165: How 'Finance Ninja" Daniel J. Mills Started at $30k a Year and Grew a US Rental Empire from Japan
While living abroad, it can be very difficult to invest in assets in your home country, especially if you’re an American. Daniel J. Mills found this out early in his professional career. As a English teacher living in Japan, he had to jump through a sizable amount of hoops to find a way to invest in American stocks, index funds, and later real estate all while overseas. Growing up in southern California, Daniel knew that there was money to be made through entrepreneurialism. He saw his father grow a business that was profiting millions each year, only to see it later become liquidated. Daniel didn’t really think too much about money or growing his personal wealth until years later. After college, Daniel moved to Japan and became an English teacher making a salary of around $30,000 (USD) a year. He met his wife, settled down, and bought an apartment in an appreciating part of the city (contrary to many other parts of Japan). Daniel was saving around $1,000 a month, and realized he didn’t want to be making $30,000 a year forever. So, he started investing in index funds and stocks, which grew his net worth and allowed him to invest in other asset classes, like real estate. Daniel even shares a tax loophole that allowed him to write off 100% of his 6-figure income while he was in Japan (solely from real estate depreciation)! Flash forward to today, Daniel has rental properties in Idaho, Alabama, and Tennessee with partners from Japan and the United States. Daniel agrees with many other real estate professionals in the fact that you need a tried and true team in cities where you’re investing. Living in Japan, he doesn't have much to worry about in the US, thanks to his fantastic property managers, handymen, partners, lenders, and real estate agents. In This Episode We CoverThe challenges and benefits of investing in American assets while abroadGetting rid of debt fast so you’re able to scale your investments How money is easier to make as you become more educated and experienced The ins-and-outs of Japanese real estate compared to American real estate Converting bonus rooms to bedrooms for higher rent Forming partnerships with real estate professionals who can help youAnd So Much More!
1 hr 19 min
164: Attacking Your Fixed Expenses & What You Can Do to Boost Cashflow: Finance Friday with Kyle and Sarah
Kyle and Sarah are in a great position. Kyle owns a mechanic and repair shop while Sarah works a regular 9-5. Combined, they’re both bringing in a solid amount of cash flow each month, but it may be getting offset by their expenses. With monthly expenses going into the 5-figures, it’s been hard for Kyle and Sarah to get the cashflow to start their real estate investing. A few months back Kyle and Sarah began tracking their expenses, and like many people, they were shocked at what they found. Some takeout food here, some shopping there, and other random expenses were really adding up, so they started to reduce their costs. Kyle and Sarah both have made significant contributions in their retirement and investing accounts, but they could be investing a lot more and getting a lot of write offs! Scott and Mindy walk through the main expense categories that Kyle and Sarah have, breaking down what can be improved, reduced, and left alone. Like many people, Kyle and Sarah have found that with some fine-tuning to their budget, they'll be able to increase their investments, by a lot! In This Episode We CoverWhy everyone needs to track their expenses and start to budgetHow to start tracking without shameWhy you should get quoted for insurance bundling every few yearsThe importance of contributing to your HSA (health savings account)Why employers may want to start 401(k) programs for their employeesWhether or not a life insurance policy may be worth the moneyWhat should and shouldn’t be a variable cost in your budgetAnd So Much More!
1 hr 20 min
Have tax questions for your upcoming 2020 taxes? Stick around then! We have a mind-blowing episode with enrolled agent Steven Hamilton from Hamilton Tax and Accounting. Mindy and Scott throw a lot of high-level, hard-hitting questions at Steven, so seriously, bring a pen and paper to this episode because you’re going to get some amazing tax strategies for 2020! How do you lower your income on your taxes if you have a W2? How do you add to your roth if you’re over the contribution income limit, and what’s the best way to get your kids to max out their retirement accounts (even if they’re only teenagers). Steven answers all these questions, plus a lot more! Whether you’re self employed or a W2 employee, you have options on contributing to retirement, AND options on leveraging those retirement accounts to fund investments. As always, it’s best to talk to your CPA, enrolled agent, or tax preparer on the best strategy that works for you. As Steven puts it, you need to have a plan for where your wealth is going and how you’re going to distribute it. Since 2020 was such a crazy year, many real estate investors are planning to double down on investments, up their contributions, or leave their W2 jobs. This all needs to be done with a plan and a strategy so you can maximize your investments and distributions. Steven helps spell out the best ways to do these (and more) through a number of different (and interesting) strategies. In This Episode We CoverThe differences between joint and separate filings as a married coupleHow AGI (adjusted gross income) effects your taxes and retirement contributionsHow to max out your 401(k) to $57,000UBIT (unrelated business income tax) and UDFI (unrelated debt financed income)How CPAs, Enrolled Agents, and Attorneys differ when preparing your taxesHow to perform an IRA rollover into a different accountHow to put even more money into your RothSetting up retirement accounts for your childrenLimiting your stock gains so you pay less taxAnd So Much More!
1 hr 26 min
162: Finance Friday: High Salary - But Nothing to Show For It. Cutting Unnecessary Expenses with Engineer Tracy
As you go further along in your career, you should (hopefully) make more and more money, but does that justify spending more money? Most times, it doesn’t. We’re joined by Tracy, experienced engineer and retirement super saver to go through her budget, expenses, and investment portfolio. Tracy has had a bit of a struggle with spending and expense tracking. A purchase here, some grocery shopping there, and by the time she added up her payments, she was consistently overspending by close to a thousand dollars, every month! Scott and Mindy have some great strategies to limit this type of random spending, and put your budget in the driver’s seat! Tracy is also interested in acquiring a rental property in mid/late 2021, but she doesn’t have the cash savings she needs to do it. That doesn’t mean Tracy lacks money. Quite the contrary, Tracy has a very respectable amount of money stored between her different retirement accounts. She was lucky enough to take advantage of her company’s 15% 401(k) match (seriously, 15%)! Now the question is: does she limit her contributions so she can save up for a rental property or does she continue to max out her retirement accounts so she has a big cushion when she decides to stop working? This is a very common question we get from listeners and members of the BiggerPockets community. You may be in the exact same position, all we can suggest is to tune in to hear what Mindy and Scott have to say! In This Episode We CoverWhy employee match programs are so valuable for retirement investingWhether or not you should keep an expensive car loan (or sell and get a cheaper option)How to fight lifestyle creep and focus on your spending and investing The importance of manual expense tracking and budgetingHow bigger shopping runs can minimize your food budget every monthWhat type of savings you should have before buying a rental propertyAnd So Much More!
1 hr 25 min
He’s back! Today we’re joined by a friend of the BiggerPockets podcast network, Brandon “The Mad Fientist”. Brandon walks us through advanced retirement account strategies you may have heard of, such as the Backdoor Roth, Roth Conversion Ladder, and the coveted Mega Backdoor Roth. While these strategies may sound intense at first, they’re quite simple in practice, as Brandon shows us! Many FI (financial independence) followers constantly ask the question “What’s the best retirement account to contribute to that will help me optimize my early retirement?”. While this can be answered a handful of ways, it often overlooks something very important: regular retirement. While chasing FI, it’s still possible to grow your traditional retirement accounts so you’re even wealthier later on in life! Brandon doesn’t just give various examples of each strategy, he’s tested them and has even ran experiments on his site, such as the Guinea Pig Experiment, which pits various early retirement strategies against each other. We also tackle common questions like: what should I contribute to if I have a low/high income, should I opt for a lower deductible on my healthcare plan to optimize my HSA (health savings account), how HSAs and FSAs differ, and what the contribution limits are for retirement accounts. Even if you’re not chasing FI, you’ll still be able to take advantage of Brandon’s advice. After all, he’s the Mad Fientist! In This Episode We CoverWhat a Backdoor Roth and Mega Backdoor Roth areWhy retirement accounts are crucial when trying to retire earlyHow low income earners can take advantage of 401(k)s and IRAsWhy an HSA is a great option for high-deductible coverageThe best times to contribute to your retirement accountsThe art of “frontloading” and using it to capitalize on market gainsAnd So Much More!Links from the ShowBiggerPockets Money Facebook GroupBiggerPockets ForumsFinance Review Guest OnboardingBiggerPockets Money Podcast 18 with Mad FientistHow to Access Retirement Funds Early - Mad FientistXY Planning NetworkFront-Loading - Mad FientistHSA - The Ultimate Retirement Account - Mad FientistExpirements - Mad FientistBiggerPockets Money Podcast 120 with Michael KitcesBiggerPockets Money Podcast 119
1 hr 31 min
Many listeners of the BiggerPockets Podcast network are resourceful when saving and earning money, but maybe not quite as resourceful as Cort Johnson. Not only does he have a full-time engineering job, which he uses to support his family, he also has 5 other streams of income on the side! From contract welding projects, to dropshipping, renting out his trailer, and even raising rabbits (seriously!), Cort has done almost everything under the sun to build up his assets. The main problem: some income streams are taking up too much time, while providing too little in return. This is a constant problem that entrepreneurs and FIRE members face, too many options! Mindy and Scott go through Cort Johnson's income, budget, expenses, and general finances to see where he should allocate his time for maximum return. This episode goes deep on the importance of scalable income and following your passions to develop side income streams that you enjoy. Cort dreams big about starting his own business, investing in multifamily property, and living financially free. As you’ll hear in this episode, he’s not far off! In This Episode We CoverHow to focus on side income streams that are worth the timeBudgeting and expense tracking so you spend lessCalculating the value of your time (so you don’t waste it)Why you should “do what you know” if you’re going to start your own businessTurning a large single family property into a multi family for house hacking Why dropshipping is such a great side hustle for busy peopleAnd SO Much More!Links from the ShowBiggerPockets Money Facebook GroupBiggerPockets ForumsFinance Review Guest Onboarding
159: How to Financially Thrive in Marriage (Even if You or Your Partner is In Debt!) with Talaat and Tai from His and Her Money
What happens when you get married and find out your partner has debt? A lot of debt...That’s a question many young couples have, shortly after finding out their significant other’s full financial picture. While it may seem scary at first, working together to solve financial problems and gravitating towards financial freedom can bring you closer together. That’s exactly what happened to Talaat and Tai McNeely from His and Her Money. Both were raised in frugal houses, but like many frugally-raised people, they split in financial directions. Tai was busy putting herself through college, debt free! On the other hand, Talaat went into the military and started spending his pay on consumer goods. The cars, the clothes, and everything in between. Tai later learned that Talaat had around $30,000 in consumer debt! So what did she do, walk away from him? Of course not! She worked with Talaat and put together a plan where they both could work hard to get out of debt. Shortly after, Talaat was debt free, so what did they do next? They bought their house, and came up with a plan to completely pay it off in 5 years (Yes, 5). Now Talaat and Tai run His and Her Money, helping other couples work together to reach their financial goals. Talaat and Tai have 7 key tips to staying happy and secure in a marriage where the finances are shared, and how to stray away from the “2-Income Trap”. In This Episode We CoverWhy you should go over finances before getting married The importance of inspiring your partner to have the right finance mentality The importance of introspection when dealing with a partner’s money situationsHow to stray away from the “2-Income Trap”Whether or not you should combine finances in a marriageThe pros/cons of paying off your home quicklyThe 7 key tips to creating a financially harmonious relationshipAnd So Much More!Links from the ShowBiggerPockets Money Facebook GroupBiggerPockets ForumsBiggerPockets Money Podcast 73 with RamitBiggerPockets Money Podcast 127 with Ramit
1 hr 18 min
Happy New Year! With the first 2021 episode of Finance Fridays, we take a look at Wayne Loux’s investments, income streams, and overall finances. Wayne is like many of our listeners: working a W2 job, but also supporting himself and his family by having 1099 income from being a real estate agent. On top of that, Wayne has over 10 rental units, spread throughout different multifamily properties. He also has solid retirement savings and cash on hand. With all this income, Wayne wanted answers on whether or not he should lessen his time at his W2 job, take more cash out from equity in the multifamily properties he owns, and other common real estate investment questions. Scott and Mindy go through different strategies that can help Wayne grow his portfolio. From 1031 exchanges, to setting up self-directed IRAs, and cash-out refinancing to build an out of state portfolio. These are questions we hear from many investors on the BiggerPockets forums, so stay tuned because Scott and Mindy just might answer a question you’ve had! In This Episode We CoverHow to value your time as a high-earning professionalPutting family over work, even if it means stepping away from an income streamWhich investments should you put money into when all your bills are being paid?SEP IRAs and Self-Directed IRAsUsing 1031 exchanges to lower your tax burden when investing Finding jobs that can scale your income (and leaving those that don’t)Whether you’re over or under leveraging your current portfolio How to speak to your partner about big financial stepsAnd So Much More!
Dec 31, 2020
157: The Money Date: What You Should (And Definitely Should Not) Do to Align Your Finances as a Couple
Calling all couples! You and your partner may be on the same page financially, or off in two different directions, regardless of where you’re at, it’s a great time to start having money dates! In this episode, Mindy and Scott are going solo, talking through why money dates are such a crucial part of any healthy relationship. This isn’t just talk, both Mindy and Scott are adamant about money dates, they do them often with their partners as well! If you’re an individual listening to this episode, you may feel a bit intimidated by the concept of a money date. Do you just sit down and talk about index funds and taxes for an hour? No! A money date can be a perfect time to be alone as a couple, talk about the future, make some positive changes, and hold each other accountable for being the best version of yourselves. If you have a partner who may be a bit averse to the concept of a money date, have no fear, Mindy and Scott have perfected their plan for setting up a successful money date, and how to make it enjoyable when you’re in it. With the new year coming up very soon, this is the perfect time to plan a money date with your special someone, you won’t regret it! In This Episode We CoverWhat is a “money date”What to do before you suggest a money date to your partnerHow to make the money date successful and what topics to bring upFollowing up on your money date and setting up systems for successThe importance of keeping your ideas simple in a money dateHow to present the idea to a partner who may not be too keen on finances Why money dates help create healthier, happier relationships And So Much More!Links from the ShowBiggerPockets Money Facebook GroupBiggerPockets ForumsWheel of Life WorksheetMoney Date TemplateFinance Review Guest Onboarding
Dec 27, 2020
156: The Conservative Money Cool Kid: Buying 20+ Houses in Cash with Richard Carey from Rich On Money
Most real estate investors get into real estate to get rich quick. If you’re looking to make a million dollars within your first year of real estate, this is the wrong podcast! But, if you’re looking to build a sustainable portfolio of cash flowing rentals while reaching financial independence in a very lucrative position, this is the episode for you! Richard Carey, AKA the “Conservative Money Cool Kid'' started out in the military, not knowing that real estate was the place where he would create his wealth. He started with a duplex and slowly began building his real estate empire, even while overseas. He even took a 10 year break from real estate, and was still able to grow his position to an impressive level! Real estate wasn’t the only way that Richard was investing. He was maxing out his IRAs and employee retirement accounts, investing in index funds and watching them grow more and more as he upped his contributions. Richard is a fantastic example of why you want to start investing as early as possible. While most real estate investors champion loans and leveraging as much as possible, Richard thinks differently. He finds a position of strength by not overleveraging, owning rentals outright, and having a solid safety net to depend on. Richard now sits in a great position, early in life, with a lot ahead of him! In This Episode We CoverThe importance of maxing out your retirement accounts when you’re youngHow to not only pay off your rental properties, but primary home soonerWhy there is an advantage to not having too much leverage on your investmentsHow to test out a property manager when long-distance investingWhy you should set goals to be in a financial position of strength Why you don’t need to be in a rush to invest right nowAnd So Much More!
Dec 20, 2020
1 hr 19 min