Let's Talk About The Benjamin's Podcast

Podcast Episode 23 Pay off & Avoid Student Loans I had the pleasure of speaking to Dave Nash CFP, CFA owner of Magister Wealth. David and I spoke about more advanced financial planning topics including but not limited to target date funds and the state of the economy. Target date funds are a good simple DIY financial planning tool. They aren't a comprehensive end all be all type of investment. The rate of return for target date funds can be less than more sophisticated investment plans. The reason for this is because these simple plans don't reflect what's going on in the market. If you rebalance or tactically allocate your portfolio you can adjust for higher or lower rates of return in the market. A great example of this that David addressed is that the current interest rate for Bonds is incredibly low. This could lead to your investment portfolio having significantly lower returns by as much as 2%. This may not seem very meaningful but you have to consider that this could lead to a reduction in your end retirement portfolio by hundreds of thousands of dollars! The rate of return on your investments can be just as impactful as the rate of return on debt that you owe. To do a simple calculation to find out how long it takes to double your investment divide 72 by the rate of return. The really impactful thing for most people is how this impacts people paying debts. If you don't pay your 7% interest debt the balance will double in 10 years. If you don't pay your 21% interest credit card debt it will double in 3.4 years. This really shows the impact of not paying off your debts. When you are investing for your financial future you should consider what your current tax rate. A good way to conduct your financial investment plan is to try to smooth out your tax rates for your life. So on average you should have the same rate of tax return throughout your life. The way you can do this is by increasing your investments in your 401k, 403b, and ira/roth ira. If you have a low tax year or a low income year you can lower your overall taxes by doing a roth conversion. I'll include a link to an article by Vanguard where you can read about the roth IRA conversion here. Target date funds do represent a better alternative than not investing or saving for retirement. There is little financial planners can do for individuals if they don't invest. It is like not exercising and eating donuts every day for 15 years. The problem with our financial mistakes that they aren't as easily seen as poor health disciplines. If you gain 50 – 100lb of fat in two years people will be able to see it easily. If you rack up 20k in credit card debt no one will know, because they cannot see it. The current state of the economy within the United States is effected  by the large amount of government spending in 2021. Many people are beginning to feel the effects of printing large amounts of money in a limited time. Also there is a growing debt load that is enormous which the US has to pay back. The only way to effectively pay this back is through taxes the governments main revenue source. To be able to pay this debt off the United States will have to go through a large technology that disrupts major industries. If you want to learn more about planning for your financial future and David Nash, CFP & CFA approach on investing go to Magister Wealth. Please note the disclaimer below: THIS IS GENERAL FINANCIAL ADVICE THAT MAY NOT APPLY TO YOU. PLEASE CONSULT WITH YOUR TAX, LEGAL, INSURANCE OR FINANCIAL PLANNING REPRESENTATIVE BEFORE MAKING ANY CHANGES.

I had the pleasure of speaking to Andrew Pentiss a senior writer for Student Loan Hero. Andrew and I spoke about how to pay off and avoid student loans. Part of the problem is the poor education on student loan borrowing for college. I remember when I went to college there wasn’t a discussion with the financial aid office about how to pay off my student loans. Instead the only conversation was how to finance and pay for my education. Also the cost of education is increasing over time. I read an article that has shown a ten fold increase in the last decade. Part of this increase has been to pay for the additional cost of administrative staff instead of paying for teaching or research staff. There has been an increase in the amount of adjunct staff. This has lead to an increase in the profitability of the college business model. It’s important for you to look at the cost of education before you get into it. There are a few alternatives to returning to college or going to college in the first place. You could go into an apprenticeship in a skilled trade for instance. According to the bureau of labor statistics  Bureau of Labor Statistics electricians make $56,180 per year on average. There are also tech boot camps which allow you to be able to pick up the skills that you need to be hired as a web designer, programmer or a graphic designer. These types of jobs can have starting salaries of $60,000+. There are several different types of payoff methods for student loans. The method that is popularized by Dave Ramsey is the Debt Snow Ball Method. The point of the debt snowball method is to list all of your debts smallest to largest and then pay off the smallest then to work on the next largest. After doing this you will be able to slowly and steadily increase the amount of debt you are paying off. The debt avalanche method is a different method for paying off your student loans and other debts. With the debt avalanche method you list your debts in order of highest interest to lowest interest. Then you begin to pay off your debts with the highest interest first. There are also a couple of different types of forgiveness programs for student loans. If you work at a non profit for 10 years and make consecutive payments then you can have some of your student loans forgiven. For more specifics on this you can go to the link here Student Aid. The other type of loan forgiveness is public loan forgiveness for a particular type of profession. Student loan hero provides excellent examples of student loan forgiveness like this one for attorneys. One of the most underrated forms of repayment is to repay it while you’re attending college. Even $50 a week can be hugely impactful. If you took out $10,000 in student loans at 6.2% accruing interest in 4 years you would have $46,596.46 owed by the time you graduated. If you paid $50 a week each week over those 4 years your total owed would be $40,892.57. The difference owed would be $5,703.89 in savings in interest. The best ways to avoid student loans are tried true and probably beaten to death. Apply for all of the financial aid that you can. If you’re not in college currently try to save as much as you can even if it’s just with a part time job. If you want to learn more about avoiding student loans or how to pay them off you can go to  Student Loan Hero.  

I had the pleasure of speaking to Tess Downing CFP, founder of Complete View Financial. Tess has been a financial planner for 13 years. Tess and I spoke about how to get started investing as a new employee. There are several recommendations that Tess Made to get started with investing. The first thing that you have to look at is where are you financially. Take a look at the sample budget below to determine how you much money that you have to save. Monthly : Paycheck Deposits Less Debt Payments (Credit Card, Student Loan,  Mortgage, Auto Loan, etc.) Less Rent Less Groceries                                 Money Left over to Invest That is a very simplified budget and I recommend using something like that to determine how much you can save. The next step is to look at the different types of financial goals that you can have based on the timing of those goals. Typically most goals are broken down into three categories: short term, midterm and long term. Examples of a short term goal are building up a savings account buffer. A medium goal example is to save up for a down payment on a house. A long term goal is to save for retirement. The general rule of thumb is to save 10% of your net income and 15% of your gross income for retirement. Remember those numbers are the minimum that you have to save! Some general advice to simplify your finances and automate the savings process. This is very easy with todays computer world. All you have to do is to tell your human resources department and then you will be able to start having your funds automatically deducted from your wages. By doing this you should be able to get your employer’s retirement plan match. The impact of obtaining this match can be huge. At workplaces that I have worked at in the past they have matched 50% on the first 10% that you contribute. This means that if you contribute 10% then receive the 50% match they will give you 5% as your employer match. That can be hugely impactful because it will allow you the ability to meet your 15% savings rate goal by just contributing 10%. If you cannot contribute the full 10-15% now don’t worry you should be able to get annual raises that will allow you to be able to increase your savings rate. If you get a cost of living adjustment or raise of 2% a year that can be funneled into your retirement plan contribution to be able to meet your investing goal. Over the years the investments that have been placed inside of a retirement plan have changed. Over time the options have moved towards simplification restricting the number of investments that are in a plan. Typically there will be several target date funds some bond, stock and REIT funds. This simplification is because most employees ended up investing in Target Date Funds instead. The reason for this is because of the simplicity of the investment. By investing in a target date fund the fund will pick risky investments at first to  be able to get higher returns. As you get closer to retirement the investments get less risky and the returns will be lower. Typically this means a move from stocks/reits to more bonds as you get closer to retiring. The one thing that most people don’t really look at is the fees on their plan. The effect of a high fee on your investment can be hugely impactful. I am going to do a simple calculation to show the effect of fees on investment return. For this example I am going to assume a 25 year old invests 15% of their gross pay earning $40,000 per year till they are 65 at an 8% rate of return. If they 25 year old does all of that then they will have $1.75 million in retirement savings. If there is a 1% fee on that rate of return then will end up with $1.31 million. That means a 1% fee would cost you $400,000 in retirement savings. To make up for that difference in fees the 25 year old would have to be saving at least 20% of their pay. That is an additional 5% of gross pay just to get the same result because of the higher fee. Another recommendation that Tess mentioned is to not to wait to start saving, do soon as soon as possible. If you don’t your future could be quite bleak, when everyone else is off to the golf course or moving to Florida to enjoy the sun you’ll still be working. Work will be mandatory for you at this point and instead of being able to help your loved ones you’ll be a burden to them. As you age your health will continue to decline and you will be unable to work as well as you could have when you were younger. Even if you just wait ten years you the impact could be huge. If you wait to start saving until you’re 35 versus 25 you’ll have to save an additional 10% of gross pay or income to be able to have the same type of retirement versus when you started. That means you will have to save 25% of your gross income to be able to achieve financial independence at 65! If you want to learn more about starting to invest you can reach out to Tess Downing go to Complete View Financial Please note the disclaimer below: THIS IS GENERAL FINANCIAL ADVICE THAT MAY NOT APPLY TO YOU. PLEASE CONSULT WITH YOUR TAX, LEGAL, INSURANCE OR FINANCIAL PLANNING REPRESENTATIVE BEFORE MAKING ANY CHANGES.    

I had the pleasure of speaking to Sharon Koifman, founder of Distant Job about obtaining a retaining a remote job. Before I go into an in depth discussion about obtaining a remote job I would like to talk about Sharon. Sharon’s company is a remote recruiting company for technology firms in North America.  Sharon has written the best seller called "Survive Remote Work". If you are currently working at a job there are many companies that are starting to offer remote work due to the corona virus. If your company does offer this benefit then you should focus on becoming more valuable to your firm. The way to do this is by developing a specialized skill set. Take the time to self-educate or study to become better at a skill set.  If your company doesn’t offer the ability to work remotely you should focus on becoming specialized in a particular skill set. If your company doesn’t offer the ability to be ability to work remotely then you should look at applying to another company. The types of positions that offer remote work are tech, marketing and admin positions. Only a few accounting positions are being added remotely because of the slow integration of technology in this industry. In the accounting industry a lot of the work that requires an accountant to be on site can be resolved by simply having someone scan and upload documents to the cloud. Now that the types of industries/jobs that are available remotely let’s discuss other aspects of remote work. If you are applying to a local company to work remotely you should be able to command a comparable salary to an in the office position. When applying or working for a remote job dress appropriately. Every day cannot be casual Friday! Invest some of your own money or the money provided by a company as a stipend into getting good technology and equipment. A great example of this is buying a walking treadmill. This could be expensive but if you’re going to be working remotely for a long period of time investing in your home office could pay dividends. Another thing that you could invest in is VR Goggles like the Oculus Quest 2. You can create a great workout with this technology investment.  When Sharon said to set up your home office he said a great quote that I will include below.             “Try to get the experience you have physical, the connection between one person as if they set in front of you on zoom.” When preparing for a remote interview there are several things that you should to prepare yourself. Make sure that you dress as nicely as you would for a regular job interview. Sharon has said that a lot of candidates will dress in a casual fashion just because the interview is remote. Another important point is to be punctual. Show up 10 to 15 minutes early for your interview. When you are preparing for a remote interview check your internet connection and technology beforehand. Have a practice “interview” wit one of your friends and make sure that you sound and look great. Also check for dead zones in where ever you are going to do the interview. You don’t want to go to your interview and drop off the “call” for five minutes due to poor connectivity. There are two questions that you are going to have to answer if you are going to work remotely. The first question from any employer is why should I let you work remotely? I would stress identifying that you will be more productive and provide concrete examples of out performance versus other potential employees. The second question you will be why should I hire you? You should emphasize the skills and expertise that you have to differentiate yourself from the other applicants. The one thing that I discussed with Sharon that was particularly impactful to me was to focus on your social experience while working remotely. You can do this by focusing on booking a social experience with your coworkers/friends. One of the things that you could do before the corona virus was to grab a cup of coffee with a friend. Now that the corona virus is here you can go for a walk with your coworkers/friends. This is one of the most important things that you should focus on if you’re working remotely. If you want to learn more about obtaining a remote job you can find out more at Sharon’s website.      

I had the pleasure of speaking to Jonathan VanSchaack a senior Security Engineer at a non for profit. During the course of his career Jonathan has built several businesses from the ground up. Jonathan has been networking for over a decade to build these businesses and his network.   Jonathan identified several different methods of networking during a downturn. Start with looking at your personal network. Look at where you work currently, have worked in the past and know outside of your workplace. If you have a job currently and take one person from your workplace out to lunch every week for a year that’s 50 new people in your network that you didn’t know. Also it will really deepen the relationships that you have in your current workplace. Another option that you can have to network is to join after hour party’s with your workplace or other groups you are a member of. Conferences are a great option for you to attend as well because you can meet people you wouldn’t otherwise. Also you could travel and see something that you might not otherwise. This will be limited by your ability to network currently during the corona virus but you can get around this by buying your coworker lunch and have a zoom meeting to talk. One of the big opportunities to be able to grow your network currently is through the use of technology. It’s hard to give someone corona virus through a zoom chat. Try using digital tools like Linkedin to start building a new relationship digitally. Also there are other websites like meetup that you can search for “local” networking events to be able to interact with people. Another option that you have at your fingertips is to reach out to classic networking groups like your local Chamber of Commerce and see what they have digitally.  You can also reach out to a few other things like discord groups, online forums, Facebook groups, etc. There are some major drawbacks to networking digitally. The first major drawback is that you have to have the technology to be able to network digitally. If you don’t have a good internet connection, good audio set up and computer I would reconsider it. You want to make a good impact on someone when you are first meeting them. If this is your first time meeting someone then it’s important to make a good impression. The second drawback of networking digitally is that you cannot know the person as well as you would if you talked to them face to face. One of the important things that you can do right now is focusing on maintaining your network. You can make sure that you are meeting all the needs oft the people in your network that may need you. One of the books that Jonathan mentioned was  Give and Take by Adam Grant PhD. If you focus on helping others during the time when they may need you it will really help your network in the long term. Everyone has had a time when they needed assistance with something and it can be extremely impactful for you to help them during this time. When networking  instead of focusing on growing a list of professional contacts grow relationships. It’s important to keep track with your network. Make a list of your contacts and then over the course of the year contact them at least once or more. If you don’t schedule the time then nothing will change.    

I had the pleasure of speaking to James Furlo, founder of Furlo Family Homes. James began his real estate investment journey when he was a child. He told his mother that he was interested in investing in Real Estate. Over time he went to College and left California to move to Oregon. He got a job out of college in the tech sector and was able to save up some money to buy a home. Many people in his position would have just bought a home but James was intentional in the fact that he wanted to buy a an investment property first. He had this talk with his wife and they went out and bought their first investment property. James bought his property and began interviewing prospective tenants. He was going through the interview process for his tenant and he knew the tenant wouldn’t be a good tenant. His initial gut reaction was to say no but the tenant was able to convince him that he would be able to get a job soon. The job that the tenant was expecting to get never came. James’ tenant said he wouldn’t smoke inside apparently the garage wasn’t inside. The tenant kept being behind on rent until they got a massive tax refund. This was the moment when something changed within James where he realized that he had to be tougher on his tenants. After this realization James laid the law down on his tenants after this that tenant was gone within 30 days of him telling him that he would have to pay on time. There are two important things to note about this James had read a lot of real estate investment books prior to buying this property. He had an idea what he was doing but doing it was different. Also the other point to pay attention to is that James could have just quit after this set back with this tenant. Now years later after this first “horror” tenant he likes being a land lord. He went on to buy more properties after this and used this as a learning opportunity for him to grow. James was able to continue to buy properties every other year by saving a large portion of his and his wife’s paycheck. By living frugally they were able to continuously grow there property empire. Doing these small things over several years allowed James and his wife to transition out of full time work into self-employment. If you want to find out more about James real estate investing business go to http://furlo.com/. I had the pleasure of speaking to James Furlo, founder of Furlo Family Homes. James began his real estate investment journey when he was a child. He told his mother that he was interested in investing in Real Estate. Over time he went to College and left California to move to Oregon. He got a job out of college in the tech sector and was able to save up some money to buy a home. Many people in his position would have just bought a home but James was intentional in the fact that he wanted to buy a an investment property first. He had this talk with his wife and they went out and bought their first investment property. James bought his property and began interviewing prospective tenants. He was going through the interview process for his tenant and he knew the tenant wouldn’t be a good tenant. His initial gut reaction was to say no but the tenant was able to convince him that he would be able to get a job soon. The job that the tenant was expecting to get never came. James’ tenant said he wouldn’t smoke inside apparently the garage wasn’t inside. The tenant kept being behind on rent until they got a massive tax refund. This was the moment when something changed within James where he realized that he had to be tougher on his tenants. After this realization James laid the law down on his tenants after this that tenant was gone within 30 days of him telling him that he would have to pay on time. There are two important things to note about this James had read a lot of real estate investment books prior to buying this property. He had an idea what he was doing but doing it was different. Also the other point to pay attention to is that James could have just quit after this set back with this tenant. Now years later after this first “horror” tenant he likes being a land lord. He went on to buy more properties after this and used this as a learning opportunity for him to grow. James was able to continue to buy properties every other year by saving a large portion of his and his wife’s paycheck. By living frugally they were able to continuously grow there property empire. Doing these small things over several years allowed James and his wife to transition out of full time work into self-employment. If you want to find out more about James real estate investing business go here.

I had the pleasure of speaking to Kevin Ha, founder of Financial Panther about using gig apps. Before I go into an in depth discussion about the gig apps I want to discuss why Kevin calls his blog Financial Panther. The name financial panther comes from an episode of the Simpsons where Marge told Homer that they should see a Financial Planner. Homer, being homer heard that they should have a financial panther. On Kevin’s Blog he uses the urban dictionary definition of financial panther.  “A large jungle cat that can be trained to maul a person’s creditors and bill-collectors if that person is short on money.” During the course of the interview I spoke to Kevin about using Gig economy apps to be able to monetize your life. Things like a blog or a freelance business take time to develop but you can use these gig economy apps to be able to earn money today. Delivering food on grub hub or door dash can make you some money today, flip the app on and your in business. Also if you use a bike to get from the pick up point to the delivery point you can get some exercise in as will as a side benefit. On his blog Kevin has said that he makes $40-$50/hour doing food deliveries during peak times by running multiple apps at once. In February 2020 alone Kevin made more than $1,000 doing gig economy apps, check the link here for the full blog post. In every families budget a large expense is housing costs. To be able to combat expense this you can do house hacking like I mentioned in a previous episode or you could use Airbnb. Airbnb allows you to focus on renting out your entire or a part of your house to someone else for  a short term stay. The app allows you a great deal more flexibility more than what is typically available in a long term lease. If you have commitment issues then this is for you! You don’t have to worry about having a tenant in your house forever instead it could be a day and you can try it. The amount that a landlord will make is usually higher on a daily basis using AirBNB versus a long term rental. There are some reasons to justify this increase in income, the cost to clean and prep the unit for a new tenant will be higher because there is more tenant turnover in short term rentals. Also you may have extended vacancies in your Airbnb property as well. If you like to walk you can use the Wag app to make some money for a lunch time stroll with a dog. This could be a great opportunity for you if you are an animal lover. In my area there is a lot of competition for this, which drives down the availability of times someone may want you to walk your dog. Also if you’re doing this on your lunch start with shorter walks to be able to make sure you can make it back to your desk in time just in case things take a little longer than expected. The one thing that Kevin discusses that is near and dear to my heart is food. He uses  secret shopper jobs to be able to get free food at restaurants. This will not earn you any money per se but you will be able to save some money by going out to eat for free. I am going to include a link to Kevin’s blog article where he writes about how to secret shop for free here here. The one thing I am going to say about this Is that if you’re considering to do secret shopping be careful because of the corona virus. If you want to find out more about monetizing your life with gig apps then you can reach out to Kevin Ha at the Financial Panther Blog.        

I had the pleasure of speaking to Maria Erickson, founder of Freedom Financial & Business Planning, LLC. Maria transitioned into Financial Planning after working as a consultant in the financial planning industry for 20 years. The main areas that we covered during the course of the interview were what to do with your money right now, what to do if you are thinking about moving, and who to talk to about the current financial state of things. Now what should you do with your money right now? Maria identified that one of the most important things that you can do right now is to build an emergency fund. Try to save three to six months worth of expenses to be able to give you enough money to secure your future if something should happen. If you have a three to six month emergency fund then you will be able to have a great deal of peace of mind because if something should happen you should be fine. The rule of thumb for an emergency fund is if you are an entreprener or have a “risky” job then move towards the six month savings fund. If you have a “safe” secure job then like the government you can go with three months of savings. Personally I prefer a more conservative approach and go with the six month emergency fund because things happen and it gives me a greater peace of mind. Once you get past the point where you have an emergency fund you should start to consider investing your extra funds. Right now there are opportunities available because things become cheaper during an economic down turn. It isn’t a good time to sell your investments because you are watching them go down and down in value. It is easy to follow herd logic and feel pressured to sell your investments because some people you know will be doing this. Selling this at this time could cause you to have to work extra years to make up for this poor decision. Instead you might be better off burying your head in the sand and ignoring the financial news for the next 12 to 24 months. Sometimes it’s better to turn off the news channel and not be influenced by the negative news and feel pressured to sell. Now what should you do if you are thinking about moving? You should line up a job before you move or have some type of income prior to moving. Moving to an area suffering from an economic recession can be very hard. Many employers might not be maintaining employment because their revenues are down. Some people will be kissing there jobs goodbye because of this recession. If you have a home to sell prior to moving it may be more difficult to sell it because of the Corona Virus. Having people come to your house and look at it might be more difficult because of social distancing and other things. Now who should you talk to about the current financial state of things? You may be experiencing your first economic down turn while you are investing. You should reach out to someone that you trust and feel is knowledgeable about investing. It could be an older uncle or relative that has experienced some of these things. If you don’t have a strong background in personal finance then you might want to contact a fee only financial planner. They will be able to provide you with some assistance in dealing with the emotional turmoil that a recession may cause. Regardless of whatever else you take away if you have someone that you can talk to about the things that you are going on in your life then you will feel calmer about the decisions that you are making. If you want to find out more about freelancing and copywriting then you can reach out to Maria Erickson, CFP  here.    

I had the pleasure of speaking to Dan Furman, founder of Clear Writing. Dan fell into the world of copywriting after losing his job and trying out a few different freelance options. He discovered his skill and ability as a copywriter in a very fortuitous time in the early 2000’s when there was little competition. Dan and I spoke about the pros and cons of being a freelancer. There are many pros to being a freelancer. You can make way more money than you could at your day job. You have the flexibility to charge whatever you want and to make whatever you can get paid. What will gradually happen over time is that as you become more established you’ll be able to be more selective in the type of work that you do. There is more flexibility than at a traditional 9-5 job. Dan mentioned the ability to go get your oil changed at 3:00pm on a weekday afternoon. You have a great deal of scheduling flexibility so if you’re a morning person who wakes up at 3:00am then you can get your work done and be off at 11:00am. The freedom to choose who you work with to a certain extent. After you have become established you can choose who your clients and can choose not to work with the ones that you like and fire the ones that they don’t. Most people who have had a boss or a coworker that they don’t like dealing with, imagine being able to fire that person whenever you wanted. The cons to being a freelancer are listed below. You’ll have to self fund your own retirement plan because you don’t have retirement plan contributions coming in from your employer. This could be a huge deal especially if you are working for a government employer or a large corporation because they could offer huge retirement incentives to work for them. If you are working for yourself entirely then you’ll have to come up with the funds yourself. The whole idea of going all in on something like this is the ability to make a lot more and save a lot more. You have to cover your own medical expenses, if you reside in a country with national health coverage like Canada you can ignore this. This can be a huge expense upwards of $20,000 for a family plan that may have been purchased on the market place. If your spouse is working with a regular employer getting on their health insurance could save you a figurative arm and a leg in financial cost. You can go through dry spells where there are no clients coming into the door. This can be a huge problem because you might not have any cash coming in for a little while. This can also be remedied by having some regular clients that you do work for by using a more discounted rate to ensure that you can eat something other than Alpo. You could feel very isolated if it’s just you working at home all day. There could be days where you don’t see another human being all day. Dan put his mail box for his company at the post office, which makes him go out and see other people. If you are used to being in an office all day with other people on your team this could be hugely isolating. Honestly if you feel the need for a social outlet it might be beneficial to get a part time job to give you someone to socialize with and combat the cash flow problems of working as a freelancer. These are just a few of the pros and cons of being a freelancer that Dan and I discussed about being a freelancer. Like a new car though I’d recommend trying before buying into going all in on being a freelancer. Dip your toe in the freelance water and work on this part time and on the side to see if this is right for you. This could stay as a part time gig for you for the long term just to make a few extra bucks or it could be something that fits you perfectly. If you give it a year or two and do it for 5-15 hours a week then this should give you enough time and cash flow to take it full time if you want to. If you want to find out more about freelancing and copywriting then you can reach out to Dan Furman at Clear Writing.        

I had the pleasure of speaking to Abhijeet Vijaivargia, Founder of Global Lancers. Abhijeet and I spoke about a variety of things during the interview. We discussed how he started Global Lancers, the importance of team building and focusing on your core competencies. Abhijeet started freelancing while in College and that led to him forming Global Lancers while still in college. Global Lancers was started as a partnership with someone that he knew while he was in college. After Abhijeet left college he started to work on Global Lancers full time. When Abhijeet was originally working on Global Lancers he identified the area of his business where he had the most competency or skill. Abhijeet was able to identify that his greatest strength lied with networking and communicating with different individuals. That was the role that he ended up filling when he was founding Global Lancers, while his partner filled in other areas.  In every business that someone forms there is going to be some part of the business that the owner or founder is exceptional at. I am an accountant in my full time job so I would be exceptional at running the numbers or determining how much things cost, like this podcast. I would be extremely weak or incompetent in other areas of operating a business. A perfect example of this is copy writing or writing sales copy I can learn how to do it and be competent after a significant amount of time. When I am saying a significant amount of time I mean 20 hours enough time to be able to be “competent” in this skill. I am using the time period of 20-40 hours because of a TedX interview that I watched said it would only take 20 hours, you can find the link here. By being competent at a skill you are able to do it as well someone that has been just been hired and has no direct experience related to that skill set. There is no way that someone who has just become competent could achieve the same level of skill that people with 10,000+ hours of experience. The person with 10,000+ hours of experience has achieved expertise in this type of skill as long as they have worked to continually improve their skill set. This is another trap that many new business owners fall into when they try to do everything instead of being excellent at one thing. This can lead to burn out by the business owner because of a new business owner trying to do everything. If there is enough money to be able to afford to hire or bring on board someone with different expertise than you it’s recommended to do so. If you don’t have a variety of people in your network or team then you will be limited onto how large you can build your business. Another reason that businesses fail are due to focusing outside of the core functions of the business. The easiest way for me to think of this is what is the minimum amount of activity that you need to be able to make a sale. It’s easy to focus on non-essential activities which don’t contribute to selling or making any money in your business. It’s easy to get bogged down in non essential activities like building a website. The example that Abhijeet used was a café. The core activities of the business are 1.) taking the customer’s order, 2.) making the coffee and 3.) receiving the money from the customer. This is the minimum amount of activities that are needed to make a sale in the café. Other activities like building a website, advertising online, looking for a bigger area to sell more coffee are non-essential activities. The majority of a new business owners time should be spent on essential activities to be able to get the business off the ground. If you want to find out more about building a team or freelancing  then you can reach out to Abhijeet Vijaivargia here.  

I had the pleasure of speaking to Nicki Krawczyk. Nikki has extensive experience as a copywriter with 15 years of professional years of experience as a copywriter. Nikki worked for prestigious brands like Reebok, Keurig, etc. Copywriting is a way to be able to market using the written word, a good example many people are familiar with is Mad Men. There are many other great examples of copywriting in every day life. Everyone receives them in the mail as a form of advertisement. Copywriting isn’t solely limited to what is printed, there is a huge and growing demand for copywriters online. Copywriting is important because it allows you to be able to increase the amount of sales that you can make as a business owner. Also it allows you to differentiate yourself versus the competition by increasing interest in what you are selling. During the conversation that I had with Nicki we discussed the importance of copywriting and when you should transition out of being your own copywriter. As a business owner when you initially start out your budget will be small and you won’t be able to afford to spend money hiring or outsourcing some copywriting jobs. You can learn how to do this quickly with websites like Nicki’s filthy rich writer. Eventually you’ll become so busy that you will be constrained by the amount of time that you are working. When you reach this point you should start to outsource some of the work to a professional copywriter. The cost that you pay initially should provide much greater return than what you initially spent. If you want to find out more about copywriting or more about Nicki Krawczyk then you can go to filthyrichwriter.com.

I had the pleasure of speaking to Fred Rewey. Fred has extensive experience with investing in real estate notes. His story is that of a rags to riches story so to speak going to when he used to live in an apartment in California and had no money till now when he and his wife have their own note business. Fred got his start in the note business by obtaining a mentor. His mentor taught him the fundamentals of note investing and provided him the information that he needed to get started. One of the advantages that many people have today versus when Fred started is the easy access to information. This is ease of access for information is a two edged sword because it can provide to much information versus not as much before. It is completely possible to obtain an excellent understanding of the real estate note investment industry by reading websites like Fred’s. Fred and his wife Tracey provide excellent free information about starting a note investment business. Also if you are looking for a more structured path for learning on how to invest in notes, please go to their website and look at the course that they provide. One of the things that may happen to people is that they find that they need some hand holding or a more comprehensive overview of the note investing industry. If you think that you will be second guessing or potentially backing out of this business then go into it with buying the course from Fred and Tracey. Doing that and investing in yourself will provide you with the best return on investment that you could ever have. You will also feel more invested in this by having invested some of your hard earned money into the course. Also I am not an affiliate and receive nothing for this recommendation, my primary goal is to have you succeed at whatever you are doing. Investing money into something will help you to ensure follow through. Honestly the more expensive the investment the more likely and serious you are to follow through on something. Fred provided several pointers on how to get started with investing in the note business. A couple of the recommendations that Fred made were to one create a website and to also become educated on note investing. The reason to create a website is that people can find you on the web. If you aren’t on the web then you might as well not exist, people will be unable to find you. If you want to find out more about note investing or more about Fred or Tracey Rewey then you can go to noteinvestor.com.

I had the pleasure of speaking to Alina Trigub. Alina works full time in corporate America while in her free time she actively runs a real estate syndication firm. Alina focuses in on investing in syndicated real estate investments in the multi family and the commercial niches. There were several things that Alina covered during the course of our conversation about Real Estate Syndication. The first was exactly what real estate syndication is, who can invest in it and the general structure of the investment. The second thing that we covered is how she would recommend someone get started with investing in real estate. The third thing that was covered was how to build a team and how to establish your role on it.   Real estate syndication is an investment tool that allows a group of investors to be able to pool their funds together to be able to invest in real estate deals they wouldn’t be able to typically afford. Then there is usually an operating partner or manager of the investment that actively manages the investment for the passive investors that have ponied up the cash for the investment. A good analogy is in starting a bar. Say Fred and George have deep pockets and they want to invest in a bar. They find Al who can run and manage the bar while Fred and George just provide the money to get the bar started. That is a very simplified example of how syndication works. There are limitations on the individuals that you can involve in your real estate syndication deals. There are typically two ways of obtaining investors the first is to reach out to accredited or wealthier investors. The paragraph below details the specific information on accredited investors. If you are looking for accredited investors then if they are single they have to have had an income in excess of $200,000 in the two most recent years. If the individuals are married this income must have exceeded $300,000 in two of the most recent years. Their income should be expected to remain the same or continue to rise in the future. Also they must have a net worth in excess of $1 million excluding their primary residence. You will find a link  to Cornell’s Legal Institute’s definition for accredited investors.   The most startling fact about this is that these laws were made in the 1970’s and they haven’t been adjusted for inflation. If you were to adjust these amounts for inflation using a 3% rate of inflation and assume a 40 year period then the amounts would be significantly different. The necessary income to meet the minimum required investment for a single household would be $652 thousand and the joint amount would be $978 thousand. The net worth necessary to be able to be considered accredited would be $3.26 million. These numbers are the minimums necessary to be able to be considered an accredited investor. The second way to be able to participate as an investor in a real estate syndication deal is to have a preexisting relationship with an individual. If you were to work with, be child hood friends of or have an existing relationship with the individual raising money then this would be able to invest with them. They couldn’t solicit or seek funds from you unless you had that preexisting relationship or were an accredited investor. Finding the investors to be able to invest in syndicated real estate is important because you need to be able to have the investment capital or money to be able to afford the property or down payment. This isn’t the entirety of the investment either instead it is only a part if of it. This only covers the action of raising the funds to be able to afford the property. The next step after raising the funds necessary to be able to afford a property is to identify which property to invest in. Alina mentioned there were two important things when looking to find a piece of property the education that you have and the relationships that you have built. Without any formal type of education or experience you will not be able to tell whether a particular property is a good investment or not. Alina originally invested in multifamily properties because she had a good understanding of the underlying investment. That knowledge plus her investment in podcasts, books and other education material allowed her the confidedence to invest. Alina used two books "Best Ever Syndication Book Ever" by Joe Fairless and "It's A Whole New Business!: The How to Book of Syndicated Real Estate" by Gene Trowbridge  to be able to help her learn about syndications. If you don’t go out and educate yourself on the type of property or investment that you are putting money in then you will never know if it’s a good investment. You will be utterly reliant upon the knowledge of other indviduals to be able to determine if  an investment is a good one or not. The second point of networking is about being able to find deals. If you actively network and build up a list of contacts in a particular industry or region you will be able to continually source deals. People will be interested in providing you with deals because they will profit from the transactions that they engage in with you. Your network is your net worth so to speak, because it will reflect the quality and quantity  of the deals that you will be able to obtain. The final part of the syndication process is to be able to put the manger or operating partner in place to be able to manage the deal. This individual will be found by networking with individuals in the region that you want to invest in. Also  it is extremely important to be able to match up your goals with the individual that you are investing with. Obtaining references for someone that you are trusting your and your investors money with would be prudent. Then once you have all of these things put together you have the foundation of a syndicated real estate deal. Then you can sit back drink your pina caladas and have a good time at the beach. No in all honesty any one deal will probably not make the life changing kind of income that you need. You will have to repeat this process over and over again to be able to get to a sizeable amount of cash flow. The more often that you do something like this the better at it you will be. Alina got her start being a passive investor in someone else’s real estate syndication deal. She was one of the passive investors that got involved by investing their money only into the deal. As she became more experienced with the process she was able to start doing these deals on her own. If this seems very complicated because of all the moving parts one of the things that you can do is read websites like Alina’s at Samo Financial or Bigger Pockets. You can educate yourself very thoroughly about the whole process to be able to learn how to do it. If you are still feeling unconfident in your ability to perform this type of investment the other thing that you can do is to go work for a real estate syndicator. Imagine that you were networking and looking for someone like Alina, you go and offer them some type of value for the information that they can offer you. Don’t go in and expect someone to just be generous with their time. Some people are like that but you’ll have a much warmer lead if you bring something to the table. You could even inquire about some pain points in their business and see what you can do to alleviate it to learn how to do this. I’m an accountant by day so if someone like Alina needed help with their bookkeeping I could offer them that for free to be able to get them to help or teach me how to do this. You could also go to work for a real estate syndicator to be able to figure out how this works. The way to look at this would be as a paid internship and take every single opportunity to be able to learn how the business works. If you are reading this and want to do something other than syndication this can be one of the greatest things that you can take way from this post. Go work for someone in the field or doing the thing that you want to and you will be paid to learn. In two to five years you could have your business up and running knowing all of the insider secrets on how to make it work. The biggest take away that I received from my interview with Alina was what she said at the end to take a look at the varied types of investments that are available. During the course of this podcast I will look at a number of things from single family investing like Episode 1 with Gagan Marwaha to investing in syndication's. Not every type of investment will  appeal to everyone If  you want to find out more about real estate syndication you can reach find more information about Alina at Samo Financial.  Please note the disclaimer below: THIS IS GENERAL FINANCIAL ADVICE THAT MAY NOT APPLY TO YOU. PLEASE CONSULT WITH YOUR TAX, LEGAL, INSURANCE OR FINANCIAL PLANNING REPRESENTATIVE BEFORE MAKING ANY CHANGES.

I had the pleasure of speaking to Rachna Jain. Rachna is an online marketing expert with a background in psychology who started working online by marketing her psychology business. Overtime she built up her online presence and eventually transitioned into helping clients with online marketing. Rachna discusses the importance of tailoring the work that you do online to you as an individual. Their has been a continual increase in the amount of people that are online. Currently many of the major niches like personal finance, fitness, etc. have large sits that are dominating them. Rachna said that there are only so many people that a website can create interest around. Once a site reaches a certain size as it continues to grow over time it experiences a decrease in the amount of involvement in the community members. This is because many individual visitors to this site may be interested about the information that the site is offering but they cannot specifically relate to the individual creator of the content or exactly the message that they are writing. In 2019 there is still a great opportunity to be able to become a thought leader for a specific tribe by niching down. This can be done by moving down from the broad categories of personal finance, entrepreneurship, food, health, etc. and focusing in on subjects such as baking. Doing this will allow businesses to be relatable to a more select group of individuals. Also by niching down from broad subjects to specific subjects firms can promote to more important customers. Also it is possible to differentiate your business based upon who you are and have been. A good example of this is Rachna’s experience in Psychology has allowed her to be able to obtain doctor’s and psychologists as clients. This is because Rachna’s clients are able to relate to Rachna’s past as a psychologist. If  you want to find out more about starting an online business or marketing you can reach out to Rachna here.

I had the pleasure of speaking to John Rampton. John is an online marketing expert with a string of successful businesses that he has started and owned. John’s first attempt at starting an online business began with a blog. He began writing for his blog for nine months before he was able to begin monetizing it. Within five months of beginning to monetize his blog he was able to make $2,000. Then within 14 months of starting his blog he was able to sell it to someone else netting over $20,000. That early win and experience gave him the experience necessary to begin more online ventures. During the course of the interview we discuss how to start an online business. The methods that John recommends to reach out to people that have grown similar businesses to the one that you are looking to start. Also John gives recommendations on how to acquire a web based business and where to go to get one, if you are looking to purchase an already established one. The biggest parallel that I have found with these web companies was with real estate. Each website or piece of digital “real estate” has its own value which can vary depending upon the buyer, the niche, etc. John had two great recommendations on how to value web based companies. The first was to value it based upon the cost it would take you to develop the site to the point its at now. The second point that he mentioned was to look for sales of similar web based businesses in the same niche. The perceived and actual value for a web based business can vary wildly based upon the niche. If  you want to find out more about starting an online business or marketing you can reach out to John at johnrampton.com.

Podcast Episode 9 Getting Started with Infopreneurship   I had the pleasure of speaking to Bailey Richert. Bailey is an award-winning business coach who helps individuals launch and grow profitable online enterprises as infopreneurs. Infopreneurship is a form of entrepreneurship focusing on the creation of information products. The form that information products can take can vary from special reports, books, courses, etc. A benefits of infopreneurship is that after you have created the product you have a product that you can sell forever. A second benefit of this is that you could add marketing to introduce individuals/purchasers to other products. By adding some form of advertisement in your initial product you can create free marketing for another product. There are a few cons of creating information products. The product that is created may not be the one that your audience or client may not want. You could have spent months creating a product that no one wants. A second con is that it requires an audience or group of clients to be able to sell these products to. There are ways to get around the cons of infopreneurship. The first is to go through the process of creating an audience. An audience to be able to sell products can be created by traditional blogging, podcasting and creating videos. If you don’t have the desire or ability to pump out blog posts you could transcribe some of the audio or visual feed to be able to create written content. By going through this process you will be able to rank organically with google and build up traffic on your website. All of this will allow you to build up an audience through whatever method is the best fit for you individually. The second con that exists for information products is creating the wrong product for the wrong audience. There are a few different ways to remedy this problem. You can reach out to individuals in your audience assuming that you have been blogging, podcasting or creating videos for a while. Tell individuals that ae on your emails list that you are interested in creating x product at x price point and see if they are interested in this product. I’d recommend asking them in the same email if they are interested in anything else or had other product recommendations. If you don’t ask you will never know what they are interested in buying. If you don’t have an existing audience then you could look for groups in the same niche as you and look through the Facebook posts for the group. What you are looking for is a recurring complaint or problem that people are looking to resolve. The reason to go to Facebook is to generate product ideas.   If you found this information on infopreneurship to be useful or helpful you can find out more about infopreneurship from Bailey at Bailey Richert.com.  

I had the pleasure of speaking to Scott Todd. Scott owns a land investing business where he buys and sells raw land in the South West. Scott turned to land investing after finding out that he was going to lose his job. He found out about it from Mark Podolsky the Land Geek, you can find out more about Mark at Land Geek. By following Mark Podolsky’s course on land investing Scott was able to replace his corporate job and live on the profits from his land business. The highlights of how Scott did this are below. Scott focuses on buying land at extremely low prices, 25% of market price. He is able to do this by sending offers to purchase to vacant land owners. Scott finds the owners of these properties at a county office.  This type of real estate investing model is based upon a numbers game, where you send many offers to vacant land owners. Scott said that he has been able to average 1.5 deals for every 100 mailer that he has sent out. This method of investing has the ability to be scaled by increasing the quantity of offers to vacant land owners. If  you want to find out more about land investing and about Scott Todd then go to Scott Todd.

  I had the pleasure of speaking to Hunter Thompson from Asym Capital. Hunter works at Asym Capital which is a real estate investing firm specializing in investing in recession resistant real estate. Recession resistant real estate investing is real estate that weathers the storm of the recession well. In comparison to classic single family or multi-family properties recession resistant real estate is still in demand. Examples of recession resistant real estate include apartment complexes in class B and class C neighborhoods, storage units, etc. Apartment complexes in Class B and Class C areas will continue to be in demand despite changes in the economy. Individuals will still want to reside in these lower cost apartments whether the economy is going to go up or down. Storage Units are in continual demand despite what is going on in the general economy. The reason that Hunter’s firm is called Asym Capital is because the firm is able to deliver asymmetric returns. While other real estate investment niches are going down these investments are going up. The reason that Hunter’s firm is able to do this are two fold. The first reason is that Asym Capital controls the expenses by proactively managing the expenses on it’s investments. They actively review the expenses that they are paying and keep control of those. The second reason is they focus on value add investing. Look at the type of investment that you have and how you can add value. If you want to find out more about Hunter Thompson you can go to Asym Capital.  

  I had the pleasure of speaking to Alex May from Connected Investors. Alex works at Connected Investors which offers a networking platform for investors and lenders in the real estate space. Alex works in business development at Connected Investors. Alex provides valuable information about the basics of what hard money is and the advantages of using hard money. Also she goes into depth on how to be able to build relationships. If you are feeling tapped out with a traditional lender and have maxed out the number of traditional loans that you can have you might want to check this episode out. Hard Money could fill in the space in your real estate portfolio where traditional lending leaves off. It’s an additional tool in your tool box for real estate investing. Also Alex provides valuable information on networking and how to distinguish yourself from other individuals when trying to establish a relationship. One of the key takeaways that she mentioned were that when networking you are building a relationship and a friendship. When cold calling or cold emailing someone reach out to them and comment on something that you genuinely enjoyed about the individual or company. Doing this will allow you to differentiate yourself from the other hundreds or thousands of people contacting this company or individual. If you want to find out more about Alex May you can go to Connected Investors.  

Today I had the pleasure of speaking to Rocky from 30 and 0.com a rental real estate investor from the Tampa Bay Region. Rocky and I discussed househacking, buying a singe family or a multi family house and renting out the other units or rooms. Rocky addresses how to pick tenants and to carefully screen them. It is particularly important to review your tenants because you will be living in the properties that you are renting out. This is the home that you will come home to day in and out so it is important to carefully pick your tenants. Also there are significant benefits to renting out rooms in your house. You could live for free or nearly for free depending upon where you are living. Imagine saving an extra $1,000 a month each and every month. In 24 months you would have $24,000 saved and that would allow you to save $24,000 every two years. In some portions of the country $24,000 could be a cheap house. Also you could just rinse and repeat and in 10 years have 5 cash flowing properties. The choice of what to do with the additional cash is up to you.

I had the pleasure of speaking to Lauren Haynes a financial planner in Richmond Va. Lauren runs her own financial advisory company based out of Williamsburg and Richmond VA. The majority of her clients range in age from mid thirties to late 40s. They have concerns with individuals with a more established career. Lauren provides additional information about investing in annuities or insurance contracts focused in on continuous income for retirement planning. During the course of this episode you will also find out about ETF’s and how they mimic stocks and mutual funds. If you want to find out more about Lauren Haynes you can go to words on wealth or Spark Financial Advisors.   Please note the disclaimer below: THIS IS GENERAL FINANCIAL ADVICE THAT MAY NOT APPLY TO YOU. PLEASE CONSULT WITH YOUR TAX, LEGAL, INSURANCE OR FINANCIAL PLANNING REPRESENTATIVE BEFORE MAKING ANY CHANGES.

I had the pleasure of speaking to Brett McHale a Pay Per Click marketing Specialist. Brett and I talked about how he started his own Pay Per Click marketing business on the side while he was still fully committed to his job. Brett started his career at a startup in the paid advertising department. He found a lot of autonomy at his job but as it became more bureaucratic over time he felt like regaining some autonomy. Many people can relate the desire for greater autonomy in the work that they do. If you want to find out more to Brett McHale go to Empiric Marketing.   Why should you listen to this podcast episode? You should listen to this podcast episode to learn more about starting your own freelance business on the side and some of the tips that Brett can provide about that.    

I had the pleasure of speaking to Kerry Mayo a Financial Planner from Clifton Park, NY. Kerry and I talked about how there are three different types of compensation methods for financial planners. The first compensation method is by commission where a broker will sell you some type of stock and then receive a commission from this sale. The second type of compensation is fee only where a financial planner will be compensated on an hourly basis for there time or be compensated for the assets that they manage. The assets under management or A.U.M. model is a method of compensation where a financial planner or planning firm will charge a certain percentage of the total assets to manage them. The third type of compensation method is a hybrid model where there is a fee based income and also commission on some type of investments, say a commission for selling a mutual fund. Kerry and I also discussed what he thinks the market will do moving forward and some of the things that will positively or negatively impact it in the coming year. If you want to find out more to Kerry Mayo please click on this link. Why should you listen to this podcast episode? You should listen to this podcast episode to learn more about how your stock broker gets compensated and how to pick one whose interest are more in line with yours.    

I had the pleasure of speaking to Gagan Marwaha about his real estate rental portfolio In Richmond Va.  Gagan Marwaha went to college for his MBA and then began working full time at Dominion Energy. As he began working full time at his corporate job he began to start investing part time in the local Richmond VA region. As he continued to invest he met his mentor named Jay Epstein. Over time he transitioned from a job that he liked greatly to one that he didn’t. He had the opportunity to be able to work for himself because he had a successful real estate rental business going on the side. By having a second source of income he had the opportunity to choose to work for himself or work for someone else. This is a great example of how to be able to achieve financial independence through a real estate business. Gagan worked hard and was able to leave his job because he had a successful and operational real estate rental business. Also it should be noted that Gagan wouldn’t have been able to achieve what he did without his full time job. If you want to find out more to Gagan Marwah please go to Marwah Investments. Why should you listen to this podcast episode? You should listen to this podcast episode to learn more about achieving financial independence through single family rentals.