Why Leave Your High Paying W2 Job | Lane Kawaoka as a Guest on W2 Prison Break Show

What’s up folks? On today’s podcast, you’re gonna be hearing a little bit more in depth in my story. I get interviewed a lot and it’s very rare that you get interviewed well, like on this recording that we’re gonna share with you guys so you guys know, there’s a lot of podcasts out there, but, we try to keep things cool and authentic for you guys.

And part of that is, not just sugarcoating the narrative that a lot of people will put out there. With that in mind, if you guys have any questions we probably need to do another, Ask Lane show where we open up the question bag. But if you guys have any more relevant, to what’s gonna going on lately go ahead and email it in at the team@simplepassivecashflow.com

We’ll get it. Show going here in a bit on that. If you haven’t yet go and sign up for the club simplepassivecashflow.com/club. You get access to. All the e-courses that we have for free, The Infinite Banking e-course and then a lot of insider information as well as deal access there. And you can also take a look at all the other past deals we’ve been doing for the handful of years prior to this.

I think maybe we started doing this, maybe 2017 was our first syndication transaction. But yeah I feel like we’re not the new guys anymore, right? I think you can tell who is fake if you make it. It’s one way of doing that is just seeing how many assets they own.

Today we own $1.2 billion of assets under ownership. And I’ll be the first one to tell you, 2019, when we are around that half a billion dollar mark, we were getting our feet under. Since then we’ve expanded the team. I personally am not really in the day to day, nor are the principles and partners not in the day to day as we’ve hired that out to industry professionals.

What does that mean? People who’ve been property managers for a long time and have. This is what they do for a living. And we go on and headhunt the best people and bring them in house to asset manage for us. Very different from, I, I think there’s a lot of people out there that think, it’s the bigger pockets mindset, right?

Somebody who just doesn’t like their day job can be a. Real estate investor. I do believe to some point, but when you start to run thousands of rental properties and accept other people’s money in the terms of the syndications, I think you need to really hire a professional to do something right.

And I just don’t wanna discredit people in the real estate investing, real estate operating asset management industry, You. Yes, you don’t need a college degree to do it, but I think experience in this industry is very valuable, which is why we’ve hired people who are much better than you know myself.

And I’ll just, I’ll call myself out on that. But if you guys want to get more involved with us, join the club. We’ll simplepassivecashflow.com/club. Beyond the lookout as we’re gonna start to put out the. The info pages and the signups for the annual retreat here in Hawaii, January 13th to the 16th.

Make sure you apply and if you are on our investor club list, you can’t just come, you gotta just, you have to book that onboarding call with myself so we can get to know each other. And even if we’re not a good fit, I always try to make it a point to point you guys in the right direction cuz it’s, that’s ultimately what I’ve found that I enjoy doing for some strange reason.

So we open up your balance sheet and we look in. It’s basically a short period of time where you get to ask the questions and send you off on your merry way. For a lot of people it can be life changing and that’s, I personally like to be that person to make that impact for you. So make sure you guys sign up for that after signing up for the club and enjoy the show.

Lane, welcome to the show, my friend. Good to see you. And I look forward to the discussion today. Thanks for coming on. Yeah. Thanks for having me love everybody. Yeah. And before we get into your W2 prison break story, which is an awesome one right now, you’re doing some great things. We’re gonna definitely dive into it.

Just, I, to expand on the intro that I gave your bio kind of gives us some background on you. Take us back to the early days when you got outta college and started working and ultimately what led you to where you are right now? Yeah, I grew up in a household where your chocolate goes to school, studies hard, is a good kid, and invests in your 401k and max that out.

Just work it and grind at a job and work your way up the ladder for several decades. Yeah, I was always, we were always taught to save, like when we went to restaurants, we never bought soft drinks. Those are always costly, we are pretty frugal with our money.

. I was able to save, 80 grand in a couple years working and to buy has to live up in Seattle. And that was that program. I call it the linear path. Cause you just follow it, like your brain dead and just good boys and girls just following that path. And that was me like right outta college.

I was a construction supervisor out there. And a hundred percent travel. And I knew you had to pay your dues. But very early, I was like, this sucks, like this engineering job sucks. Yeah. Another fun thing people like say, oh, it’s good to be outside outdoors.

And not stuck in office. I’m the opposite. I went to the, go to the office every day. So be the same thing. Go to the gym the same time. That was more like me, but , that was how, how I was in my early twenties. And you were in engineering, it sounds like that’s correct. I got a bachelor’s in industrial engineering because I wasn’t smarter enough to get it in computer science, electrical, chemical, and not smart enough to get it in like mechanical or civil for undergraduate.

Yeah. So I went to project management, right? There you go. And you mentioned about you were being taught to save. Hey look, my parents did the same thing too. We were frugal. It’s invest in, I drank the Kool-Aid too. Invest in your 401k and save and get a good job. And. Hopefully you retire when you’re 65 and you’ll have enough money to live for the next 20 or some odd years.

What did you do with that? You saved up the 80 grand. So obviously there was some benefits there, you learned those lessons. What did you said you bought a house with the 80,000. Did you buy a rental property or did you buy your main residence? Yeah, I bought the main resonance first because that’s what everybody says to do.

Get on the escalator of wealth building and oh you’re paying rent and throwing money down the tube, which in my opinion is totally false. I don’t know people get that from, but I blindly followed the dog. One, bought a house live in and, appear this 20 something year old kid is living there all of himself and he’s traveling a hundred percent for work.

So what does a cheapo do? I started to rent it out. And I just lived off the company dime, living in hotels for several years up straight. And I, I tell people it’s not what you make, what your top black income is. It’s more what you save. Now, it’s making close to six figures, but like nothing like how kids are making these days, or I know a lot of your guys are making like two, 300 plus thousand.

A lot of my clients make over 500, 600,000 as doctors. It’s all what you net. And at that time, making a hundred grand, I was able to save sometimes 80, $90,000 a year, just paying taxes, basically. So all that money went to buying more and more rentals after that first one, I got that taste of cash.

So I was like, wow. The tenant’s paying down my mortgage, I’m getting the equity appreciation there. I’m getting cash flow, which I can feel like I can finally spend it, cuz it feels like free money. And then I’m getting the tax benefits and then the appreciation to which I don’t really count on, cuz I don’t believe in gambling on appreciation and be going cash flow. But when you add those four up, you’re making like 20, 30% plus and your returns on your money. And I. Why the heck am I doing this? Eight to 10% nonsense.

Great insight. So it sounds like you had a pretty significant mindset shift early in your W2 career. And that really helped you, understand that, Hey, there’s I can leverage my W2 job, you’re out traveling. You’re not really there. So you just said, Hey, let’s rent this thing and you got a taste of the passive income, and then you started acquiring some more properties. And we talk about that a little. And before I go any further, I know people have heard this before, but we’re not talking about wholesaling and flipping houses to me.

That’s what you do when you’re broke. For many of us with good paying jobs and, are busy managing our, like our day job. So we don’t get fired the stuff on the side. it needs to be passive. So I was buying these what they were called, turnkey rentals. Sometimes folks out, out there, like the flyover states where the numbers work way better.

One of the things we look for even today, when I buy large apartments is like this 1% rent evaluat ratio. So you take the monthly rents divided by the purchase price and it needs to be 1% or higher for the numbers to work for the cash. Why is cashflow important? Obviously you get paid every month and, but in case of a recession, you’re not, out on the code, right?

You can pay your debt surface. We, we don’t really look at like loan, the value. We look at debt surface coverage ratio for some more sophisticated investors out there of debt surface coverage ratio, 1.2, five or greater. Like going into these types of deals, you. It’s typically not gonna be where you live.

Most of my clients live in Washington, California, New York. It ain’t gonna be there. Those are called primary markets. So I was buying in lot of these secondary ter rate markets like Birmingham, Atlanta, Indianapolis, Kansas city, Memphis, little rock, places like that. Not the funnest places to go and visit, but they have these great rent value ratios that allow you to cash flow.

They don’t appreciate as much. No, I don’t really care about that. I don’t care about what cash. So I started to buy all these 20 key rentals and just all my money plowed to just down payments on these things over the next several years. Did you, okay? This is great. This is great stuff. So you’re not living in, you’re not living where you’re investing.

Which I think is a misnomer for a lot of folks who are, working in a job that they want to get out of and maybe create some cash flow. So you did this all virtually, essentially, and maybe touch a little bit more on what you mean by turnkey. Rental. And how active were you in managing these properties that you ended up purchasing in other states?

Yeah. This is actually like a product that people will sell Turkey rentals. If you Google it things will pop up. Guys, providers will pop up and supposedly there’s different layers of turnkey, essentially the idea is house flipper out there will go buy a beat up piece of junk and they’ll fix it up.

They’ll but they’ll put it put like a renter type of standard type of stuff. It won’t be like super pretty, but it’ll be like really durable and good enough, for government work or for, class B and C renters for the most part. So they’ll fix the roof, the flooring appliances, the new page job they’ll fit all the interior stuff.

And. Sometimes these guys will even put a tenant in there for you and manage it for you. I always recommend my folks to get a third party property manager to get this all in place. So you don’t, you buy from somebody else, it’s a great way for like new investors to put on the training wheels as a landlord.

But this is what I did, I bought from 2012 or 2009 was when I bought my first rental . So 2015 is when I stopped by these little rental properties, I got up to 11 of ’em and I think they’re a critical part of wealth building, but if you’re already in a credit investor or million dollar network or greater making more than two 50 a year it’s little rental properties are a pain in the ass and they’re still have some little bit of li legal liability and the debt’s in your personal.

Syndications and private placements might be more of your style. That’s where I switched. So for 2015, with 11 rentals, each rental gives me like a couple hundred bucks, few hundred bucks, a cash flow every month. So you add that up. I was positive cash flow, 3000 bucks, which was BEC a lot of that’s when it’s real, estate’s tax free.

So it was essentially like half my paycheck. I saw the like to financial freedom. Yeah. And I actually saw this very early on and my, my attitude towards work changed pretty drastically in the first, even the first several years doing this where I was I don’t really need to do this too much longer.

Yeah. So you were planning the exit. You were you saw it as you said. Yeah. Yeah. My first job was pretty hard. I worked for a very conservative company where, quality of life is low, but the pay is a little higher. And maybe that was probably a good thing too. Yeah.

Because it cl it heated up the wa falling water and it made me really hate my. And wanna get out even more and more motivation to saving, to put the down payments and more properties. But that was I would say my attitude definitely changed after a while. Like I became apathetic in a way where it’s I don’t have to keep doing this.

Like I make more than you guys at me. It’s start to realize. 95% of people out there. They just are really bad with their money. They can’t save it. They spend more than they make. And, let’s put aside the folks who don’t go to college. Not saying college is really that great at anything, but don’t go to college, don’t get a professional career.

A lot of those people, it’s an income. They just don’t make enough money. If you don’t make 50, 80 grand in this country with a family, you’re not making enough money. Quite frankly. Yeah. That’s a different problem. I don’t know how to fix that. There’s so many websites, debt, consolidation. I don’t know about that, but I was good with my money.

So a lot of folks that I think are listening resonating with this, right? You make six figures, but there’s this kind of money mindset out there. Like Dave Ramsey, C you Orman the saver mentality. What I tell people a lot is that’s good for people who, number one, don’t make that much money. Or number two, maybe you do make a good salary, but you suck at your personal finance.

You can’t really keep a budget. And I would still argue that most people are like this. The people who cross over, like people like myself, right? We save a boatload of our, into 401k, even though we shouldn’t be doing that. And we were on this fast pass to financial independence, need to get rid of the Dave Ramsey, Suzy Orman save, say, save.

And you gotta get into being buy assets with good debt and leverage your debt and in a way, be on the offense. People don’t realize that there’s these two paradigms and the two some people call it the rich dad, poor dad mentality to operating system. I call it the simple passive cash flow.com mentality.

Cause actually tell you guys what to do, buying little rental properties to your network, cuz half a million million, then go into syndications and private placements. After that. But that, that’s what I followed. I followed this journey. Once I got to the accredited status, I started to go into syndications in private placements and I started to dump the low, annoying rental properties.

But the annoying rental properties to me was a way how I learned and it helped me really do due diligence on the larger deals as a passive investor. And Yeah. Yeah. Great share. Can you talk about, and I love the simple passive cash flow.com. That’s your, that’s where you teach people how to do this.

And basically follow this path that you’ve developed, which are gonna get to there’s. So a lot more here, maybe talk about one of your first syndication deals. Cause you did make the leap from single family too, to, to syndications, to mal. Yeah. I already had that mindset of these rental properties are a pain in the butt.

It’s not scalable. Yeah. For if, like I said, I had 11 rentals and maybe a few hun $3,000 and pass the cash flow every month. And it was a bit of a headache because with 11 rentals, just to give some people some insight. I had maybe an eviction or two every year, which are a little annoying.

Of course I have a property manager on all these properties. I’m not some idiot who runs this stuff myself remotely. There’s somebody else that takes 10% of the rents that does all my dirty work for me. Yep. But yeah, to deal with these evictions and these, every quarter, you’re gonna have some big kind of catastrophe.

If you have a love of rentals, it’s if you have 10 sons, one of ’em is gonna go to jail every decade, like that’s just the odds. I’ve never heard that before, but yeah, I guess that makes sense. I don’t have sons, but I just see it on TV and, I just see it out there, see if Felic, some kids gonna go to jail, typically a dude . But yeah I, you see where this is going, and totally I’m like, then I started to join. This is where the big thing aha moment for me was I started to interact with other high network accredit investors.

And these aren’t, super rich people, but they have a million dollar net worth or greater. And a lot of ’em were. Of my pedigree I was an engineer, there are a lot of engineers. There’s a heck, a lot of engineers as investors, doctors, lawyers, dentists, accountants, pharmacists, lot professionals also working their day jobs because it’s a great way to, build up that cash to buy more rentals or go into more deals.

But they’re all their main thing was that they were, you. Dumping their rentals and going into these Archer syndications. And I just saw the writing on the wall. And when you meet people who do what you do and they say I used to do what you do, but now I do this. That’s probably one of the best arguments for me that I at least start to look into these large syndicated projects.

But when I first started saw this stuff, I thought they were like Ponzi schemes. But then I started to get to know the people build relationships. And that’s what this world is. It’s a people game, building relationships, the right operators and building colleagues and peers of other passive investors to know who’s legit in this business.

The trouble is everybody’s got podcasts these days. Everybody’s got books. So it’s really hard to determine who’s legit in this, fake it to your, make it type of world that the general partners live. Which is why I tell everybody and how, like my whole method is like building relationships with other passive investors is why we have a community for this.

And you just basically copy what other passive investors do, that have gotten good returns from people having gotten their money. And this is the essence, like this is the country club deals. This is the virtual country. In a way. And this is the way that a lot of investors invest and we can get into it later, but it really opens up the taxes because now when you’re going into these deals, a lot of these deals do cost segregations, which if some people are rental property owners, you can deduct 1 27 of the value of the home every year and take that as a paper loss.

But with this stuff, you could deduct one third of the property all in the first year. Yeah. Like it could be like a 10 or 20 X that deduction, and now you can implement certain strategies. The typical one for my clients are like, you have a couple, one higher paid person and maybe another lower paid one that we wanna have ’em to stay at home and play with the kids and enjoy life.

Now that person can implement real estate professional status rep status, which is a checkbook on checkbox on your taxes. There’s a few loopholes that jump through, but once you do that, now you can use the passive losses to not only offset all the passive income, that’s the gimme, but use it to offset the ordinary income, which I know a lot of you guys have high w two or 10 99 salaries.

And you can basically, if you can pay whatever taxes you want. At that point. Correct. And as you alluded to earlier, it’s not what you earn. It’s what you get to keep, right? This is right. This is a tremendous way to reduce your tax liability. And even to, to zero in some cases, I’m sure. Yeah.

I don’t pay taxes equally. I have million plus bucks of passive activity losses. To use at my disposal. Yeah, there’s a strategy to it. And unfortunately, a lot of CPAs tax folks don’t really understand this stuff. That’s why, like a lot of this stuff is if there’s one big piece of financial advice, never take financial advice from people who are not financially free themselves.

Like, why would you wanna take financial advice from a CPA? The dude has a job at J B. He works for a paycheck. He hasn’t figured this stuff out. Yeah. Show me your income statement. Show me your net worth. Yeah, i, I don’t income. It’s all what you keep and what you accumulate at the end of the day.

There’s a lot of people with high incomes that aren’t the most sophisticated investors. or money managers. And it’s all net worth to me is what your age is. So when did you great stuff? It’s you’re now in these multi-unit deals and you’re buying a lot of commercial assets if you will.

And you’re up to several thousand units now, but when did you start. Really think about, okay, I’m exiting my W2. yeah, I did this. So know, switching back to the W2 world I did change jobs few times actually. I started to work for the government and , I actually, the job became pretty I actually enjoyed it at that cause I enjoyed the full workers.

I liked the management. I didn’t like what I did one bit, but I mean to me, there’s like a triangle of who do you work for? Who do you work with or your subordinates, and then do you like the work that you’re in? I think if you have two out of three of those, you can be pretty damn happy.

You can’t have one or not. Yeah, I guess what you’re trying to find is something that’s all three, which. Good luck but some of my doctor clients have it, because they, if they happen to be, have a good boss, that’s the hardest one. They work with people and they, they often work with people on their worst day and that could be very enriching.

And then they obviously, they may like their coworkers to have a great team environment. That’s the perfect environment where you can make a full load of money doing that. Most of them work two to three days a week. But they typically do once they find this stuff. But for me it was like just downgrading to like more quality of life, less work responsibilities, but after a while, I went into some bad deals with people as a past investor.

Then I realized that I needed to control the capital stack myself and, that’s why I started to do deals myself. And then my impressions would come in and that was it I felt felt a little irresponsible, like bringing in my constituents that here I am working this W2 full-time job on the side.

Little Iwan still. So I eventually cut the cord on that, but if I wasn’t like a general partner geo operator, Probably, that would’ve been a great, like I could have probably still doing it today. Like I enjoyed the work somewhat. It was cruise. I got to do my investing, passive investing thing on the site, which isn’t that hard.

Yeah. To be a passive investor, maybe takes five hours a month to do it. Yeah. That’s really all it takes. Yeah. Great. Yeah. But that, yeah that’s what. I couldn’t just stayed in that job and just kicked back and cruise, but, I think I quit around like 2018, I think. 18 all right.

So you’ve been here for about a little over 10 years in W2. Yeah. But the w two really helped me, propel our company and, build our organization that, I, and I think for my kids, I’m not a huge fan of college and higher education. But I do think that it gets you in a position to compete and get into a fortune 500 company.

And I’m not a huge fan of fortune 500 companies cuz of bureaucracy and everything, but it helps puts you into a system and you can be on the inside and be a. You can learn how their systems are. And a lot of those systems I implement today, minus all the BS, essentially. It goes without saying congrats on the on the exit there, but talk about your company now, you’ve got this big real estate company.

You’ve got over a billion assets under management, over 8,000 units. Talk about what, talk about your business and maybe a little bit about what, like a typical day looks like for you? What are you doing? Yeah, today it’s changed a lot. In the beginning we were running around.

Doing everything, managing the manager, working with investors. When we went over, I would say 500 million of assets on their management. It became unscalable to do it like that for ourselves. And that was a period where we had to reinvest a lot of our. Profits into other staff with who did our job a lot better than us.

So some of the key hires other than, investor relations staff and, marketing staff, but the key hires are like, hiring other property managers. But the property managers who did, were in the industry for a decade plus, and they have this insights, it’s just if you came at, and play doctor or computer scientist or computer engineer for a day, you just can’t do it. Like even if you studied up for six months to a couple years, you just can’t do it. And. Here I am, I guess I’m a semi smart dude, right? But I don’t know, like the little nuances that somebody who was, worked at a 30, $40,000 leasing agent job and stepped up to a property manager that maybe started their own property management company.

Those are some valuable insights that kind of, we have as our operations staff now that we’ve engulfed. So we’ve, our role has changed from, doing everything, to just creating the org structure. And that, that was not one of my forte. So we have some C level staff that help us do that.

But these days it’s more like guiding the direction and business development. Cuz that was essentially what got us started was the key relationships and continuing to build key relationships in the future, like with banks and with equity partners and stuff like that. What is the, sorry, go ahead. Oh, I think still.

I have a life coach and he tells me you need to figure out what you really enjoy out of all these random things you’re doing. And for me, it’s interacting with investors, give them that all home. And you’ve been doing it all wrong of 401ks, this bunch of retail investments that just, go out to the clueless and you need to get into like deals where, people and where.

It does well in recessions and then you you implement that, then you get the cost segregations and the depreciation and losses to do different games on your taxes. Then you do a little bit infinite banking, which is like cash value, life insurance at a 90 10 split with 20 10% being insurance.

And those are 1, 2, 3 combos. Like it’s a powerful thing that is very counterintuitive to how normal people do finances or people still in that Dave Ramsey school of thought. It’s a game changer and it allows, people who’ve been working so hard, I’d say our average client, 1.5 million net worth in their early forties with two kids, you change one thing around now, one spouse doesn’t have to work and now they’re, they see the light instead of now they’re 20, 30 years of working.

It’s really five years ahead of ’em. It’s totally transformational within, these individual families and, putting on the events and then meeting other people who have taken the red pill of finance. That’s what I enjoy. Awesome. And you, so you’re putting on some events too. Talk a little bit more about about that.

It sounds like you have events for your clients. Yeah, we’re a kooky bunch, right? Like we are our deep down core is like we’re savers. We delay grad and we get off on that. People come to, we do in Hawaii, like people come to Hawaii, nobody stays at the high end stuff. That’s not good use of, that’s not good value.

They stay in like kind of the more boutiquey, three star, four star hotels. A lot of these guys are very affluent, especially once they start to invest and. It’s lonely, right? All our friends and family are investing in like the 401k or some of the, the more aggressive ones are doing crypto and Bitcoin or worse out coins.

And it’s just here. We are investing in very stable, boring assets. Like I almost call it like investing in blue overalls and machines and hard work. We buy. 1960s and 1990 properties that caters towards the lower middle class, a grungier demographic. It’s not sexy. We slowly and it takes a while, right?

It’s not a get rich quick steam. We go in and we rehab units slowly as 10 minutes, move out takes forever, takes, several years. but in recessions, it performs pretty well. And in good times it outperforms a lot of the good stuff. Yeah. And it’s like this idea of doing this with so many people is crazy too, that like when people, assemble, I’m going out to like LA next week and Arizona, and just to do a little pop up.

Meeting, but when people assemble and they’re like, yeah, I don’t do the 401k because like all the reasons lane said it totally makes sense, but like none of my coworkers, I can’t, they start to become very distanced from most of their coworkers, because none of that stuff, when they actually use their head and get away from the financial dog mouth put on by all the fan guards, alies all these institutions that want you to put your money in that stuff.

Yeah. They’re. It makes no sense, but I still, people are still like, they’re stuck in that spell. But when I come here, I can have great conversations and we disclose what our net worth is, what we’re investing in. And these, we can talk about these alternative investing ideas, talk about deals. It’s just it’s like a cult to the us, right?

You’re around like-minded people and you’re, you’re all it’s always good to be in, in a different room, especially when you don’t like the one that you’re. Yeah, I love what you talk when you, I love what you say about 401ks. And I saw the light on that too. I always knew it, but I just kept feeding it in cuz it became like automatic, I caution anyone to be very leery of putting your money into into a program, whatever what, for lack of a better phrase, where they control, how much you can put in, they control what you can invest in.

And then. Tell you, when you can take it out, they, and then they tell you when you have to take it out. So it’s just very limiting and it’s all completely one sided. And I saw the light on that. I’m sure you have plenty of thoughts on the topic, but, I got completely out of that.

I, yeah. I, over pretty concisely in a, couple minutes I have four big issues with the 401k. Yeah. Please share type of stuff. Like first, like it’s a lot of it has to do with taxes. . When I put my money, a lot of the whole dogma is predicated on you will be, you’ll get older and you’ll Shivel up and die and make less money in the future.

And at that point you’ll be in lower tax bracket. But not me, not most of my investors, they’re gonna be baller in the future in me in that much higher tax bracket than they are today. Yep. Therefore, you should pay your taxes on the damn thing today. Take it out today while you’re in a lower tax bracket.

Number two. Look where this country is going, how are you gonna pay for all these government entitlement programs with raise taxes in the future? So again, pay your taxes now, get it out. Now the next biggest thing is I think the argument for these 401ks that oh, gross tax free.

When you invest in real estate, that has a bunch of paper losses like depreciation, you can write all a bunch of other stuff. It often is tax free anyway, so that point is negated, but here’s the big kicker. I think, we briefly touched upon this, like how most people are playing checkers, putting money in their 401k or Roth IRAs or whatever.

And we play chess, right? We’re manipulating our adjust gross income on our personal tax return based on what our investments are. And when you play this chess game, instead of checkers, I want the depreciation and losses that come from my investments where when you’re investing, you can invest through a self-directed IRA too.

But when you’re investing through one of these type of programs or solo 401k, it’s you don’t get the passive losses, the flow on your personal tax site. It stays locked up in there. Yeah. And that’s the downside to this. It’s more about using the losses on the deals and the investment ties from depreciation, which is just paper loss to clean up your pay less taxes today.

And you lose that ability when you invest in this insulated 401k or solo 401k. So unless, the only good thing it’s. If you’re investing in non-tax advantage type of stuff. What it’s non-tax advantage stuff like, like your crypto things like that, or if you’re a private money lender in, in, in a, in real estate I wouldn’t do that anyway.

Where you just lend money to a house flipper. And there’s no losses you’re getting paid with a 10 99. There’s no tax advantage with that, that’s the stuff you’re supposed to do it in those type of stuff, but I don’t do anything. That’s not tax advantage really. So love it.

Great share great insight. And something more we can learn at simple passive cash flow.com. I’m definitely assuming that. And then you have a podcast as, as well. Talk a little bit about your. Yeah. It’s basically a fall of my journey. I started back in 2016 when I was buying little rental properties and I would just teach people how to buy, turnkey rentals and yeah.

Back then we had a little incubator group and. Now a lot of the information’s for free. And if you’re just in the game of buying little turnkey rental, you can go to simple pass cash, flow.com/turnkey and get the free guide there. But as I became over an credit investor, and like I said, at that time I was going into a lot of larger syndication deals.

I saw the light and for credit is just, it’s a no brainer to go into these syndicated deals. If you could build relationships and build a community around your. Or join a community out there. And that was where it transitioned and it is, that’s my whole thing is I. I know that there’s something else out there and that’s my job is to cut the corners for a lot of folks, right?

If you’re net worth is a million bucks, you shouldn’t Dick around with little rental properties, you just go to the big stuff, the syndicated deals. But for a lot of my investors that are like one to $10 million net worth what’s after, what do you do after, when you’ve got, five, $10 million plus, and you can comfortably live off your four or 5% off of that.

What are like the 50 million, a hundred million dollar families the family is doing, right? Yeah. That’s the kind of stuff that I try and learn these days and I try and bring it down to my folks and just that insight. Cause you wanna just always be improving as a investor and be, become a professional investor.

The trouble is right. Most people are working their day jobs, so they don’t really have the time to, and, but the, and the issue is interacting with the right higher level people, higher level investors, getting access to those rooms, which a lot of people don’t have the time for nor the network.

But that’s been my passion to uncovering this myself. But even, to implement the strategies for one to $10 million net worth people, I. You look at it and it’s not that hard. Like I said, invest in good deals. Use the passive losses on your taxes, tell your CPA what to do or find a new one.

Yeah, infinite banking and it’s pretty simple, but it’s very counterintuitive to what, like they normally tell us right. To do. Extremely. Great chair. Great journey. Love your story. Just before we wrap up, I got a couple of couple questions for you. I wanted to ask one, do you, whether it’s a morning routine or some habits that you’ve adopted, that you could share with the listeners that have really led to your, to success or keep you up, on the path, if you.

Yeah, I think one thing I do well is I execute I’m the person who will write down my list of things to do, but I’ll actually do it. I, and I think that allows you to constantly innovate and constantly improve. I don’t know what that, if you improve one person every day, at the end of the, you’ll be like 20 something times better than what you.

I’m not a huge fan of like boring routines. I don’t wake up and do yoga. I jump on the emails and put out the fires, just like anybody else. I don’t wake up super early, today was a little early for me. I try to wake up around eight. Nice. If I can. Yeah. And I think like my whole advice from that is Hey, do what works for you guys.

Not everybody is the same, but make sure it works for you. And I would say I’m really good at focusing on what the business is. And for a lot of folks listing, it’s like your own personal finances. What are you gonna do with the investments and taxes? Not what you’re doing with your employer.

You’re building somebody else’s dream with that. Build yours first. Even if it you’re like me. You’re working a day job. You’re sleepwalking through it for a decade. That’s to me, that’s the most important thing is get your own stuff. And doesn’t take that much time to learn, to do what’s right.

And to implement it, especially once what you should be doing. But you can sleep sleepwalk through a job. They take, they pay for your time and your head, but they don’t charge you for your heart. So you you always have those sex, those few extra hours a day to put to where you are doing after you play with the kids and you do your family obligations and you’re tired.

Course, too many people spend so much time, like over the news or like focusing on things that don’t matter. What’s the saying? Most people major in minor things. Tony Robbs both. Yeah. Yeah. Great stuff. Get your own stuff. Awesome. Share. Do you believe in, do you have a coach or a mentor, do you believe in that?

Not really. I think when you’re starting out, I think a coach would be good. That’s the role I play for some folks. My inner circle and mastermind group and. But, you gotta pay ’em right. If anybody’s worth it, you gotta pay ’em and the trouble is there’s a lot of fake gurus out there that don’t really do anything.

They just write books and stuff like that and have YouTube channels. That’s why a lot of stuff on my website is free. I hate that fake picture stuff. The guys that teach people and they mostly prey on not your audience, they mostly prey on the guys who don’t have money and are really desperate.

And they sell ’em on hope and fear, but yeah. Yeah. I would say You need to find a model that’s doing this, but if you’re starting out, there’s a lot of YouTube and podcasts to just start to absorb it. And I would say focus on getting a community rather than worshiping the gods and the gurus.

Find other peers on this journey and that’s gonna be the way to get you off the ground. Of course, I’m super cheap. And that’s how I used to do it initially. But then I saw the light in 2015 when I really started to pay, like five figures plus a year on these mastering groups in education.

And that got me connected with the right committee. Then there’s the freebee free loader tire kicker crowd of peer groups. Yeah. So that was a big thing in hindsight, if somebody’s starting out, so much free stuff out. You should be able to dissect, but just know you’re trading time for money in a way, but I’m always just rolling down the road before you interject any kind of type of money into it.

Like once, once you’ve got some, you might have a rental property or in several deals, then I would say it makes sense to phony up. Once you get proof of concept and this whole thing works and then accelerate it with a better community and network after that, that is actually serious. Go ahead. Yeah.

Thanks lane. We’re gonna, we’re gonna give the website again, simple. Passive cash flow.com. Simple passive cash flow.com. It’s been tremendous, haven’t you? I just, I love the insight. I love the way you think. You obviously think a lot differently now than you did when you first started out, so that’s the, you can see the growth there and really appreciate the share.

Anything else you want to share with the listeners before we sign off or that I forgot to. No, I think some people are saying that eventually you’re gonna quit the day job. I think that’s probably the mindset of a lot of folks, but, speaking from myself and a lot of my folks who are like two to 5 million networks who broke through that part of the stratosphere.

Everybody, you gotta do something with your time and you gotta try and figure out what makes you happy. I do think you have to go through a period, like a little air pocket where you don’t do Jack for maybe six months to several years where you just go weightless.

And this concept of financial freedom to me is kinda like you, you need to save enough money to buy enough assets, to create enough passive income, where it exceeds your expenses. So 10, 20 grand per month. And then you put your. And then you go wait less and you gotta go through this vacuum and air bubble where you’re just floating, but until you’re floating and searching for your next main life mission it’s hard to do that, to search when you’re stuck trading time for money.

So I think that’s what I’m uncovering with myself. And some of my clients have to go to that stage. You gotta get your own oxygen mask in the first year, you gotta get the fi and then the next chapter, your life will come. But it’s a lonely world, right? Not many people get to ponder these types of first world, or I know first world problems, but like the upper 1% first world problems, where you’ve searching for autonomy and trying to find some kind of meeting of what the heck you’re here. when your money continues to compound on itself, where it compounds at a rate where it’s quicker than you could spend at a regional rate of course, but like yeah. Not many people are faced for that.

Most people are stuck in a day job just going at training time for money. Yeah. Don’t have to do that. Great final thought. Appreciate the share. And you are spending some time with us today. I know it’s valuable. Everyone, thanks for tuning in as always to make it great.