Epic Real Estate Investing - Cute Couple Cash Flows | 453

Episode Date: August 25, 2018

Today on Turnkey Saturday, Mercedes Torres speaks with Rob and Nancy Kim, a husband and wife team that lives in Minnesota and invests with Cash Flow Savvy. They share how they chose turnkey investing and passive income, how they overcame their hesitations, and the advice they’d give to new turnkey investors. Learn more about your ad choices. Visit megaphone.fm/adchoices

This is Terio Media. So you want to be a real estate investor, but you don't want to do the work. If there were only a way where someone else could do it for you, now there is. Tune in here each and every Saturday on the epic real estate investing show for Turnkey Saturdays. With your host, Mercedes Torres. Ladies and gentlemen, I am honored to have you guys on board. I am going to introduce to you to Rob and Nancy Kim. husband and wife team that lives in Minnesota started investing with us and I'm just going to let

them take it over and kind of tell us who they are and what they're up to, what they're doing, and what this venture has brought them. So you know what? I'm going to start with ladies first, Rob. So Ms. Nancy, tell us a little bit about yourself, about the family, about who you are. And yeah, and Rob, I'm going to extend the same courtesy to you. Hi, everyone. I'm Nancy Kim. Like Mercedes said, we live in Minnesota and I'm a working mom. So a full-time job and have two boys that are active, six and two. And so we really were just looking at pursuing how we can have our or make our work for us. And that's how we originally got connected with Mercedes and cash flow. But again, trying to figure how we can make our lives just a little bit easier going forward in the future. As we're both really busy parents, We are just looking for a way where we can actually enjoy ourselves and spend more time as a family. Right. I so get that. Mr. Rob, tell us about yourself. So my name's Rob Kim. Nancy's other half, I'd like to say better half, but sometimes that doesn't always work out, right?

But yeah, we're both busy working professionals, working full-time jobs. And like Nancy said, we want to really leverage what our money can do for us. and got hooked up with Matt's podcast, the Cashflow Savvy podcast and Epic Real Estate Podcasts and really just got intrigued. And he was really influential and starting to think in a different strategic kind of way on how to put our money to work for us. And that was really through real estate. And ultimately what led us to Mercedes with Cashful Savvy and our first two turnkey

properties that we purchased about a year ago. Ooh, I think I hear too. I'm so excited. Well, we'll jump into that. But so you discovered us through the podcast. You know, why passive income? What made you decide specifically? Okay, we need passive income.

You know, you guys are both working parents. You do very well. You've got two kids. And so why passive income? Again, we both do well in our careers. And we're at a point now where we're looking at really additional investments. We have income that we can start investing outside of of a 401k or a typical IRA.

And we've, you know, we've talked to people. We've encountered people that acquire real estate. And it's always been of interest, but we just didn't know how to do it. And I think that was really the first kind of turning point for us to say, if we have the money, how do we have it start working for us? How do we break the ice? How do we get over that level of discomfort and really just learning how to invest ourselves without, I would say, again, a typical financial broker and just what other options are out there

besides what we've traditionally been doing over the last 10 years. And just knowing that I'm already working, I'm already busy, it wasn't necessarily taking on an additional job. It was going to take and require additional hours away from my children. I wanted to be able to have something that was going to actually free up my time to where we could spend, again, more time as a family and to be able to travel or thinking 15 years down the road of like what does our life look like at that point in time and how could we potentially set ourselves up for success to retire? And in doing that, it was really through passive income that got us the most excited. Awesome.

The idea of passive income to us really was, you know, this idea of creating streams of rent checks coming to us each month, right? And having that money work for us now and having somebody else to pay for a mortgage and insurance. and all those great things. And at the end of the day, still walking away with some money in your pocket, right? So it's pretty exciting. We've finally crossed that hurdle where we've purchased a property

and now two properties and actually now three properties. And it's really starting to pick up some momentum and it's really exciting. And it's really not as hard or as challenging as you might think it is when you're first starting out. And I think that was the biggest challenge for us

was just getting over that initial hurdle of just doing it and stop thinking about it. Oh, so you get the nail on the head. You know, Nancy just mentioned, you know, we had to get out of this comfort level. It was uncomfortable. And I have to say, it's a big step to really think outside the box. And you guys, like, embraced it, which is why you're doing so well. Now, Rob, you've already mentioned two properties and we'll talk about the third one you've got going on is super exciting.

But tell me about your first. property that you acquired through us. Actually, if memory serves me correctly, you guys went like gung-ho and did two at the same time, right? I love it. I love it. So Rob, tell me about the two properties to begin with. Sure. So, I mean, essentially, you know, we made the commitment with you and the cash flow savvy team that we wanted to move forward. And essentially, you started sending us property profiles on a pretty regular basis. And there were two in St. Louis. And we were kind of going back and forth, which one we might be interested in. And we're like, what the heck?

Let's just do it. We went with both. So we made that decision really easy. And that was about a year ago last May, so May of 2017. So we're a little over a year now. And again, it was just making that commitment to ourselves to make that initial jump in. And you guys held our hands along the way every step of the way. And we couldn't have done it without you guys.

And like I said before, it really, actually was much easier process than anticipated. And again, that was with the teamwork with you guys and just all the great communication and the teams that you guys worked with that you put us in contact with as well through your referrals. Thank you. I take great pride in holding people's hands because when I started guys, nobody held my hand. I made so many mistakes because there was nobody there to turn to. I just went gung-ho, and so I love that you said that we held your hand, Rob, so thank you for that. Nancy, I know, I remember when you were going through the profiles, you had a lot of great questions. Tell me about the profiles. Did they help you? Did

they not help you? And for our listeners, a profile is really like a electronic file of the property that you're going to be purchasing that has tabs on the top and it has everything from the property address to all of its numbers to summaries to graphs and a description of the property. So Nancy, tell me about the profiles. Yes, I will definitely say, Rob, who is all in. I was primarily one foot in and I think really just looking at the property profiles and truly putting the numbers behind the logic and really understanding what was the initial investment, what was the return on our investment?

What were the comps? Like what is the long-term strategy to look like? So I think just being able to have the numbers analyze it, ask those questions, is it truly a five-year investment, a 10-year investment, a 30-year investment? Because depending on how you look at it, the numbers game in the rent. And that's where I was able to really start analyzing it. And I think better just understanding, again, the strategy and what we're going after.

And that's where you really helped us to say, is it a short-term strategy? Is it a long-term strategy? What are you really looking to do? And the choices and the decisions that you make and where you choose to invest is is going to be different based on what your long-term goal is as our family, what we're looking to accomplish. So that helped me because it's one of those things that if it was easy, everybody would do it. And we just didn't know how to do it. And so that was the misconception that it was, well, if it was easy, everybody would do it. But it is easy. You just have to be connected to the right people and really learn how to do it. And then once you learn how to do it, you become comfortable and it

becomes a lot less difficult. And so that's where the property profiles, I think, built my confidence that we were making a good investment. And again, we, as Rob said, through collecting the rent checks and being able to jump in with both properties to where they cycle at different times. So if we're out of one tenant, the one that is occupied, was able to fund the other property. And so it was less of a financial risk for us to go in and invest in two properties at the same time versus just one. Yeah, you guys certainly did it right. Not everybody has the luxury of being able to do that. And honestly, thinking outside the box for them to say, I'm going to get two properties together one. You guys did it right. So now that you guys have had the property for a year,

Nancy, I'm going to ask you specifically because you did. a lot of homework on profiles. How are the profiles in comparison to real life now? Were the figures accurate? They were accurate. I mean, the comps and what the property praised at, if everything was in line, so there wasn't a disconnect between what actualized

versus what profiles. And actually, what we were able to go in from a rent or rent increase is actually higher than what was on the profiles. and so it worked in our favor in that in that sense and then again being able to if it's something you want to choose to manage your own property or if you want to have a property management company I mean those fees are all accounted for so there wasn't expenses or any hidden fees or unplanned fees that wasn't a part of the profile so we were aware of every I would say every expense going

into the properties yeah I think that's very important I'm a big believer of what is it under promise over deliver. So I'd rather be a big fan of being super conservative on the profiles. And I hear that a lot that there aren't any hidden fees. Yeah, there are no hidden fees. The numbers are the numbers and I disclose them to you. So Rob, I'm going to go back to you because I know, as Nancy said, you were the spear, the one that led the troops to this whole ordeal of real estate investment.

Um, did you interview other turnkey operations? Uh, to be honest, no, we didn't. Um, I, uh, I, I was hooked with you guys once I started listening to a podcast. I mean, I really was hooked quickly and, um, listening to other people that you guys have worked with interviews, um, just the level of integrity and honesty and, uh, really just face value that you bring to what you guys do every day and how you partner with, um, you know, investors and entrepreneurs, it was something I wanted to be a part of. And so, you know, we kind of took baby steps. And in fact, we, I think the first time we met actually face-to-face was a property tour with, with you guys in St. Louis, a few months, I don't know, boy, I guess maybe about a

year and a half ago. And I think that was really what solidified that we wanted to move forward in partnership with you guys and purchasing Trinkie properties. That's awesome. I had totally forgotten that I meant you there. I felt like I had known you forever, you guys. Oh, that's awesome. So Rob, what do you think has been the biggest challenge in embracing the turnkey portion of your real estate investing career? Because now you're off on your own and I love it. So we'll talk about that. So what would you say was your biggest challenge through this whole turnkey process? Yeah. So, I mean, our biggest challenge one was just taking that initial jump in, right? Like, we're going to do this.

But I think the other kind of mental block that we were faced with was this idea of buying a property that wasn't near us. So we live in Minneapolis, Minnesota, and we bought properties in St. Louis, Missouri, right? So there was a lot of trust that we're going to have to put into place that our partners, specifically property management, was going to be taking care of our property, taking care of the tenants, making sure the upkeep on the house is there. And all these things are happening. So that was a big challenge for us. I think the other challenge is when people think of, well, property management is going to take care of everything. It's passive income. It's not really passive involvement.

In fact, you do have to be pretty involved. You've got to stay on top of things and you got to watch your own back. It is necessary that you work with property managers, of course, that they're there to support you. But you also have to manage the property managers themselves. And that was a little bit of a challenge to you. And again, being remote. that also creates some dynamics that you've got to work through and work within as well. Yeah, that's, I couldn't have said that better.

Nancy, what do you want to add to that? I know that you had different types of challenges. So share your challenges with me. I think one two outside of the property is just, it's the learning between the husband and wife and how you're embarking on this journey together and how we, I would say, trust within each other because we're both going through the learning, together. We both feel comfortable and confident in different aspects of the process. And so how do we leverage each other? And then really just figuring out, I would say the dynamics of, you know,

how involved is Rob within the property management company? Where is my place in that? We both can't be involved. We both can't be peeing and calling these individuals. And so really just the coordination between the two of us to figure out how we can support each other through this process. So that was definitely, I would say, a learning. And then just not, again, always knowing. So how long does it actually take to source a tenant? How long should it take for your property to be up and running before they can take pictures and post it and advertise it? And, you know, there's just some of those things that you just don't know what or how long it should take if you're in transition between tenants. And so, again, we just had to go through those experiences and just learn what we feel is

acceptable, what's not acceptable, how you work with the property management company, how you have those expectations up front and aligned. And it was a great learning experience and it built, I would say, confidence in yourself and just who those individuals are that are managing your property on your behalf. But it was a really good experience. I think you do have to go through some challenges or ask a lot of questions just to be able to understand and learn when it's a experience. Yeah, no, you have said that so perfectly. You know, one of the reasons I wanted to invite both of you at the same time on the podcast is because I have found that our most successful individuals are those husband and wife teams or those partnerships, not necessarily husband and wife,

but those people that are on the same page to begin with. And I know, Nancy, you started with one foot in, but Rob just a little bit to show you. Then it looks like you took off running, I mean, relatively quickly. But it's so important that a partnership is on the same page. And that's why you guys have success is because you have clearly defined your roles in this partnership. And like you said, not both of you are pinging property manager because trust me, they get a lot of work without both of you thinking now, you know? So I love to find that, and that's what's made you guys, like, really successful.

I love it. So, Rob, I'm going to ask you, what would you do different next time? I know that you're working on your own properties and projects now. Yeah. So what would you do different? Now, what are you doing different? Yeah, I think one of the biggest lessons I learned is this, the support and a network that I've built with working with epic real estate. There's so many great people and so many people that are willing to help.

And, you know, we were faced with a lot of questions along the way when we're first starting out. And to this day, still always have a lot of questions about new opportunities and questions about a property or how to analyze something. And what we really need to understand and I think I learned was that I need to reach out more and use that network that I'm associated with now and really make life easier. I don't need to make all the mistakes or we don't need to make all the mistakes on our own. We can leverage the mistakes that others made and learn from them and take their advice. And we've got a really, really great network of people to do that. Yeah, you know, I will say the epic community is epic. I mean, I don't know how else to say it. Are the partners,

our followers, our Facebook group blows up, our, you know, RIA's badass group. I mean, the amount of knowledge that you get from just the people in the community is, you know, is, you know, is mind-blowing. Like sometimes when someone posts something on our Facebook page and ask for help, you get 40 comments from just our epic community members. So Rob, you're absolutely right. I'm going to ask the same question to you, Ms. Nancy. What would you do different from this point on? Yeah, we would have acted faster. I would say we would have acquired properties sooner and we probably would have acquired more properties. Because when I reflect back just some of the concerns and the unknown, it really, again, wasn't that big of a deal in hindsight. So it's just being able to

trust the people that you're around. And again, I know Rob obviously has spoken very highly of you during this podcast, but I would say the fact that you guys practice your own philosophy and live by your own principles is that in itself is so comforting. And to know, know that you were there and to be able to trust you that you have our goals in mind and you're really here to help us and to guide us and just would have trusted more so in that process. But again, you have to be ready to take off the risks as well. But I would have a little bit faster, but it would have just been further along in the game. Yeah.

You absolutely have to be ready and you have to make a decision. And when you make the decision, you can't look back. But Nancy, I can't tell you how many people say, I wish I would have started sooner. So thank you for saying that. I even say the same thing. And I've been doing this for a minute. So awesome. Thank you for sharing that.

So I know you guys are now doing a delayed refi. Our epic community doesn't know a whole lot about a delayed refi because it's something that doesn't happen every day. So, Rob, your words, tell me what you're doing now with your delayed refinance. Sure. Well, we kind of stumbled upon an opportunity with another epic member, family member, if you will, a local guy here in Minnesota, Russell, Russell Tapper, and he had an opportunity for us to go in on a deal with him to purchase a property. And so we had the unique opportunity to present an all-cash offer for the property to acquire it. And then we actually went back to the lender that we worked with for our two turnkey properties. We had such a good experience with them that we decided to go back and work with Chaley Ridge at Ridge Lending.

And so essentially we are going to be 100% leveraged with everything that we put into it to purchase it. We're actually going to get back out minus a few closing costs, but that's unavoidable. And we're now going to have a third property. we're going to add to our property profiles. And it's actually here in Minneapolis. So we do have the luxury of it being in our backyard. And it's a great rental property, long-term tenant that's there, really great tenant.

And we foresee this being a really great long-term buy-and-hold rental property. Awesome. Yeah. We did a whole episode on the delayed refinance. And we will read that episode again. We still do delayed refinance in our office. It's a little bit different because you have to go all in, in cash first, then you do a cash out refinance. But like Rob says, you're able to pull out

everything that you invested if you do it right. Awesome. So what advice from this point on to our turnkey family would you give to a new investor? And I'm going to start with Nancy first, because Nancy gives good advice. Yeah. Nancy, what advice would you give to a new investor considering term key? I would just say ask questions. Ask a lot of questions. And I think don't be afraid to ask the questions, the hard ones that says, tell me about a time that it didn't go right. What were the mistakes? What were the learnings? What are the risks? And fully understanding that, you know, there is risks, but how do you minimize those risks? And that's really by surrounding yourself with a great network that can guide you and walk you through and help you and teach and

train you. But I remember having a call with another couple and understanding what was the impact to their family, how much time does it take away from the kids, what can you expect, and just really understanding the decisions that we're making short term and long term for our family. And so ask questions, connect with people. The more people you can connect with, you're going to get all different types of stories, experiences, and really just tailoring and figuring out which one is the best for you, because there isn't one right way. There isn't one right strategy. So it's really just figuring out what is right for you and for your family.

Oh, so well said. Mr. Rob, what is your thoughts or what is your advice to a new investor considering turnkey? Yeah, I guess going back to my own experience is I just sat on it too long, right, before actually just doing it. It's so critical to take action and not just think about it or analyze. it's taking the action and understanding that you're just, you need to start taking those first steps. You're going to learn and learn and learn and build that confidence. And I would say the other thing, too, is we kind of touched on before was whether it's

your spouse, your partner, business partner, whatever it may be, making sure that you guys are all on the same page and what your goals and strategies are going to be and kind of what role each is going to take in the process. Because I know that I couldn't have done that. this probably on my own without being able to lean on Nancy in different capacities. And so to have that partnership there in place was really what kind of got us through hard times, difficult times. But what's great is we get to celebrate everything together too. And we have a lot to celebrate that we've accomplished in the last 12 to 14 months. And we just plan on continuing to go forward

and growing bigger and stronger. That flows my mind, 12 to 14 months. And you guys started with knowing absolutely nothing. And now you guys own three properties. That's priceless, guys. Thank you for sharing your story. Thank you. So, you know, my favorite part of my job is talking to somebody. Of course, I'm a great talker, as you know,

but talking to someone on the phone and just kind of, you know, leading them through the process. But then fast forward, you know, sometimes it's six months, sometimes it's 12, sometimes it's two years. But then I get to see the portfolio that they're building. Oh, it makes me so excited. I feel like you guys are my children. So, guys, thank you so much for sharing candidly your story, your growth, your trials,

your tribulations, and really more so your advice because I know there are people out there listening that are thinking the same exact things that you guys shared. So I know you're going to make a difference for someone and thank you for taking the time. Thank you. Good day, guys. Love you both. sure I'll see you at the next epic event. Thanks. Bye. Does your money work for you as hard as you do for it? If not, no worries. You do not

have a money problem. You merely have an idea problem. We're cashflow savvy.com and we'd like to share a new idea with you around income real estate that can transform your financial future and accelerate its arrival. Go to cashflow savvy.com and download a free investors package. Cashflowsavvy.com. not have a money problem. Merely an idea problem. Cashflow savvy.com. More ideas, less worries. Cashflow savvy.com.

This podcast is a part of the C-suite radio network. For more top business podcasts, visit c-sweetradio.com.