Have a podcast in 30 days

Without headaches or hassles

In this episode, you’ll discover:

  • Why cash flow isn’t king in real estate investing (and what to focus on instead) (4:22)
  • The “20 years ahead” method for building enough wealth that you can retire 20 years earlier than your peers (4:45)
  • Why the stock market is a more wild and emotional rollercoaster ride than real estate (10:40)
  • How having too much money in the stock market can leave you unable to pay your bills (11:40)
  • The “Pay your rent” secret that makes real estate investing safer and more reliable than the stock market (11:52)

Hey! Want to do a deal? Need my help? No cash to make an offer? Send me a quick text at 440-389-3883 and we’ll work together to get you the deal.

Read Full Transcript

Welcome to Cleveland real estate investor. On this podcast, you'll hear about every aspect of the real estate investment business. You will talk to your rockstar investors about their businesses, how they built them, where they came from, and where they're going. Who am I? I'm Joe Lieber and I've made millions of dollars from the real estate investment business over the last 20 years. If you're ready to hear the good and bad from a guy who's learned this business from the school of hard knocks and get educated by some bad ass entrepreneurs, then put your helmet on, strap on your chin strap. Let's ride.

(00:54): What's up guys. What's going on? I'm going to talk to you about the income game today. You better get this right? You better get it right. Hey, before though, before we get started, do I give you a quick update? I've been homeschooling my kids. I hired a teacher, a licensed K to six teacher that comes into my office that I've closed down. A guy has gentlemen. He comes in and teach the kids. He can teach the entire curriculum in nine hours a week. We do three days, three hours. And then one of the days we're doing art class for three hours with like this artist who it's really cool because we do that these high level art projects like with clay and just all kinds of really cool drawings and sketches. She really teaches some stuff a lot more fun than you'd have like at school, our class, right.

(01:54): She only get like 30 minutes in the class. So it's working really good. You know, what's crazy is that he can teach that curriculum in nine hours and otherwise you have to be in school all week. And I was talking to him about that and he was saying, well, it's like one on one. I just had my two kids in there that he's teaching and he can just hammer through it. If we wanted to increase the time he could have the whole curriculum taught by new year's Eve and be done with the entire year's curriculum. And I was like, don't do that. And you know what, just pace it out and not rush, you know? So they can't let it really resonate. But that was just crazy to me. It's going really well. If he ever thought of doing something like this, it's pretty darn exciting.

(02:45): Also, I'm just now trying to find a little bit more time for him. Cause I'm trying to lace this education. There's some really good stuff out there. There's kid preneurs and Oh, by the way, a lot of this stuff comes with like comprehension where they'll give you almost like homework to do with this. There's another series called Connor and Boyd. It's a book series and these are books that are written to the seven to 12 year old, somewhere in that age group. And they're almost like comic books. And one of the books in the series is called. I think it's the first book it's called food truck fiasco. And it's all about like a guy who gets a food truck and all the trials and tribulations. He goes through with own a food truck from like the day you get it, you know, a tire being flat and truck won't start and the food's going to spoil and city permitting and where you can park it and very cool.

(03:47): And then there's comprehension with this stuff you can buy as well. Dave Ramsey even has a series out for kids and I'm starting to lace their education with some of this entrepreneurial stuff because they don't teach this. As y'all know, they don't teach this stuff in school. I don't care how high you go. If you got a PhD from Harvard, they don't have stuff like this. So that's going to kind of play into today's episode. You know, the income game, this is important. It took me a lot of years to figure this game out and thank goodness I finally did. You know, this is what I've been noticing. This is the word out there right now from millennials to the 40 to 60 age group is not everybody is looking for cash flow when they're buying this real estate. And I didn't really realize that the first thing you read talks about is cash flow cash flow cash.

(04:43): And I'm hearing that that is not what folks are really looking for there. Looking for hard assets. They're looking for wealth building. They're thinking 15, 20, 25, 30 years down the road. What that's going to look like. I talked to a younger guy today, 30 years old, and his plan was just to get a property only to take the cashflow and immediately attack the mortgage. Just to get this stuff paid off. He's thinking long term, he's thinking 15, 20 years down the road. And I want to tell you guys something just from personal experience, when you buy these investment properties, if there's any way to avoid doing a 30 year mortgage, don't take it a 30 year mortgage. I call them prison sentences. Don't do that. If you don't attack principle, which sometimes you won't because you can be down the road year five, year six, and have a major CapEx item where you could lose cash flow for a year or two, especially when you have a mortgage and you're not going to want to hit principal.

(05:53): So don't do that. The interest draw is so crazy. I remember looking at a mortgage that I took out a long time ago. I don't have the mortgage anymore, but I took it out on a 30 year term and I was 15 years into the mortgage. And the principal balance moves ever so slightly. Like it is crazy how little it moves. I remember this loan, this is off the top of my head, but I think I took like an $85,000 loan. And 15 years later, the still old, like 72 on it with some krill, wasn't a crazy rate. It was probably like seven, seven and a half percent, which is good in the late nineties, early two thousands. So if you can do any in the difference in payment is not that much between a 15 and 30 year or even 20 and 30 year mortgage, that the interest draws just so much more that I would advise you not to do that.

(06:54): But this is the way it was. This is what I'm hearing. That there's a group of people out there who are just after wealth building and you know what it makes sense. I like this move. I can tell you from experience, these properties will serve you. Well, the time's going to pass anyways. So you might as well let them pass, owning some hard assets own in this real estate. Can, here's a bonus play. If you bought real estate and Cleveland over the last, you know, since the housing bust, we're not typically an area where you're going to see appreciation, but Holy smokes, have we seen appreciation? We've seen appreciation like wildfire over the last couple years and lately during COVID it's crazy. The demand for investment real estate and retail real estate, like all aspects of real estate here in Cleveland, residential real estate. I'm talking about it's wild, it's all fire.

(07:55): So it's still a good time to buy. It's a good time to get in. Who knows how high it's going to go? That's been a question I get a lot too. And my answer is how high is it going to go? Well, when you look at other markets and what you get out there, it's, we're still way behind everybody else. You know, a three bedroom bungalow in Cleveland, Ohio that sells for 125,000 that we think is a lot in Denver sells for 525,000 or in San Francisco sells for a million dollars. You know? So anytime you're still on the lower side, there's could be room for these things to go up. I don't know how high they're gonna go, but they'll have some room there. So think of this more, even as a longterm play, these assets can serve you very well. When you hit 60, 65 and you want to slow down and you own 10 of these things and they're paid for and they're worth who knows 150 200 grand, a pop, you know, no debt on them.

(08:58): There's some real money there you might want to sell and supplement your lifestyle. That's when you go get your house in Southern California or Florida, if you're in East coast or all us East coast, as we all go to Florida and all you all us coast boys seem to go down to Palm Springs or San Diego. I think that's funny or Arizona, maybe. I don't know, somewhere around there. Yeah, that's my idea. I'm going to go to Florida one of these days, but these assets, they serve you very well. So just think of that a little bit to think of long term wealth building. You got to get the income game, right? Cause you don't want to get down the road and get upset. So let's see what else I want to tell you. Private lending that's hot right now are people want to lend money, especially on real estate, on hard assets.

(09:45): I recently wanted to be able to relate to some of you cats out there with the stock market. I talked to a lot of you guys all around the country and you're all heavily invested in the stock market. And I've never been a stock guy, but I wanted when Cobas started, I'm like, you know, I think this is a good time. I want to see what this is like. Like I want to be able to, when I talk to you on the phone, you're calling me about real estate. I want to be able to talk to you better and understand where you're coming from. So I didn't do anything crazy. I took 50 grand and I put it into an E-Trade account and I did this like on March 17th and I've been watching it go up and down, up and down. And I'm up right now.

(10:25): I think just like 72 grand in there right now, there was a got up to 87 GS and I was like super pumped. But this is what I want to tell you. I'm not telling I'm not bragging or anything, by the way. It's not even really a lot of money in the grand scheme of things. But this is why I'm telling you this because of the emotional roller coaster that I go through, just watching my E-Trade account. I watched this damn thing go from 50,000 to 70 to 87. Then in June it came all the way back down to 37,000. Then back up again to like right now, 70 to 72 grand or something. I don't know. I could probably log in while I'm on the podcast with you and see what it's at, but this is what I'm going through, right? Like when do I cash out?

(11:16): Like I got in my head like, Oh, when it turns into a hundred, I'm cashing out. Well, should I, or do I cash out now and make my 20 grand and run? Should I cash out 87? Should I have just raked some money off and wait for it to fall again? Maybe it wasn't going to fall. Maybe it's on a run. Maybe it's like, the Democrats are saying it's a K shape recovery. I don't know. None of us know it's gonna go up down left, right sideways. And then like, what if I want to live off of that though? Like, what if I want to pull back 2000 bucks and pay some bills? You can't really do that. I don't want to like rake that off. I want to leave it in case it goes up. So it's really a weird thing. But when I buy real estate, though, once I infuse that capital, I take the cashflow off the table every month.

(11:58): If I pay 70 grand for a house and I get a thousand bucks a month in rent, boom thousand bucks here, I can pay bills with that, which is what I do. I use that money to pay liabilities that I have. But yeah, so I did that to be able to relate, you know, I'm not a stock market guy. I'm not putting any more money in. And at some point I'll pull this money off. I've gotten my head when a double. So hopefully it does do that. And it's going back down to 37 grand again, but that's what I'm trying to do. So whatever, but I'm telling you just to get the income game straight and there's nothing wrong with having a good day job and taking that money and throwing it out there passively. I know some of you're trying to make real estate, your full time game.

(12:39): I've talked to you, a few of you are doing that and that's cool. You can do that, but nothing is easy. There's nothing easy in business. It's which pill do you want to take today? You know, whether you're a wholesaler or you're a doctor or you're a surgeon or you're an accountant, or you're an attorney, you know, all the jobs I'm talking about here, you're going to beat your head against the wall and everything. I have my challenges in this business. Call me, I'll tell you about them. I'm super transparent. I'll probably talk about them. I'm on one of these shows, I started getting into it a little bit with just like the utility bills issues. And you know, today I've got a tenant upset with me because I put a new roof on a house for them. And they're mad because the roofers didn't finish yesterday.

(13:22): And there was some rain and although the house didn't get wet, they felt that there was the electrical box is being compromised. Like just crazy stuff like that. And they're calling the city inspector on me. So they're going to start all this crap and probably make uncle Joe here have to write some big checks because when the city inspector comes in, it's not going to be fun, but there's headaches with everything. So if you're truly not happy with your job, then yeah, you probably should do something you're happy about because life is way freaking too short, way too short. And you definitely want to do something. You're happy about it, but just don't think that like I'm going to get into real estate and it's just going to be skipping and milk and honey, Shangri-La, it's really not like that. But I don't know if this, so today's show is just about, about getting your income straight. Make sure you keep a focus on that. Educate yourself, constantly get your real estate, how to this the real estate podcast. And I'm a big fan of it. It's served me very well and hopefully it will serve you too. Thanks for listening. Have a wonderful day. See you on another show.

(14:34): This is ThePodcastFactory.com.

Have a podcast in 30 days

Without headaches or hassles


Copyright Marketing 2.0 16877 E.Colonial Dr #203 Orlando, FL 32820