Epic Real Estate Investing - Step by Step to Get Out of The Rate Race & Create Passive Income | 701

Episode Date: July 2, 2019

Mercedes created the series on how to create passive income! In today’s episode, learn what the passive income really is and how it defers from active income. Learn more about your ad choices. Visit megaphone.fm/adchoices

What I like best about Epic Intensive was the billing rapport with the sellers, because that's really what I came here for to learn more about that because I have lost deals, not building good enough rapport with some of the sellers that I've come across. So I felt that what I learned today really helped me. Hey, Matt here, I got a great show for you today, but first I got a question. Are you trying to buy discounted real estate, but finding that spending more and more on marketing is just becoming way too much to handle. I mean, do you start fresh every Monday, fail,

then vow to start again with the same old real estate investing strategies that aren't working for you? Well, you deserve to learn about a new way of contacting your leads, setting appointments, and making offers by actually setting up a really good automated lead machine so you can quickly get your hands on more discounted real estate. That's the goal, right? Because this changes everything. And before we get started today, this podcast, as the podcast, long as you've been listening, even whether that's just a week or it's been a few years,

you know it's all about finding discounted off-market real estate deals and then what to do with them. And if you're really serious about finding these types of deals at will, then you might like to join us at the upcoming live three-day Epic Intensive Lead Machine Workshop. It's going to be in Manhattan Beach, California on July 18th through the 20th. And if that sounds good to you, then have a look at Epicintensive.com. I mean, it's California. It's the beach. It's the middle of summer.

Bring the family, make a vacation out of it. Go to Epicintensive.com and let's make it happen. All righty? Let's get started with the show. 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 Tuesday on the Epic Real Estate Investing Show for Turnkey Tuesdays with your host, Mercedes Torres. Hello and welcome, welcome to Turnkey Tuesdays. This is Mercedes Torres, the turnkey girl, and I am lucky enough to be partners in crime with Mr. Matt Terrio, the guy who created the epic real estate empire. This show is real estate investing for busy people, busy people just like you who understand the importance of real estate and just don't know how to get started. or don't want to grow their portfolio on their own. If this is your first time here, glad you made it. Make yourself at home. If this is not your first time here, welcome back.

And to my repeat listeners, thank you so much for your love, the love that you send your way, or the love that you send my way, the emails, the questions, the kudos. I mean, questions you asked and scenarios that you and I speak. about when we're on the phone is what helped me formulate podcasts that help you. And after all, you are the reason that I created this show. So hello to all of my friends and welcome back to the show. So I want to start off this episode by sending some love to a ton of people that just closed a few properties. Mr. Alex Ramirez, that's a cop that we interviewed a couple of weeks ago. He bought another property. I think that was property number four. And Omar and Yin,

local investors here from Southern California, I was lucky enough to meet them for lunch just a couple of days ago. They bought two properties in Alabama and here's to your passive income, my local friends. Christopher Scheisler, he is an American living in the UK. Congratulations. I know you've closed on your first investment property in Alabama and Mr. Dillon Peters. Back from his world tour, he traveled the world while he was collecting passive income. And upon his return, he closed on his, I think, seventh property, or it might be eighth, eighth property. And congratulations to you. The last one that you acquired was in Indianapolis. And that is a great market, great team. So congratulations to you, my friend.

Speaking of you, there is no secret, my friends, that I hop on the phone with you listeners. And I get to discuss your financial future, you know, passive income through turnkey properties. I get to discuss, you know, your retirement and a good real estate strategy for you, etc. And I realize that many of you feel stuck, frustrated, if you will. and many of you just can't clearly see the next step that you should be taking when it pertains to creating passive income. I mean, you get it. You understand that passive income, it's important. And you understand that doing what you're doing right now is probably not going to provide the financial future that you want for yourself in your family.

or you figured out that at the rate you're going, you won't be able to retire. In fact, I can relate to you and many of our listeners can relate to you because believe it or not, I had that realization several years ago and this feeling, the lack of direction and the unknown is really what kind of lit a fire. under our butts that catapulted us to start buying properties in markets that were not our own backyard. I know, it's scary. It's scary to think that. But as I often say, we live where we want to live, and Matt and I invest where it makes sense. You know, we live in Los Angeles, California, and it does not make any sense whatsoever to invest here for cash flow.

It is very difficult just because our price points are over the top. And it's just the California market. And what Matt and I discovered is that market wasn't going to serve our purpose. Our purpose was passive income and it was very difficult to attain here in California. Not impossible, just extremely difficult. And that's why we kind of just ventured off to see where was it not so difficult. Thus, this is what forced us to find markets in Middle America that would serve our purpose. Now, fast forward, almost 13 years, we figured it out.

But it was a way long journey. Well, longer than we wanted it to be for sure. And we made a lot of mistakes along the way. Let's face it, we didn't have someone to call when we got stuck. We didn't have a coach. We made a lot of stupid and costly mistakes. And unfortunately, we learned through trial and error. And we were frustrated to say the least. And when I speak with you, there's a lot of frustrations in my investor friends out there. I mean, you're frustrated for a number of reasons. Some of you, you don't have time. Many of you think you don't have the money. And most of you don't even know how to get started with your first investment property. And if you do have properties, you don't know how to take the next step to your

next property. You're stuck. You don't know who to call. You don't even know what questions to ask and what questions you're not asking. I mean, the list goes on and on. Trust me, my friends, I've been there. You know, you totally get the idea of passive income. And you totally want to be. You totally want. it, but you just don't have the darnest idea of how to get it into motion. And many of you don't even have the time to put all of these pieces together to make something like this work. So what I have decided to do for you, my friends, is to begin a multi-part series for you to help you put all of this together. And I'm calling this the frustrated investors guide to passive income.

Now, if you've been on to my website, cashflow savvy.com, that's savvy with two Vs, I've shared that you can download a PDF that explains to you how to do it. I mean, it is one of the most common questions that I get. I'm always asked, so how did you and Matt escape the rat race in three and a half years? Well, I'm just sharing with you on that PDF. And now I'm doing it here, how Matt and I did it. And how tangible it is for you to do it too. So if you're a visual person, then just go to our website, download it. Just click on the link that says,

Frustrated Investor's Guide to Passive Income, download it there, or just stays tuned, and I will break it down for you in a couple of series preceding this one. Okay? So let's get started. Imagine this. You catch a plane to Italy, China, Tahiti, or Africa. I always wanted to go to Africa. You spend weeks on end, reveling in the sand, touching the great wall of China, or you go on a safari in Africa and you ride an elephant. I mean, you spot wildlife that you've only seen on TV. You discover new music. You taste new food.

You don't check your email once the entire time. time you're out there. Hell, you are having the time of your life and you even forget to post pictures on social media. You go profoundly offline like it's 1969. And you return to the U.S., you check your bank balance and notice it has grown while you're away. You return from your extended trip with more money than you had when you left. Does that sound like a fantasy? Well, this can be your reality if you create passive income. What's passive income? I mean, really, What is passive income? Many of you have the idea of what it is, and it's their idea of what it is versus what it is actually

that can frustrate the most flexible, patient, understanding, and resilient people that walk this planet. So, what is passive income? Passive income is income that finds its way to your bank account while you're doing something else. Something else like sleeping or like spending time with your family or eating ice cream or even eating ice cream while you're spending time with your family or while you're sleeping. When you're collecting passive income, your money is working harder for you. Notice, I didn't exclude your work from the description. What happens is your income losses correlate to your hours.

At any job, regardless of the income it pays, there's a direct relationship between time and money. Active income requires an exchange of time for money. Active income in our society is the state of affairs when it comes to making a living and you hear it reverberating in your everyday conversation. For example, she makes $80,000 per year. Or I charged $80,000. $200 per hour. He earns $4,000 a month. These statements reflect a notion between time and money. The more hours you log at the office, for example, the more money you make. Passive income shatters that relationship. It's a complete mind shift. Time is limited, but money is infinite. Time is precious and in short supply, my friends, money is abundant. Trading time for money

is unsustainable. Of course, if you're, you know, Kim Kardashian or the offspring of one of the candidates, you're forced to exchange time for dollars in the beginning that is, but it's simply a stepping stone. Trading time for money is a temporary situation. It's not permanent, my friends, unless you'd like it to be. I mean, after all, I do speak to some, I do speak to some clients that absolutely love their jobs. They love their profession. They love their career. And that's great. But what's more important is they choose to continue to do their career. because they love it. They have a passion for it. Most of you continue your career because you have to. Passive income, residual income, cash flow. It goes by many, many names. The idea of passive income is an encouraging one that it ludes to the life free of financial worry. Further, the concept of passive income is logical, and easy to understand. How could the pursuit of simple income models leave so many baffled and demoralized? I ask myself that all the time. And the reason I'm putting this series together is because I understand it.

It's all too familiar to me. The investment world can be discouraging. It could be a discouraging landscape to navigate of which a number of obstacles, vehicles, and players can hinder your process. The wide array of interruptions and distractions you can encounter when it comes to your financial future have you constantly questioning your current investments and efforts, not to mention the low percentage or the low yields that you're getting. Is this the best I can You ask yourself, I mean, I used to ask myself that time and time again. Will my current investments get me to where I want to go? If so, will they get me there in time?

If these thoughts and questions aren't enough to drive you stir crazy, every place you turn for some sort of financial advice, whether it be an investment magazine or, you know, CNN, or money today or a website or an expert television personality. Your senses are activated by inauthenticity or a notion of a downright conspiracy against you. How, your own financial planner sometimes seems more of an insurance salesman out for his own best interests more than anything. Face it, you're tired of being misled or something. sold. I know the feeling. The frustration continues as you have limited time, not to mention,

little desire to take your investing into your old hands, into your own hands, or you may not have the confidence. You've got a career, you've got a family, you've got enough responsibilities as it is that taking on a new investment strategy or an investment vehicle seems too much to handle. I mean, seriously, who has a time to maneuver through the vast body of investment options to find what's right for you, for your family, and for your financial situation and goals? Ultimately, your biggest fear of never being able to exit the rat race is a serious concern coming true and reverberating in your mind day in and day out. Will you ever get any time for yourself? Will you ever have some me time?

You're not alone, my friends. It's not your fault and I absolutely get it. I mean, all you really want are investments that are easy to understand, and you want the confidence that they'll produce right at or right above market average. You want options. You want facts. You want someone competent that you can trust that takes on the heavy lifting of finding, rehabbing and managing an investment that is going to produce a cash-on-cash return for you that is going

to provide passive income for you. Even if you found just one option to add to your portfolio that met your criteria, you want the peace of mind that it's going to work. Fundamentally, you want an investment portfolio that produces steady streams of consistent, passive income that will grant you the free time and the more important things in life other than work, other than the things that you have to do. At a certain point in life, time is more important than money. And it's passive income that will buy you the time like nothing else will ever do. So active income versus passive income, I'm sure you have a definition in your mind. So what I'm going to do here is we're going to start with a clean slate and really define

a few key terms so that we are all on the same page. The term rat race is a metaphor for a person's situation in which they find themselves financially trapped by their circumstances. And regardless of the amount of effort they put forth, the best they seem to do is stand still. Can you relate to that? The financial obligation we collect over the course of our lives, such as mortgage or rent, your car expenses or doctor bills, student loans, daycare, insurance, activities for the kids. I mean, countless other expenses can render us slaves to our jobs. I mean, in a recent survey by Forbes, 56% of Americans have said they have less than 1,000,

and dollars in their checking and savings account combined. 76% of Americans are living paycheck to paycheck and are at serious risk of financial ruins should the slightest things in their life go array. I mean, even the highest paying jobs of society often aren't enough to escape. escape, escape the rat race, that is. As a result, people tend to stick with their jobs that they dislike, that they utterly hate for fear of jumping out of the frying pan into the fire. With few exceptions, it's our pursuit of active income that keeps us in the rat race. So what is active income? Active income comes as a direct results of our efforts.

The phrase exchanging time for dollars is frequently used to describe active income. This can be seen as wages, salaries, self-employed providers like lawyers, doctors, real estate agents, for example, commission salespeople. there's a small percentage of society who's compensated with vast amounts of money as a corporate CEO or a professional athlete or like a rock star or celebrity. earning a high active income typically requires dedication, talent, timing, and a certain amount of good fortune beyond most people. As good as this type of active income can be, it's still limited because no matter how much money one gets paid, they still have to show up to work in order to earn their money. Note, 78% of NFL athletes and 62% of NBA athletes run out of money run out of money within. than a few years after they stop playing their professional sport.

In other words, after their playing paycheck stop, they generally go broke. Isn't that so sad? So that leaves passive income. Mercedes, we know what passive income is. Well, I'm going to define passive income. Passive income is when you continue to, to get paid after the work is done.

This includes royalties from your books. This includes movies and songs, and it includes income from real estate or business investments, where you don't actually have to be present to earn it. For example, Bill Gates. Bill Gates is a great example because he is still making residual income from Microsoft,

even though he hasn't worked there for years. The idea of building wealth through passive income has an understandable appeal, especially for those concerned about whether or not they'll be able to save from their work to meet their retirement goals. For example, to generate just $5,000 a month in retirement income from a portfolio, you'd have to amass about $1.2 million in an account that you do not touch,

assuming a 5% withdrawal rate. And even then, you better hope you don't live one day past your 20 years in retirement. It's much better to direct your effort towards creating a $5,000 stream of passive income using more creative avenues than just to work, work, work, and save, save, like so many of us have been taught. So here is the passive income myth and the source of investors' frustration. So Investopedia defines passive income

as earnings of an individual derived from an investment, a limited partnership, or otherwise enterprise in which he or she is not actively involved. However, popular culture defines it as any money you earn while sitting on the beach sipping margaritas.

Which one is it? Or is it neither? The answer to that question will be answered on the next episode of Turnkey Tuesday. That's it for today, my friends. Thank you so much for joining me and come to join me for all the answers on next week's Turnkey Tuesday episode where cash flow is king. Do you have doubts about your current plan for retirement actually panning out? Imagine revolutionizing your retirement plan so it pays you right now and in retirement.

Change one thing, one time, and that revolution can be yours. That's bad news for Wall Street, but great news for you. We're cash flow savvy, and we'd like to offer you free information that will show you how one simple tweak can cause your retirement plan to pay you right now and in retirement. And it's yours for free. For the secret your financial planner doesn't want you to know, go to cashflowsabby.com. That's cashflow savvy.com. This podcast is a part of the C-suite Radio Network. For more top business podcasts, visit c-sweetradio.com.

Thank you.