Fundamentals of Real Estate Success : 3 Most important Questions Answered

Summary

Real estate investors Danny and Flip share their journey, failures, and lessons learned over 15 years to help others avoid common mistakes. They explain the difference between active and passive investing, noting that many pursue active flips/wholesales as a side career without realizing the time/money pitfalls. They advise assessing your goals first, deciding if you want an extra job or passive income, and finding a trusted team. They believe you can try both active and passive small-scale first to decide which path works best before committing. Ultimately they now focus on quality of life and giving back, using a trusted team for active work while they passive invest.

Takeaways

• 😟 Make sure you understand where your money is invested and what the associated risks and returns are
• 😀 Ask key questions upfront - who do you trust, where do you want to start, which path is right for you
• 😕 Going down the wrong investment path can cost time and money
• 🤔 Evaluate both active and passive real estate investing to see which fits your goals
• 😠 Real estate investing has risks - be prepared to lose some money
• 😊 Mitigate risks by diversifying and doing enough volume
• 🙂 Take the time to design the lifestyle you want before investing
• 😀 Find an experienced team you can trust to educate and guide you
• 😉 Set boundaries and timelines when exploring new investing avenues
• 💡Teach and learn from both successes and failures in real estate

Q & A

What is the biggest mistake real estate investors typically make?

The biggest mistake is going down the wrong path by not knowing where to start or which investing path is right for them. Many jump into being active investors without realizing it takes a lot of time and work on top of their regular career.

What three key questions should real estate investors ask before getting started?

The three key questions are: 1) Where do I start? 2) Which path is right for me? 3) Who do I trust?

What is the difference between being an active real estate investor versus a passive one?

Active investors are involved in the day-to-day work of finding, fixing up, renting out, and selling properties. Passive investors provide funding to other companies and people to do the active work while they collect returns.

What does the lifestyle design worksheet help investors determine?

The lifestyle design worksheet helps investors determine what they want and don't want out of life. This clarifies whether they should pursue active or passive real estate investing based on their goals.

Even with experience, do the hosts still lose money on real estate deals?

Yes, even with their 15+ years of experience and safeguards in place, the hosts say they still lose money on some deals. This is why they focus on doing high volume - to mitigate the risk.

What is the show's purpose for providing education about real estate investing?

The show wants to help people avoid common mistakes and years of lost time and money by educating them upfront so they can make wise decisions and live a higher quality life.

What are some examples of passive real estate investments they recommend?

Some examples are private money lending, real estate syndications, Turnkey rental properties, and master notes.

What current passive opportunity do they discuss that helps reduce tax burden?

They mention the Cottonwood Town Homes opportunity which allows investors to get a $30K-50K tax write-off by investing $100K.

Why have the hosts structured their business to be more passive now?

Now that they have achieved success, the hosts want to focus more on their quality of life, giving back, and side projects like their podcast instead of active real estate work.

What resources do the hosts provide for people looking to get started?

They offer a free lifestyle design worksheet, free call consultations with their team members, and their contact info to ask questions and get help ([email protected]).

Outlines

00:00

😊 Introducing the podcast episode and key focus areas

The hosts welcome listeners to a new episode focused on examining where investors should put their money, assessing associated risks and returns, and identifying alternatives that offer true wealth preservation along with favorable tax implications. They emphasize the importance of asking critical questions upfront before investing.

05:01

😮‍💨 Cautioning against blindly investing money without understanding risks and uses

The hosts advise being wary of various investment options where you lack clarity on how your money is utilized and the actual risks and returns involved. They stress you should feel confident you have wealth preservation and understand all tax impacts, contrasting banks which simply use your money to benefit themselves.

10:02

😃 Relating their personal journey into real estate and subsequent pivots

The hosts describe how they individually developed interest in real estate, took realtor courses and became licensed before the 2008 financial crisis. After struggles as new realtors, they pursued real estate investing by buying distressed properties but eventually needed to change course after tapped out financially.

15:04

💡 Recommending reverse order of key questions for real estate investors

The hosts suggest real estate investors should prioritize who to trust first, then explore which investing path suits their goals, and finally identify where to get started. They emphasize character and transparency as reasons to potentially trust them.

20:05

📝 Explaining their lifestyle design worksheet for clarity on wants

The hosts walk through their lifestyle design worksheet which has investors highlight what they want or don't want across key lifestyle categories. This surfaces clarity on true goals and helps determine if active or passive real estate investing is the right fit.

25:05

⭕ Describing active vs. passive investing and the blend in between

The hosts visualize active and passive real estate investing using two overlapping circles, identifying a middle hybrid section. They characterize truly passive as hands-off like private lending versus active as demanding like fix and flips.

30:06

⏱ Lamenting investors wasting too much time and money chasing active profits

The hosts criticize how easily investors pursue active real estate investing without understanding alternatives, only to later regret the lost time with family and lost money from mistakes. They suggest instead carefully evaluating options first.

35:08

🙌 Expressing passion to help investors avoid painful mistakes

The hosts explain their fervor to save investors years of wasted time and money through education on prudent options leveraging trusted partners. They aim to equip investors to enjoy life instead via passive means.

40:09

💰 Recapping key takeaways and current passive investment opportunities

In closing, the hosts summarize key lessons from their journey, urge creating clarity on lifestyle wants first, and highlight current passive opportunities like master notes and townhomes offering substantial tax savings.

Keywords

💡real estate investing

Real estate investing refers to purchasing and managing properties like residential homes, apartments, commercial buildings etc. to generate returns through rental income, property resale profits etc. The video discusses mistakes people make when getting into real estate investing e.g. going the active investor route without evaluating passive options.

💡active investor

An active real estate investor is directly involved in activities like finding deals, rehabilitating properties, managing rentals etc. This is like a second job and takes time away from family. The video advocates evaluating if a passive route may better suit one's goals.

💡passive investor

A passive real estate investor provides capital to other experienced investors/operators to invest on their behalf without direct involvement in day-to-day activities. This frees up time for family, leisure etc.

💡lifestyle design

Assessing one's lifestyle priorities and goals through a worksheet to determine if active or passive real estate investing better aligns with them. This helps choose the right path.

💡wealth preservation

Investing to preserve capital and generate reasonable returns rather than chasing exceptionally high but risky returns. The video asks if investment options offer true wealth preservation.

💡tax implications

The video states that one should evaluate the tax impact of different real estate investments. Some options like the Cottonwood Town Homes can provide high tax deductions.

💡return on investment

The monetary returns expected from an investment. The video advocates comparing returns from active vs passive real estate investing.

💡mitigating risk

Taking steps to minimize the chance of loss when investing. The video states they mitigate risk by doing high deal volume so losses in a few deals are covered by profits from most.

💡quality of life

How satisfied and happy one is with their lifestyle. The video states passive investing provides more time for family, leisure and giving back i.e. higher quality of life.

💡transparency

Openly sharing details about failures, mistakes, bad deals etc. along with successes. The video says they are fully transparent unlike some real estate gurus.

Highlights

You should ask questions about where you invest your money and what risks you face

Real wealth preservation keeps your money safe while earning good returns

Many investors don't understand where their money goes when investing in stocks or banks

We became real estate agents in 2008 when the market crashed, giving us valuable experience

The three key questions are where do I start, which path is right for me, and who do I trust

You can be actively passive or passively active with strategies like turnkey real estate investing

Many investors regret chasing active real estate roles without considering passive options

Even experienced investors like us still lose money on deals - it's about mitigating risks

Do a lifestyle design exercise to understand what you want before deciding on investing

Set a timeline to evaluate active versus passive investing instead of losing years

Find a team you trust, then use tools like our lifestyle design worksheet to clarify goals

Our mission is giving back by sharing lessons learned to help investors avoid pitfalls

Cottonwood Townhomes can provide a $30-50k tax write-off - ask about legal tax reduction

Master Note program offers 10-12% returns with flexibility to exit annually

Learning from mistakes and lessons is very powerful - we aim to help avoid those pitfalls

Transcripts

you should be afraid of stocks and all

of the things that where you're putting

your money and you don't know exactly

what's going on and where it's being

used and what type of return you're

getting what your risks are do you have

true wealth preservation is it safe is

there a safer alternative and what is

the comparison on your return on

investment what type of tax implications

are there based on where you're

investing are you actually adding to

your tax burden or are you reducing your

tax burden there's so many questions

that people don't know that they should

be asking at the very very beginning so

that's what I really want to dig into in

this episode

[Music]

hey everybody flip and Danny here

welcome to another exciting episode of

the freedom

show yes welcome we're so excited to be

here today and today we're going to have

a flip and Danny solo episode but it's

not really a solo episode it's a duet

come on oh yeah good call yes this is a

duet this is not a solo all right Mr

musician whatever come on everybody

knows

that um we were actually talking about

uh before we jumped on the air uh what

we wanted to talk about today um and

many times if you followed us in our

freedom through passive income podcast

where we did 365 days in a row we

literally would wake up and be like hey

we got to record some podcasts today um

and sometimes we' do two or three in a

row just a batch because we would have

meetings and sometimes we'd literally be

getting up and doing just a podcast

every single day um and so it was always

it got to the point where I mean I was

planning right so at the beginning of

these episodes you would have seen me

with like this iPad in front of oh man

it was detailed listing of everything we

talk about that we're talking about like

the five big biggest mistakes Real

Estate Investors make or um you know

what does a cost segregation study mean

or we're talking about inflation or or

tax benefits or whatever the topic is

and I've got my iPad out I've got the

title of the episode and I've got some

notes for us both um and it eventually

got to the point where we just said what

are we talking about today yeah towards

episode 300 it was like are we talking

about something today let's go and

record that actually happen way sooner

than 300 but um uh so literally you know

as we jumped on this podcast it's not

that we're um uh not really pre-planning

what we're talking about it's just I

think that we talk to so many investors

all the time that we know what the

questions are that that people are

asking we know the battles um that

they're having um we know the mistakes

that they're making and many times it's

not just conversations with other people

it's stuff that has happened to us and

so um you know as we you know prepared

for this podcast um just a few minutes

ago he said what are we talking about

and we brainstormed a few things and and

really went back to um what type of

investor are you um and I think that

that has been the biggest mistake we've

seen over and over and over of people

not knowing where to start when they get

involved in real estate yep and I'll say

this over and over again the top three

questions are where do I start which

path is right for me and who do I trust

and if you don't answer those questions

then you end up going down the wrong

path most of the time right um so I know

you're about to add something in there

so I didn't mean to cut you off yeah no

I was just what when we were talking

about like what we're going to talk

about today we also don't you know we

don't have things pre-canned for like

five five episodes we talk about

something relevant something that's

today something that's fresh something

that you know came up yesterday

something that came up the day before uh

and so that's also a reason why we don't

plan these like what are we talking

about well what's happened recently yes

you know and so that's that's what makes

us so exciting too so yes yeah it keeps

it fresh for us too right because if

something crazy happened um then we get

to talk about it because we we don't

have anything like oh but we were going

to talk about interest rates today

boring that is so boring um so let's

talk about probably one of the biggest

mistakes Real Estate Investors make

funny that I actually referenced that um

just a second ago and it really is going

down the wrong path out of the gate I

think a lot of people are interested in

real estate I think a lot of people um

are

um not sure how to get into real estate

uh they think that they can't get into

real estate because of whatever reason

maybe knowledge maybe because they they

think that they have to have a bunch of

money um to be able to buy something

outright they don't understand the

mechanics of real estate um and so what

happens is you end up um if you're if

you're really serious about real estate

and learning a little bit more about it

so that you can understand how people

are Building Wealth um then

you end up going down a path of how do I

get started so that's where do I start

and as you answer that question you

start realizing that okay well I could

become a realtor which is the path that

we took yes um um and then it could be I

could be an investor but that means I'm

going to probably buy a rental property

Buy and Hold is probably the most common

um thing taught when you're talking

about real estate investing or the bur

method um or something like that those

are the the easier to understand ways to

get into real estate especially if

you're a busy professional and we use

the term busy professional simply

because most of the people uh that want

to get in real estate and build their

wealth are doctors lawyers um uh

entrepreneurs business owners um just

High income earners like you you've

gotten yourself into a position where

you absolutely love what you do you're

really good at what you do

um and you understand hey but you know

what do I do with all this money I've

got all this active income and at some

point in time I'm going to want to

retire and what do I do so that I can be

growing this income in a safe way um and

I don't understand real estate I don't

understand necessarily stocks and mutual

funds and things like that but yet so

many people invest in that um so many

people put their money in the bank and

they have no idea what the bank's doing

with their money right um uh no

Lots they're not yeah your money your

money is not doing anything for you

sorry that's what your your money is not

doing anything for it's doing a lot for

the bank just nothing for you yes

exactly so um reality is is that

wherever you put your money um it's

being used for something and uh you

probably have a lack of understanding of

exactly what it's being used for and so

our admonishment I guess at the

beginning of this episode really is not

to be afraid of real estate yes because

it's like anything else you should be

afraid of stocks and all of the things

that where you're put your money and you

don't know exactly what's going on and

where it's being used and what type of

return you're getting what your risks

are do you have true wealth preservation

is it safe is there a safer alternative

and what is the comparison on your

return on investment what type of tax

implications are there based on where

you're investing are you actually adding

to your tax burden or are you reducing

your tax burden there's so many

questions that people don't know that

they should be asking at the very very

beginning so that's what I really want

to dig into in this episode so do you

want to go back to just a a short recap

of um where we got started because we

too didn't know where to start when we

decided we wanted to get into real

estate um you know actually I um went

into the mortgage business before I did

anything else um and then we got into

real estate uh so you want to start kind

of talk about that story and then talk

about um the probably a common question

we get asked a lot and what our answer

is and then we'll kind of roll into you

know some other yeah absolutely so a

long long time ago in a galaxy far far

away

we both decided that we wanted to be uh

we wanted to go into real estate we

didn't want to know if we wanted to be

re Real Estate Investors or realtor you

know we didn't know what we wanted to do

we knew we wanted to go into real estate

yeah uh because you were in The Mortgage

business and and you had gotten your

your you dipped your toe into

essentially real estate because you were

on that side of things uh and uh and I

was coming out of the the art career and

and uh we both we were both intrigued

with with uh with real estate you know I

wasn't intrigued with the stocks and

bonds thank goodness um but we were both

intrigued with real estate and so we did

what most people do not all people but

most people do and we went out and

studied for our realtor's license and

and took the test passed the test uh we

got we got our uh license uh September

of 2008 um and you know and and people

we always laugh this is the worst time

to get your license actually was the

best time for us to get our license

because if you can learn and figure

things out there you know when it's at

the bottom of the barrel then you know

when it's at its height then it's just

easy easy going um and so anyway so we

got our license in and it took eight

months to do a deal which was depressing

um and you know we burnt through a lot

of money and that was when we like you

know hey what's you know what's what's

this about being a real estate investor

you know why don't we be

investors and you know you found someone

that teaching 12 ways on how to buy and

sell real estate you know um and with

with basically with no money right and

so we took the class and learned and did

did everything they said and you know we

had the ground running and but we

started learning right there you know we

we like we went blend we went blindly

into being Realtors you know because

that's what you do I mean was that the

bad thing to do I don't think so I mean

it just I wish we could have shortened

that eight months of doing a deal you

know but we' learned a lot about real

estate we've learned the foundation of

real estate which helped us you know

help Propel us once we went into the

real estate investing side of things um

you know and people ask us uh you know

because we went into you know short

sales and and U gosh you know sub twos

uh sub2 ws and you know um just whatever

we could get our hands on it and back

then it was you know 2008 2009 and you

know all of those deals we you know we

couldn't throw a rock without hitting a

short sale um and uh but people ask us

you know if we could do it all over

again would we do the same thing or

would we do something different uh we

both have different answers um uh and

and you want to say what your answer is

well I actually have two answers you

have two answers you say yours well mine

is I mean yes I wish we would have

gotten into multif family right then but

we didn't know you know we thought we

had the this goes to you know the one

you don't know what you don't know right

we just thought that we needed money MH

and we just did a course we learned how

to do 12 ways and how to buy and sell

real estate using no money mhm well

that's cool I just spent eight months

burning through my you know savings I

got no money let's let's do it you know

um and uh and so so we did that but uh

uh you know I I had no no idea that you

know any of these things that we're

doing today if we would have known then

you know about all these strategies and

getting into multif family and I mean I

would we would have jumped into multif

family at least I would have I don't

know about

you yeah so um I have two answers um one

is really the right answer the one that

I believe um the answer that I believe

is that we are on this path for a reason

right um we are here because we are

meant to be here everything that we've

learned has been um has gotten to us

where we are today I do not regret one

thing about where we are today I think

God has us right here for a reason and a

purpose um my second answer though is

had we known about passive

investing right had we known about

passive investing from the get-go that

we could find a team that we trusted

that was already skilled and experienced

and had the knowledge and and years

behind them many hundreds of deals

behind them has proven track record um

had we known that we could invest with

them and get a return on their money we

at the very least likely would have

split our funds and said hey we have a

bucket of cash let's take half of this

and invest it in this way or we would

have gotten on in some type of strategy

call and said and somebody would have

taught us hey when you have money you

want to have different buckets you want

to have a bucket that is liquid so in

case you need it you've got access to it

you have peace of mind you can sleep at

night you want a a bucket that's really

focused on on preservation of wealth

right um you're not going to shoot for

the moon with this bucket you're going

to you're going to probably invest it in

real estate that's going to give you

really good returns but it's a solid

asset class it's not going to go to zero

um or um you have this third bucket

where you are going to you know you're

going to just shoot for the star shoot

for the moon and you know pretty much

say I'm burning this money but I'm

hoping it's going to go like crazy and

I'm like going to be one of those you

know fortunate people that um you know

just made Millions because I invested in

this early on right um and so maybe we

would have gotten on a strategy session

call and been taught about the different

buckets and there's many more buckets

than just that there's a tax you know

tax benefit bucket um uh there's a cash

flow bucket there's all kinds of

different buckets and reasons that you

invest and goals that you have for your

money and what you want it to do for you

maybe somebody would have had that

conversation with us and we would have

said hey we're going to take half of our

capital and we're going to put some in

the in the bucket that we want liquid

and some in the bucket that we just want

we want growth but we also want the

confidence of wealth preservation and

some of it maybe we're going to shoot

for the moon shoot for the stars

whatever it is um and maybe we have done

that and we wouldn't have like Tapped

Out you know all of our savings you know

chasing this realer thing maybe we would

have said hey we have spent this much

money now whatever was left and we need

a new Direction maybe we' have found our

new Direction a little bit faster and we

wouldn't have waited as long because we

had the cash to wait we had the cash to

keep on learning and keep on you know

pursuing um uh but it eventually ran out

and when it ran out is when we said it's

time you know it's time to do something

new and it's not like we were at you

know Zars in the bank account but we

were close enough that we said all right

we need a new strategy we we need to

correct our course yeah so that if we

were going to change anything I I think

I would have wanted to be educated I

would have wanted to listen to a podcast

like this that told me hey there are

different avenues for you to go if you

want to invest in real estate you don't

have to be active um you can go the

passive route here's what that looks

like and I don't know what that where

that decision would have led but having

the knowledge would it would at least

have given us the opportunity to make a

better decision right I could have said

hey we did the exact right thing because

we had all of the information in our

fingertips right then in 2008 um instead

we didn't know where to start Y and we

thought well let's get our license you

know and let's just see where it goes

and that's what we did and it it brought

us here so I'm a static um um for where

we are um and and maybe those lessons

were meant to be so that we could share

it on a podcast like this right maybe

everything that we've gone through was

meant to not only get us to success but

be able to share with other people to

say hey this is what we did and we can

help you not make the same mistake and

lose years and years and years and maybe

that's not a loss of years to us um it

was just meant to be so now we go and

and start talking about this particular

topic and tell you what um what we say

you should be doing um and that is

answered the the questions of where do I

start which path is right for me and who

do I trust and as one of our um

investors recently said you should

really ask those questions in the

reverse order um so really ask who do

you trust um if you're listening to this

podcast right now I hope that we are one

of the people that you trust and why

would you trust us because um quite

frankly we're just the real deal we talk

about the goods we talk about the bads

we're not we don't care about being

transparent um we don't care about

sharing our failures um actually think

it's of benefit to you because if we

teach you um the challenges that we've

had the failures that we've met um and

and show you how we solved the problem

and the lessons that we've learned it

helps you to avoid those mistakes and I

really think that that's part of our

path and why we're here um so um and

looking at our track record looking at

our testimonials looking at talking to

our clients looking at um how we've

built our companies looking at who we

are as people and what happens when we

do fail on something how are our

investors treated how is the how did the

deal turn out looking at the character

um of who we are which we talk about a

lot when it comes to trust I hope you've

already answered that question that's

why you're you're listening to us right

now um but then now go back to where do

I start which path is right for me um

and so we talk about the lifestyle

design um and that's really a worksheet

that we share with people that it starts

you on the path of answering the

questions of what you want right I just

want to go back to the trust thing you

know um and and you hit on all the you

know the

transparency um you know and and we we

show you everything and our character

and and uh I mean what it comes down to

is we're not telling you to trust us

we're telling you that you can trust us

and if you don't trust us that's fine

yes that's we're not we're not forcing

you to trust us we're giving you

everything and uh to we're giving you

all of the information and then you do

it with it what you may um and you know

by being transparent by showing you our

highs and lows is showing you what we've

done and showing you know being

completely 100% transparent um uh but

again we're not forcing you to trust us

I don't want anyone to think that we're

that they told me to trust them no we're

telling you you can trust us uh so just

wanted to throw that in there because I

just what it's that's important I don't

want people to think that we're forcing

them to trust us I I don't think we can

force people to trust

us um so the great thing about flip and

ey is we always think opposite so um if

you hear conversations like this this is

actually happens in real life um we just

have both have different points of view

so I'm glad that he shared that point of

view okay so let's get back to you know

where do we start so that's the next

question that you want to ask um and we

we like to talk about the lifestyle

design um and that's a worksheet that we

provide to you um and you can just email

us um invest freedom family

investments.com if you'd like a copy of

this um then just say lifestyle Design

worksheet and and somebody will send it

to you it's it's free no charge um uh

but it's boxes essentially and what

you're going to want to do is you're

going to want to fill it out and uh you

can either answer the questions of what

do you want or what don't you want um so

I think it's easier to answer what don't

you want right so um let's talk about

travel flip um what don't you want when

it comes to

travel no travel I want travel I always

want travel uh I don't know what what I

what I don't want about travel um I

don't know no what I don't want about

travel I don't want to drive long

distances yeah you know that's that's

one thing I don't want um I don't know

what else I don't want on travel that

one that you stump me on that one yeah

um okay so let me pick something else

geography what don't you want cold okay

could I have said that faster yeah I

don't think I could have said that

faster I I don't want cold um I want

warm you know nice warm climates uh 12

months out of the year would be

preferable um what else do I don't want

I don't want to be in the middle of the

woods okay as nice and peaceful as that

may sound I've had one too many run-ins

with uh Critters um in the last couple

years that uh that's where the critters

live and they can stay there I'm I'm a

city

boy so I don't want to be in the middle

of the woods I don't want to be up in

the mountain I don't want to be secluded

you know because I like having access to

things yeah okay um so for travel I

think I would say I don't want to be

forced to travel oh you know I want to

travel because I want to travel um I

also don't want to be traveling so much

that I'm barely home we have dogs and we

love our dogs right and so um those of

you with kids can relate to to to

replace dogs with kids right um so you

may not want to be traveling a lot

because you want to be home with kids

you may not want a second career um or

second job uh that is in top of the job

that you love because you want to be

with your family you want to be with

your spouse you want to have date nights

um you want to be at your kids soccer

games you want to um just be a part of

their life and and allow them to learn

from you um and have and create those

memories while you can I I know that

there's um a book I can't remember the

title of it but it talks about you have

only 18 Summers with your kid oh right

right and so I thought that's really

impactful to think about you you think

18 years you're like oh my gosh 18 years

but when you think of it as Summers

because summers are when most families

get to have a vacation or they get to

spend time with their kids and you think

I only have 18 Summers with my kid like

that suddenly puts it in perspective of

how quick life can go by and how little

time you have to spend with your kids at

each age increment um so this book even

talks about taking your kids out like if

you have three kids each kid gets to

choose hey this is what I want to do and

this is my day with you um and you do

that like once a month or something like

that I can't remember I didn't read the

book because we have dogs and our dogs

just don't care they care that they get

cuddled and fed and loved and um pet and

all that type of stuff but um those are

the things that you fill out on this

worksheet so this work sheet really has

six boxes and it's and it's got the

boxes and you could be saying the things

you want to do or you want to see and

you want to get out of life or you could

be um saying the things that you don't

want and either are good you could do

both you could split the boxes in half

and be like I want this I don't want

this because the don't want really

starts providing Clarity of what you do

want um so that's really the first

exercise that we like to talk about a

lot because had we done that um I again

don't know what path we would have

chosen um and for us we may have chosen

both because we like to be exploratory

right we like to explore different

things and experience at firsthand um we

were coming out of a career that we were

intending on changing careers anyway so

it wasn't like we had a career that we

um loved and that that real estate was

going to be a second job right um so

when we were in this position we were

really open to all of it um it's just

that we could have made different

choices had we been a little bit more

educated about our options so I think

that's where you start when um where do

I start it's really answering it's

filling out that sheet and and that

sheet is going to ultimately lead you to

this do I want to be an active investor

or do I want to be a passive investor

and now Flip's going to talk a little

bit about like two circles because uh we

say actively passive and passively

active sometimes and we're going to talk

about that a little bit and he's going

to expl explain why we say that right so

what you want to do is just imagine two

circles but they sort of overlap just a

little bit so there's that little tiny

section right there in the Middle where

the two circles you know overlap so if

you're in in that little tiny section

you're actually in both circles and so

one Circle would be the active investor

and the other Circle would be the

passive investor but that little tiny

Circle or the little tiny section where

the two circles uh overlap that's what

we like to call either actively passive

investor or the passively active

investor and there's just a few things

that can actually fit in that spot

because most everything is either you

are just truly passive or you are truly

active so like a truly passive is you

know like a a private money lender right

a syndication and funds uh like here's

my money make it work don't call me just

give me checks right uh then there's the

active investor you know like fixing

flips that's I don't think there's more

active than that uh but then like the

actively passive or passively active

whichever way you want to look at it uh

would be sort of I like TurnKey uh

TurnKey real estate because TurnKey yes

it's you're you're passive because

you're not buying the house you're not

rehabbing the house you're not putting

the tenant in there but you know because

we're we're doing because the company

does that but but you still you once you

buy the property from us then you still

monthly have the the the notice from the

property manager and you know uh the

Water Heater just blew up you know or

the the the tenant poured cement down

the toilet you know or whatever you know

so you still have stuff that you have to

deal with it you know because most of

the stuff you'll tell the property

manager just deal with it you know don't

tell me about it just cover it whatever

um but there are things that you

actually have to still do or the tenant

you know decides to leave and move up

out of the country or whatever now you

got to get a new tenant and redo the

house or whatever so there are things

you have to do but it's still passive

because you know we're the ones doing

all the work so it's it's it's weird

that's why it's that little tiny sliver

uh but all the other passive stuff

they're all by itself over here you're

not having to be active uh for those

other uh those other strategies same

with the active side um it's very active

and what you like you I don't know how

far you want me to go into this but when

you're when when active it it is it's

another career yes you know it's another

job um you know and even I think that's

probably the one thing that those Fix

and Flip shows do on TV they show you

how much work it is they're not there's

so many things about those shows that

are 100% fake um

sorry spoiler alert if you didn't know

that already um you know but uh uh but

but one thing is is that you know

because it shows them constantly doing

work you know constantly doing so so I

think that's probably the one that they

really show that's true yeah um is that

that is it is another career uh but with

passive side it's not a career it's

you're just Building Wealth you're you

know for your future and for your

family's future and um so yeah those are

my circles yeah so um I really love that

he described that there's we could go

down many Avenues right here but that

would be a very very long podcast um I I

think what we really want to hit on um

is

that many of the investors and and what

we've seen is many investors will go

down the active route not realizing that

um they know that it's it's extra work

right they know that after they get off

their job they're going to go ahead and

and start pursuing this they might go to

a real estate Club they might JV which

stands for joint venture with another

investor but it's still an extra job

after they get done with their career

their W2 or whatever it is that you do

where you earn your active income now

you're going to go and do something else

with this you know activity of real

estate that you are pursuing and that

activity takes away from your life and

your family and people only realize that

6 months 12 months one two three years

down the road and they're like crap this

is not what I was looking for this is

not what I intended and suddenly they

are now backtracking trying to sell a

property or do something different after

so much time and effort invested so much

time lost from their families um that

they regret making the mistake of going

down this active route because they

didn't understand hey I can just do the

passive or maybe I can do both and over

the next six months I can actually

evaluate what have I done in six months

on the active side what has my money

done for me in six months on the passive

side and they can actually put a

decision tree Benchmark right there that

says is what do I want to do because

I've just experienced six months of

exploring the active and exploring the

passive and that is a much wiser way to

walk into the real estate World um is

understanding your options and if you

want to explore both then do something

like that as opposed to losing so much

time and for many investors losing so

much money because reality is um

investing in real estate is not easy you

will lose money and even as much

experience that flip and I have and the

team that we have and all the safeguards

that we've put in place because of the

mistakes that we've made and the lessons

that we've learned and the processes we

put so that we don't make those mistakes

again we still lose money on deals it's

just reality we tell our investors this

is reality it's why we do volume because

we are mitigating our Risk by doing 10

deals knowing that maybe two of them are

going to lose money and the other eight

are going to be fantastic y so if eight

are fantastic and only two lose money

we're good like we're we're in the the

the plus side of of things so if you're

not mitigating risk in that way you have

to go into this knowing hey I'm going to

lose some money at some point in time

it's just where where is it and was that

time away from my family and that extra

work and that extra stress worth the

learning curve that it takes in real

estate when experienced people like us

who have been in it for uh 15ish years

um are still are saying we still make

mistakes um so knowing and understanding

that reality because you're going to see

on Facebook and you're going to see on

the internet and you're going to you're

going to hear ads of hey become a

wholesaler become a fix and flipper

you're going to make thousands of

dollars you're going to make millions of

dollars you're going to become you're

going to reach all of your dreams um and

they don't tell you about the hard roads

they don't tell you about the lost money

they don't tell you how long it's going

to take for you to get your first deal

um they don't tell you any of that and

so so many people are chasing this

active real estate role when all they

really could be doing is taking that

money that they're investing in these

courses and actually investing passively

um and earning money that way and then

getting to enjoy life because that's

what we all want right we just want to

enjoy life we want to have a really

great time um I'm going to stop right

there because I'm going to continue on

on the rant but um you are here with

flip and dandy in the freedom show and

we are going to take one quick short

commercial break and we will be right

back add new income streams to your

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Investments can help own property and

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own

future freedom family

Investments get more time to focus on

what matters learn which investing path

is for you where to start and who to

trust visit freedom family

investments.com all right welcome back

to the freedom show I was on a little

bit of a rant and I stopped myself um so

that you could we could get that

commercial break in before um we got so

far in that I had forgot to actually um

stop for a second um so I think I'm just

really really pass passate about saving

people the time um uh and the money um

because uh we have one life and that

life is very very important to you to

your family to those that you love um to

everything that you want to accomplish

to the things that you want to give back

to and if you're spending it on a second

career on a second job because you're so

in interested in real estate that you

think that you want to jump in but you

go the active route not understanding

all of your options and not taking the

time to actually evaluate what it is

that you want by doing that lifestyle

design um then you're going to lose

years of your life and fortunately for

us I don't feel like we lost years of

our life because of where we landed

right um but it could have turned out

differently right um so we're just

really trying to do our very very best

to convey um what to ask what to talk

about what to explore before you

actually make the move um and when

you're ready to make the move um then

just be confident in the choice that you

made and be confident that you uh can

set some time parameters on on that um

decision so that if you said hey I

actually do think that I want to be um a

wholesaler maybe that's what I want to

do I'm going to go out and find deals um

put a timeline on what that looks like

and what you want to earn and and make

your decision tree that if I succeed at

this in six months and make this much

money I am going to continue and if

after six months I have not made this

much money then I have proven to me that

it is not meeting my goals it's taking

time away from the other things that I

could be doing um and I could have a

more passive route um that is actually

going to build more wealth because I

don't have the learning curve I don't

have the mistakes I don't have the lost

time the lost money and I'm going to

live a higher quality life um so those

are the things that you want to talk

about those are the things that you want

to um discuss I would say discuss it

with your family first your spouse right

sit down flip and I um sit down and talk

about things like this all the time and

and and really it happened I think at

the point where 2022 when we are finally

on that road of hey you know we did it

after all this work we finally did it we

started saying what do we want to do we

went to the doctor made sure we were

okay because we were working nonstop um

and we got a clean bill of health and we

said okay now now what what does this

look like and um I think up to that

point just that previous year we had

started taking quarterly vacations just

so that we could get out and Away um you

know for a little bit um but even then

it was hard um because you know the

business is still going and we're always

worried about you know uh building these

businesses as fast as they've gone so

we're always available to everybody to

make sure that things are going okay um

um uh so you don't have to do that right

you don't have to get to the point where

finally you're

like we made it um you can do it a

better way a wiser way um and that's

what we're really trying to share today

is really find the team that you trust

once you find the team that you trust

and you talk to your family and you fill

out that lifestyle design U worksheet um

then talk to somebody on that team so if

it's our team you're going to talk to

Ben and CJ Jr um and you're going to

talk to them about hey this is what we

uh discuss this is what we like we

actually want to be um we're going to

try a little bit active maybe um we want

to dip our toe and just the passive and

then we want to try maybe this circle of

actively passive where you have TurnKey

or um the equity Advantage program and

maybe that little circle of equity

advantage and TurnKey set gives you the

mix of active and passive just enough

that you love it you've got the control

that you want you've got a little bit

more of the cash flow especially in the

equity advantage that you would if you

wanted to be a fixed

um and maybe that's where you where

where you want to live is right in that

middle of both circles um and then um or

maybe if you're like me now that I've

learned everything I would like I'm so

glad that our team is doing it all

because I don't want to be doing it

anymore I don't want to be physically

out there doing all of this hard work I

love that we have a team that is doing

it for us so we've learned how to be

passive in a very different way right we

just hired the people um that we trust

and that we oversee to be able to do the

active um part of real estate investing

so that flip and I can continue to be

passive investors because we are more

focused on our quality of life together

as a couple and as just humans um in

general of what we want to do in life

and the causes that we want to give back

to and doing things like this like doing

a podcast um it's not like we make

revenue from doing a podcast we're here

to it's one of our ways to give back um

many of the speaking events that we go

to it's not like we're paid to speak

there we actually pay to travel there

why because we are very interested in

giving back um and teaching other

investors um why we do what we do why

we've made the choices that we have made

what the pitfalls were of those choices

um and you know where we are now um and

and you know I think looking back um is

really really important to share um and

it helps people live a higher quality

life um and you know we just want to

expose real estate to everybody that's

right what else what did I miss what did

you

miss over the last 15 years let me let

me see if you missed

anything no I mean I love it you know uh

everything's happens for a reason you

know uh we were meant to do what we did

uh to be able to learn all of the things

and we learned them all in a specific

order to be able to start building our

companies and and to build our companies

one by one by one by one faster than

anyone else thought was possible yes um

so and it was because of that Foundation

that we started back in 2008 even you

know as Realtors we started that

Foundation of learning Real Estate

Learning the basics learning you know

the stuff that they don't teach you when

you're a real estate investor they don't

teach you all the other stuff that you

know they teach as Realtors so um so no

I think everything was was done on

purpose and you know like I said uh you

know uh it's it is what it is that's not

what what what I I just said it it was

everything happens for a reason there

you go you know and I love it I love you

know we always talk about what would you

do different I I'm I'm with you I'm I'm

this I'm I'm super excited about

everything that happened and and the way

it happened yeah yeah okay so um I don't

think we need to belabor the point

anymore I think we've like done a good

job of sharing our story and telling you

what what how we think um is the best

way to proceed uh we will recap it here

real quick so number one find a team

that you can trust um and if that's us

um then utilize us right and so if

you're still asking where do I start and

you're scared you haven't taken that

first step um we encourage you to sit

down with your spouse and your family um

and email us at invest freedom family

investments.com ask for that lifestyle

Design worksheet um we'll send that over

to you sit down and just fill it out

even have your kids fill it out what do

they want you know that's just super

cool if you've got a family um how neat

is it um for you to teach them this step

this process of saying hey you get to

have anything that you want in

life what is it um and and allow them to

contribute to you know what this looks

looks like what a fun family activity um

and then once you've kind of filled it

out then jump on the phone with Ben CJ J

Jr talk to them about you know uh this

is what my family talked about we

actually want to be um uh more passive

we we both have incomes um active

incomes we both have careers that we

love um we both we have a family that we

want to spend time with we don't need an

extra job we don't need an extra career

we don't need the risk of trying to be

an active investor and then losing that

money we'd rather just put it to work

passively so that we can enjoy life and

have that peace of mind um so those are

the things that you want to talk about

and then they're going to tell you hey

here's the types of investment

opportunities that fit in your bucket so

as they share those investment

opportunities with you um you're going

to be able to then sit down and evaluate

them and determine um are these going to

meet my goals you actually might learn

more things on those calls um and those

calls are no obligation they're

absolutely free um we're here to educate

you we're here to be a resource for you

um because you feel confident that you

did The Upfront work that allowed you to

say hey this is the life that I want to

live this is where the vehicles that are

going to get me to where I want to go um

and um man I mean What happiness that

would give me if we would have like had

that education right up front um so we

encourage you to go to um our website

you can go to chatwi freedom.com um

again Ben and CJ um are funds private

money lending syndications um Master

notes um very very passive Jr is who

going to want to talk to if you think

you're in that semi passive um uh and

he's going to talk you about TurnKey

real estate he's going to talk to you

about um Equity Advantage um where it's

very much I think the other day you said

it's like a bird it's like the bird yeah

yeah you're going to buy a property at a

very steep discount and our team can

help you renovate it our team can help

you manage it our team can help you sell

it depending on what your exit strategy

is and you're going to get a good chunk

of equity just by taking advantage of

that type of program uh it does mean

you're a little bit more active so just

keep that in mind and that's why they're

there to really educate you on these

options so um we just wanted to really

share this um this mistake that a lot of

people make um we wanted to share the

education to hopefully set you up for

Success so that you can make the right

decisions um and we always like to end

our podcast with things that we have

going on right now um so I'm trying to

think about when this is going to air

it's actually going to air within like a

week um so uh I think the big things

right now are still our Master note

program it's the most popular program

that we have um for Passive investors um

you're going to get a high 10 to 12%

return it also meets the liquidity angle

um you can get it out any year that you

choose um and it's just really super

simple um so if you want to be a passive

investor again that's probably our most

popular program we're in between funds

at the moment so I know by the time this

one airs our new fund will not have

launched so you can even you can ask

about it it's just not ready yet um so

private money lending Master note

program TurnKey properties Equity

Advantage properties all of that um uh

those are opportunities that you can

look at right now um we still have

Cottonwood Town Homes um available for

you right now um if you are looking for

tax benefits that's what you're going to

want to look at um if you call your CPA

and you say hey what's my 2023 tax

burden and he says it's high call us

about that Cottonwood Town Homes because

you will be able to invest um and get

like somewhere if you invested $100,000

as an example you're going to get

somewhere between a$3 to $50,000 tax

right off that is real money that is

like that that is how the 1% of the 1%

get wealthier is by legally being able

to reduce their tax burden every single

year um so if you hear everybody go I

didn't pay any taxes this year it's

because they're finding investment

opportunities like that um so um that's

very limited and it's a real GameChanger

when it comes to your wealth building

strategy so um Cottonwood Town Homes uh

uh call the team and ask them so yeah

chat withth freedom.com just scroll down

you're going to see everybody's calendar

we make it super easy for you all you

have to do is just jump on find a date

and time that works for you and you're

going to get to talk to them um and it's

fantastic and if there's anything else

that we can do for you always just in

email us that's why we give out our

email invest at freedom family

investments.com say hey and listening to

your podcast I would love for you guys

to talk about this I would love for help

on this um we do active we do passive we

do it all so we are here at your

fingertips to do um and help in any way

possible and we want you to use us

that's what we're here for we love to

help so never be afraid to ask for help

don't be afraid to get started um we're

here to help you take um every step um

from the very start all the way to hey

we did it we met our retirement goals

we're super excited and um yeah that's

all I have flip anything else no no I

love it I I love looking back and trying

to figure out did we do the right thing

yeah yes mistakes and Lessons Learned

are always very very powerful so we hope

you enjoy this episode um we are looking

forward to um uh the next one I believe

the next one is a guest um and we are I

believe having um well I'm not going to

even it's not even no no I'm not going

to give it it's a really really awesome

episode episodes uh we're breaking this

one into two parts um you are going to

learn so much so don't miss out on next

Wednesday's episode um it's going to be

a surprise and lots of fun I think this

this one's supposed to air right before

Thanksgiving so Happy Thanksgiving Happy

Thanksgiving everybody yes I'm glad you

remember that all right all right thank

you everybody see you next Wednesday

[Music]

bye nothing on this show should be

considered specific personal or

professional advice please consult an

appropriate tax legal real estate

Financial or business professional for

individualized advice opinions and

information on the show are not

guaranteed all investment strategies

have the potential for profit or loss