Epic Real Estate Investing - EPREI 054 : J Massey - Getting Started Investing in Real Estate with No Money or Credit

Episode Date: May 15, 2013

On today's epsiode, Matt is joined by one of his best friends and mentors Mr. J Massey to discuss getting started in real estate investing with no money or credit, moving at the speed of instruction, and other ninja nuggets. Get Matt's free real estate investing course at FreeRealEstateInvestingCourse.com Subscribe to J Massey's new podcast "Cashflow Diary." Click Here Learn more about your ad choices. Visit megaphone.fm/adchoices

Without further delay. Your guru. Sorry. Your guide to a better life through real estate investing. Matt Terrio. Hey, this is episode 54 of the epic real estate investing podcast. My name is Matt Terrio, the rat race escape artist. And if you haven't done so, go to free real estate investing course.com where I show you step by step on how I escape the rat race.

you can do it too. I leave nothing out there. Everything is there for you and 10 easy to follow video tutorials and that's yours for free at free real estate investing course.com. Now, if I'm sounding a little funny or a little different, it's for two reasons. One, I've got a cold again. This is like five and five months. I've got a stuffy nose and my ears are clogged and my head is ringing and two, I'm currently on the road opening up Cashflow Savvy's fifth market this year and establishing my team of professionals in Kansas City. And just before I sat down to start recording, I noticed that I had forgotten the microphone that I used for podcasting. So right now, I'm broadcasting to you over my iPhone. Sometimes you just got to get the job done by any means

necessary. So here I am in a Kansas City hotel room talking into my iPhone and everything will be back to normal next episode. And hopefully the episode after that will be better than normal as I'm in the middle of signing a three-year lease for a studio and office space in Glendale, California. Kicking this up a notch. Taking your success up to that next level. I'm getting much more serious with the podcast going back to a weekly episodes weekly episodes also of the your do over podcast and i'm going to be rolling out two new podcasts around your favorite subject that's real estate investing and wealth creation which brings me to today's episode i recorded a very special interview last week just for you an interview with an accomplished real estate investor

a very good friend one of my best and he's played a role as a mentor of mine in many areas of my life and business and and I can certainly say that I wouldn't be doing what I'm doing today, nor would I have accomplished what I've accomplished without him. He's played that important of a role in my life. And, you know, we recorded this interview last week and we recorded it over Skype, which I never really have a problem with sound quality, but for some reason we've got a few rough patches in this interview. So be patient and know when they happen. If you hear some dropouts or some static, just know that they're temporary, all right? And the interview will bounce right back. So without further ado today, for you on the Epic Real Estate Investing podcast, I introduced to you, Mr. Jay Massey.

Jay, welcome to the show. Thank you for having me. Glad to be here. I am so glad that you're here as well. It's been a long time coming. You know, as I was introducing you, I was sharing with the people here, the listeners, that, you know, we've had a very unique business relationship and a good relationship, a great relationship. We've accomplished a lot together. You know, I've learned a lot from you and you've learned a lot from me, I think. And we basically, though, started at the same time in this real estate investing venture. So why don't you just kind of start with your background and let everyone know how you got here?

Absolutely. Definitely appreciate the opportunity to introduce myself to your listeners. And, yeah, they already know that you rock. Good. And I'm glad that they're here for more quality content. For me, you know, like a lot of things in my life anyway, they begin, I began real estate by necessity. I didn't grow up thinking real estate was something I was going to do.

I didn't know anything about cap rates and returns and all this other stuff. These are all things that I've learned over time. But I started, believe it or not, in the financial services industry, financial services, insurance, and financial planning. I was a licensed representative for a while, not licensed anymore. I just want to be clear on that. And so I had access to all kinds of different. a financial product. What I like is that I got to mess with numbers and help people. That was fun. And it felt like I was providing a solution. Well, it felt like that for a while. And

unfortunately, we've all experienced that new thing that somehow gets tarnished over time and you get disillusioned with it over a while. And that kind of happened to me when I realized that even after putting together these financial plans for people, they still didn't really have a shot at anything that was due retirement. My challenge was that, in this process, my own journey, I started playing a game called Cashflow 101 by Robert Kioski, and I've had the fortune now of having been able to play that game and instruct that game for almost a decade. I've even been able to do something with him in the room, and that was a lot of fun. But that game teaches some very basic concepts about investing that I had never known,

and I wanted to do them. I wanted to be in real estate. And being, you know, the normal-deared person that I grew up being, I didn't know how to make a switch. I didn't know how to make a change. I didn't know how to go from financial planning to insurance. How do you do that? That's an upending of my entire life. And so as things go, you know, sometimes our reality gets much worse than we finally get ourselves in gear.

And for me, you know, my wife experienced a condition known as hyper, and since most people don't know what that is. It just simply means that when she is pregnant, she can't consume bread or water. So she couldn't even eat your drink. And that sent us into this downward spiral of fear and scared and didn't know really what to do. I stopped going, I had to make a choice. You know, do I go to work? Do I go to her bed site?

And I don't fault anybody for making the choice of going to water because it's tough. That's a tough position to be in. And it's the first time that I understood that self-employment could be a challenge if you don't have a plan B or D or E-F or G, actually. And we didn't have any of those. We weren't taught that. So what ends up happening is while my wife is going, all of these medical procedures that I had never heard of, I get frustrated one day, and I went to a volleyball, and I have punctured my lung while trying to the ball. And that has developed a condition known as pleuracy, and I have asthma. So now I couldn't walk and talk.

My wife can't eat or drink. And we are in the situation where you can't walk or talk or eat drink. It's kind of tough to live and get by day to day. And we don't have any passive income. It's all active. And a friend of mine comes and says, hey, I know the solution to your problem is that you need to become a real estate investor. At the time, I was still selling our personal possessions online on eBay, trying to make, you know, ends meet. and this was a solution.

I was like, okay, it doesn't sound like a solution because aren't real estate investors supposed to have money and credit money? I don't have either of those. So how is this going to be a solution for me? And that was the beginning of my transformation in the sense that I learned sometimes what we grow up thinking or what we think we know might not necessarily be true. Just because we've held it to be true for a long time, we may have never questioned it.

And I was able to question it enough to actually sit down, listen with an open mind. And yeah, that's kind of what happened is that they opened up this whole new world to me about, you know, retirement plans and how they can be used in real estate and what value really is and all these things that has now, you know, that has led you and I to be able to do some incredible things for people inside of real estate. I mean, it's been a lot of fun, I guess, is what I really want to say. Indeed, it's been very, a lot of fun. It's fun to work really hard and actually get results and make some money doing it. Yes, the opposite. We've all done enough of that. Let's not.

Right. The life of an entrepreneur can often consist of working really, really hard and getting not a darn thing in return. So, yeah, no, it has been fun. You know, when we first met Jay, we were attending the same educational program, and then we were in an office together. We started sharing an office. And at the time, pardon me?

I said, yes, we did. Yeah, definitely. You know, and at the time, as I was going through the education, I was guilty of something that I know so many are guilty of because they send me emails about it all the time. I was getting ready to get ready. I was trying to learn everything first before I got started. And as we were sharing an office and we got started at the same time, I noticed you had just, you know, you were processing some papers.

And I was like, well, what are you doing over there? And you were like, I'm wholesaling deals. And that's kind of when I first heard the term wholesale. I was like, how could you be wholesaling deals? I mean, I'm a real estate agent. I've had four years experience over you and you just figured out what real estate is. How come you're doing it and I'm still learning? Tell me, tell me what inspired you to, what was it that inspired you to take that very first step?

That's probably the most common question I get from my listeners is, I'm just having trouble getting started. How do I get started? And, you know, I can totally relate because I was there at one time myself. Who was it that helped you get started? And I don't guess what inspired it. How did it happen for you? Well, I would say that the answer to that question is it's a matter of necessity. I don't know if you've seen the movie or if anyone has seen the movie Cinderella Man.

Because they asked James Braddock the same question, you know, what are you fighting for? And he said, I'm fighting for food. I'm fighting for bread. I'm trying to eat. And that's where it was. I mean, we were literally in a situation where if I didn't sell something on E-B on Friday by Monday, we didn't have food. It wasn't, but we were, we had the times I can still remember where we would figure out ways to hang out at the in-law's house. longer just so that they would feel obligated to feed us in the grandkids again.

You know, it was because we didn't know how we were going to eat if we went home. It was all kinds of things like that. And when you're faced with the fact that you made your wife a promise for better for work, and you feel like you're the person that is causing all the worse. And you feel like, you know, I dropped out of college because as I did, I'm not a college graduate in shape of me and I didn't necessarily walk to go that. It's just like, man, there's got to be something better than this. Because having been a financial planner, I saw people that I'm like, dude, I may not have gone to college, but I'm smarter than you.

You know? And I've got to be able to do something of value in this marketplace. It doesn't require a college degree. I mean, there are so many examples. And if we supposedly live in the land of opportunity, then where is my opportunity? How can I create it? As you said, being surrounded by the right communities, individuals who, with taking action, then, you know, it helped you to stay and keyword here is get started

and stay started, helps you to stay started as you experience roadblocks. I can't tell you the number of roadblocks that I experienced, but having the right coaches, having the right mentors, having the right credible, integrable examples. And then at the end of the day, I was more afraid of being hungry than I was afraid of messing up a contract or not getting deal right or looking stupid in front of an investor. It was like, look, if I don't do this, I won't eat. And I often say that I was given gifts of having no money and no credit because oftentimes most investors eventually run out of money and credit

and they must learn how to do these things creatively anyway, regardless of what they want to do, you know, whether a single family or, like right now, I'm doing apartments in a shopping center. But it doesn't matter the size of the real estate. still have to understand the techniques, not understanding them and being willing to apply them. They're two completely different things. And I'm very guilty of being the fire, fire, aim, then ready person. That's pretty much what I do.

You spend some time cleaning up my messes. Like I hired a bookkeeper way too late. I was 90 plus transactions in before I did that. That ended up costing six figures because the IRS wants their money. but you can get it fixed. It's just I would have rather have done that than sat on the sidelines for those two years, not knowing how the whole Quickbook things work. And I was able to get something accomplished.

I feel very, very fortunate because, you know, I don't know that if I didn't have that strong motivation, I don't know that I would have been willing to overcome the fear and overcome my perception of comfort. That thing kills so many comfort kills dreams in so many ways. And fortunately, I was in a situation where I wasn't afforded any illusion of comfort. I couldn't tell anybody that I was comfortable. It's easy to see that I was uncomfortable, that, you know, you go out to eat and you order water. And then they wonder, why aren't you eating?

Well, the truth is, I can't afford it. I have no money right now. I, if I eat, we, I don't know how. You know, it's like if I eat at it, I don't have a gag. That puts a fire under me. That puts a fire under people. And, you know, I've got kids. You know, you want to be an example.

How many of us as parents have said, hey, you know, little Johnny, little Susan, you can go be anything you want. But you know what? I'm just going to sit behind a cubicle and hide out and be afraid and never try to grow. those thoughts really, really haunted me. And in fact, I met a gentleman this past spring who gave me a quote that encapsulates that to a degree. And he simply said, hell is to meet the man or in this man or woman you could have been. And I was just like, oh, wow, I don't want to meet the person that I could have been.

What a person? man you know and it just motivated by things and you know we've got a good strong network at church and I think a lot crying even more is what it pays but it's worth it I mean what else are you going to spend your life doing only got one life I don't want to make it

work absolutely so the what I've what I heard was you know and I talk about it's the first lesson of my free course is the first lesson at the academy. I've talked about it several times on the on this show almost to the point where people are saying, you know, just get down to the techniques, get after the strategy, get to the tactics. Let's not mess around with all this rah-rah stuff. And what they're classifying is rah-rah is very much the reason that you get started. Your why is what we call it. And it's probably the most important part of this business

because this business does get difficult, it gets challenging, it has its obstacles, and if that Y isn't in place, those challenges and obstacles will stop you every time. I agree 100%. In fact, what I like to tell people and share is the questions you need to answer in order to have a successful business are thus, and you must answer them in this order. It is why, what, when, who, how? Why what win, who, how? Why on earth are you doing this?

Simon Sennett wrote an entire book on this. There's a reason there's an entire book written by one guy on why and starting with it. There's a reason because it is that important. And yes, we do get hoodwink into thinking, well, if I just had all the right contract and all the right techniques and all the way do dads, you know, electronic equipment. I mean, if I knew all the right marketing strategy. I mean, I didn't have a website for years. I'm just now building that. You know, all of these things I didn't know are so irrelevant in so many cases,

it's most important just to go get started because you'll learn things to a completely different level. But if you don't have a reason to get up every morning, and it's got to be more money, you can't just, I want to make more money. Well, if you want to make more money, go get another job. You know, you've got to want to make a different. You've got to want to be someone of significant. And most of the time we've spent so much time helping other people's dreams come through. We've forgotten that we have them, let alone what they are.

And we don't give ourselves permission to express them. Once the last time you've been able to go around your friends and say, hey, you know, this is what I would really like to do with my life and have that idea accepted and encouraged and nurtured? Or are you too afraid that there's going to be criticism? there. I mean, but those are the very things that will get us up out of bed. Because if you, I mean, easier, you know, say you make a quarter of a million dollars. All you got to do is get up, fight with traffic, do what the boss tells you, and then go home. Okay. That's a lot easier than accepting responsibility for providing jobs and taxes and housing. I mean, that's some of the

basics of what a business owner has to do. Could you imagine? And that's, and there's a steep learning curve with that, but it's not what we're taught. And again, it's not that it's easier. It's just what's more familiar. What's more familiar to most of us, unfortunately, isn't what's best for us. Right. It's like, you know, we all know we should eat an apple a day. We know that, but we don't. Exactly. And it is what it is. The point I'm trying to say is, I'm just trying to underscore vehemently. The one thing that I have on straight is why on earth I keep getting up, keep doing this. All the other pieces, you can go find. You can go find someone who is good at doing the books. You can go find people who are good at the market. You can go find all of these

other pieces that are there. But you must become clear, crystal clear, on who you are, what you represent, like I said, you've got to answer those five questions, why, what, went who, how, in order, and then you'll know exactly how to create a great business. You know, the other thing that you had touched on was the fire, fire, aim, ready method. I have a coaching client. I haven't told you about him yet because, I mean, we're like only eight weeks into his coaching program. I had, I interviewed him on the last episode.

And in eight weeks, from not knowing. one thing about real estate. He's done 11 wholesale transactions averaging about $5,000 per transaction. That sounds like my kind of guy. Yeah, in eight weeks. And I've gone out to St. Louis to visit him twice within those eight weeks because I was just, I had to get some of that. Because I was like, what's going on out here? How are you doing this?

And so I went out and rode around with him and everything. And, you know, he doesn't have a website. He doesn't have an LLC. He doesn't have a business card. I stopped by his home office. It looked like a tornado went through there three times, and they did not clean up in between those three times. And I was just blown away.

And now he's getting around to the point where he's got an assistant. He's having a professional organizer come in and fix up his office. And, you know, he's hiring all of those parts, those other resources that are available. But the part that's important is wise in place, and he didn't wait to know it all before he got started. that if there's one thing that i hope you're everyone just heard that they that he did not wait until he knew it all to get started and here's the fun piece you'll never going to know it all so quit waiting

you know like it always changes and and and because he went out there and that's what i love about it because he went out there and got something done he now has the resources to be able to bring in and fill in his which you're very similar to mine because I've had higher people to come organized my office and calendar and all that thing, which is funny. It's like you don't have to be the best at every

piece of the business. You've got to be the best at a few. I mean, you can find people who are good at the other pieces. I totally agree. And my hat's off to him. It has awesome, awesome work. I hope he continues to do so. When he

hits that roadblock, because I Bull Road bucks comes because you get started. I hope he just continues to push through. And that's amazing. That's great stuff. That's awesome. That's awesome. Okay, so I know you started off.

Your first few transactions were wholesales. And, boy, you've come a long way since then. That was, what, about three and a half, almost four years ago, I guess. Actually, it's almost five years now, believe it or not. Is it five? Wow. Time is funny. I know.

My grandmother's 92nd birthday was the other day And I said Gosh, grandma, you're 92 She goes, yes, I'm getting old And I was like, I'm 43 Yes, you are old Like time flies

But So bring us up to speed Because you've done You're not just a wholesaler anymore By any means And I think you mentioned shopping centers Just a few minutes ago So bring us up to

how you become, uh, from going from a wholesaler to multi units, multifamily, hundreds of units and shopping centers. What happened in between? Right.

Like a magic wand. Next few hours, right? Totally. Um, we, well, and it was ultimately that, something that Stephen Covey said,

that was a great man. Um, he, he said, start with the end in mind. I knew I wanted to do what saw in Robert Kiosaki's cash-go-game. I knew that I wanted that. I wanted to be a passive income investor. That's what I wanted. So I've structured most of my wholesale transactions to sell to the

person that I wanted to become most like, which is a buy-in-hold person. So then I started learning from them what made a good deal, what didn't, made good financing, what was horrible, what were the type, the good types of properties. And from that piece, I was like, okay, cool this makes sense then i started adopting some of their beliefs about money and what is it used for and all these things what happened is i remember because i would sell at this time i was you know wholesaling transactions and my fee was like only two thousand dollars at the time because it was just a small little single family house and some of those eventually got up to twenty six thousand dollars even done you know apartment buildings now which is even a whole other number

but the the point is is that in that process you get paid one time And what I saw was I could get paid my fee once for people who today still own those are getting hundreds of dollars a month, not to mention all the tax write-off and the other benefit. And I said to myself, I want that. So I had to figure out. So I challenged myself to figure out a way to create, and here's the matter, I wanted to create $20 a month of passive income.

And I promise you, I have never worked so hard to create $20 in my entire long. life. But that's what I had to do. It started out with $20. The 20, I want my goal with the bind up property, be able to raise the capital, either from a hard money lender, private lender, whatever it took, because now that I understood it made a good deal, I figured I could talk to somebody and say, hey, we're going to use your money. I'm going to arrange the deal and make this happen. And that's exactly what happened is that I was able to put together a number of small single-family houses and keep them. And I was like, awesome.

It worked. And, you know, through that process, I was like, okay, well, if we can work for one or two or three or four, I wonder if it could work for more. And that's about the time I started raising even more money. And when you and I started doing deals together, and I forgot how much we raised, but I think it was close to a million dollars. And we went out there and did it all over again. And then, emboldened by my great success,

I said, I can't fail, which we all know means is the precursor to, I'm about to lose it all, or something of that picture. And I went out there and I raised me again, and then I tried to do some fixing and flicking and that did not go well at all. And I'm, but, you know, it is because you take the bed, you take the bed, so they, okay. And from that process, I realized that, okay, now I've got a problem. I have to solve it. How do you solve a $100,000 problem? and I remember I remember it clear day my counter or sorry my accounting person at the time comes to me because I was all excited because I did I went back to doing small single family houses and I was all excited because I did a 200 a month deal in Georgia and I was like yeah look we got another one at $200 a month and she turns to me

clearly and says Mr. James you can not be wasting your time on on single family houses and $200 a month and I was like what are you mean don't you understand it's packed? passive income, and I'm starting to try to teach her about passive income and why it's all this. She's like, yeah, I get that. And then she said, how long did it do you? And I told her, and I was like, and she's like, yeah. And for that same amount of time, you need to figure out a way to do $2,000 a month every time you do all that. I was like, okay, well, how do you suggest I do that?

And if you know, she's so knowledgeable, she goes, that's not my problem. It's yours. She's like, oh, great, wonderful. Cool. And I think that was around the beginning of 2010. And what happened is I was like, okay, well, the only thing I could think of was a apartment building. That was the only thing I knew. I was like, well, an apartment building supposedly is going to be larger. And then I was just thinking it can't be too different than single family houses. I mean, and the process has to be very, very similar. So I'm like, okay, cool. Well, I'm going to apply this process to the same thing and do

apartment buildings. And so I did the same techniques that I've always taught that I always do to go find an apartment building instead of a single family house. Then they came and then I said, okay, let's go find someone who's willing to play this apartment game with me. And I found my first investor. They put up all the money. I did all the work, which is pretty much my structure for most cases. And what ends up happening is we bought two 12-unit buildings within like, I don't know, 60 days of each other. And I was like, oh, my goodness. And then I started doing the numbers on those 24 units, because we were able to get a killer deal on them. I mean, combined between both buildings. We bought all 24 units for a purchase price around $40,000. We had a lot of rehab to do.

So we spent probably, I want to say, $250,000 on rehab on all of them. them, about $300,000 all in on 24 units, which still is good in my opinion. But at the time, those buildings were easily producing $140,000 a year gross, and I was just doing the math. Oh, my God, this is awesome. You know, this is thousands of dollars per month. And then I got hooked. I was like, well, shoot, that is the same work.

And now thousands of dollars a month comes in as opposed to, you know, $200 or $100. And I began to get larger and bigger. And once you do it once, you know, one friend tells another friend, who tells another friend, and then tells their mom, who tells their cousin, who tells their third uncle. And what it took happening is you, I just kept doing it. Since I found it, since I began to put a team together, all these things were going well. I was like, awesome.

This rocked. And then, you know, last year, probably easily. The most challenging years I've had thus far, when it's getting started, you know, we had some issues with one of our property managers, and it caused a big slowdown in everything. But this is when I learned how to, the quality of the team, the internal team that I had put together. My internal team came together, we were able to recover the buildings. We did have to sell one. I wasn't happy about it, but that's okay. We did have to sell one.

And now, those buildings are approaching 100% occupancy again. And literally, as we speak today, negotiating on 139 unit building, 119 unit building, and I think it's 181,000 shopping mall. No, that's gross land area. So that includes parking, et cetera. So I'm working on all three of those while negotiating at the same time to purchase another package of 200 houses so that, you know, for smaller investors so that they can buy them and, you know, kind of do the same thing that we've done before. Right. Right. So I'm doing all of those things now, but it was based on having so much experience, having things go well, having things wrong. And the key thing for, I want to say to, you know, your people and your audiences, that they understand that investors what they're looking for,

is not so much that you know what to do when they're going right. They want to know that if it goes bad, you can fix it, period. And because I've had things to go bad. There are some people, especially the deals in Indiana, those went horribly, horribly. I'm still paying them back. But they're getting paid back. That's the key.

I didn't leave them high and dry. Does that make sense? I mean, those things are key, those things are important. and learning to build bigger, better, stronger teams is amazing. And here's the funnest part about last year. Even though last year was horrible, what it did is that it put us in relationship with some higher-level people who had the ability to help us locally, and they came to the table, totally helped us. And because of all these new relationships, right now we're in the process of planning an event with the NBA,

the National Basketball Association, to happen. some of our tenants near one of our building. And what we're, I'm so excited because I'm going to get to teach while, so we're going to have NBA players there, which is great. But then what we're going to have is a session where I get the privilege of teaching cash flow, the game, to the kids, to the parents, and hopefully if I get my wish, I'll be able to teach the NBA players as well. Giving back the very same thing that got all this stuff started for me,

and I'm just excited about it. Right. Right. That's awesome. Congrats. I got to get you on the podcast more to figure out what's going on in your life. Because you certainly don't share it when we talk on the phone. I'm busy or not really, but kind of.

I assume everybody is busy and doing fun stuff, you know? That's the whole point. That's what I mean by this stuff is fun. No, totally. You're so busy, it becomes normal. It does come. I mean, you know. You know, last year I certainly had to pinch myself several times for sure.

It was just, it does get fun. Something, I mean, there's so much stuff that you just said that we could all talk about. But there's one thing I want to go in on or focus in on. You know, the most popular question I get is just I'm having trouble get started. Can you help me get started? How do I get? The second question I get, and it's probably, they're probably neck and neck, but is where do I find the money? How do I find the money to do my deal?

deals. And you and I have, we started out in this business without a, excuse, the expression apothepice and we had nothing. And I've tried to explain so many times in so many different ways of how I found the money. And I'm just, I'm not even going to offer my input on how I found the money, because they've heard it several times. Tell me, let's, let's go start with, let's go with how you did find the money. And then the second. half of that question would be, if you had zero today, where would you start? And what would be your first step? Let's do that. Got it. Okay. And as you can imagine, I get, I definitely get this question because people ask me, you were, you were a homeless, you were squatting a bank

property. How on earth, I mean, most of your listeners, they got to understand. My credit store, when I started, it was a $3.98. I've not found too many people who can beat that number. I did not let that low, actually. Well, there you go. And they wondered, you have no money, no credit. How did all this happen? And I call it there's a process. You're in a path or path to becoming,

past becoming a real estate investor, and you just got to understand how to reallocate your own resources. For example, right now you have a certain level of desire. That certain level of desire was that desire. You're doing certain things. You desire to go to the movies, and that's what you do. And you just misallocated your time, which is what you have. I had desire and I had time.

That's actually a resource. And as Tony Robbins said, it's not about resources. It's about your resourcefulness. And we discount our time as if it's not valuable. Well, here's the truth. It has little value when you don't have. have much knowledge behind the good news is knowledge is the easiest thing to obtain. So in looking back, this is what I realized I was doing. I took my desire and started my desire, took that desire

and invested in education, and that's where I spent my time. Now, that education wasn't just technical knowledge. It also has to do with skill sets. That's the next step. You must take it take your time to invest in new skill sets. Those new skill sets are, you know, maybe you don't like sales, but you want to do real estate. Well, good news is that if you learn to do sales, you can do real estate. The bad news is you might have to change who you are in order to do sales. But if you learn it, that skill set is yours.

But what also happens is that that skill set puts you into new relationships, contacts, new people come into your life who you did not know before, but you now know new relationships as you demonstrate to them that you, that you do what you say you're going to do, that even when things go wrong, you fix it, that you are willing to be held accountable no matter what happens. As you go through the peace, what ends up happening is they begin to trust you and you build character with them, which is given, they therefore give you credibility with what it is that you do, credit and credibility. That's the true credit. We used to think of, when we said credit these days, most people think of a three-digit number.

And just to understand that credit is not a number. FICO is a marketing thing at best. I wish I had control of it, but I don't. But we still, we subjugate ourselves to a number. and credit is is not what we currently call credit today. And so as I was saying, with those new skills, you've got new people that you're surrounded by, those new people assign a certain level of credibility to you,

which is great with the true credit that you need. With that credit or credibility, this is what you do. You learn to sell them a solution to their need, which therefore produces cash. This is what I did with wholesale it. So all those steps came before you actually did, deal. You're doing all those things, and then what ends up happening is you learn, you use your time to create something of value, and then because you have the appropriate credibility, people buy it

from you. And then the next step happens is that people say, well, I don't want to do it. How about you do it for me? And then you say, okay, cool. Well, we're going to need this much of your capital, and I'll run the deal. So now you can create cash flow. And then from that cash flow, depending on what you're doing, you have the ability to create equity, be that found for, stays, passes, all these different types of equity. And with that equity, you then become a person of significance where people want to know what you know and they want to follow you in your kids and your friends and your family all wonder, what are you doing? How does that work? And you get to have completely different conversations, which, again, completely new people, which then starts the cycle all over again.

now that you begin to have some level of influence among your peers, you've got to take your desire and double down on your time to be able to reinvest that time and get even bigger and better skill sets. Who knows, you might be invited to speak on stage and you might even start your podcast, right? You've got to double that down and reinvest into other people. And that's what's great about you, is that that's what you've been doing for a number of years. And I know there are a number of people who are going through this process with you, and because they're going through it, like that guy you were just talking about. You know, they're experiencing various levels of success and quickly because you're clear

on what it is that they need to do. You can follow the path when it's laid out for them that way. The things that really get to me is that I know that I can play in your game if I'm taught the rules. and if we were taught what you and I have been discussing just now when we were little kids, our lives would look totally different, totally different. We would have made different choices. But you know what?

The good news is that they're listening today, they're listening to this, and now they have a shot at having a completely different life. Yep. It's never too late to do what you could have done, right? Exactly. Or never too late to be who you could have become. Exactly. Right.

Because you don't want to meet that person later. Right. Really don't. That would be hellish. Awesome. So in this process, and this is something I've been struggling with, is how to create a course or how to create a step-by-step instruction, or just a step-by-step list.

Because when you go through that process that you just so eloquently and thoroughly drew out, there's so many things in there that I don't know if you can teach it or predict it other than you know if you just stay in action and the harder you work the more opportunity in quote unquote luck will come your way would you agree with that I would agree but I want to change the definition of the word luck sure because some people take luck and think that that it happens to do with some sort of chance I mean Malcolm I think with Malcolm I think with mouth glad well wrote a book called outliers. And once you become, or to become an outlier is goal.

And then once you are one, stay there. Because different things just happen for you. The world responds differently to people who take action. And that response is what some people interpret as luck. Taki called it laboring under correct knowledge. And if that means I'm now laboring under correct knowledge, and that's fine by me. I'll take that kind of lucky all day long.

And that's the whole point. It does take a lot of preparation, but, you know, people have also said that luck is where preparation and opportunity both each. Right, right. And that's why I put luck, why I went quote unquote luck, because people perceive it as luck.

But I don't know, maybe we can, I had no idea I was even going to go this direction on this interview, but it's your conversation, our conversation has led me to a way of maybe we can help put this together in a way where, you know, if you do the, gosh, I don't even know how to say it, just to raise the money for your deals, to get to the point where you're doing deals, whether it's your money or other people's money, you know, that first step is you talked about, you know, you have certain resources and the one resource that we all have is time. We have a choice on how to allocate our time.

And then the second step was, okay, if you want something that you don't have, you need to learn how to get it. So the second step, I guess, would be to allocate your time towards education, right? Education, yeah, sure, absolutely. Okay. So then step three. Education's got to become skills. It's got to become a new skill. Okay, so how do we get from –

Education has to be a new skill. Right. So how do we get from education to skill? practice. You've got to practice what it is that you're being taught. Practice to rehearse. This is where most rubber meets the road and most people quit. It's because I've said this before, there are two things that's impossible to do simultaneously. You cannot learn and look good at the same time. And as a human being, we're such a proud creature sometimes that we're not willing to be embarrassed or willing to fumble and willing to try something new until we

understand everything about it so we can look as good as possible to ourselves and friends. We have very fragile egos and that prevents us from actually taking action. But it's that very taking action, that very practice. And by definition, the word practice means you don't know how to do it. I mean, if you really want to think about that concept, why is it that lawyers and doctors still have a practice? You get to practice law and they practice medicine. That should scare you right there.

But that's the whole of the story, right? But when it comes to real estate, we're supposed to know how to do it. We don't get to practice real estate. We're supposed to know everything to begin with. And the thing that makes the leap is taking that education and to practice. If you don't practice, it never becomes a skill. Whether that's, you got to, okay, say you've got to learn to sell. Okay, that means you must.

You must find something that you can sell and earn income from it. You've got to learn to practice that. There's a certain skill set just to that. And I don't care what you sell. You've got to learn how to do it. Part of that, part of learning how to sell is actually learning how to communicate, not just in written form, but verbally face-to-face over the phone. That's, again, another skill set.

all of those skill sets are what compound for time. There's a compounding effect as you begin to learn those skill sets. And depending on how you run your real estate business, you must learn the skill set of what I call the skill set of a CEO. Like the CEO isn't the one collecting the rent, okay? And they're not the one fixing the toilet. So that means you've got to learn the skill set of managing a team. And I can, I can, for hours, and the lessons I learned last.

year on how I messed so much of that up. But the point is, is that you still got to be willing to practice and learn that skill set so that you have it. So that you get, then you take that skill set into new, you know, new people. You're going to meet new people, new relationships, new, you know, new acquaintances, associates, whatever you want to call it. Right. Okay. So let's just, let's settle on practice games. Let's just clarify.

and you kind of alluded to it when you talk about, you know, you practice medicine or you practice law. But they're not, you know, in the gymnasium doing reps of, you know, litigation. They're actually in the real courtroom doing their litigation. And they get better with each case that they get. And I would, so that's what we mean by practice is, like, I don't want you to practice writing contracts and that, and wait until that becomes a skill. I mean, obviously you want to go through it a couple times so you're familiar. but you really need to take that practice and that activity out into the real world. So it's not all practices.

You've got to do also. I don't know if there's another word. Absolutely. That can combine those two words together. But just wanted to clarify that. The word you're looking for. Go ahead. What am I looking for?

I think the word you're looking for is simulation. There's got to be a simulation for days, just like we do with our military. We simulate for a while. We simulate for a while. And then what happens is that, We've then put them in the real thing. And then we put them in the real thing with training wheels, but then we put them in the real, you know, F-16, F-18,

black, whatever it is that they're learning to fly. And then over time, just like, I mean, you know, you haven't been a Marine. You didn't start off with live ammo. This is true. I hope not. But anyway, you eventually worked your way up to live ammo. You didn't just, but you may have started reading about, you know,

the M-16. You may have started reading about the rifle, then you had to learn to take care of the rifle, how to clean it from a book, then you had to practice it, and then someone watched what you did. That's where the community comes in. That's where all those faith guards and being a part of your academy and all this stuff comes from. That's what a coach is for is to help you during those practice stage, to take it from just theory to the actual, you know, experience so that you have evidence that you can indeed. do and succeed at doing this. What the difference is is how quickly that you go through that stage. I mean, some people, let's just say, for example, because Tony Roberts talks about this if it took, if I told somebody that it takes 2,000 phone calls to be good at on the phone

and get all, and be able to raise all the things you needed, some people are going to take 20 years to do 2,000 phone calls and others are going to do it in two weeks. Still 2,000 phone calls either way. Right. The point is, is how quickly and intensely you practice because if you, yes, you need space repetition, it's hard and difficult for us as humans to learn something if we space it out too far. We must practice with intense, with purpose and focus in order to make the quote-unquote quick overnight change. Mm-hmm.

Exactly. Perfect. That's a great analogy, you know, as far as the military, I can. certainly relate. You know, and when they, and the one thing I just kind of wanted to point out and expound on that, just with a sentence or two on that analogy, is that when they did give me live ammo, I still was by far not an expert or a competent rifleman, you know. Right.

But they did give me live ammo. And, you know, so I did have to take some shots, even when I still was very unclear as to what I was doing and wasn't sure if I was going to hurt somebody or not. But thank God I did not hurt anybody. And the one thing about real estate is no one is going to die investing in real estate. Well, you hope. I hope, yes. But, I mean, there's nothing fatal like a bullet, you know, involved by ammunition.

So there really is nothing to be afraid of to just get started. That's kind of where I wanted to end up. And then once that does start becoming a skill. So now we've gone through how we're going to allocate our time. We're going to educate. Then we're going to start to practice and simulate. And then from there, what I think really happens, and it's the hardest thing to teach, is the hardest thing to convince people and have them to have faith in,

is when you're in action and when you're demonstrating skill, and whether that's a beginning skill or an expert skill, it does attract opportunity, it attracts people, it attracts situations into your life, that all of a sudden starts to make, you know, the business a little easier. Would you agree with that? And that, yeah, absolutely. Here's my personal case and point right here. When I first started, I, okay, and this may be challenging for some people to hear,

but I am naturally an introverted person. I don't like talking to people. It's not something I do on my own accord. You take me to a party and I look for the darkest corner, hang out there, find some meat and cheese and I'm happy. That's like where I go. But my mentor challenged me. He said, look, if you're going to succeed at this, you need to learn to speak in public. I'm like, no, I don't.

That was my response. And I went kicking and screaming the Toastmasters. And, you know, and being me, I was like, well, if I'm going to do it, let me just do it. Let me do everything I can do inside that space. Here's what is important. I've been able to win a number of awards for those masters, which is great. That's not the payoff point. The payoff point comes much later.

So this was back in 2008. In 2009, I started doing presentations. I instruct across the country. I've been able to do some cooking and clients, all this other stuff. Here's the point. Because I was comfortable speaking, I started teaching cash flow to groups, to groups of people. Because of that, I was in a position to be prepared and ready when the call came that Mr. Kiyosaki was going to be in a room and I was going to be the one to actually do the instructing. But that started five years ago, four and a half years ago, learning how to be

comfortable in front of the room, teaching someone else's game, mind you, to a group of a hundred and plus people, and he's in the room. That is the whole thing. But had I not been proficient or learned to become proficient over time with just speaking, that opportunity would never have existed. Now, that's not something I was planning on ever happening. I couldn't, I can't make that happen. Opportunity and preparation came together. because we need to be in action. No, without understanding where it was going, in a lot of cases. Right.

I just knew it something, my mentor said I needed to do. Right, right. You know, and for those that are listening, because you cut out a few times there, Jane, I just wanted to clarify that the game, the board game, cash flow savvy by Robert Kiyosaki, it is indeed a game, but it is also an exceptional education piece,

an exceptional training piece, and a great way to bring people together to get them aligned and united on one conversation. And one thing Jay has used over several years now to create and build his business is use this game, cash flow, and train people and show people how to play the game and just watch their whole experience change. The lights go off, the light bulbs go off, and things start to click, and they start learning how to implement the things that we talk about on this show and that we've been talking about today in their real life. So Jay's been doing that for a long time. And what he found himself, was it on the cruise ship?

Yep, yep. Jay went on a cruise, and he was asked to lead a very large group of people in this game of cash flow. And it just so happened that Robert Kiyosaki was on the same cruise and in the audience, listening to Jay teach his own game back to him. Now, you're right, Jay. you couldn't have planned that in a hundred years. But those are the types of things that skill produced. Those are the types of situations and the circumstances, the opportunities, and the luck that skill produces. So a great example.

Exactly. Yep. Perfect. Okay, cool. So once you get this skill, you know, and then you just keep on and just staying in action and staying in motion, these things happen to you all the time. And it's to the point now where, you know, Jay and myself, we don't really have to do a lot of prospecting and marketing. It's because of all the hard work in the marketing and the prospecting and the direct mail and the internet and every other conceivable thing that we've ever come up with because we've come up with a lot of them of trying to generate leads and generate business. We've done some pretty silly things.

And everybody has to start there because you have to generate the leads while you're developing the skill. and so you can simulate and practice what you've learned. And now we get to the point where, you know, our phone rings and people ask, hey, I've got 40 properties. Would you like to buy them? And you just stay in motion. And then the business does get easier. And it does get fun.

It's just unfortunate that there's so many gurus and people out there that misguide people showing that part first, you know. Right. And it just... You know, I, do think that many of them probably started out okay and and then something happened along the way and I think the key is that they they stopped actively participating in a lot of cases in the real estate market and that's like the one thing that I tell everyone I know is that I will stop teaching

I'll stop speaking today about real estate anyway when I stop doing it that way you know everything I'm talking about is based upon likely what I did last, you know, because that's where the, you know, information is only as relevant, is directly relevant in, and according to its timeliness. You know, if you tell me how real estate worked in 1970, that's not too useful today. But I need to know how it worked last week last month. How is it working today? And if we can, you know, if your listeners can continue to support people like you who are making sure that they're out there actually participating.

I think the policy of the information that they receive will improve over time because they'll vote with their dollars. Like, look, this guy's still doing it. And because he's still doing it, I'd rather listen to him. He doesn't need the flash and the showy and the glamour and the commercials, etc.

Those are useful, at least be integrable examples at the same time. Mm-hmm. Mm-hmm. and each and every one of you will have the opportunity to now start listening to Jay. He just launched his own podcast after a couple years of my strong encouragement and recommendation. He finally did launch that podcast. It's not all that Jay talked about in just a second.

It's Cashflow Diary. It can be found right here next to mine on iTunes. And so definitely he's got a wealth of information, as you can probably already tell. He's very much demonstrated that. And so you can tune into his podcast, download his podcast, as well. But you did mention something, Jay, that I want to talk about before we go, is, you know, you talked about what's going on today. So let's talk about real estate today. You know, kind of give me an overview of how you see the market, where it's going, and what you're doing

in response to where you feel it's going. Got it. Well, there are a number of things that are going on. I mean, we've got an intersection of macroeconomics. We've got an intersection of real estate and various different asset classes, all converging and being, moving simultaneously. And it's our job to understand where the opportunities are, what to avoid. You there? You know, depending on the sector. Hold on, Jay, you'd cut out there for about five seconds. Oh, okay.

Can you rewind? All right. Six seconds. No problem. Okay. So, ask the question again, please. Sure. Well, we have a convergence of certain asset classes and a difference between micro and macro something.

Go ahead. Got it. Got it. So what we've got going on in the marketplace is you've got convergence of many different things. You've got convergence of macroeconomics. You've got conversion crises inside of currencies as well as different asset and asset classes. So you've got to understand the sector that you're playing in and how that is relevant. For example, in the single-family house space, that looks different to me than the multifamily space,

which looks different to me than the commercial retail, commercial office, commercial industrial space. Here's the point. If we're in a situation, and depending on what you believe is how you should respond. So for me, I think I believe that our dollar is in trouble. Now, that's not necessarily in and of itself a bad thing. The question is, how can I put myself in a situation where, I can profit from and benefit people in the meantime from doing that. The same thing happened back in the depression, et cetera. So what is it that you can do? And for me, that means allocate my time

to understanding real asset. That is real estate. That can also be precious metals. That could be anything that crazy to Bitcoin. And I don't know if your listeners have been paying attention to the news, but hearing about that. But, you know, we're diversified across so that we understand how each of these things react to the current marketplace. When people get poorer, that means that higher-end real estate might be in trouble. Simply, they can't afford it, their job goes away. So you may want to shift your assets towards the things that people who, the lower end, the quote-unquote lower end of things, simple because they mean that that's what's affordable,

which could also mean that your rent may also be in jeopardy in terms of going down. So when you're negotiating deals these days, you need to keep some downward, you need to negotiate with a patent so that you know that you have some, if downward pressure enters the marketplace where you are, you have the ability to sustain that downward pressure and still maintain control of that particular mortgage. And that's what our debt is forced to control the asset. additionally, things like since we have this devaluation going on, that means you may want to be the one acquiring more debt, because in a higher inflation or inflationary situation, that gets cheaper over time and gets revalued, which is great for those that are the dead oars. You're the one receiving the payments, maybe not so much. but again, that depends because the opposite could also be true. So all of those things have to play into what I term your investor identity and who it is, where you want to play this game.

There's actually a play, especially right now in California, for wall land. Because at some point, we're going to need to build something somewhere again. So that makes a whole lot of sense to do. But for those who are interested in things like that. But as the macro and microeconomic change, the most, probably the thing that I'm most concerned about that I look at, no matter what marketplace I'm going to, is the job mix and job durability. Like, can these jobs, when I say job mix, is it all one industry? You know, it is all entertainment or is it entertainment and also finance? That's what I mean by job mix.

I want a wide diversity of job mix. Additionally, I want job diversity, or sorry, durability. Because if the job can be easily and efficiently sent offshore, I think that job is in jeopardy because there are millions of other people who have been educated by our schools who go back to their own country who are now able to work because of advances in technology, they're able to work from, quote unquote, home, and home is in a completely different country. And because they're in a completely different country, they can work significantly less, which becomes an efficiency magnet for the person running the business.

You know, when you look at large companies and you see them sending jobs over there, it's not because they want to. It's just cheaper. And they have a responsibility to shareholders to produce a profit. Well, you can't produce a profit under certain guidelines here. So that also then gets us into the whole political arena, right? So all of these things intersect and affect where you do business at real estate. So, you know, I look for those jurisdictions that are very business friendly.

I look for those jurisdictions that have very diverse and durable job markets that have infrastructure that cannot easily be moved. You know, there's a marketplace out there that has a river, and rivers don't move that fast. They can't be offshore or outsource. It's not going to anywhere because the river is going to be there and because it's still a working river, it works out very, very well that the jobs related to that are going to still be there. So those are the types of things when I look at the real estate market that I'm looking at so that I can make sure that I place capital where it goes because, you know, it's like a sacred trust. They're hoping you know this stuff. They're hoping that they're investing

the fact that you have the time to go find these things out, the time to develop these relationships to know it. Because one of the great things about real things is that you can actually, quote, unquote, profit from insider information. You've got to go find. You've got to go find that inside information as best as you possibly can so that you, yourself, and your investors can, and more, you can provide clean, same affordable housing at a fair price. Awesome. Thank you, Jay. That's one of the, the places I always turn to you for is what's going on in the economics and the economy and how that affects what we do. I want to keep talking about it, but we're here like at an hour

15 right now. Perhaps you'll have to come back and we'll continue this conversation. Would that be all right? It's sooner than later this time. Sooner than later, yes. Okay, we will not wait for more years to do this. Very good. Well, awesome, Jay, before we go, why don't you tell them your new podcast, Cashflow Diary right here on iTunes. Go ahead and tell them what it's all about and what they can expect to learn over their Cashflow diary. Excellent. You're going to learn a lot of the reasons and how to analyze markets.

You're going to learn a lot of things that you've just heard me share. But at the end of the day, it's going to be how to create cash flow for yourself. I call it a personal cash flow pipeline, literally having cash come to the door. And that's the whole point. We've got YouTube. We've got iTunes. We also have a website. This is cashflow diary.com.

And in fact, just because I started out as a wholesaler, what you have is you have the ability to get the e-book that teaches you how to do wholesaling the way I did it. And you have the ability to find where I might be teaching cash flow or even come to a webinar. all that stuff is online. Hopefully you enjoy it. I don't know, but it's all good. And I'm definitely glad for you listening today so that you know that you're getting the absolute best highest quality information you could have access there.

Awesome. And you actually have a, I know you put it together a free course as well. Is that accurate? The free course changed to the e-book because it turned out to be, it was just too much. It was way too much because the courses now what is called the cash flow creation system. What it will do is it'll teach you literally from start to end how to do everything that I do.

It is not for the faint of heart, but if you really want to know how to get that done, we'll rip and come out over time so that you have enough time to get all the lessons. But what I learned is that people need money now. So instead of teaching them the long-term strategy, we're going to focus on giving them some cash now through the wholesaling. So that's why that is now complimentary, and you have the ability to get that. Some people may choose to still become a member of the website, and that's great, because then they'll have the opportunity to get exposure to everything that it is that we do and duplicated in quick order.

Awesome. Awesome, Jay. Thanks for joining us, and we will talk soon, bud. Awesome. Thanks for your time. Appreciate it. Thank you for spending this time with Matt Taylor. and the epic real estate investing podcast.

When you have a moment, stop by iTunes to leave your comments and let us know what you think of the show. And if you haven't done so already, get started investing today by visiting free real estate investing course.com. To access Matt's free course, how to do deals, no money required. Until next time, to your success. To your success. To your success. This podcast is a part of the C-Suite Radio Network. For more top business podcasts, visit c-sweetradio.com.