free proposal and find out how much you could save this tax season. Guys, really quick, if you want to be a guest on the Bigger Pockets podcast, go and check out biggerpockets.com slash guest. There is absolutely. zero guarantee that you're going to be on the show if you fill out that form. However, we're always looking for guest ideas. So, you know, if you want to put yourself up in the running, please fill out the form. And if we think you're interesting or if we can fit you in some way,

we'll do that. Or if you're a nationally syndicated radio hosts that has millions of people listen to them every week. But we'll get there. We'll get there. Yeah. And just because we don't pick you doesn't mean you're not interesting. It's not a validation of. We still like you. Yeah. Yeah. Yeah. Anyway. So, Speaking of nationally syndicated radio hosts, today's show features Clark Howard, a nationally syndicated talk show host. He's a consumer expert.

His goal is to try to help you keep more of the money that you make. He talks about ripoffs, spending less money, save more money. He's a great guy, awesome personality. He's got a huge, huge following nationally. He's put out tons of books. He's been on TV. He's been all over the place.

I used to seriously watch him all the time. It was like my daily ritual. I'd watch the Clark Howard show on HLN. It was called HLN News. It was like CNN sub one. Anyway, I watch that all the time. There you go. So, yeah, it's pretty cool to have him on today.

And he's a real estate investor. He is. He is. And that's, that's the fun of all this. So we're really excited to have him. And let's just bring him on and get into this thing. All right, Clark, welcome to the show, man. It's good to have you here.

Thank you very much. It's great to be here. Yeah, this is weird talking to you. I watched you on TV for years, like the headline news. And like, I love that. stuff. So this is surreal. Well, it's scary for small children to see me on TV. I don't have a face for TV, but I've done it for years. I've been doing TV either as a reporter, an anchor, or a host for 25 years now. Wow. Wow. That's a long time on TV. That's impressive. Yeah, that's good. But you are a radio

guy more than anything, correct? Well, I've been doing both since I started in radio in 1987, started in 1991 and started my newspaper column in 1990. So I've been doing all for all three for a very long period of time. In 1990, I was not quite in diapers, but pretty darn close. You still might be, I'm 60. You know, I'm the old guy. And Clark's getting close to the point where he'll need some diapers himself. So, you know, that's right. You know, it's funny because you reach that point and like where you start looking for generic so that you know when that time comes, you'll wear them, you're ready. All right, man, let's talk about your store really quick.

So radio, TV, newspaper, but you started in the travel agency business, right? Yeah, well, it goes back one step further. I was a social worker right out of graduate school. Okay. And social worker for several years. And then the airlines had, this won't make any sense to you. but the government used to decide every flight that an airline could fly, every fare they could charge, and what time of day the flight could go.

Nice. And when airlines were deregulated, at the point they were deregulated, nobody ever flew. I mean, only the very, very wealthiest of people in the United States or very, very top executives would get on an airplane. It was an extreme luxury. Well, I believe so much in free markets. that I thought, you know, you deregulate the airlines, it's going to absolutely come alive as an industry. So I decided to become a travel agent, went to school to learn how to be a travel agent, work for one for a while, and then opened my own, my first one when I was 25, and then another and another,

and I kept building up new locations as the travel industry went from being basically asleep to totally alive with, And now that we only have just a few small airlines, four airlines control, 80% of travel in the country, four giant airlines. Back then we had more than a hundred airlines all competing for customers. And so it was a great business to be in because there were huge commissions I was getting in my travel agencies. And then people from one of the national chains came and bought me out and kicked me out the door on the day that we closed. Wow. And I moved to the east coast of Florida and became a beach bump. Nice.

Never had an intention to work again, was just having a good time at the beach. And then for obscure family reasons, I had to come back to my birth home of Atlanta, gave up the beach, and I was doing nothing. And then I got a call from a radio station asking me if I'd be a guest on a travel show they had. I did that one Sunday and that let me do another and another another. And one thing I've not mentioned, even when I was a social worker, I was really entrepreneurial. I bought my first foreclosure when I was 22 years old. I learned to invest in stocks when I was in my early 20s. And so I had the entrepreneurial thing and then opened my own business when I was 25.

So the radio station pretty quickly gave me a weekday show called Cover Your Assets, which was a weekday show about money and investing in real estate. and that really launched everything that I do now and have done ever since. I retired at 31, and when I retired, I never had an intention to work again, and now I work multiple jobs. So how do you explain that? That's funny. That's that entrepreneurial bug, man.

We can't stop. You can't put that genie back in the entrepreneurial bottle. I just love, I see opportunity, and I just have to grab it. Yeah. Outstanding. Well, let's talk about the real estate. So you bought your first foreclosure at 22. What was kind of, what was the mindset?

And then has that continued? I believe we did some reading that you've also done a bit of investing. Hopefully, that's not all that you did in the world of investing. But tell us a little bit about that. Well, I have nine real estate properties. Okay. And I have a pretty widespread investment portfolio in stocks, bonds, index funds. And so I am at base at heart, someone who is an investor and an active participant

in, particularly in the real estate. I have multiple rental properties. And so what I've always done is when the market has tanked, like I had a, okay, I'll tell you a funny story. What's funny to me. back in 2004 was when I started feeling that we were going to have a real estate bust. And it happened because a guy called in my radio show, and it was like an epiphany because I'd had all these people calling about investing in real estate during the bubble. And this guy was calling me about buying a property in North Fort Myers, Florida that was a condo that was only a figment of the developers, his imagination at that time. And he was asking me if he should buy 10 of them in this one building. And I'm like, oh my goodness. And, you know, because we were in the no money down, freak out craze where there was no documentation. You could buy anything just by having a heartbeat. And at that moment,

I was like, this is not going to end well. But the clincher for me later that year was there was a survey where people were asked, what was the value of real estate going to go up each year? And people believe that for eternity it was going to go up 20% a year. And that did it for me. So I did something totally out of my normal character. I stopped doing my normal because every pay period, every month, I put money into a variety of stock and bond investments. I stopped doing it late in 2004 and started banking.

all that money, preparing for what I thought was going to be an eventual real estate bust and accumulate a number of properties. So it turned out, I was right. It took longer than I thought. And I started buying too early. I bought my first foreclosure of the bust in early 2007. And then since then, I bought a number of others through the bus. The last one I bought that was a true distress sale was in 2011 and then values started their recovery. And since then I've only bought one more. I've been more cautious, but I ran it up to nine properties. Hey, I got a really quick funny story, which was I was an agent in LA, a real estate agent in 01, 0203-ish. And for me, It was, I was talking with some friends and one of our buddies is a cop and he had talked about

another cop who had just bought a million dollar house. And we're all like, this is crazy. I'm sorry. I love, you know, all for the police and everything else. But like, police shouldn't be able to be affording million dollars. I mean, on their salaries. Right. Something was wrong.

And yeah, there were a lot of signals. And everybody who says, oh, we didn't know what was going to happen. They were fall baloney. Right. And, you know, there's just part of human nature. If you go back through history, we've had manias going back to like the middle ages. And people get all psyched about something. Think about what we went through with Bitcoin a couple of years ago.

And now that started again, Bitcoin running up. So people want to believe. They want to believe the story. And I've heard it with gold. I've heard it with silver. Real estate, obviously. The dot-com bus back in the 19. late 1990s. So it's part of who we are is that we want to believe those miracle stories.

So I know Brandon wants to get to you on the real estate. I just want to ask really quickly on for people listening, how do we know that we're in one of these and how do we not get caught up in the mania? How do we not get into the hysteria and follow the hordes? I have a simple rule that is so anti-intellectual. What you do is you want to. when you're getting all excited about an investment or a new business or whatever, you look for that relative of yours or friend of yours who's the most negative person you can think of and let them try to shoot down your idea. And if you still believe in it after the most negative person in your life tells you every reason why you're an idiot and you still want to do it,

You may have passed the smell test and go forward because what can happen if you're open to hearing that person is they may open your eyes to things. The adrenaline running in you. The psychology won't let you see. It's kind of like the way I look at any mania, it's like when you meet a new woman and you're all excited about it and everything about her is perfect and the chase is on and you can't believe you've met the most gorgeous. brilliant, wonderful woman ever. And then you catch her and then it's like, oh, I didn't know that. I didn't know that. I mean, we've all been there in that infatuation phase. So it's painful when you break up from that person, or it turns out you got involved with the wrong person. It's even more painful in many ways financially when you do that with that infatuation about an investment, an opportunity and idea. So you got to have that person there who throws cold water. My now wife, who we've been married 20 years, when we were dating, everybody told her that I was scum,

run for me, stay away from me, that I was a nightmare to even date. And she ultimately made her own decision, probably the wrong one. And we ended up getting married. But she had all those skeptics telling her that I was just bad news. And so you need those people out there that help you apply the brakes and slow down that freight train you're on to do this particular, that particular investment or venture or whatever. Yeah. And I think that's good because, you know, people go to these, you know, real estate seminars or they watch a late night TV guy, right? And it's like, you know, you can get rich and you can have all this cool stuff I have. if you just, you know, and they get so excited and they get blinded to all like the reality of what they're really dealing with.

I mean, I know you talk a lot about scams. Like, do you do get people calling you about those kind of things? Like I got hooked by some late night charlatan or anything? I call them the dare to be rich pitch. Okay. I like that. And so with the dare to be rich, it's all about they have a secret system. Yep.

They're dying to share it with you. Yep. You get to come to the free ballroom presentation. And then, and the ballroom presentation is really all about, look at me, I drive a Ferrari. And in my spare time, I drive the Tesla. And I have my private jet and I have this and that and the other. And then the person up front says, and this can be you too. You can do this.

And all you need to do is spend $3,495 to take our introductory course. I mean, you know, been there, done that. It's funny. and TV will go hidden camera to these things. And they all have the same flavor and feeling. They are all identical. I don't know if you remember during the depths of the Great Recession, there were all these motivational road shows that were going on around the country.

And you'd have these big name motivational speakers who'd either come in or they'd be on the big screen in an arena. And that was all a speaker. smoke screen for all the dare to be rich crowd that would set up and they'd have their time on the agenda and they'd be in the breakout rooms. It was all about getting people to write those checks and sign up for the systems. Okay, so here's the thing I always tell people. If you are presented with a dare to be rich thing and the person says it's their secret system and the wealth you can create is unlimited.

Why would they ever, ever share it with you? Yep. They're not going to. Yep. Yeah. Yeah, I love the new thing where they get you to, you know, hey, go home and call your credit card company and let's show that you are a master negotiator. So you call your credit card company to increase your credit card limits so that, of course,

you have enough money on your credit card to pay for their expensive course. It's crazy. So let's go back to the smell test. I mean, you're this consumer advocate. You know, you're somebody, we, you know, we have bigger pockets. We were founded based upon me as a real estate investor having my smell test. These guys stink, right? So we created this place where it's communal learning. You know, let's bring everybody together and have successful people who are actually on the ground doing things, helping one another out instead of forcing people to rely on these folks to learn. And anyway, so what's the smell test? How does somebody know that they're in for a pitch, that they're in with somebody that they just need to get the hell out of there? Okay. So the way I look at this is with any that that really stink, it's that there's like this magical one way of creating wealth in whatever industry it is. There's no such thing. You know, you probably have made your wealth in real estate completely differently than I have. Everybody, there are certain principles you learn, basics you look for. But just as there are so many different houses, different neighborhoods, there are many different strategies to making money in any field.

You know, you can talk to the Wall Street crowd. And you can talk to one brilliant person after another. after another. And they all can convince you why their investment strategy is the one you should be doing. But it works for them. It's not necessarily going to work for you. You have to have a discipline system that you live by, but it's your discipline system. And what will work beautifully for you, let's take an example. I'll get a call from somebody who wants to do real estate, let's say, and they are somebody who is a former home contractor. Well, for them, they're probably best off buying the worst, nastiest, beat-up, smelliest home ever because they can, they know,

they have the skills, they have the right subs, they know how to go in and at the lowest possible cost, rehab, and either turn that into a rental property or sell it. But somebody who's a a white-collar man or woman who can't do anything for him or herself. Me. I can't do anything for myself. It requires a totally different kind of philosophy. And so that's why any seminar or dare to be rich thing where it's all about you doing their exact checkmark system has no credit at all. Yep. I could not agree more. I tell people that all the time because a lot of the guys are saying, you know, this thing called real estate wholesaling where you just find good deals or you should be a flipper like the, you know, like the TV shows, the flipping houses, or you should buy a

rental property or you should get into commercial or whatever, right? Like, and everyone says, this is how you should do it. And it's ridiculous. I mean, everybody has their own skills, their own time, their own talents, their own location, right? Like, what works in Atlanta won't necessarily work in Seattle, right, or Denver. And yeah, I love that advice. I think people should rewind that, listen to it a couple times because it is so true. And just, so let me expound on that. Can I say something before you go for? All right. So I have a friend, I'm throwing under the bus right now. I can say man or woman anything, but a real estate professional who got excited, knows a market

in one part of the country, got excited about buying real estate in Idaho. Had read something, heard something that Idaho was the place to go make money and lost her. shirt buying those properties in Idaho because she didn't understand the local market. And they say all politics is local, all real estate is local too. And you've got to do your homework. You've got to know that neighborhood. And I'm sorry, I digressed. No, I love that. I love that. So how does somebody do that? How does somebody know what is going to work in their area or what they should consider investing in? It's dull and it's time consuming. You know, you don't make snap judgments.

You really get to know a street. You get to know a neighborhood. You know, I'll talk to people who feel like they know a neighborhood and they want to buy their first investment property, their first rental property. And they'll look specifically for what they can buy on the cheap. And so I have some things I say, well, that playing that nasty relative I was talking about earlier,

what I'll say is, so whether the yards look like, like in the neighborhood? Or people taking care of them? How many boarded up houses are there? Or values in that neighborhood headed straight down? Are they headed sideways? Or does it look like it's a neighborhood that's starting to turn that's headed up? You know, you've got to think outside one dimension and you've got to know more than, hey, that house is cheap. You've got to have a sense of what the culture of that area is, what the schools are like. What's going to happen over time? I find that most novice real estate investors only focus on the fact that an individual property is a deal without looking at the wider sense of what's happening in the area. And so that's where I really hit the stop button on people is do that work first before you focus on an individual house.

What used to be called farming a neighborhood. I don't know if anybody uses that expression anymore. We still do sometimes. Yeah, where you become an expert in that area where you know, like there's an investor I know who can tell you in neighborhoods that he's interested in buying, he can go down the street with you and tell you, okay, that house has two bedrooms, it has a really crappy bathroom, the kitchen was redone six years ago. He knows every single house piece by piece.

and so he can identify when there's real value. And he now has over 40 properties. And he is absolutely making a full living doing that. He used to be an accountant. Yeah, I love that. I love that. I mean, so I started, you know, in this, Josh makes funny me all the time here called Podunk Washington.

I'm all in the middle of nowhere, right? It's like a smaller town. Like, there's not a lot of investors here. I mean, it's not any of the flashy towns. But I know my area intrinsically. I know every street. I know what's worth what, where, how, when, why. So I became the master of that farm, right?

So like, and that's how I was able to build my rental property business up was because I know what things are. Now, other people come into my area to buy property from Seattle or whatever, you know, where you can buy a house for $100 grand in my area. They come in and you know those houses because I'm going to buy them later when they go into foreclosure because like they can't handle them because they don't know the area at all. So I excellent. Well, they're used to paying $100,000 for the parking space at the time of medium.

Seattle. And you know, you talked about cheap. And it's one of the things that we harp on. It's one of the things that people give me crap about because I pick on Detroit. I pick on the Rust Belt, you know, and I pick on it not because Detroit and the Rust Belt are horrible places, some parts are, but I pick on it because, you know, they've got the dollar houses or houses that are free that they want to give to you that you shouldn't be taking because those houses are worth less than the zero, right? They're willing to give you. And And so, you know, there's that distinction between cheap and something that has undiscovered value in it. And just because something's cheap doesn't mean that the value's there yet.

And you hit the nail right there by saying you got to know where that neighborhood's going. I mean, if things are turning in the right direction, okay, maybe it's worth consideration. But, you know, if false signs are pointing to the wrong way, negative downhill jobs fleeing, you name it, bad politics. It doesn't matter how cheap the house is. It's not a place you want to buy. But you know, there is a signal that I like, and that is when you have a down-and-out neighborhood that single men, young single men are going in and they are buying those homes to live in and they're rehabbing them, that's a neighborhood that I think has upside potential in any urban area.

and when you see that, you know, 20-something who doesn't have much money, and it's always single guys because they're not as worried about the crime as couples are, obviously women would be. They are the pioneers and they are the early alert that a fringe neighborhood may end up not being fringe anymore. And so that's one of the things that I have looked for and has worked for me, work for me, work for me. twice and I lost a lot of money once when I guessed wrong on one of those neighborhoods. And I ended up with a property. I lost a lot of money on because the neighborhood did not flip, did not turn. But that's something that has been one of my things is looking for the young guys' owner-occupying. Right on.

Right on. I've heard that. That's cool. So something like that, it sounds like you did a bit of speculation, right? You were doing a little bit of that. Are you in your portfolio, it looks like you've been buying these distressed properties, it sounds like it. Is your intent appreciation or is your intent cash flow from the rentals? Or is it a combination of the two?

Well, I have an unusual situation. My wife is 15 years younger than I am, which is one of those reasons. All those people were saying, run from him, get away from him. But I buy them to hold as rental properties and generate income. because it's almost like when I'm dead and gone, it's a perfect pension plan for my wife to have all the money from those rental properties that are all now paid off.

A lot of them during the bus, I had to pay cash for. There was not financing available. And so they generate fantastic cash flow every month. And that's going to be enough income to support her when I'm dead. So it's a personal reason why I've built that portfolio, but they're ones to buy and keep. Yep. I like that. I like, and I like the fact that you have a purpose behind what you're doing. You're not just, I want to get rich. I want to make more money. You know, this is why I want to buy the rentals. They accomplish this purpose and, you know, this is the property I'm going to buy because

they accomplish that purchase or purpose, not just because I want to buy whatever I can. I like that. And it's diversification for me. I'm not a one-note kind of guy. You know, I do the real estate. I do stocks. I do bonds. I do a variety of investing so that you never know what parts up, what parts down. And so you lower your risk if you invest across multiple types of things.

And that's why I do real estate and I do the various more traditional investing. Hey, Clark, in terms of diversification, what would you recommend for? folks. I know a lot of our listeners and a lot of the folks on bigger pockets are almost all in on real estate. They don't want to be part of the market. They don't want to worry about all that. They typically are far savvier than the average Joe when it comes to real estate. So they put all their eggs in that basket. Do you think that's a good idea? No. What would you recommend? No. I know. Okay. So how should they be considering? I'm a big believer. You never do all eggs in one basket. for people who don't have an interest in or knowledge about investing, the easiest lift of all is to do it on the retirement side. You know, a lot of people love real estate because of all the tax advantages that come with it. The beauty of being able to do a Roth IRA is the money that you

put in will never be taxed. You put the money in, it grows tax-free. When you hit retirement age, you spend it tax-free. And it gives you an easy way to diversify, and if you go into something as simple as a, what's known as a Target Retirement Fund, where you pick the year closest to when you're going to retire, you don't have to do any thinking about how much should be in domestic stocks, how much should be in international, how much should be in small company, large company, how much should be in bonds. They do that all for you on automatic pilot, and as you age, it gets more conservative. The Roth, you can put $5,500 a year in.

it gives you the ability to have something more going on for yourself than just a singular kind of investment like real estate. Because we saw with the ups and downs how dangerous it can be to be in just stocks or how dangerous it can be to be in just real estate. So that's why the diversification is so simple. And the simplest answer of all is you go online to vanguard.com, which is a co-op. It's like a credit union for investing. you open a Roth account and you do the whole thing in less than 10 minutes. That's cool. Actually, it's on my agenda to do like this month I was going to go open a Roth and I'll do it

your Vanguard because you just suggested that. Vanguard is the hands down, the best investment house, not just in the United States, but in the world. And doing business with them costs one-twentyth of what it is if you go to one of those big full commission brokerage houses. No one should ever go to one of those unless you just hate yourself. Yeah, Vanguard's really cheap. I've got my funds set through Vanguard.

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extended periods, you can hire a local co-host to take care of the hosting for you. These co-hosts are vetted locals who already have experience hosting on Airbnb. A co-host can handle all the details like messaging guests, creating your host space, and managing reservations. So everything runs smoothly. It's a practical way to earn a little extra money, maybe even some cash toward your next trip. Plus, you get to share your place with someone traveling to your area while you're off making memories somewhere else. Your home might be worth more than you think. Find out how much at Airbnb.com slash host. Well, we know that you're kind of short on time, so we definitely want to respect your time capacity here. Can we ask you four more questions, our famous four? Can we, can we

Quickly knock it out. Awesome, man. So, Brandon. All right. So this is our famous four, which is sponsored by Pat Live, the leading provider of call center services for real estate investors. With over 15 years of experience, Pat Live's professional agents have helped thousands of people just like you spend less time on the phone and more time making money. Set up is fast, easy and flexible. Pat Live can recommend the perfect call flow for your needs and create a custom solution just for you. Whether you're fielding calls from yellow letter campaigns, pre-screening, buyers and sellers or managing rental properties, Pat Live can handle it all. To start a risk-free 14-day trial and get half off your first month of service, call 1-800-862-0-0-0-2 or visit pat-live.com slash bigger pockets. It's time for the fire round. All right, the famous for these questions we ask every single guest. And so we're going to throw them at you real quick. And we're going to alter them a little bit maybe, but maybe not. Actually, I'll, I'll, I'll, throw them at you in if we need altar we can. First of all, what is your favorite, if you have one, a favorite real estate related book? I don't have one. My favorite real estate author is Elise Glink.

Okay. Yep. I know. You're familiar with Elise. Yeah, I was on her radio show back a few months back. She's done a bunch of different books that all deal with different parts of real estate investing. I think she's brilliant. Yep. Agreed. Cool. All right. How about business books? Favorite business book? Is there anything that you're reading now? Not like personal finance. but actually just generally building a business or entrepreneurship, anything like that. My favorite book is an oldie from Canada called The Wealthy Barber. Ever heard of it? No, never heard of it.

I've heard of it. I don't know much about it. The wealthy barber is about how this guy cut people's hair all through the years and heard them talk about all their big plans and everything they were doing. And the wealthy barber wasn't making near the money of the people that was in his chair, kept saving money all through his life and ended up wealthy. a multi-millionaire in retirement, and all the people who cut the hair for, he was retired, they had to keep working and had to do barber.

It's a very clever, very clear book about why we need to rethink our relationship with money, particularly here in America where we love to spend every last penny we make. Yeah, that's true. That's true. What about hobbies? What do you do for fun besides, you know, ventures and more ventures and more ventures? travel. I love to travel. I mean, I love to travel. In fact, my wife and I were changing planes in London a couple of weeks ago, and there was a special I saw on the computer while we were waiting for our plane change, and I booked us to go back in just a couple of weeks with our kids. I just absolutely love seeing everyone on Earth. I've been to every continent except Antarctica and every state except North Dakota.

You're missing out. It's a... There weren't any deals. So my deal on travel is you buy the deal and then figure out why you want to go there. Interesting. I like that. Fair enough. You live in Washington State. I do, yeah. And Josh is in Denver.

Right now you need to know that there's a huge fair war going on from Washington State to Hawaii. Interesting. And it's because of new service that's just started up to Hawaii. And a lot of the fairs from the West Coast. In fact, you go the whole I-5 corridor from the Canadian border to the Mexican border, you can buy tickets right now to Hawaii in the 300s round trip. I'm going right now. So you've got to go.

I'm actually going to Ireland tomorrow, which is going to be excited. I've never been there, but I'm leaving tomorrow morning. Yeah, 7 a.m. It was like $700. So it was cheaper than normal, but it wasn't. That's not bad from Washington. Yeah, from Washington. I got to work with you on this.

That's, I treat you. I just want to like travel. velocity and book something. Let's make this about me. Denver. What kind of deals can I get? Denver? Denver has lately had just about the cheapest fares in the United States. So you've got no problem at all in Denver. It's cheap to fly anywhere, yeah. Denver is very inexpensive. You know, is southwest, you go to the C-Concourse at DIA, and they're just Southwest planes everywhere. Frontier's been dialing back their number of flights in Denver, but they have so many cheap. fairs that they're really influencing things. And United is running such a crummy airline these days.

They're getting people in the seats by heavily discounting. And so that's been why in Denver, you've got the cheapest stuff going in the country. Yeah. Yeah, it's been great. Although I refuse to fly frontier because I don't want to pay to breathe the air or to use the toilet. So my my oldest brother is flying frontier this day. He's flying him. And he's like, he's 69 years old. I'm like, Gary, why aren't you nicer to yourself? Yeah, it's not worth it. $29.

I'm like, okay. I won't fly frontier unless I am absolutely forced to. I refuse. All right, really, really quickly, travel. What is your favorite place to travel? What's been your favorite destination on Earth? My favorite place on Earth is Chile. Fly to Santiago, visit Chile, great people.

affordable, and just magnificent sites. From skiing to the ocean. A lotche, right? You got to pick each of you. You got the ocean in Washington State. You got the skiing in Colorado. You go to Chile. You got both.

I like it. I'm going to add that to my list. I'm a huge traveler. I've been to every state but Alaska. So I got to hit up that one next year. Yeah, cruise maybe. I don't know. No excuse for you living in Washington state.

I know. It's like. Not having been to Alaska. It's like next door. It's like next door. Well, this is the guy that goes in his Prius and Prius camps. He and his wife lay sleep in the back of the Prius. It's the funniest thing.

It's really clever. So when you feel comfortable enough with the money, you got to get a Tesla. I would love money. I went from a Prius to a Tesla. Yep. And I've got, I mean, I cannot tell you. I've never spent money like that on a car in my life. The Tesla is the most exciting thing you will ever drive.

Camping in the back of the Tesla will be much close. ass here. I will do that. My buddy, Serge Chucott, who's been on the show, we bought a Prius, and then Ben Labovich just bought a Prius last week. So now I got a Prius. I have to buy a Tesla. I mean, a Tesla, sorry, a Tesla.

Oh, they just bought a Tesla. And then Ben just bought a Tesla. So now I have to buy a Tesla. And you have a Tesla, apparently. Yeah. And the self-driving thing is freaky. Because you engage the autopilot, and you just sit there and you stare out the window, the car drives itself about 95% flawlessly.

You've got to pay a little of attention because it's a beta right now. It's not quite ready for prime time. Wow, that's awesome. Now I'm going to go waste all my money on a test. I'm kidding. All right, my final question of the day. What do you believe, like overall, what do you believe sets apart successful investors, whether it's stock, real estate, whatever, just successful financial people from those

who give up, fail or never get started on that journey? Habits. You have to build good habits. You have to have your personal life together. and you can't have lifestyle debt. So you create good habits, kind of stuff we talked about, about how you do things sequentially

as you're building investments or whatever kind. And you can't go into trying to make money owing everybody on earth money. So you get the good fundamentals in place and you have the confidence, you can truly be wealthy. Yeah, I love that. I love it.

I'm reading the book, the power of habits right now. It's kind of all about that process. So, yeah, very cool. All right, Clark, before we let you go, you have the Clark Howard podcast. You've got the syndicated show around the country. Where else can people find out more about you?

Where can they find you? Got anything you want to share? Well, Clarkhaword.com, and we have a fantastic mobile presence. 70% of our Clarkhawad.com traffic is on people's smartphones. And so there's information as you're going about, as you're trying to make decisions to shop, invest, whatever. We just pop the phone out. Go to Clark Howard.com. And it's my goal to save you money, make you money,

and keep you from getting ripped off. I was on your phone. I was on there today on my phone. So, yeah. It's true. Fantastic, man. Well, Clark, we really do appreciate you coming on. I know my mission with bigger pockets with starting this is all about trying to help people be successful. It's all about trying to help people prevent themselves from getting in trouble and getting ripped off. And so, you know, having you on the show means a lot. It's just an honor.

We appreciate it. And thanks for the time. It's been really fun. Cool. Well, I will see you around. Okay. See you on the slopes. Sounds good.

All right, guys, that was Clark Howard for you. Hopefully you learned a thing or two. Always good to have somebody on the show who's been around the block a few times. And, you know, the beauty is, I mean, he's. even admitted, listen, I screwed up. I made some mistakes and I lost a ton of money. And so, you know, this is one of the guys out there who's, you know, trying to help us all out. And he too is making mistakes. So nobody's flawless. Nobody's perfect. We all make mistakes, particularly as it pertains to investing. So if you're just getting started in particular,

do not be afraid of that. It stops so many people from getting started, the fear of making mistakes. And so I just want to harp upon it. I mean, Brandon, you just made a mistake last week, didn't you? I did. Yeah, I don't know. Remind me. I was betting on the fact that... I don't know.

I'm sure I made a mistake last week. I make a mistake every week, but I don't know what it was. We all make mistakes. You know, I try not to remember those. Yeah, yeah, there you go. But yeah, so it was great to have Clark. And definitely check out his podcast and check out his website. He's got lots of great stuff there.

Yeah, it does. Cool. Yeah, yeah, yeah. So you're going to Ireland. Tell us what's the plan. What do you got going on? I'm going to Ireland to you know, see it. I don't know. I heard. That sounds, that sounds excited. You know,

now I really understand why your wife, Heather, is with you. I mean, you're just, I'm an articulate guy. Yeah. Deep. No, I, I heard that, you know the movie, the Princess Bride? Yes. Okay, this is one of my favorite movies. Anyway, there's a scene where they go to the cliffs of insanity. Oh, yeah. Yeah, apparently that is in Ireland. So I'm going to go and peer over the cliffs of insanity, which are actually called like the cliffs of Moher or something like that. You're going to bust out a sword and start. I am going to, and my name is Innuo Mentoro.

You killed my father. Prepare to die. Maybe. That was terrible. That was terrible. I don't have a Spanish accent. You guys are just sightseeing. You guys are just kind of cruising around, huh?

Yeah, you know, we're not going to invest in any real estate in Ireland anytime soon. Wow. Why not? Because I don't know anything about it. And I only invest in my local areas. Come on. Go find a vacation rental. Yeah.

Actually, we are. We are staying in Airbnb stuff. Are you really? We are. So what if, what if you show up and that place is not available? the guy's like, ha ha. I will call up Airbnb and make them yell at the person and make them find me a place to stay. There you go. That is the beauty of Airbnb, isn't it? That is. That's why I trust them more than just like a guy in Craigslist. Exactly. Cool. Awesome, man. We'll have a great trip.

We're excited for you. And you guys, thanks for listening to the Bigger Pockets podcast. We definitely appreciate it. Please do check out the other 148 shows at biggerpockets.com slash podcast. You can check out the show notes on today's show at biggerpockets.com slash show 149. That's biggerpockets.com slash show 149. Thanks for listening. Jump on iTunes. And soon, please jump on Android. Android is coming out with a podcast marketplace. So I think it's the Google Play podcast marketplace. It'll come out in the next month or two is what I'm told. So jump on there. Leave us some ratings and reviews. And thanks for listening. We'll see you next week. I'm Josh. Storkan, signing off.

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