Call 11 + 12: Misc Questions
Incubator Closeout 😁
I’ll open the floor up to any questions that anybody had, anything that people are working with through
You’ve talked about right. Infinite banking and HP as the, as what makes up the opportunity fund. So lately I’ve heard George Newbury say that redemptions are no longer, like a couple of weeks. It’s more I don’t know, three or four months.
Is that changing how you use HP as a source of liquidity or are you like forecasting better or differently or. Yeah. So what happened with HP in the pandemic? Like people were like freaked out, so they made a run on the bank a little bit. So that’s why it extended out to be about two to three months to get the redemption.
Granted, I think a lot of those people who freaked out are usually the people on sophisticated people who use that thing, like a freaking bank account, which you’re not supposed to. So I’ve had 70 grand in there since. Two or three years now, and I’ve never used it. I never redeemed it yet. I’ve got to close a couple of times, but never actually used it.
So that’s like the last line of defense that I use or the last, bullet that I have hidden around the house in case a intruder comes in. And if you use that metaphor, but yeah, I’ve been using my infinite banking. And now it just gets bigger and bigger. So that’s what I been using. So I actually thought about actually, what’s going to put in a whole bunch into HP again last, last month.
And then it took them. We had some problems with my account number, which is my fault, but then I found that something else to put my money in and I put it there, but I still think it’s a great source of. Just putting money to make money. Another option is Andy showed everybody this block five thing.
I don’t know, Andy, you want to put your block fi affiliate then in the group, but that’s cool. You can make 8% sticking your money into some staple coin thing or 5% on gold. I just realized that. It’s a great rate, but the negatives is that if Bach fi goes belly up, you’re screwed.
They, it, at least with the little D diligence I did and asking around on the company, they do have, there are in America, so that’s cool. And they do have insurance, but who knows if that ever works? Yeah, but it’s Lloyd’s of London, lloyd’s of London is pretty much, they’re my insurance carrier for a lot of stuff, so help, like just, you never know, right?
AHV never know infinite banking. I think that’s the surest bet of the three, like I think it is you have to diversify into a bunch of things and just, even in your opportunity fund, Now if you don’t have that much. Yeah. Just stick it all in one thing. But if you’re running with opportunity fund a 50, a hundred, $200,000 or more, we definitely gonna want to diversify it a bit.
Yeah. The reason why I asked this question is because when you had that year-end syndication recap the other week Kyle mentioned something about a deal coming in February. And that kind of a little, little ball, if you will and said, okay, Hey, if that’s something I’m interested in, how can I finance that?
And I thought, my HP, I, in my opinion, you should always have a couple bullets in the gun ready to go. So what I mean, when I define a bullet, I define it as 50 grand because that’s just a, a minimum, so you should have, you don’t need to have in your checking account savings account, but something you can scrounge up in a week or two 50 or a hundred grand ready to grow granted for some people here, you may not even have 50 grand.
So forget I said this just don’t pay attention. Just think of it until later. But for, you may only have two bullets, right? I’m last few years, I’ve tried to have that last third bullet just in case boom. There was two deals right in a row. And then there’s another deal that happens to come up, which this tends to happen right in the beginning of the year to the summertime, I think is where the most of the action happens.
Beginning of January is usually pretty slow. Then February comes around is when things open up in my opinion. Come Thanksgiving, things actually don’t even happen. So there’s some ups and downs in terms of deal flow. So that’s what makes things hard for investors. You have to have plenty ready to go.
You can’t just be like Andy and just save up this money and just deploy it right away. Yeah, I would say if you have a couple 50 grand stacks of cash, ready to go that school and then. But another one, infinite banking, HP, or block fi is another or combination of the three for that last bullet.
But once you’ve done that, you’ve got you’ve got maybe some hard decisions. You got to take money out of your retirement account. You have to take money out of your 401k or take money out of your home equity. We’ll talk about that in the bubble. There’s all people in different situations.
And a lot of it is just, is this shit working well, if it is then that’s what you do, right? Those are the hard eras of all decisions that you start to have to come up with. And where do you pull that liquidity from? But it looks like Sean dropped off, but
anybody have more, some specifics about that or I thought about this a lot. So of my ideas about this stuff,
but, okay. Oh, sorry. All right. You said that you were going to invest into HP earlier, but you were you found somewhere else to put your money. Where did, where was that? I thought I put my money into another deal. Turns out I didn’t, Signed the paperwork yet. So I put the money in there and then that was like, seventy-five grand.
I don’t know. Good question, man. My money just disappears. That’s, I think that’s what it should do. You should always feel like you’re poor. It always seems like I have less than 10 or 15 grand in my checking account. Or yeah, no, I, what I did too, as I made another life insurance policy too, so I put some money into that.
So then for heroin, I was going to put 120 grand into HP, just for no good, other reason than trading $10,000 a month, the cash cashflow, even though that wasn’t the highest and best use for that money, but that was my goal. But then I found hire best use opportunities for that money. So I put it elsewhere.
I think one mistake is like people like, look at HB, pays monthly. Everybody’s doing it, but make no mistake. HP is more of a bronze level investment. Putting money into rental properties and vacation deals. That’s going to be. Where it makes way more money HB as ordinary income too. So I do see that common mistake.
A lot people fall in love with HP, but HP is just, okay. If it weren’t for the liquidity component where you can pull your money out in a reasonable amount of time, I don’t know if I would be doing it as much.
That was the reasoning behind my question that I asked earlier. Because they’ve been selling, advertising themselves on like that two, two weeks turnaround, for redemption. It used to be like that. I redeemed a long time ago when I put my money back in and it took me two weeks that recently, no, that was like two years ago, right?
Yeah. But what if you want to game the system? We didn’t talk about this too much, but like the way they have it now, because it’s a large fund. Now they have this queuing order. So you submit an email and then it puts you on the waiting list and it comes up. It usually takes a few weeks to a month.
I don’t know how long it takes, but then you have the first writer refusal in a way. If you want it to be a jerk, you could just put in a, as soon as you have like a wince of anxiety, you put it in your class. So they may ping you back a month later. Who knows when, and then you just say, no, I’m cool.
I did something else, or you guys took so long. I need some more money in the meantime. I don’t know if that’s really ethical, but that’s a way of gaming the system.
but most of you guys are fine. It’s the guys who are like the freebie people who are putting in $5,000 or something, some chump change like that. Those are the guys that are annoying me that do that type of stuff.
Yeah, and I definitely want to put what I have in HP. What now having participated in whispering Oaks and, looking at chambers now I definitely want to think about leveraging what I have in my HP for, another future syndication deal. I just feel like a better place to put it.
What do you keep in like your checking accounts or? My checking probably has 20 and I’m a see man. You’re like, you’re, you might have a big credit card bill here that I might be like five or 10 grand. My credit card builder, probably if I posted a five. Okay. Sometimes I’ll have bigger credit card bills cause I have to pay vendors and stuff like that.
So that’s what I keep a little bit more, but we have for you, this is what makes your guys’ life really easy. Cause you guys are very, you guys are aren’t running businesses, right? That have big needs for cash for paying something. So your expenses are very consistent. What I would do is like I would run your checking at Cal on at 10 grand.
And everything that you have more than 10 grand sweep it into, HP, or actually that’s where you could use block fi I’m. I wouldn’t go crazy with block fi and D would probably disagree with me. And some of these other guys would disagree with me, but maybe as coming from a more conservative person, that block five may be like, whatever is over 10 brands, like maybe five to 10 grand, just float in block five.
And block fi you can move in and out. It seems like easily
and anything more than that put into HV. That’d be my, I would do it or just, that kind of seems like a pain in the ass, but you can, we got the idea. I think,
What, how much do you have nothing by her 20 grand in there? All in the stable client, not only just specifically to stable class, 20 grand, and I have a 30 grand and HP,
I found you, you don’t pay the wiring fee every time. Go through a custodian called Gemini, so I get to do an ACH transfer of 25 grand. So I used that. Okay. I used as low checking account, it’s like a business banking account. They don’t have wiring fees, incoming or outgoing.
So I sweep it into as well first. And then I transfer it from as little to that big and vice versa. I need something with no wiring. Yes. Look at as well. How do you spell that? E Z L O.
But I also use commodity as a bank account. They give me 1% and BlueVine as a business checking account that also gives 1%. But those, I think you have word fees, stuff, move it from one hand to another thing that has low
while you see your makeup. Okay, go ahead. No, sorry. Finish your thought. I was just thinking, and he’s making a lot of good money with that thing. Eight, 9% 20 grand. It’s better than my chase savings. Point zero one. Yeah.
I don’t know. You see what I’m saying? Andy I’m kinda like that. The analogy I like to say is like you and are like, Gambling, Karen. Hello. We have a lot of like legal gambling things. I don’t know how it is in New York. Probably not the same. We also have a lot of legal fireworks, but it’s pretty strict here.
Yeah. Yeah. We don’t care here in Hawaii. So we go and we kick everyone’s butt and in poker, cause you could count cards or whatnot, but then it’s like, all right, we leave and then they stab us and take our money at the end. That’s what I see. Block five. It’s yeah, it’s making a lot of money, but at this block five just gets compromised or screwed anyway.
So how do you quantify that risk? It’s like a syndication. Syndications are always better deals, but the fact that, that instance where the operator just is not honest. Same thing. So how do you want to write that? I think once, if I can get to your level and get really comfortable with The different people creating decent vacations.
I can better quantify the risk. I think in my current mental situation, I’m very familiar with crypto technologies and whatnot, so that my opinion might change. Give it like a year or two. Yeah. And that’s cool. And that’s why you have guys like me and your network. I have guys like you and my network where we agree to disagree.
We all have different like investment philosophies. But yeah, I’ll throw in five grand into block buy. Cause you’re doing that much. That’s why I always asked. All right, man. You say it’s so good. What do you got in there? Let’s see what you’re really working with. Okay. I’ll put it in five grand.
Sounds like you’re pretty confident. And that’s how it starts, I think.
But go ahead, John.
Oh, I was just going to say a side had tax question regarding syndication deals. And let’s take like whispering Oaks as an example. When you start making distributions from a tax standpoint, my understanding is the cashflow is treated as passive income, but in year five, when you sell.
That’s going to be treated as capital gains for LPs. Is that the right way to understand it up to your basis? I think, yeah, technically it should be passive income after there’s something to do with the timeframe also, so three years or if you’ve held it for longer than a certain time, technically, but here’s the deal.
You get all these K ones and on the left side of the K one, there’s all these check boxes and stuff like that. That categorizes as such, the CPA that I’m going to have 20 or 30 of these things. And the CPA always just has her own ID, or they only have to pay attention to that and they categorize it.
However I tell them. So what I’m saying is like a syndication exits in a year or two years. To me. I think that I was like, eh, shouldn’t that be ordinary? Your state professional status. It doesn’t matter. But I’m like, Hey, I’m not saying anything, I’m not stupid. But I’m like, shouldn’t that be ordinary?
But every time I always tell them, Oh, I think that’s all. Or I think that’s all past them. I’m all LP investor. So you don’t put one-on-one together. They think, Oh, he’s passive. So it’s passive income is what I’ve noticed. So what happens in real life turn seems to be something different and that’s goes at your own tax professional.
So I don’t I’m not saying I know either way, but that’s what I’ve noticed, what that’s okay. If you want to be like really forceful about it, you can ask your, you can wait to see what your tax professional categorizes it as, and then tell him, Hey, I’m a passive investor. This was meant to be the intention of this opportunity was to hold this term, but we just happened to sell it.
It was not intended to be a flip, put this thing as passive and see what they do.
That would be one way I would handle it, but likely you won’t even care because we’ll have so many passive losses. They want to get mad.
And what difference does it make? If you go into another deal of two deals in that same year with those proceeds, it doesn’t matter. You’ll just get even more passive losses.
Good question. But that’s just how it is. What if you refi it? What if you end up refining as a GP in like your five? Awesome. Then nobody pays taxes anyway. And that’s the ideal scenario, right? You refinance in. If next year turns out to be the year. I think it’s going to be where people actually go out and spend money.
Because a lot of a lot of white collar people had a lot of money to spend on football games and vacations, and the American resolve is going to come back. You might see some deals refinance of 18 months at a much lower cap rate and you get all your money back. You just stay in the deal.
That’s ideal, right? You get your original money back. You didn’t pay taxes on it. And then you just cashflow that’s ideal and that’s the infinite return model. And that’s the goal of any syndication,
but that’d be a worst case scenario. They sell and they, you have to take the game, the tax hit and then the depreciation recapture. But you should have the passive losses built up to offset that.
And keep an eye on how the CPA categorizes the sale. Yeah. Got it. Okay. And I think it’s important to ask it in the right manner where you sound educated. So they’re not going to give you those, the answer they would give to any other stupid client say, I ask it like, Oh, we say, we exited this.
I’m just curious, like what we exited this deal. Is that passive income or ordinary income? Just curious, and did I pay taxes on it? You just sit and wait, what did they say? And if they give you the answer, you don’t want to hear, say tell me how it’s not passive income. And they’ll say you held it for less than two years or you flipped it.
And you’re like, no, I, I don’t know. I think that’s where you might need a second opinion. Yes.
I’ll be honest. I don’t know. But to me, my understanding of passive income that is certainly passive. It’s not like you’ve flipped it in six months or a year.
Yeah, it makes sense.
Anything else?
Can you share anything about the bubble mastermind that you have coming up in a couple of weeks? Yeah. So you guys get to come for a little cheaper price, like a hundred bucks, but I have to make a, I still have to work on a agenda, but the vision is like we work on to work on certain topics. Like the scenario where the guy has a big Mo in his 401k retirement account.
How does he leak his money slowly? The teach the concept, like how I just did in five to 10 minutes, then break people up into groups, right? People who’ve already done it and they don’t care. They can go. And in a hallway like breakout room people who are thinking about it right now to do it, I think Andy, right guys like yourself, that you have to talk about the tax implications of bringing it out slowly. So your 150,000 AGI, doesn’t go above a certain amount. Put you guys in a group together. And then people who are still super clueless and it’s wait, what, what does that again? Keeping them in another group. And just keep cycling through different topics like that.
There’s not too many topics to talk about my opinion. Maybe we do one on syndications. Another one would be 10 31 exchanges. I think that’s, that’d be one good one to talk about like, Why you wouldn’t do it, but hate, maybe there’s a group of people that actually make sense for those people can go talk about that.
But have multiple breakout rooms where you’re totally not interested. You can just go BS with a bunch of other people. It’s just throwing people in different situations or breakout rooms where you can interact with people on a one-on-one with some sort of a guided topic base to give you the opportunity to meet as many people in this ecosystem as possible.
Cool. Okay. My recommendation is just you’ll probably meet At least a half a dozen people, you may not get along with every single one of them, but try and find the cylinder similarities and try and reach out to them maybe in the next few months or six months or a year. And then see if you can cut something going there.
Most people, maybe I take it back, but people are paying to be in this stuff, so they have to be somewhat interested, or. Or into meeting and building relationships with people. It’s a self-selecting group, just like this thing whole was right. This is why I’m like, you pay for what you get with all that free Facebook crap.
It’s just, you just got a bunch of random people. It’s just not worth the time it comes down to your time. It’s that whole new social media group club policy is just a bunch of garbage on there just to decipher and going through that stuff or going through a website like Reddit. Yeah, it might be some good nuggets in there, but I’m not going to spend my time to go through the pile of just nonsense.
You guys want curated stuff. And then, so the issue are some curated people. I try to sort of filter people and, there’s been a couple people that I just know it’s a closed group. You can’t come. But yeah, everybody’s making pretty good money. Everybody’s more Working professionals, that type of stuff.
I would say I’m not warranting that it’s like a safe person. I’ve never worn something like that, but at least you guys can, shoot fish in a barrel in a little bit.
Gotta send a question, go ahead. You’ve got friends, family members, coworkers who are not accredited investors, so they don’t have access to the deals that we do. So what would be some of the pitfalls of setting up a, another entity or a partnership with somebody so they can come in on a syndication deal with us.
Shoot me an email I’ll we recorded a mastermind. This of guys who did this. Multiple times. Yeah, she may email I’ll send that to you, but yeah, like a lot of people, what they’ll do is actually, this is how I started. I had a buddy and, we were like, Oh, we want to get in a deal for 25 grand each or 15 grand each or whatever it was.
So we created an LLC. We split the K one deductions and were able to get more insights into more deals. It’s pretty common people do that,
but I think the pitfall is you may not be totally aligned with that person. Or it just may be too much of a pain in the ass to do right. To split the K ones and all that stuff. Luckily it’s, you’re just a passive entity, right? You’re not doing anything so there’s no, I, it’s pretty hard for there to be any hard feelings from somebody not doing anything because there’s not right.
Whenever you start working with another person that always comes into play. Yeah. I was thinking, putting that disclaimer in Hey, we’re just passive investors. This is the setup and whatever happens. That’s how it’s going to be. And we’ll just split it the way we drew up from the beginning.
Yeah. And I think, but what I also think is fair. You guys are the ones putting in the work, right? They’re the ones that are just like, luckily to be a part of it, charge them something. Maybe it can be off the side. Maybe they just buy you dinner every quarter or something like that.
But you guys are the ones putting in the effort, building relationships, spending your most valuable resource, which is time.
Okay. Anything else? So I raised this earlier, but are you able to share anything about this February deal? That’s in the pipeline? At a very high level, it doesn’t have to be, just share what you’re able to share. There’s a lot of, there’s a lot of things.
Various Hot-Seats
Okay, so I’ll go first for Christmas. I am thinking of buying myself a venom back brace. If you guys have seen like Dwight Howard where these things in the NBA finals, but it’s expensive, but because I drove my AGI so low, if you guys look it up I think you can write off all your expenses that exceed a certain percent of your AGI, like five or 10%.
But if you make a hundred grand a year five to 10%, five or 10 grand, like you never have that much inexpensive, but because my AGI is so low, that threshold actually is very attainable. So I’m trying to write off a lot of medical expenses that come off, everything I can. I’ll probably have. Somebody prescribed massages and stuff like that for me or whatnot, but that’s what I am buying for Christmas.
And I also bought a conference table to use here. It also is a combo pool table also. Actually let’s go in order. Chad, why don’t you go? And then we’ll go to the gives and gets you have time at the end. Okay. Yeah. So this is kind of stuff I got over the year. Not really necessarily for Christmas, but I thought it’s applicable to tax savings.
So I guess the first thing is a computer monitor, an extra screen. Cause pretty sure it’s deductible, if you can just do it for administrative office. Yeah. I agree. Get yourself one of those curved ones. It’s a pretty nice Costco and the next one’s kind of a. Iffy. We have all these investor calls and all that.
So soundproof, acoustical panels to limit all the background noise and all that. If you’ve got noisy neighbors or something or kids. Yeah, sure. Desk lights, if you have poor lighting in your The blue light glasses, I would push. So all the business stuff might be a little more riskier. Yeah. I would always push it to more of the less risky category if you can. So like the blue light falls in the health category, but you make a lot of money AGI wise. I don’t know if you can write it off, but just thoughts there.
Yeah. I just put all this stuff on just because, so we can talk about it. The Google drive storage, I thought that one’s definitely. Oh yeah. Yeah. That’s for sure. It sounds like 20, 30 bucks a year. I think now
you Phillips you smart bulb. I would just write it off as a light bulb. Yeah. I just put it on to be specific, but yeah, it’s just the light bulb because what’s the thing he has to be reasonable. I don’t know if that’s very reasonable and that term is the cheapest one. It’s 20 bucks. Yeah.
But one could make the argument that you could just go with a 99 cent fault, but there’s really no sense to join too much attention to it. You know what I mean? When you actually document it? Yeah. The main one is just the computer monitoring and the Google drive storage. Yeah. You’re going to buy yourself some cool Apple Macs, headphones.
I don’t know if that’s a reasonable 500 bucks or headphones. I was going to buy it if I I wrote off my AirPod pros. I just don’t really use headphones. Maybe someone else will buy one.
Okay. Justin, you want to go or.
Oh right here. Yes. All right. So yeah. We’ve got a Pocono ski trip next week and it’s in the Eastern half of Pennsylvania where our property is more Western half of Pennsylvania. So trying to finagle a way to make that some sort of business expense. That would be nice. Okay. We’re talking about short-term rentals.
So maybe short term there, so that short-term rental, you cannot write off the trip until you’ve picked up an asset that makes at least a dollar. You get that, right? Yes. So save the receipts and then a year from now, when you did that thing is put into service. Now you can come back to previous years and deduct it.
So long as that. So how long can you hold on to it? I’m assuming that it’s forever. Within reason, right? Pete went on us. If you bought a property here. No, you can’t write off the other one you tripped, you took back in 2016. I don’t think that’s reasonable. But make sure when you go on the trip, you like, you grab you make notes in your calendar, you grab like brochures.
Like one time I went to Vegas and actually was legitimately looking for commercial properties in Vegas being very honest, but then my. I think just my girlfriend at the time, but my girl, my wife was like, are you really interested in buying a property here? Are you just doing it for Texas? I don’t know.
It’s just looking how the market is, but because I write, I wrote it off because I have this all incumbency, very vague business that I do all over the place. And I happen to also happen to meet an investor. Actually I met a bunch of investors there. We had a big party.
So that’s why I was able to write it off. Let’s talk about the ski trip when you guys leaving just get a sense of the timeline, next Tuesday. Okay. So when you guys going skiing, and when you actually going to do real estate work, Okay. So we’re meeting someone from the Latvian Kenji group to talk real estate on the way up there in Philadelphia.
So that’s a business meeting, so that falls under the realm of education, technically. So be careful of that. That’s not as strong as talking to vendors. Oh, okay. So I would. Look, you could probably write it off and go on earning it audited. What? Maybe 5% of the time. And when you are audited, he probably changed the story a little bit around that.
You’d probably say that these are your partners or whatnot, but. Go do Brandon Hall’s e-course and he’ll say no, this is a no go.
We’re going to, we’re going to try it. Let’s see. Yeah. So you have to, you gotta meet vendors, right? Like you gotta, when I go to Vegas, I’m meeting a broker professional by meeting a carpet person. I don’t know. But not you guys meaning each other, going to California, going to Seattle, having a beer at Shawn does not technically count that counts under education, unless you’re going to buy one of his properties that you need to save their receipts to.
When you finally buy the thing, then you can write it off. But Hey, you can take your chances. So when people have business meetings, it’s always with some vendor or somebody they have to buy from, it falls under the realm of education, in my opinion. And I’m pretty, I think I’m pretty aggressive, but I would not feel comfortable with that, to be honest.
That makes sense. Why don’t we stop by and just see the property? Yeah. Yeah. Now you’re probably like, screw that. We don’t want to talk to these guys anymore if it doesn’t count. Yeah. We’ll talk, we’ll go interact with property managers. Go talk to prop go view properties. They do have Real estate people that aren’t looking to sell them Airbnb types.
Places. Yeah. So that’s a possibility then. Yeah. So switch up your interactions that way. Yeah. Office chair and office desk I’ve had for six, seven years. So be nice to upgrade and something nicer.
I can bend the bull, found a good deal to Hawaii. That’s in may. So if we can expense that. Yeah. It’s in Kona and I think you’re in a wahoo, right? Is that right? Yeah, that’s not, yeah. There’s a big ocean clean us. I don’t know.
Yeah. I don’t know how we can finagle that. I thought I have a buddy that’s in Japan and he’s a I think he’s a trustee and my estate. So I’ve gotten the idea of having him when I go to Japan. We’re doing our state meeting. We’re going to Japan. Oh yeah. It lets me meet your guy, but they’re not your trustee.
You see what I’m saying? I see. Let’s try to figure something out though. Living trust. Do you guys do one of those things? Yeah. We just got that last month. You guys have trustees or is it just you guys did you make your mother or your brother? Yeah, we have trustees there in Chicago and stuff.
So I check with your tax guy, but I think that’s a lot more legit than meeting some random couple ski scope to me. Like you see what we’re doing? We’re trying to think broader, right?
No.
That’s all right. Okay. Yeah. And when, yeah, when your guys’ net worth is five to $10 million, and you just want me to be a trustee, then I guess you could write off your whole trip to Hawaii, but that’s. I know when I was going getting, trying to get to on the ski trip was like, so you’re going on Tuesday.
You’re hitting the slopes for how many days. Two or three days, two or three days back Christmas Eve. Okay. So just be mindful of the sandwich rule, right? You can’t deduct the whole thing if you’re only getting business for a couple hours on Thursday, right? Yeah. It has to be an appropriate amount.
So if you fly in. Tuesday on Wednesday, you take a business meeting with a broker there, grant granted, or you own rental properties in the area, right? You can, that’s the same broker, just four hours away. You’re making this hard, man. It’s I don’t know. I don’t know, but I know I don’t, you can do whatever you want, but I don’t know if I would push it.
Because here’s why look big picture guys. You guys are potentially doing real estate professional status. Don’t these little whimsical trips. What do you have to gain maybe about a thousand bucks of cash tax savings? Who cares? Stop thinking small ball. Don’t let that something like that.
Blow up your real estate professional status down the road or now. Right where now you’re using all these a hundred. Maybe you don’t do it fully, but you use like a hundred grand of passive losses to bring your AGI down from 500 to 400, with $50,000 of tax savings there, don’t let some stupid ski trip where you save a thousand dollars blow up.
And now they’re harassing you every year after when you’re trying to write off 50. Yeah. Okay. Yeah. That makes sense. Sure.
But yeah we’re nickel and diming. We’re trying to see. Yeah. You got to get up that, until you think about big picture, you don’t think about it, but yeah, stay under the radar. If it’s not more than like 10 grand I tax savings, I be careful. I may not be worth it. And that’s the whole.
Bigger pockets, crowd, right? They like nickel and dime. I hope you can make your property magical down the 8%. All right. He’ll just screw you some way or another. They’re always trying to grab that penny, but the news track with the bigger picture and that’s what they’re always stuck on that website all day long.
I dunno, man. I would try and find out what I would do is try and look for a short-term rental there, keep the receipts. You can’t write it off until you buy something there. But I think that’s, as we were talking earlier, that would be a better Avenue for doing real estate professional status, which is the ultimate goal, I think.
And then see if there are seats for that. And then only when you do two years from now, when you do have that rental. Right off. You’re going to go on like the Wednesday for the day, for half the day. And then the other time you’re going to be screwing off skiing. Definitely don’t write off your ski lift tickets and all the meals for that, but maybe write off a third or a quarter of your flights, and then that first night’s hotel, I think that’s appropriate.
Okay. Not this year, right? When you buy it, the rental after you, right? Yeah. Yeah. Once we get that short term rental. Yeah. Yeah. But by then, you’re like, who cares? Not even worth it? No, I don’t know. I C I would rather put the effort into this stuff than the trading, all these penny stocks and all these other things, but I haven’t taught at all.
Yeah, take a nap day. Cause it’s time for you. I don’t want to do all that. Okay. Oh Justin too. Or what are you buying there? You have the dentist practice too. So you gotta, so I had a couple of quick questions. You’re talking about writing stuff off or saving the receipts to write something off after buying a short-term rental later.
I’m imagining that this is very like. Analogous to just buying any sort of business. So like a lot of the expenditures that I’m doing in terms of meeting people, trying to build out a network to find a dental practice, to buy, I can save these receipts. And then when I have a dental practice, I can write that off against the business.
Would that be a sort of a similar situation outside of my realm, but I would say that’s seems very reasonable. Okay. So I had talked to another CPA on that point too. And he was mentioning that if I were to like, do that, save all the receipts and stuff. I could like personally get my money out of the business as well, by I dunno, more or less like paying back a loan to my person from the business.
Does that sound? Yeah, a lot of, a lot of people will do stuff like that. I don’t understand. I think when you’re doing like bigger stuff, that makes sense. Like, when you’re saying bigger, you’re talking dental practice versus single family house. Yeah. Yeah. Like they, what they’re trying to do is they’re trying to make it where they borrow.
You’re going to have to put in a cash disbursement for, as your owners state, or you can lend money to your company. Yeah, you can lend it at 10% or 30. Know you can’t do crazy rates, but maybe you lend money to your company at 15%. That’s enough. So it’s like passive income, or I don’t know if it’s passive, ordinary, but as opposed to, in lieu of taking a salary in a way or your own living expenses, so people can play games with that.
I think I’m missing something like, I don’t understand why people really do that. But like in a situation where say you have a strategy for five, 10 million net worth families as they do a nonprofit. So what they’ll do is once it’s in a nonprofit, it’s locked up.
That money is off the table of litigators, which is nice, but it’s off the table for you, unless you make provisions in there where the you lend money to the thing, and it pays you with the interest. More than exceeds your daily expenses is the picture. Okay. So it’s the same idea, a little bit different example, the same idea.
Okay. But I haven’t really figured it out. What’s the, I think that I speculate the reason why they do that is because your business is likely a C corporate eSport, and two, you want to run as much stuff to do that funnel because you don’t have to pay the self-employment taxes, pseudo food of a, that stuff.
And that’s why it’s better to run the money through there. And it take your salary, not as a salary, but as interest you give to the company, because you got to give the company money anyway, in the beginning, you’re in it. You have a feed the beast. So you might as well take it as distributions interest distributions that way, as opposed to just putting in there and getting gloss.
Okay. That makes more sense. Yeah, whatever they’re doing, I think they got the right idea. So I would just go with it. Okay. And as far as like administrative office furniture, I’ve just have a bunch of like random stuff in here, but does the administer, does that kind of furniture need to be business specific?
So I get like a desk and a computer monitor. That makes a lot of sense. But if I also wanted to have a little bit of exercise equipment in the corner to blow off a little steam while I’m, working in the administrative office, or if I need a little Zen garden where I can start plants indoors, and then transplant them out to my garden, later on in the year is that all.
Legitimate. I’m not, I don’t want to get you in trouble, Kathy, but the way I interpret that is I would do it. You would do it, but I would be careful. How do you label it? Like again, if you go back to the old video, I did, I have my ledger. Like things like that would be vague. It would just be on there and a line item, $250 or whatever.
Okay. I wouldn’t, I would be vague and HUD write it off because it’s, for me, it’s easy because I have this long ass list of ledger items. It just gets lost in the shuffle. Okay. But I think for you, I would put most of these expenses under your operational dentist’s business, not your real estate stuff.
Because I think that’s stuff is more a legitimate business then. Let’s make no mistake here as real estate investors. You technically don’t need much. And there is risk involved with that by writing out some of this stuff. But again, we’re putting it under the thing that can support it the best.
But if I were to, and so instead of having a real estate business for this with the dental practice, I can still get an administrative office in my home. And then, yeah, I guess I would just be able to write it off through the app. Business expenses saying the same things, right?
Like it’s furniture for the admin office. It’s a Zen garden. It’s a, yeah. Whatever. Your dentist practice. Are you the only partner? So I haven’t gotten into one yet. Like I’m still looking for that practice to acquire. And that’s actually my last part on the, get the business mindset shift for me.
I know. We’ll get to that a little bit later. Let’s talk about this now. Cause I thinking of it. Okay. For you guys. Try, whatever you can do to not take like a salary, but shifted more towards equity. So you’re getting compensated, not with ordinary income, which is your salary, but with K one passive income, because that’s, if you guys haven’t gotten a sense, this is the big gain.
Shifting money from ordinary income to passive slowly today, I don’t make any ordinary income. I don’t need real estate professional status. But I think we all start off, especially in this group, we’ll see all ordinary or trying to shift. So when you’re setting up your stuff, I would take, you can, this kind of opens up the pie or the negotiation pie, right?
With who you’re working with, that you’re taking your share via passive income or equity, as opposed to salary. Because you’re able to use passive losses from other real estate deals to offset the passive income without real estate professional status. Sorry. Say that one more time. So you’re saying that if with a, like a dental practice, if I were to shift my compensation from a salary, like ordinary income stuff to somehow get a disbursement via a K one or something, I could then take those gains and offset it from the loss passive losses from like the syndication deals.
Is that what you’re saying? Correct? Because those gains would be passive income. Okay, you following? Yeah. So I’m following that part. And I liked that because I hadn’t actually considered that. I don’t know if I’ve ever heard of a dental office being able to give out, payouts as far as like a K one, but I have no idea the structure that would need to be in order to do that in the first place.
Yes. It’s uncommon. Because most people don’t think this way, but like there, I have this doctor group. They run up emergency metal coal hospital, and they pay themselves via equity, but there’s, don’t get me wrong. They’re slaving away at that thing. They’re active, slaves to their business and yeah they do take a salary because their CPA makes them do it and appropriately, but the majority of it trying to come out as like a K one distribution.
So I don’t know. I don’t know if that’s majority, it’s probably not majority. But at least some of it as much as feasible per the CPA, they push to that passive income side. Okay. So I feel like I’ve heard something similar with dental practices, but it’s mostly about the dental practices are set up as escort.
So you’re taking the dividends and stuff, but is that going to be different than the K ones? Like generating passive, I don’t know. I don’t think it matters. I think it’s how the partnership is structured is the main thing. Okay. Because if the partnership is structured where you’re not, you’re a shareholder versus employee.
And then so the shareholder, you’re seeing that’s getting paid with the K one income passive income, but the shareholders, the employee side, That can float through it as corporate C corporate, whatever sole proprietorship. I think that’s the way to distinguish. So what you’re asking is it S-corp secret?
I don’t think that matters. This is okay. This is the split prior to that. Okay. Just something that not many people do this, because they don’t get that. This is why they’re slaving away. Cause they don’t understand this concept. Are any of those, the dentist that you like, introduced me to you, like I’ve never discussed this particular topic with any of them.
Are any of them doing something like this or do you know, or wouldn’t might be able to put me in contact with maybe that doctor’s group and how they set that up? Just so I have an idea, I mean your CPA should, this is a prime example where you have to drive the ship, no CPN there. And I would propose this stuff to you because most people don’t even not don’t have passive losses. Majority nine, nine, 9% of people out there are slaving away with ordinary income. They don’t have passive losses. So this is all a moot point to them. So no CPA would advise it because they don’t have it in the first place, but this is where you have to propose the strategy Hey, I’m a real estate investor.
I get a lot of passive losses. I’m thinking of setting things up like this so I can utilize my passive losses and to push as much stuff to passive. Or Q1, but then this is where you have to get a lawyer involved. Because this is not a CPA thing. It’s more of a lawyer, how they set the partnership.
So yeah, another S another scenario. I got another guy he’s like a chiropractor and he’s got a few extra rooms in his office, or one extra room that he wants to push to, like a massage person. And obviously the normal route would be yeah. Charged the massage person thousand dollars a month rent.
Problem with that is that’s ordinary income. So I was like, yeah, I want you like off. Tell them to run it at, pay me 400 bucks a month, but I want a 20% of your revenue per a K one, but shake on it. A JV. I’m a pass entity. You pay me via K one.
But you see how, if you have to get the CPA and lawyer involved in setting this stuff up, people will wonder, what the hell are you doing? Like, why are you making things so complicated? If you can take, a third of your income as passive income that you wouldn’t have, otherwise you sheltered a third of your income.
From taxes, assuming you have the passive losses. And this is what I was talking about earlier. It’s like the deals is just one third of this fixture, which turn off passive losses. But unless you have this stuff structured, you cannot use those passive losses efficiently. Like in your case, this is where the W2 workers screwed.
They don’t have these levers, but like dentists and, business got on their own businesses. I dream situation.
But, it’s hard. I think a lot of people don’t think this way, so you’re going to be pushing a pill with this probably, but it’s good to hear it and to talk through it. I like to explore that a lot. Yeah. I don’t think the guys, I think, I don’t think the younger guys are doing this in that group.
I know one of ’em, It’s super smart, how he gets the real estate professionals that so Justin, you better listen to this. So he owns the dentist practice, but he makes the wife, they own the dental practice and the building. Which isn’t necessarily a good idea, in my opinion, I think it’s a bad waste of money to buy her own building, but he has the wife be the property manager to the building.
So he, every month when he pays the rent, he pays the property manager, which is his wife for it. So the wife is turning 750 hours doing this, getting real professional status. So that’s another little, it. Everybody else. I think who are not dentists are the the medical practice people with a building should probably just forget I said this, but in this, your particular situation, this is very possible and it’s super smart.
You don’t have to screw around with this. Some you definitely don’t want to screw with burst. That’s just idiotic. I think this is a waste of time and too much risk, but. Justin, you’re going to go down this rabbit hole of this short term rental, and there’s a lot of nuances to it, but you can like just circumvent all that with this, renting out your dental practice to your, or the building to yourself and having your spouse, but then you need to stop that doesn’t have a job too.
At least she can’t have a job that. Does more than this, right? Like it has to be the real estate stuff more so than anything else. You can’t have a 40 hour a week, day job. He’s got to go part-time at least. Okay. But as you can see, as you guys have seen the reason I bring this up is. It helps Justin, but it doesn’t apply to most people here, but hopefully it gets the wheels turning because these are how the idea of the ideas have to come to you guys.
It’s not fear of CPA, accountant. If it came from them, they wouldn’t be working that,
and these things change all the time, like real estate passive losses and bonus depreciation is a newer thing. Once Trump took office, he made this thing and it’s not going to be around forever, actually. It’s phasing out in year 20, 22, but these things change all the time, which is why you guys network, you guys connect with other people getting around the right people.
Okay. But I would just let that simmer, now that she can look for it now, it’s a possibility. Now you go find some models that do it, and then you ask them about the nuances. Cause I don’t know how they do it. Okay. Yeah. If anybody in your group would be like is doing that and would be willing to shed a little light, I would be happy to talk with them and in some way, shape or form.
Come to the bubble. Okay. Yeah. Come to the bubble. I don’t know. We’ll talk from there. Cody there, Teresa I’m here. And what do you want to buy for Christmas? Just got myself, some reading glasses that I needed that they had the blue light lenses. So it was the same thing that I think Chad was talking about earlier and then getting myself a new laptop as well.
So the glasses stuff to me that falls under the health category. And I forgot to mention you technically use, you could be doing like an HRA. Or a health savings account. Okay. Does everybody know the difference between us it’s there’s so many articles written on this thing and it’s confused.
They confuse it even more, but I’ve written a little bit about that. Yeah. So you can, if the HSA is better because you don’t use ax, you don’t lose the ability to, you can carry for the set aside money every year, basically. The problem is you can only do it if you have a high deductible plan. So if you don’t have a high deductible plan, you can’t create one.
The HRA is if you have anything else, but a high deductible plan, your that’s the only option you have. But the problem there is you have to set aside, you have to proclaim that you’re going to need this much money to use on health expenses, and it’s a use it or lose it thing.
So the trick is at the end of the year, you tally up all your health expenses, like $150 on glasses, $50 knee brace, $250 on your doctor visits. And you set aside that much money into your HRA or HSA and you pay out of that. And then that way you lower your taxable income just by that amount.
Depending where you are, it might be a waste of your time, but that’s how you should do it. Or are you doing any like HRA or HSA stuff or. I’m not, no I think that’s what hung me up the last time when I was looking at it was doing the high deductible, because I just didn’t want one. But I did the fact that you could use pre-tax income to go towards any of your health costs that was in, in the fact that you can invest it in, grow the money in there.
That always appealed to me. But I think I got hung up on that deductible. Yeah. I’m going out on a limb here with this advice, but if you’re younger and you’re generally in good health, I think it’s a no brainer to go with the high deductible plan. And then a nice for multiple reasons for insurance, less costly. But then you can use the H S a and now you can put I think three or five grand every year into that thing. And it. It’s actually way better than a Roth account, way better, because you can spend it tax free too on you don’t get texted at the beginning. You don’t get taxed at hand and you get tech and you don’t have to pay taxes on health-related stuff.
And it carries for indefinitely. I actually have a health savings account with $14,000 that I bought that coffee farm out of. So you can self-direct it too. But I stopped contributing that stupid thing cause they just got annoying. And I don’t know, to make a self directed HSA plan. There’s a lot of administrative fees from the custodian to use and trusts, I think.
And I just thought it was just not worth my headache, but I would say if your employer has one, whether the administrator or usually it’s free. You could put money into there every year, but I know this is where I’m torn. Like you guys are investors. I would rather not put my money into that stuff and just invest it.
You guys are going to make a better ROI on it anyway, even if you don’t pay taxes on it, on the entrance and the exit or what you spend it on, if that makes sense. Yeah. Yeah. No, that makes sense. I didn’t know that you can get self-directed either, even if it’s through your employer. Yeah, you can take it out.
Okay. Is it like alone that you have to pay interest back into it or anything like that? No, you just take it and just take the container and put it somewhere else with another custodian. Okay. So like when you have that HSA with your current employers folks, You can’t invest on anything other than the garbage investments that they put you in, or they have options, right?
So you can self-drive, you can take that container, take it to entrust or new view wherever. And now they have a lot less restrictions on where you can use the money for. But the problem is it’s such a small amount of money. What can you buy for five grand a year? It takes a while to build this up.
Yeah, and I think you’re better off just investing it in cash, but I don’t know. I just know what’s out there if you guys want to play that type of game, but the nice thing with the, what you could do is you could fund the HSA or HRA, just keep it really neat where you just put in there.
What, you’re going to spend in the next. It’s 12 to 18 months. You’re going to buy the glasses for a hundred bucks. You put a hundred bucks in there, you pay it out, HSA done. That’s another option. Or like a lot of people use that stuff for like healthcare or daycare. I don’t know.
So what did, what do you guys send your kids to daycare? Yep. Three of them or something like that, wrap the flex spending account for the daycare. And that gets eaten up in two or three months. It helps in that respect that it is a tax free or pre-tax, but it’s just not enough to cover childcare expenses.
Yeah. So yeah, the flex spending account is like an HRA. You put it in there and you pay it out of that thing. So you don’t have to pay the taxes on the loan on the whole or the pre-tax, but that HSA rollover self-directed thing is interesting because my partner does contribute, I don’t know, a thousand or two, whatever into that account.
So that’s then. I think our max is 7,000, so I’ve been putting that into it. It’s like 10,000 that I could play with and realize you could do that, but you’re seeing what I’m saying. Drain it out, don’t try and build up much money in the HSA because I think that money is better off somewhere else.
Just like for the same reason why I’d rather have your money not be an IPC. I’d rather have it cash so you can make money. You’re more flexible. The same reason, but if you want to run it like a slush fund with the HSA for 18 months, 24 months call it that. I think that’s a good usage, but don’t try.
And every year put in six grand to try and build it up to 30 grand in five years. That’s just not, I don’t think that’s a good idea,
but what do you guys spend on like daycare? For one kid. I don’t know. That’s all I’m asking you.
It’s it’s not map it’s 900 now, 900 a month. For the youngest. Then the other two, it’s mostly the summer camps and day camps and those are a couple of thousand a month, so yeah. Okay. So 10 grand a year or something like that. So that would more than that would be a no brainer to put in the.
That amount into the HRA or six grand to HSA, we shelter that. Cause you’re going to spend that. But, yeah, so Cody, so your laptop, I think that’s fair game too, but you gotta make money right on the rental first. What about the cause I have I’m in a couple of syndications right now.
If I have that and they have the K one, can I still take the laptop in that case? I think it’s a little bit more sketchy. I would try and write. This is all kind of fringy stuff we’re talking about. So whenever you can put it under something that’s less that warrants it more like your direct rental.
I would push it to that side if you could.
That makes sense. Yeah. No, that makes sense. It seems a little bit more directly tied. I just closed on my rental in mid November. So even though I’ve had it, I’ve gotten my first cashflow payment for it. Can I still take it for this year or is it better to take it next year? Once I’ve had a full year of income.
The laptops 1000 bucks, your cat year profit on that property is 500. If that, yeah. Something like that. I would wait until next year, because this year you’re probably going to be negative anyway. Because you’re going to take the depreciation for the full year. Yeah. So that’s the key, right?
That’s the overall goal is like drive you down to zero. That’s essentially what we’re trying to do. So just put it off to next year. Okay. And I think that’s the trouble is like, what I’ve found logistically is like keeping track of this stuff. And we give all this stuff to your CPA and you don’t really know it’s hard to follow if they did it or not, or if they just threw it out.
So I would just float this on back and then pop it in there next year.
But yeah. Next year you’ll probably make what, $3,000 profit or something like that. How much is the property worth? The property was 96,000.
And then your depreciation, I’m guessing one 27th of let’s call it
60,000. So I’m guessing you’re taking that 20 or two grand deduction every year for depreciation. Just my guess. So you’d probably be.
You’re going to be negative anyway. I think, but I would just throw it on next year. So would I be taking a full one 27th of a deduction, even though I’ve only had the property for about a month and a half before year end? Is that how it works? I think so, but I’m not sure on that, but I think that’s how it works.
Okay. Yeah. Ask the CPA, but I think on the schedule, E they ask you like how many days that’s been in service. I never followed like the forms and how that actually used. They use that number or why they used it, but I kind of feeling like they, they prorate that the depreciation for the first year.
Okay. But I know on this indications, if we close it before the end of the year, it doesn’t matter. We take the whole thing and full year bonus appreciation, but I’m not sure on the single family, but if that’s the case and they only give it to you partially the author on that laptop and go negative.
I think that would be a big distinguisher. You can run. You can run a bit the business at negative for a few years, nothing wrong with that. But I’m just trying to throw that laptop in the year where it can fly under the radar at the most. And under the right business unit.
It’s, there’s always a chance of audit and getting throwing out, but I think you’ve got to give yourself the best chance.
But that it that’s all you want nothing else. Cause I was going to get more creative and laptops and glasses do light glasses, I guess is the thing this year,
trying to look at my desk. Oh, one, one exercise I do every year is I go back to my Amazon payments and I just look at what I bought and just think can this remotely be used for my business. And I do that because it’s easy, right? Amazon makes it so easy to go look at your past orders. So everything I do is always the ease.
What is the minimum effective? Those are the easiest thing that I can grab some of these. Mini deductions is everything you do. Even if you’re in the lowest tax bracket, it kinda is like a 20% savings discount. People will jump out of the building for a 10% discount. Why would you not do this is what I think.
Any other questions or is who else is out here too? Tara. You got any fun one? Sean, you got any fun ones?
Yeah.
I don’t know if you guys are doing board meetings or if you guys set up like your board of advisors, but you could probably take your friends out to dinner or something like that. If they’re on your board.
I buy myself a lot of these Amazon smart plugs I have in my office trying to see what else they got. Tape office supplies, stamps, surge protectors, camera stuff.
Oh, wait a minute. Isn’t there a provision where as long as you’re in the North American zone. You can do any business trip that is like an executive business trip or something like that. Yes. But if you own one rental property, I think that is hard to justify, and that’s why once you go and once you take your business negative, which you already are, because of all the appreciation you’re getting, even at one 27, Per year, because you will have things that break, you will have to pay your property manager that the 10 98, I think you’re going to be negative. Anyway, I think so. I don’t think you’re warranted some kind of executive business ship until you own a bunch of these things you’re talking about, going with the spouse to. Vacation or something. Talk about goals or something.
Yes. Yeah. I think, yeah, that’s again, that’s like another marketing trick by cGAS. It kinda gets you by that, but I think you can only do it if it’s practical, like you’re making money, you’re already positive, but you can play that game, however you want. I’m just telling you the more conservative side of being something like that.
So an observation that I wanted to make. And in one of the past, or maybe it was the recent Cambridge webinar that you did lane, I think you cited as an example where if someone works in best offer of, into that deal, they probably get 40 10 cost segregation, like depreciation that they take.
That’s a lot of pal. And so in that scenario, is it even worth the time to, go through the Amazon list and, I identified a search protect, you know what I’m trying to get at? You’re in a syndication is it worth doing this or are you doing it because your pal, you don’t have enough pills right now to offset your passive income.
Is that why you’re doing it? Put it this way. I have hundreds of thousands of dollars of passive losses suspended. Passive losses is the definition, but I just, in the, just two minutes, I was just scrolling down my Amazon thing. It’s easy. It’s fun. Makes me suck it to the man.
Or uncle Sam. I enjoy it.
I think it’s okay. So put it here, put it this way. Here’s the difference is the passive activity losses from deals. Technically, you’re gonna have to pay that back at some point, right? When the deal exits five, 10 years later, but me writing off $20 for Amazon plug. That never comes back to me. That’s an expense and they never have to pay that back so hard to quantify, but I think it’s worth it.
I’m going to keep doing what I’m doing. Okay. I see. Okay. So yeah, if you put it like that we’re almost talking apples and oranges. Yeah. They’re all passed out. Yeah. But when you have to pay it back, you have to recapture the depreciation. Got it. And that’s when the deal exits after like your Fiverr.
Yeah. And of course you’ve probably gone into a dozen deals by then. So he’s like a rich guy in his bank account. It goes down a lot, but it goes up twice as much again, but it, and it doesn’t matter, but I don’t know. I always, I grew up with a scarcity mindset, so I’m going to keep picking up passive losses if I can.
Yeah, but yeah, I get to your point, you’re not paying off the reading lessons and the laptop. You’re not having to, I can’t remember the terminology you used earlier, but to recapture it down the line. Yeah. Yeah. And technically, I think with a laptop, depending how your CPA looks at the world, if they’re like by the book, you have to depreciate that asset depending on what category of asset it is.
In five, 10 years, but who does that? Who has a life? I think if your CPA is doing that, they obviously don’t have enough clients because they actually spend their time doing that nonsense. And they’re not being practical because that’s just dumb. And like we were saying We’ve mentioned this a long time ago, but say you were, you had a big repair, like your HVAC gets stolen.
Sorry, Chad again, but you should be technically, you’re supposed to write something like that off in five years, you’re supposed to decrease capitalize. The asset is what it’s the terminology, but there’s a diminimous law. I think it’s $250,000. If you can. If it’s under that threshold, they say, screw it.
It’s not worth, but IRS has time. It’s not worth your time. Just write the whole damn thing off first year. So with that diminish this law, you a wink, wink, try and make everything from it. So these videos are ever shared, and it’s not to be contrary to speak our tax advice, but if you have something large, that’s there.
$3,500 work with your vendor split invoice. That’s when I work, I don’t know. That’s when I was a project manager and we had to, I had my delegation of authority of how much money I could spend. I don’t know, like 50 or a hundred grand per vendor invoice. I told them to split all the time. I don’t want it.
I don’t want to send the email to my boss’s boss to get some DocuSign thing or. Both your workflow. Like I’m not an idiot. I got to get the job done. So that’s what I’m going to do. And I think that’s where you have to make the call as a real estate investor or business owner. How you do that stuff?
Justin’s in a hard part. Cause he got a Bible and like on a dentist chair, or a drill, how much a jewel costs by the way.
There, there are a lot. It’s funny in the dentist circle, like sometimes people will look for the deals and try to find stuff on eBay. But if you go through the vendors, they can be depending on the type, they can be several hundred dollars to like a thousand dollars. Okay. Okay. Let’s take something bigger.
Like a chair. Okay. Something that’s five grand or something like that, probably about right. Yeah. How do you guys write that off? Is it all in the first year or two? To be totally honest. I don’t know. I’d have to talk with some people who go in do these practices, like Denovo, just like from the ground up building it.
And then I don’t really know how it comes into play. If it’s in my position where I want to buy an existing practice. But I would imagine most of it gets depreciated out over time. But I’ve only just recently heard about this diminimous or what is it the minimum, whenever you’re just talking about like law it’s in the e-course the write-up is in there, but yeah, this is why we do this, right?
So that you are educated and empowered to ask the right questions to guide the conversation the right way. Now their next step is to go talk to other dentists. Hey, just out of curiosity, did you write that off? Unfortunately, they won’t know, they won’t have a free prompt. Probably not.
Dentists are notoriously bad. That isn’t doctors. I feel like I, I get the rap that we’re all very bad investors, but that’s maybe the right question would be go to your CPA and say Hey, just hypothetically, I bought an office chair. Is, does this fall on, this is something I can write off the first year or do I have to capitalize it over five years or 15 years or whatever and see what he says.
And then you look into it, then you ask the question. Is there, have you heard of the minimis law? Because I don’t know if the Munis law applies to this real estate only are businesses. I don’t know. But I’m sure there’s other things in other arenas, but. Say, Hey, I’ve heard of this minimis thing. How do you, what’s your interpretation of this thing and how can I take advantage of this?
And then you nod your head and you walk away and you work with your vendors appropriately to bill you accordingly and to label it as such,
because that’s a big deal, right? Like you saving 50 cents on every dollar on that $2,500, 500 bucks in year, or that’s a lot of money. That you can bring to today as opposed to in the future.
Very true. I’m not in your industry. I’m just, I don’t know. I don’t know that type of English do what you guys do, but to me, it’s all, I would look up section one 79 other tax schools
looking it up right now. If you want to sound smart and I would have read this before you go talk to your CPA. So my understanding section one 79 is like above the line type of stuff where you just appreciate it right away. You can have the discussion with your CPA where Oh, it’s, this is just one sec.
Is that chair one 79? Or is it something else? So these they’re chipped off to the, what the hell is going on. So don’t just tell you no, go away like any other dentists. So I’m looking at a solar deal right now. And these are the questions I’ve asked. Cause I don’t know. I’m like, is it one 79?
Because if it is then all these other rules apply where it’s just a business deduction.
See, that’s how you got to spend your time. Reading things like that. I think
makes sense. So I’ll look into this. I appreciate the the direction. Yeah. Look into that. Yeah guys, I think we’ve overshot the time here. I gotta get run in. We’ll come back to some of these gifts and Getz next time. But if not, have a great holidays and new years, we’ll see.
Third.
Hi.
Transcription:
As everyone does. No, we’re all in similar situations and timing, I guess currently drew the connection of Medford Julaine. I think it was Kevin. He was selling a home in Birmingham as well. So I was in touch with him Amelie. I went through the numbers, it looked very similar. So I just got on board some already in the pre-approval steps for my second place in Birmingham.
But. It’s you know, new year’s and Christmas. We haven’t done much in the last two weeks, but the ball is rolling at least. I guess the bigger thing is, as you mentioned, ever since we started this course, my cash reserves is slowly going up. I think more than, way before I invested in any sort of real estate, it was straight into the stock market or 401ks.
Now I’m hitting the point where I used to think there’s plenty of homes. I can just, whenever I hit 20 or 25,000, just buying those at one. But then I, I go through your podcasts. I hear, once you had 11, you just thought it’s a pain in the ass, and then you had a repair every month for, or an eviction so often.
So I guess I’m just not sure is it. Am I supposed to just get three or four upfront, just have that foundation and then stop doing that, get something more sustainable and then slowly sell my homes. And then next half a decade or two, where is your net worth at now about, so it took a while to pay off my loans, but my actual one net worth is around.
Like it’s under 200 K. Yeah, it hang off. The loans was a bad move, right? You should have just bought more assets. But nevertheless, actually, so actually may I found this receipt yesterday or early this week as it’s cleaning my room for new years. So like it’s, I paid off bank of America, like four or five grand here.
And what the hell was I thinking? Like this is from 2011. But yeah, we all make that mistake. I, I recently, like last year I got a better job and things have been looking up, which is why, became positive in my net worth actually for the first time in my career. So that’s how I I’ve been trying to do research on how to maintain that and just to celebrate my net worth.
And just to where I am today. And you’re pretty frugal too silly. What are you saving per year? 40, 50 grand a year. I’m saving about 90 grand a year. Geez. Yeah, he’s single. Not married, but right. You got to go to the bubble to find now, Yeah, man. Like the effect that you’re able to put away, like 90 grand a year, like that’s phenomenal.
And you’re not like a doctor, right? Yeah. You’re not you’re HCI, it’s not over two 50, 300. So that’s amazing. Keep doing that as much as you can. I would actually say as more of a life thing, maybe in the next couple of years to take the, just buy some cool stuff for yourself.
It will be for the financial freedom, I think in the next handful of years. Anyway, that’s hard to gain the VR headset. That should be fun. Yeah. I’m not talking about cheap stuff like that. I’m talking about like Porsche’s and stuff like that. That’s what I’m talking about. Wow. Not quite sure you can go and buy your Oculus.
That’s cool. If that’s what you want to do. But yeah, at saving 90 grand a year, or even more than 50, just assuming more than 50, right? If you want to chill out a little bit and enjoy life a little bit more, take more vacations, where you’re at. I would definitely say maybe single-family home.
Wouldn’t be your trajectory. Maybe buy one more for the next six months to a year. But yeah, Cindy syndications, you’re already on that higher trajectory, right? Like a lot of the doc, like the lot of the dentists, they just skip right over this stuff and they just go straight to us and vacations, even though their net worth is, under a quarter million.
It’s the other profile where you’re only able to put away 10 to $30,000 a year, which is way faster than most people out there. But you’re moving at a turtle space. You’ll get there. It’s just going to take a decade. Those are the guys who have to self-generate to get turnkey rentals, to build that net worth up to a point where they can go into a syndication deal for 50 grand, because that’s what it comes down to.
50 grand is the minimums. You can get into deals for 25 35 grand, but those are just desperate operators looking for money. And you don’t really want into those deals. So if you’re looking at 50 grand as a minimum investment, that’s you don’t want that to be more than. 20% of your net worth for sure.
The fact that you’re able to come up with 90 grand a year, the punk stuff a little bit, but I would say I don’t try and do both see what you like. You’re in the master, the family office mastermind too. So you’re seeing it from both angles. You see the contrast between this group and folks, and then that group.
I don’t know if you interacted with some of the heavy hitters in there, but it’s very different, right? Yeah. It’s I feel like I’m somewhere in between, but I do feel more in the very beginning of everything, which is why I still got a lot out of this course. I just felt like going straight for some big syndication without knowing what I’m doing.
Didn’t seem like a wise move either as well. Yeah. I think the syndication is where you want to go, but I think some of the people in the mastermind were pulling you into the infinite banking arena. And I was kinda, I didn’t want to say anything, but I was like, I don’t know, Andy, that’s when you are fat with liquidity, right?
A lot of those guys are million dollar net worth and above, and they’re pretty inefficient with their money. They got 40 grand here, 70 grand a year in their checking account or whatnot. That’s an infinite, banking’s four. There’s like the procedure is you go into deals, you get your passive losses, offset your active income, or just paid less taxes in general.
That gives you more money to invest or put into infinite banking. Cause where I think where you were heading at some point, I don’t know if you’re still here, but you’re hearing what these guys are saying. Right? Infinite banking is the best and that’s cool, but you take a big hit on the fees, right?
I’d rather have you take that 90 grand every year put into deals and maybe in the next year or two, then do infinite banking starting with a policy like that, or if you want to, and you just want to start learning about, just do, make a policy. That’s five grand a year or something like that to make small, you’ll get there.
A lot of these guys are like 45, 65 years, and now they’re doing it right? Like you have the luxury of waiting.
But, yeah, that’s pretty much where I am. It’s just, I’m trying to decide what is the fastest acceleration or the fastest move. But then if like my current savings rate, I wouldn’t need to buy four homes a year, which is also not very sustainable. What I would suggest for you is maybe at least for the next six months to two years, take a strategy of both, you’re you’re in a situation where you can take risks. So people listening right now, this may not be your situation, but Andy is able to take risks. He’s single. He doesn’t have to answer anyone. He dude banks 90 grand a year. But like you can do, you can for you, I’d say maybe you can do burgers and stuff if that’s what you want to do with your time.
So I don’t want to talk to Peter, this is what kind of Peter’s doing. Taking a little bit more risk or definitely getting off at turnkey for you finding your own broker or maybe doing five to 10 grand a rehab at most, but then that opens up the next question. What is your time like?
You’re a programmer like college, your job, like you have a lot of free time or is that pity takes up all your bandwidth. I think as I progressed in my career, I’ll have less time to to multitask. Okay. So is that, is it safe to say that is your highest and best use at your day job? Yeah, most likely like I don’t yeah, I think my trajectory can still go up pretty much in my career, so I don’t think I wouldn’t be doing Burr, yeah. Okay. Okay. So that’s what separates you and a lot of people in this ecosystems. Figuring out what your highest and best use and for if, yeah, if you’re a mailman delivery guy working for ups or whatever, you go on Birch for properties, because your highest and best use is probably doing that even though it’s risky, but for you and for a lot of people in this group, it’s the opposite, right?
It’s you may not like your job, but to school, spend most of your bandwidth on that. And by turn key or decent indication, it’s that every, I think everybody has to realize what is that one thing that they do best and just focus on that.
Yeah. Talk to Peter, he would be a good contact for you. But yeah. Any other questions or anything else we can help out on? No, that was my questions for the single-family side, I guess the minor question was if I did go down doing multiple single family homes, does it matter that much that my credit score might have seven hard posts by the end of the year or within two years?
I guess not really a big deal after a while the heck, are you doing just playing with credit cards or? I, you, they’re going to roll off in a year, but yeah, basically I did that for a while. That shouldn’t matter. I think whenever you do those hard pools, it’s minus five, 10 points. Is that what you notice?
I know that’s I was doing the same thing at some point. Yeah. Yeah. It wasn’t that much in the end. I just wasn’t sure if, if I try to get an, a Fannie Mae loan to go look at my report and. Maybe as a requirement, they shouldn’t have done many hard posts in a given time. No, that sh it, so it’ll flow down to your credit score.
So that’s what the factor is. What’s your credit score now? Seven 50. Okay. I don’t talk to the blender. Ask them what is the best like credit score threshold. I think the seven 40, I don’t know, just ask them, but I think it’s seven 40 or something as the highest. Where if you go, if you drop down, say seven 25, it goes down like a quarter, it goes up a quarter point or something like that, which doesn’t matter, who cares.
If I want it to just try to maintain ramped that threshold, if possible. Yeah. Yeah. Or buy a tradeline, go on that shade line parasite that I have and say, Hey, is anybody have a big ass credit card that I can jump on as authorized user for a few months, for 200 bucks or trade with each other? Cause I had one too.
Yeah. Yeah. I think that will bump your credit score. 25 to 40 50 point. I don’t know. Let me know. I’m just guessing, but I’m sure. That would work. I’d let you onto my, I have a card that’s $30,000 credit limit. But every time I get authorized user it’s 250 bucks. So that thing is always busy for me.
Let me know if you want to be on my, a chase reserve. We can trade
chase. Doesn’t like me, or I’ll get a reflect from you. That’s true. Yeah. Yeah. Are you using that chase card as authorized user? Just one, like I have multiple chase. I’m just keeping, I’m limiting it to one. I’m only using my discover and Barclays. I think that they might, if you use the other chase cards, I think if they compromise one, they’ll kick you off the whole thing.
That’s what happens to you, right? Yeah, I think, yeah, so I may not, cause that’s my highest paying card, but. What is it? What did they give you on that one? It was like a one 75 personal. Yeah. I had one that was $325. Okay. And then my old neighbor, she had one that was like $400. It was like, I don’t even know how like $75,000 credit from like 10, 15 years ago.
That was a big one. They’re pretty strict on that now. Yeah. If you go down to if you get freaked out with that stuff, I would go as a long-term authorized user. I don’t need a credit score. I don’t care. I don’t know it. I don’t know. Yeah. Put that in the trade line, hacker group and see who bites on that.
But I wouldn’t, I don’t know if it’s even worth the $200 man, to be honest, if you’ve paying like a little bit higher percent, who cares? I wouldn’t freak out about it. That’s true. But that’s what those things are doing, when every time you get dinged, it’s goes down five, 10%, 10 points. At least that’s what I’ve noticed when I was geeking out and seeing what, how it actually impacted things.
Yeah. I know. I lost or I missed a payment. And I left one loan, went into default and my credit score dropped 40 points. So there’s a data point for you. Thanks. These four mortgages. Cause it’s my first one. I’m not used to how that’s calculated. It doesn’t show up, but it doesn’t affect my average age of credit or any other points.
That’s just my credit. Yeah. So I think it was just two or three points in the short term. Yeah, it’s a big of a deal in that case. Yeah. Yeah. That’s FICO credit score as a joke. Just playing the rules. Yeah. Yeah. But yeah, I wouldn’t worry too much about that. Keep doing the other stuff if it’s fun to you, but cool.
Yeah, that was, I guess the only thing I thought was a recent, I was thinking about. Yeah. And that’s like, when you do the syndication stuff, it doesn’t matter what your credit score is. Just have the money. Yeah. Yeah. Cool. Thanks. Yeah.
Theresa, why don’t you give people a little bit of context about yourself and then we’ll see what you did and if there’s any, anything we can help out with
no specific question, just generally the process.
Can you hear me? Okay. Sure. Context, like most folks on the call. This is my first time, venturing into something like this. I was really nervous about remote investing, even though a friend on that lane. And I have in common had talked about it before, and it was something that my friend was really familiar with.
And he invested in North Carolina, but, I was interested in real estate investing. However, I was not so keen on the idea of investing remotely. I was of the mind that. It would be really hard to invest in something outside of the state where I live sight unseen without having the, the network of people that I could meet face to face that I could trust, that weren’t just going to take me for a ride and take my money and run.
But I think lane, it was after your initial I think a webinar that I was on, I think that was the beginning of August, where I started to get more context and started to gain more understanding about how remote investing could work and how it could be effective. And after that webinar, then I got interested.
And my friend connected me with you and we had that. That chat about some of my goals and some of the next steps. And so that’s how I got connected with this, incubator course, which has been really helpful. So essentially when I came into the course, I was like, where do I sign? I really want to do this.
I’m ready to do it. I had been thinking about it probably for about, I would say over a year, maybe year and a half. But I just didn’t know how to put the pieces together. And I think I had mentioned before at the beginning of the course that hearing Chad’s story was really helpful. And just Chad, I think has a way of making people feel like, Hey, it’s not that hard, anybody can do it.
And so just. Going step-by-step through the course with everybody reading the material is getting to learn from other folks who are doing it for the first time was very valuable. And of course, lane hearing your expertise and your experience, the good, the bad, the ugly, I think was really helpful too.
I would say maybe one of the biggest challenges for me in the beginning in wanting to get a property secured was just the competitive. Climate of investing in Birmingham. And I think that’s just, it’s a hot spot for investors. And so the turnkey provider that I was working with had a really good reputation.
And because of that had a lot of folks, if you are seriously interested, some of whom are in this group. So that was a bit hard just trying not to get discouraged, even though properties got swooped up right away. And I found that just being persistent was key communicating with the turnkey provider on a regular basis with key.
Communicating with a property manager who I felt comfortable with and who I could trust in that market was really important. And looking for other avenues, if properties didn’t come up through the turnkey provider that were available to me I worked with the property manager to find out what other avenues I could pursue to find potential properties to invest in.
So that was probably really the only challenge that I had outside of that once I was able to find a property and I was familiar with the analyzer and I was able to just work through the numbers really quickly. I just had to, will myself to pull the trigger. If the numbers looked good on a high level and I knew that, the home inspection was still coming up and that there were ways that I could, essentially changed my mind if I didn’t feel good about the property, once everything was vetted, that I could walk away.
Without a ton of risk. So I pulled the trigger and after that, actually everything seems relatively simple. Once the turnkey provider and the property manager, I had their contacts and they would give me other contacts for, inspectors and just everybody on their respective teams.
And so going with the people that were in their trusted network, helped me feel more comfortable with the process, and the closing and everything else was thankfully super smooth. I imagine that it’s not that way every time, but it was really smooth for my first experience. And so I closed the beginning of, I think it was December 1st, actually around there.
And and just got set up with the property management team and got my account set up. And so now just waiting for the first rent check and yeah. So overall it’s been pretty good. Cool. So your profile is a little unique, I think within this group you’re like that person who’s never played golf before, and then it shows up for a free 30 minute session and is already to go golfing for the first time tomorrow.
Not tomorrow. I think most people that come into this group, they struggle on their S their own. And they realize some of the landmines that are out there. And that’s what paralyzes people too, and makes this process take more than a few months, makes them take six years to a year.
That said you came in with none of those notions. So you’re the, you gotta be careful that. Just moving forward that just to not step on the landmines, because they are out there. What I would suggest is find the other people that are in your market, out of this group. And if you have two or three of them, you’re good.
Don’t worry about it. But stay close to those few people, exchange contacts, and then make sure you guys sync up. Maybe. I don’t know if you guys want to do a group thing, that’s always hard to coordinate with everybody’s adult schedules, but make it a point personally, to reach out to one of those persons every six to nine months and just go round Robin on amongst the three and just, they the goals would be all right.
How is your property manager? What repairs came up? What did you do? And, just just keep abreast of that type of stuff. Specifically so that when it happens to you and it will happen, you’ve got somebody to call or you already know what the action plan is
from this point. It’s pretty smooth sailing, right? And no, I do have to say a special thanks to Andy and Terry, who both invested in them Birmingham around the same time, all got our properties secured at the same time. And it was really helpful because we definitely, I would message them back and forth and, just pepper them with questions and ask if this is normal.
And just knowing that other folks had gone through it and it turned out okay. Was reassuring. Thanks guys. Cause I think had I not had that, I would be definitely more hesitant, and feeling like, Oh, I’m not getting respond. Should I be worried? Maybe something’s going on. And I don’t know about it.
I might’ve been a little bit more paranoid. But just hearing, Oh, that’s par for the course. I went through that too. It might take a little bit longer. That was reassuring. Yeah, your network is your net worth, right? And you naturally found this out, that you have to find other people that are doing the same thing around you.
So if you guys haven’t found that peer group of people in your own market, you guys need to do that because it makes things so much more easier unless you guys like to do it the hard way you guys can do whatever you want. But I think this is the super easy way of. Staying abreast of what the heck is happening and who are the people you’re working with just to spot check them.
What was one thing that you thought initially was a problem that you, or like a surprise or something going through the process? Just so maybe somebody else runs into that to your
surprise. I would say, you know what I mentioned earlier, I didn’t realize how competitive it was going to be to try to secure some of those properties. And so that was a bit hard, cause it was like you in some cases had to. Review and analyze the property in a matter of minutes and feel comfortable pulling the trigger and saying, okay, this is a deal that I want to go in on.
I didn’t realize that I thought that I would have more time to analyze maybe at least a couple of days. So that was surprising to me. The only other sort of thing that I didn’t expect was that how long it took. Once I closed on the property to get set up with the property management team, even though we had been corresponding regularly the whole way through, and I had developed a level of trust, I think the account management side of the property management company Took a little longer than expected.
And so I got a little bit nervous about that, but things are squared away now. And I, you mentioned this on a previous meeting that on a previous call that we had, but just my personal experience and listening to some of the other women that are in this investor group in this incubator it seemed like we were up against a lot of the same problems.
And so whether or not it was just perception or if it’s reality, I’m not sure, but I had mentioned that. It seems like maybe for the ladies out there that it could be that, there are some, unintended biases out there, maybe in this business where maybe women who are trying to invest in real estate, maybe aren’t taken as seriously.
Because I know that folks in the beginning, like myself struggled with getting getting them property that seemed appropriate. I know Jessica is killing it though. I’m seeing her post on Facebook but I think it was a little bit rough going in the beginning just to get established with folks that we felt like we had a good relationship with that we could trust that we could be taken seriously with.
That’s all I can think of. So going forward, maybe one thing I can see happening is okay. In the beginning, you’re getting the sales pitch to jump on board on the property management team or the broker, the broker has gone at this point, right? The person you bought the property from, you’ll never hear from yeah, in a way.
They could be a resource for another property management company or potentially live and, but consider that relationship gone, they sold the property. They’re off to the next client, the property manager. That’s the person you’re interacting with more, but let’s talk about what’s the cadence of interaction with them.
If you’re collecting your rent checks nothing’s happening. I don’t think you should be talking to them at all. If anybody here thinks otherwise let’s talk about it. But if there’s something that breaks like $150, $200 repair, you should be approving it via email. But you may never talk to anybody on the phone to do something like that.
I just, I guess what I’m trying to paint is it’s not going to be like, kumbaya, get on the phone and let’s see how things are going right. Every quarter. I don’t think that is, necessary. So I guess what was your vision of. Cadence and interacting with the property manager. What would you like to see happen and see if it’s realistic?
Oh, yeah, no, I think that it was just a matter of getting my account set up, making sure that I was going to get the money into my account for the rent. So I’m just talking about a month timeframe from when I close to them, obtaining the key use the security deposit being transferred over, making sure that I was set up so that I could receive some money in my account.
So I haven’t. Actually received the first month’s rent yet. So it remains to be seen, but I would agree with you. I don’t think that constant interaction is necessary with property management company, as long as things seem to be going smoothly. Just I think the initial process of, there didn’t seem to be any sort of urgency around making sure that I was set up in the system prior to, First month owner distribution.
And so that made me a little bit worried. But again, I think that if we have the holidays and people are out sick and so I think those were all factors that contributed. Yeah. Yeah. You’ll get set up with that first month’s payment. I would just plug them via email every week on that.
But once you get going, maybe set up something at least a reminder for yourself to just at least. Talk to somebody on the phone at least once a month, a year, preferably when something is going on, as opposed to just out of the blue sky, just randomly check in and say, hello, nobody really likes that.
In my opinion, probably matched are super busy, but just to stay top of mind. So they know your name potentially. Sometimes it is nice to drop in when something is not right. Terribly wrong. So you’re not the pissed off person that they think of all the time. But there’s, you want to be the squeaky wheel.
You don’t want to be the pain in the ass person at the same time. You don’t want to be the person who’s totally oblivious to what’s happening. And they feel like not, they don’t, they can just run one, one quote, On some repair because they know Theresa is the one that just is drinking pina coladas in Hawaii and just screw it off.
It doesn’t even care. It has so much money. Anyway, it doesn’t matter. There’s a immediate ground. I think you want to play as a whole.
What do you go from here? What’s your next move? What’s what are you working on them?
I’m open to investing in more single family homes. I think that you had advised us to not move too quickly because there is some danger in that as well. So I was thinking maybe three months was a good timeframe, to just learn the process and see how it goes. But also very interested in the syndication deals that I’ve been seeing that has been coming up that Cambridge Cambridge is a Houston deal.
So just learning as much as I can about that. I watched the webinar that you had on that, and wanting to learn more about syndication in general, to understand how to better analyze those deals. And think I will probably sign up for your news syndication e-course will be one of my next moves and then participating in the mastermind group.
That’s coming up later this month. Yeah. Okay. And you guys are able to buy the e-course this indication e-course and then when you guys jump into a deal, we refund that for you guys to, Oh, nice. Okay. And then I, yeah, because you guys are incubator clients, you guys have the ability to, when you refer a friend, I’m just reading it from the bottom of the page, refer a friend and they join.
The club and they have an onboarding call with me. You both get the syndication e-course for free or the remote rental e-course so it’s a way of kind of sharing it with, I know you guys have friends and you guys don’t want to waste your time, teaching them all this stuff, because most times people never do anything.
Everybody talks big, but nobody ever does anything. So don’t waste your time. Just give them the, I-Corps see if they get past page one, but that’s the system we have in place for you guys. But yeah, I think what a lot of people will do is as they’re transitioning they’ll be looking for syndications and they will also be looking for their turnkeys.
As you’ve seen turkeys come. Are pretty infrequent, right? I think you’ve got lucky there. You didn’t wait too long, but some people can wait three, four months and be forced to finally pick something after their cash reserves pile up so he can do both. And why not? Right pitch.
Eventually people just go over to this location side. But maybe at this point you start to find your own broker. Because you know what these things are and you know how to no, you know what the tenant profile is, what they want. So you wean yourself off turnkey as the next step for a lot of you guys,
but anything else.
No, it was just thank you for for the course and for the guidance and thank you to everybody on the, in the group. It’s been super helpful. One last thing here for you, Birmingham people, I have, you guys will need an HVAC. At some point, somebody will steal a ladder or a break. The property management has.
Guys, but they’ll usually upcharge it by 10, 20% I’m guessing. But I got this guy, Leon, here’s his contact information there. I’ll give him a call. I think he just, I either Venmo, Tam or PayPal at hand, and he’s cool. And this is where you have your network of people who use guys like this, but.
The HVAC is the largest repair you’re going to have to do where it’s really simple. It’s a it’s not like a rule. It’s not like a big electrician thing, but if, just having guys like that for HVAC, the biggest repair you’re going to do is key. Everything else, the property manager should be able to take care of.
And if you’re getting upcharge 10, 20%, which I think is very customary, it shouldn’t break the bank, but the HVAC is the big one.