See our quitting guide here – Simplepassivecashflow.com/quit
Matt no amount of motivation is going to change the way you feel. But if you can commit to yourself and honor your commitments and doing whatever you need to do to make sure that you reach your goals financially, then you have to reverse engineer how to do that. And one of those things for me is on the physicality aspect of it and making sure that my health is in order. So
this is a story about a dude named Lane he moved to the mainland and bought one place to stay. And then one day he went try to rent them out. And then he became one real investor.
Simple passive cash flow listeners today I have Kyle Jones, one of my apartment partners. And if you guys haven’t heard of him before he was on episode 152. We, we talked about kind of getting started in apartment investing and but today we have a big he has a big announcement for
Folks, big, big announcement. Kyle, what’s that announcement? What’s the big one? Well, I am pulling a copy cat move like you and I quit my job, my corporate job that is, so I have exited the corporate world, left my position at IBM and I’m now a full time real estate investor and entrepreneur.
So maybe for those who will never go back and listen to Episode 152, why don’t you give a little little synopsis of what you’ve been up to the last, you know, decade of your life.
Take us back so computer can kind of get a little bit background and then I think what we’re going to do here so the value add is like for a lot of listeners is a lot of you guys are right on the cusp of quitting your day job. Right But a lot of us are high paid working professionals, where we make a lot of money and so total golden handcuffs.
So at what point what is the thought processes? What are the things that we didn’t think of before we kind of pulled the plug? But I’ll call watch it. Yeah. Give us a little background and context here. Sure. Yeah. So
I guess a little bit about me, I’m based in Houston. I been investing in real estate, when I started probably about eight years or so ago with single families,
but really didn’t start getting serious into multifamily until about five years ago, and then
kind of fast tracking through it. We started buying properties with our own dime, you know, through my earnings at IBM and, you know, in sales there and I was earning commissions and bonuses and things like that, and so was using those funds to purchase smaller multifamily before I realized that, at some point, you’re going to run out of capital and so I’d rather leverage the capital that I
had left that wasn’t tied up in equity to fund syndications and raising money and bringing investors to the table at that point so we could continue to scale the portfolio and ultimately creating enough cash flow so that I could eventually leave the corporate world or at least have the option. You know, my first goal was to just replace expenses. That was my first goal, you know, build up enough cash flow where if something happened and I was let go or you know, global pandemic happened or whatever, I could be
okay, because we at least had our expenses covered. And then when that really became a reality, then it was okay now let me really replace my w two income or get close to it, so that I could
you know, if I was getting closer to it, I could see light at the end of the tunnel where if I just focus more time and effort into
finding more deals and create
more cash flow than I can personally get to that comfort level to hit the eject button. But, you know, there’s a lot more in this in this space and podcast land and real estate guru land where it’s, you know, it’s really cool to quit your job and, and there’s like a war with it and everything else which I certainly agree with. But I also think there’s a The reality is a lot of the people that you might find that do this, you know, they weren’t like me and you were we are high paying high or we were high paid professionals, you know, they were somebody who had a entry level job, and they decided to go all in maybe they didn’t have a really high risk profile, I have a wife and three kids. So it just took me longer to get to a point to feel comfort in the fact that I had enough cash flow and everything else and so
you know, kind of going off on a tangent now, but those are some of the things that I think
Get lost. And just because somebody says they quit their job to focus on real estate investing, you know, sometimes there’s a reality behind the scenes that doesn’t, you know, it’s not a it’s not a meaningful thing necessarily versus somebody who’s leaving a corporate job. Yeah, I mean, I had a, I had like a info page on this a while ago, simple passive cash flow, calm slash quit. I don’t think I ever shared that with you. But people either fall in one side of this argument, right? Do you quit your day job to go after real estate? You know, I think you and I are aligned with that like, no. So if you make more than 80 100 grand a year, your highest and best use is likely at your day job. But we’re in this ethos where a lot of you know other people they make under 5060 grand a year. And for those people, it makes total sense. Yeah, quit your day job because you’re not making much there anyway, dude, right? You can, you could replace that through through probably two or three deals.
And be fine. And yeah, I mean, that’s that’s a that’s a predicament that I’ve always had. I mean, because we we raised capital and you know, we always had investors at least that would, you know, while you had quit your job, I think they would come and ask me Hey, when’s Kyle going to quit it a job. And I think there’s also an aspect of it where just because I’m still working full time doesn’t mean I haven’t set up the appropriate measures to put a strong team in place. I mean, that’s frankly, that’s the only way that I would have been able to even do this on the side and still work a full time job that, you know, a grant is it was flexible. You know, it was I worked from home for many years beyond pre COVID and everything else. I’ve been working from home for 10 years. So there’s flexibility in that. But there’s also you know, an element to where if you if you’re truly passionate about that, and you’re not there yet, you could go find a job that’s more flexible, because I get it not everybody can work from home. I mean, now it’s obviously different.
Because we’re in the pandemic times, but pre COVID and maybe, you know, 2021 when people are back in the office, they could tailor their job efforts towards finding remote capability or remote options, you know, work work from home options, if you will, to allow them that flexibility to be able to do some more things on the side, whether it’s real estate or another side hustle. One question that always comes up on you know, from from passive investors and it’s got a question asked is right, like, are the sponsors is their full time gig or not? On one side of the story, I have kind of tried to work with professionals, a lot of the partners that I choose to work with are 100 K and above people who, you know, kick butt at their day job as opposed to some random person. I don’t know. I mean, when you go on LinkedIn, and you see someone as an entrepreneur, and it’s the year 2020, that means you don’t have a job. You couldn’t find the job, right. So
this isn’t the 19
Anyway, we’re all we’re all tipped off to that. But, I mean, do you have any idea or thoughts on that? You know, I mean, there’s pros and cons both ways. Yeah. Well, I think there’s a lot of relatable skills that I took from my corporate job. I mean, I’ve always been in sales. So there’s obviously there’s a lot of transferable skills, which is being able to build rapport, being able to sell a deal, you know, not only I was selling technology to cut, like, you know, big corporations, but I was also now in selling deals to investors, and getting pepsin behind that. So, also just putting a team together, putting a strong team together project management skills, I mean, you have those, I have those from just the leadership skills that I developed in the corporate world, it’s still putting teams together and and then getting behind the team and making sure that you’re staying, staying in touch and providing oversight but you’re also not having to get into
To the nitty gritty details as well, like it kind of reminds me like when we have a deal that we closed, where there’s like three properties in there, and we’re splitting up the accounting and I’m like, oh, my goodness, this is this, like how at back at the day job where we kind of make things complicated on purpose just to confuse ourselves. It’s like, here we are doing it again. There’s probably a reason why and we’re comfortable with it, because we’re used to that complexity in a large corporation, respecting the chain of command, I think, you know, working with property managers and other professions, big thing. Yeah, it’s still a big difference between investing with somebody who current it worker, still working in the, you know, their day job, you don’t know how much of their bandwidth is going to their day job or running your deal, and being a steward of their money. Some people will say, Well, I’m all for funding people, you know, people going after their dreams. I don’t want to be the person putting in 50 hundred grand so somebody can feel it out to finally
You know, yeah,
right? Right, right now you can kind of fully come out and say that, exactly. It’s like the chicken in the egg thing. You’ve got to have a track record to be able to do that. But you also, you know, if you’re a high earning professional, and you’ve got a family, you can’t just jump ship. You know, it’s for me, too. It’s kind of scary. I mean, I’m doing it in the middle of this pandemic, when a lot of people are, unfortunately out of work. You know, whether the pandemic happened this year or not, I mean, nobody could have predicted it. But this was a year that I was coming into looking at, hey, this could be the year that I leave the corporate world. And that’s what I let’s let’s kind of unpack this because this is the you’ve been planning this for quite some time. You already mentioned you have a wife and three kids. So you’re not just another throw. Just goes to the gym a lot. You got responsibilities. Tell. Tell us about
Like, I know in the beginning of like your corporate life 1010 years ago, you are drinking the kool aid of climbing the corporate ladder, like, what was the mindset of Carl Jones? Early 2000? Well, I mean, Frank, are you still think you’re gonna make it to the Major Leagues? Yeah. Now, I mean, it got tempting here as of later in my career, because I finally did have some of that tenure at IBM and I was being looked at it, you know, even executive type positions. And there were other positions that I’ve actually even the last 10, two years, I had actually turned down that would have set me up to be, you know, Director VP type. Yeah, going back. I mean, yeah, I definitely wanted to move through the ranks. And,
you know, my first goal was to work for an organization like IBM, or Microsoft and Oracle, which I worked at all three of those corporations. These are large, high tech software organizations. I think that just
Mainly stemmed from my dad. So I kind of fell into the trap of just falling in line with the way that my dad did his career and handle that and went about, you know, raising his family. And there’s nothing wrong with that. I mean, I lived a good childhood. But for me, it ultimately came down to truly what freedom is. And it sounds kind of hokey. But I mean, you know, if you’re working in a corporate environment, you are working towards building somebody else’s goals and dreams versus just yours. I mean, obviously, you could, there’s a subset of that. And that’s kind of what we’re talking about. Now. You could develop this career path to get there. You know, I want to be a sales manager and then a director and then a VP. So you have the hierarchy. And that’s exactly what I wanted until I did see my dad get laid off, basically forced into early retirement from the company he was working for. Also
Still high tech software organization. And that’s really what kicked it into overdrive. And that is also the kind of read just that timing of it is what I needed to to just kind of get my wife on board as well. She was already supportive. But it didn’t really resonate with her until I said, hey, look over here, look what my dad’s going through. Like, we need to figure this out now, so that we never have to worry about this. And she got it, because she saw what my dad was going through. So that was kind of like the event that kick started, it really shifted me into overdrive and, and being way more intentional about my investing, the types of deals I was looking for and things like that.
It was always it’s always been about cash flow. You know, there’s now we’re getting to a point where we’re doing some, maybe some heavier lifting so there’s
more of an appreciation play in there but early on and even still looking for cash flow, producing deals.
Just about getting multiple streams of income. So if you can get, you know, 2030 k hits and just kind of stack those up on top of each other, before you know it, that’s that’s where you’re at. Your family is very similar to my family like we both have a bunch of poor dads right, that are still working, are still working crazy. Oh, we have kind of a friendly competition or when actually one of our dads is going to pull the trigger and actually invest in one of these deals. They just don’t get it right.
But so so what is it? Some people will say it’s either your family doesn’t really understand what you do like a lot of like, think my parents still think of like a real estate agent. They don’t understand they still think I should have been an engineer, or is it just like, you know, you spent all this time building this 10 year to kind of blow it away, right?
What is the bigger of the two? You know, I think the in my because I’ve had conversations with my dad and I think he’s always said
Especially later in his career, too, he’s encouraged me to go after this. And he said, If I had to do it over, that’s what I would have done. You know, so he’s been pretty transparent about that. So in a way, I think he is, you know, he’s proud of me and, you know, kind of stepping out and taking some risk early on. And I think he wishes he would have done some of that. So, you know, the appetite to actually invest now at his age. I mean, he’s at that he’s at that retirement age where he needs to watch where he’s putting his money, he can’t just go it his risk profile is much different than, you know, when it was in his 30s. But yeah, that’s kind of how it’s transitioned through the mindset and it’s given me more confidence and faith to go out and try to achieve this now. So we’ll get into a little bit of like, what were the things that they end that money tip, the skill for you
as you kind of build that runway.
But what are some tips to manage the workload while you’re doing W to get some ideas? Yeah, I definitely think I have a huge advantage just with the type of job that I had. And so that does come down to being able to work from home. And I think, you know, there’s one thing that the coronaviruses has done for a lot of corporations, and that’s shown them that a lot of the productivity can still be accomplished by working from home. And so I think we’re gonna see a lot of companies that are gonna allow that more often. So take advantage of it, especially right now, you know, if you’re still sitting and working at home, take advantage of the time, because that’s the only way that I was able to do it. And I had a job where, you know, my boss wasn’t breathing down my neck. As long as I was taking care of what I needed to do and staying on top of, you know, the things that were required of me. I was left alone. And so I had to stay extra diligent on the IBM stuff. So kind of
Build up and be able to take the time to work on the side investing. Stay off the radar, right? Yes, they have the radar. And that’s a that’s exactly right. I mean, you know, whereas usually, that’s a, I was having a conversation with one of my former colleagues,
just this week when I was kind of telling them what I was doing and everything else. And that’s one of the things that he mentioned. He was like, you know, you’ve always done what you needed to do, but you kind of stayed off the radar, you know, that allowed you to, you know, do these other things. And I had confided to him a little bit. He knew I was investing in real estate. I don’t think he knew to what extent but if you’re if you, you’ve got to pick, do you want to be a passive investor or an active investor? And I think you can achieve true financial freedom through passive investing, but it’s going to take working more hours at your day job to get the money to invest passively or on the active side. You’ve got to be able to
Work essentially to full time jobs and have some nights where you stay up a little bit later, or get up a little bit earlier to work on the side hustle. It’s just about committing, identifying what you want, but then committing to how you’re going to get it done.
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So I mean passive investing, if you’re spending more than a few hours a week, researching stuff, you’re doing it the wrong way. I mean, it really should be a few hours a month from a passive investor standpoint, you just don’t have the network or you’re just wasting your time on the wrong stuff. cause obviously more of an active investor. But you know, maybe maybe you kind of break down your day, a little bit like, especially in how did you spend all the time for your family, right, because you had to partition things. So people are a bad passive investors do spend too much time doing it. Maybe they can kind of emulate what you did. But yeah, how much I mean, how much hours to
The IDM think a typical, I mean, I was feeling safe to say now, right? Yeah, I mean, some days, it’d be a full eight hour Sundays, it’d be 10. Some days, it’d be four or five. I mean, it just depends on the day and the amount of customer calls that I had and the types of deals I was working. You know, it wasn’t always a rigid schedule. But I mean, for the most part, I stuck to my routine. And that was, I mean, one of the things that I did I get up at four o’clock in the morning. I know, you know, this, because, you know, we, we’ve been at some of those conferences we’ve buddied up and
my alarm goes off early, especially when your your body’s still on Hawaiian time. I know that’s super early for you. But I know I’m still sometimes I’m in the Dropbox and I see you getting out. Alright, I gotta go to sleep.
Yeah, so that’s one of the things that I that fit my schedule, rather than staying up late. You know, you’ve got to kind of pay
I mean, you still want to try to get some sleep where you can, but for me it was getting to bed a little bit earlier, but waking up at an extreme time, so that I could, you know, have the runway uninterrupted time to do the things that I did to catch up and then, you know, then sprinkle throughout the day. So I would spend, you know, the first parts of my morning, after I, you know, have a morning routine and everything else doing what I need to do on the real estate stuff and catching up and then, and then kind of shifting gears. So compartmentalising, shifting gears to IBM, and then usually have some calls in the morning around IBM, you know, for the most part, if I didn’t have any deals that I was underwriting that day or anything else, there might be a day where I’m not really doing anything real estate related, because the whole goal is to find a capable, efficient property manager to do the heavy lifting so that maybe you’re only spending a few hours a week, you know,
Reviewing financials reviewing your weekly reports. And yes, we have weekly calls with a property manager, but those are, you know, we, we would do ours, it’d be hour and a half on Monday and an hour on Friday. So that’s only really two and a half hours time. And then throughout the week, there were, you know, some live questions. So, you know, there’s really not a now tax time is more difficult. It’s much more involved. I’ve got to be more responsive with the accounting needs and things like that, because people need their k ones. And we need to be diligent with our investors. But looking at a time right now in August work, there’s not much going on, we have some rehabs going on. So there’s not a whole lot of day to day combat that I need to be involved with. I still get a random call every now and then from our property manager with a one off question is rarely an emergency situation that can’t wait for those calls. So I’m going to keep
Keep that structure in place. Because I want to continue to have more free time and really focus efforts in some other projects and things like that, you know, like finding more deals or you know, just taking the sophistication up another notch with the way that we operate our deals you know, there’s there’s little things little projects that I can take on now that I probably couldn’t before the power, how do you kind of do you know your kids name? And do they know you? Just next guy that wakes up one morning and crashes at 10, nine and comes down for dinner, grab some ready made food, things of all. How do you how do you bring that? Do you partition a search in time for that stuff? I do. I mean, it’s a little bit easier, you know, they’re around all day now. So there’s a lot of mix and match with
them being authentic school and
trying to take breaks
breaks throughout the day but also, I’m pretty rigid also on the back end of the day, I try to shut off between five and 530 and really just focus
my entire efforts towards my family try to put my phone away as much as I can. I’m not always successful
in the workplace behind you know, usually if I can schedule it out, you know, like we’ve done some calls and
you know, my goes to what works with you and I need to catch up and I’m going to catch up in the day. I don’t mind scheduling a call at eight o’clock my time except when we don’t.
You know, I can catch up real quick. I just try to keep the evenings open to my family and just be as efficient as possible throughout the day.
Frankly, I don’t take a lunch break.
And then they can get breaks throughout the day and I picked up a couple
Get up somewhere, it might have been the deep work guy where you don’t take too long for you to take
I think I’ve heard that too on some podcasts like four or five years ago like some like one of these like geniuses or like some kind of like, like a classical musical composer, he would go in his room for like, like 15 minutes or two hours, and then he would set the timer and then he would come back out and then just totally screw off for 20 or 30 minutes. And then like clockwork, he goes right back in there. It’s like the optimum like, it was optimal time. Are you got it? Everyone’s a little different, right? Yeah, no, that’s kind of worked out for me just making making it.
More regular, I guess, versus like taking a long extended break and we come back tired. I
don’t want to have a big deal because you don’t want to be dragging in the afternoon. You’ve got to make sure that sleep efficiently
There’s like some health components that I, I made sure to take care of my body and physical aspect of it too, just so I can have the energy. Yeah, sort of like a basketball player. He calls out, you know, middle of the third quarter. So you can come back, you know, 11 minutes in the fourth quarter. It’s like very nature very strategic.
see, I mean, you and I are a little different. I think when I was working, you seem to be a little more partitions. Right. Like you have phases throughout the day. Yeah, it’s not always perfect. But I think I was. I work maybe my last few, four or five years, four years of in my day job. I maybe only did about a couple hours of work a day and it was very steady. You seem to be all over the place with your W two job demands, but I was pretty steady. I could knock it out in a couple hours. And then it was just real estate all the time.
Yeah, we, you know, in my job, we’re still kind of at the mercy of another person’s schedule.
That’s a big part of it, you know, you’ve got trying to sell a customer and deal.
On the IBM side or sell more product, you’ve got to kind of work around their schedule, cater to them. So wasn’t always perfect. But I generally tried to have some free time in there every day that was allocated towards doing something around real estate, whether it was around the operational side of it or even just trying to find new deals. Any other tips for the W two working stiff out there?
You know, for me, I can’t. I kind of mentioned it just now. But I mean that it gets overlooked a lot. But the physical aspect of just taking care of your body and taking care of your health. There is no way that I couldn’t have done what I’ve been doing and operating with the amount of potential stress that could be there. So you just got to take care of your body. And that’s not just eating right. That’s exercise, but more importantly, that’s also sleep.
That’s what I’ve learned. It just all goes together. And if one thing is out of whack, it can really derail your day. I mean, you’re if you don’t have the energy, like we were just talking about, if you don’t have the energy, it’s not gonna happen. And if you don’t feel well, I mean, no matter, no amount of motivation is going to change the way you feel. But if you can commit to yourself and honor your commitments, and doing whatever you need to do to make sure that you reach your goals financially, then you have to reverse engineer how to do that. And one of those things for me is is on the physicality aspect of it and making sure that my health is in order. So how many hours of sleep Are you typically shooting for?
You know, waking up at four, I’m usually trying to go to bed between nine and 930. So it comes out to about six full hours of sleep. Not everybody can operate on six hours, but, you know, whatever you feel like your body needs. You’ve got to listen to your body and, you know, there’s certain
That’s, that’s one thing I’ve actually been, you know, had been reading up and studying sleep and you know, just trying to better my sleep habits and I think that’s where our our diet and our exercise all that will affect our sleep. And if that’s not an order, you’re not going to be able to sleep efficiently.
I I’ve been doing like a 2:30pm nap every day there was a book when I don’t know who wrote it, but that was the takeaway from the book.
you’re dragging ass anyway in a while so just not getting ahead and take a nap. Yeah, I I’ve actually tried that and experimented with that where it’s like, you know, they say like a 20 minute nap or a 30 minute nap. And I’ve tried them all. I’ve tried 20 minutes or 30 minutes of trying hour. They do not work for me. If I crash like I’m done. I’m toast like, I’ve taken nap. I’m done for the day. Yeah, I wake up I don’t want to do anything. Yeah, I’m sorry to see that too.
You know, it’s just I don’t like waking up so it’s like two times where I’m like God dang. Like
Yeah, you know, these are just ideas, guys, right? Like, I mean, Kyle’s early riser I kind of tend to stay up late.
From what I hear from you guys passive investors, I think most of you guys will put your kids down to sleep at what eight or nine
or a little bit more free range kids 10 1030 whenever they choose, but then you guys are up from like 1030 to one o’clock two o’clock, doing stuff on the computer on their own. So hey, I think the thing is just try it out. Right? Try it, see what works experiment. So let’s transition to what was the final like, you know, a couple things that had to change for you to finally quit the day job. You know, we had always it’s different for you. That’s why I didn’t understand why you didn’t quit much earlier. Whether it’s right or wrong, what were the things that you needed the metrics you needed to hit to be able to
pull the plug. And yeah, I think, Well, one of the things that was a little bit tougher to manage was, I was going to do it as long as I could meaning work, you know, stick with IBM and continue to do real estate to where I wasn’t like, super high stress, like feeling my anxiety at a high level, just like always feeling like I was just wired. And it this year more than ever, it was really starting to get to that point. I mean, we’re starting to do some bigger deals,
a lot more to manage, and things like that. And so that was starting to intrude in my, in my headspace. And so I knew that, you know, especially the, the first deal that you mentioned, the first deal this year where we did the three property portfolio.
I knew that was going to be a Kickstarter for me that could potentially make it happen. And so, and then we ended up and we’re just
Doing a development deal. And so, you know, the development deals, a heavier lift for me is ground up construction. So I knew that
in order for me to also be at my best from a steward of investor capital on that magnitude, it probably be good for me to go ahead and, and say goodbye. But like, I didn’t just go out and do a development deal. I mean, I had set up some of these components in place. I mean, every deal that we did, it was just like one step closer to, you know, getting to the to the freedom aspect of it. So, I guess the metrics that I had put, you know, I kind of mentioned earlier it’s number one, replacing expenses number two, getting close to or having line of sight into replacing my my income. Once I got to replacing my expenses, that’s when I really just knew that it could be accelerated and then you know, from there, we just
kept doing deals, I mean, you know that a part of it too, is just the, the work is really starting to pay off for what I have been able to do and developing relationships and some of these markets that we’re investing in. And so, you know, there’s plenty of deals to, to underwrite and analyze and see if they fit. And so I just think about how much more could we do, potentially, if I was able to operate full time on all cylinders, and have a headspace to just fully devote to real estate and growing the business there. One of the things you’ve mentioned to me was like, you know, we get paid off asset management fee like
usually one or 2% of income generated kind of like a property manager. And I think that the takeaway for other people is like that can be akin to your passive investments, right? Like when that gets up to be a certain amount that exceeds your your monthly spend. That is, that’s kind of what you’re that’s
The apex. Yeah, yeah, that’s definitely a part of it. So, you know, the way that we’re making money from our side is asset management fees, acquisition fees, which certainly helps, which is more, I see acquisition fees, you know, I don’t want to, I don’t want to develop a business based on acquisition fees. I don’t want to ever find myself where I have to go and do a deal. That’s more like bonus. But in my world, that’s like closing a deal at IBM, that’s your bonus, that’s not your base salary. And for a lot of larger institutional operators, that’s really the only way to keep the lights on like that one to $2 million payrolls, they need to charge three, four or 5% acquisition fees. Exactly. If they’re not doing deals, they can’t operate efficiently or they have to scale down and I just never wanted to build a business based purely on that so and then of course, the cash flow that spits off you know, we get the sweat equity in the in the general partnership and then anything else
top of that, that we invest in our own deals, but your monthly overhead is pretty low like me personally, I think. Yeah, I mean, now my rents really cheap.
Got a couple car payments. That’s about it. I’m under my, yeah, my wife’s a teacher. And I think I made it so all the monthly charges go to her account and her her paycheck pays at all. All the reoccurring expenses. I just like it because selfishly I just like to see my account. This
is what I
like. Part of a key is like a lower head. Right? Yeah, overhead. Totally, totally. I mean, it’s, it’s challenging. I mean, we take the joint account approach, my wife and I, but, you know, we did get on the same page about setting a budget and managing our expenses.
And just figuring out, you know, like, How many times are we going to eat out
You know, what are we going to set aside for just sludge money, you know, fun money? What are you know? And then, of course, we’ve got a regular repeating expenses, but we also live. And that’s the other thing, maybe it would take somebody moving. I mean, I know there’s a lot of people that are listening to this, and some of the areas of the country where real estate is just super expensive, whereas, I mean, I’m in Houston, Texas, we live in a 3000 square foot house and
where you could get a 3000 square foot house in another part of the country, it’d be a couple million bucks, and that’s nowhere near what we paid for our house. And so our mortgage is very small. I mean, very small compared to a lot of people that I know that live in Hawaii, or California or New York, that you know, are paying three $4,000 in rent, and they’re in 1000 Square Foot apartment of some sort or something like that. So we’ve made
See it all guys like we we approve all investor applications before we go out. And you and I see all the financial profiles, everybody we know how much you guys make. And we know how much your net worth is. I mean, in a way we have better oversight than CPAs investing in and there’s a stark contrast, you know who is doing it the right way in their financial budgets? And who is who’s overspending? Right who is a spendthrift spouse? Yeah, knighted there. Yeah, totally. I mean, it’s,
I mean, we not to scare anybody, but we have to review that. We got to make sure that, you know, the right people are coming into our deals, but, you know, you’re seeing it across the country, not just people who are trying to be a real estate professional, but you’re seeing a mass exodus and some of the coastal climates. I mean, people have been moving from California to Texas for years now. People are moving from New York down
In the southern states, like Florida, or they’re just moving into the suburbs. So it’s been happening for a while. But that might be what it takes. I mean, the property in the south and in the Midwest is cheaper than the coastal areas. That’s just the fact. And so, you know, that’s an easy way to, if you are looking at this and you don’t, maybe you don’t have a family, or maybe you don’t have a lot of maybe do have a family, but you don’t have a lot of commitments and your gross risk profile is pretty high. And you can work anywhere you want, why not look at living in a place that is just a lower cost of living and no state income tax and a lot of things like that that are set up for you to win versus the alternative, which doesn’t leave a whole lot left for you to put back to invest at the end of the day after you pay all your taxes and your high cost of living and all that other stuff. But at the same time, Kyle and I did not make over $300,000 at our day job. So what can we say?
Yeah, I think yes, that’s probably might be a good
problem to have on the one hand, but yeah, it’s gonna take you a lot of passive investing to be able to replace that income. I think like, at least my goal for a lot of you guys is especially if you’re a higher income earner like that is you get to a point in your mindset where you’re investing, you see the light at the end of the tunnel, it’s not a 2030 year tunnel. It might be a 510 or even 12 year tunnel. And you get to a place in your mindset where you’re good, like, yeah, you have to come to this job every day. Or maybe you go to part time, but you’re not there because out of fear, where you know, you’re afraid of getting fired or you need that job, right? And then it comes and you’re freaking out. That is cool. When did you kind of hit that point
in your investing career, that you maybe came over that Apex? So it really needed the job like yeah, you’re gonna keep it because it’s good money. It’s easy money, but it just wasn’t that you didn’t really
Nita, are you there more things are later. In terms of mindset. Yeah, I think
especially on the topic of really high earning professionals,
you know, it might be challenging to get out there and, and really try to drum up deals, and maybe they do have a really demanding job. And so they, frankly, might be better fits to invest passively for now, until something changes, maybe, maybe they get a new job later on, where they have a little bit more free time. Maybe they are required to be in an office right now, at the moment, but down the line, they go and they get another job or frankly, they decide the stress of the environment that they’re in is too much and they are willing to sacrifice a little bit financially and allows them to have more time to go find deals, but I mean, either way, I think it can be done. It’s just what is your stress tolerance, what’s your risk tolerance and what are you willing to
To commit to to, to get at what point at what point when in your investments, you kind of see the light that this was gonna be. Your days at IBM were numbered. Well, I mean, for me, I was thinking through it. I mean, obviously I had, I was coming into this year, knowing that this year could be the year just based on the pipeline that we had. And the deal volume that we had in front of us, you know, it wasn’t ever like I was running from IBM, and I still don’t feel that way. I feel like I’m running towards something real estate. Really, when we started finally closing a few of these deals that we have in the pipeline, that’s when it started becoming a better reality. And once we got through a big part of the due diligence process on this development deal that we have knew that this was probably it. And you know, I think I shared that with you when when we were doing our due diligence trip and in Huntsville and that this could be it And sure enough,
Here we are. In April and May were a little scary read it. We’ve never been through a pandemic, a little bit nursing was that what was that? Oh, you know, April and May little bit of you know, stress and anxiety. We have never been through a pandemic, but I’ve seen collections come through, sometimes even stronger in some places. Yes, that was also key to because I write I mean, okay, knowing what I know, and knew that this year could be the year and so like, I was having those thoughts in March, hey, maybe this will be delayed a little bit. Maybe it’s not this year, not knowing what collections would look like, over the next couple months. But yeah, right. collections have been where they need to be, if not better, in most cases. So that certainly helped give me more confidence that, hey, this is actually working. This is this is a good long asset class and it’s tested, and we’re testing it now. Maybe we’re not through the entirety of it, but it should be
Like, things are progressing and at least in our properties, so you know things happen for a reason.
most successful people when things happen, they don’t they understand things open another door opens up. So that can mean you know, in Kyle’s case, you know, a pandemic happens his stress test is his theories that workforce housing works or it could mean somebody loses their job and finds a different one that has a little bit more free time to go finally pick up pickups and single family homes or even sorry if you lost a whole bunch of money in the stock market, but I’m like well wake up you know, it’s all a bunch of fake money out there. He come easy, go and start investing in real assets. But yeah, let’s let’s wrap up here. Take us to the story. How’d you let him know was it just like a little, little handwritten note or
some people put like a bag of dicks is what some people tell.
Oh, no, no.
Yeah, I said I want to.
Well, I, you know, there’s always that what if it? What if fact, yes, you know, and if anybody and, and, you know, get out of there, but
I just thought, you know, it wasn’t anything special I just call my boss now I did have to I kind of rehearse what I was going to say before I call them for a few minutes but I mean, I’ve been rehearsing what I was going to say for for for a month, you know, just said, hey, it’s time for a new chapter in my life and I’m gonna
start focusing on real estate investing full time and I’m leaving the corporate world for now and just kind of left it
pretty casual and and just real politically correct, real neutral. And he said, No, that’s great. In fact,
he might be a potential investor because he said, Hey, I know
Learn more about that because I’ve got all this money. Because I’m your boss, I’m rich, and I need a place to put it. So who knows, he may or may not invest. You know, I mean, my boss and I had a good relationship. I think if there’s one takeaway that, you know, people can glean from this, it’s, you know, at least in my experience, you know, you go through work, you have some politics, you know, sometimes things tick you off, but you forget about that, right? When you’re outside the day job is just, you wonder why, like, when you were in it, it was such a big issue. And when you when it’s you don’t have to go to the day job, you don’t have to deal with all these people. It just seems a part of your life that
you didn’t need to do it. And now your life can really start now. Right? Well, yeah, Kyle, thanks for joining us. You want to get your contact information out there for people to get a hold of you.
Yeah, sure. I can post in the show notes, but my
Email is k Jones at true point cap.com My website is www dot truepoint cap calm or everybody will you know you have to keep working the day job that’s cool just just know that your days are numbered and you know enjoy it right whether you’re working a day job or not
All right you guys
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