Full Time Job, Children, and Spouse. What next?

Question

Looking towards the future I decided about a year ago that real estate investing (REI) would be my chosen career path after I retire from the military. Through my learning process I have been educating my wife with everything I've been learning as well. She openly states that she is supportive and willing to make our first REI purchase as soon as I find out where my next duty assignment will be (will find out within the next 60 days). However, when discussing saving seed money/down payments with her she starts to become a little defensive about our current position. We are both employed with decent income and have four children. Through the last few months and weeks I have shared many success stories with her from the podcasts, but her major concern that she has voiced with me is that to the best of our knowledge, none of the cases we've seen so far have had large families upon starting in REI. I know there have to be plenty of success stories out there, but haven't seen any that I could bring to her attention. Please, if you fit this category and don't mind sharing you story so I can use it as an example to help put her at ease I would be grateful.

Thanks,

Weldon

Thanks,

Weldon

Joel W. · Answer

@Weldon Malbrough

I initially started to look at Cleveland because I wanted to be stationed there for career progression. I quickly realized the potential for great real estate investments there. The resources I have used are these:  www.areavibes.com to grade certain neighborhoods and areas I should look at. It is not always accurate and is very subjective, but it still gave me general areas to look at once you identify a city. Once I identified areas within Cleveland I started building relationships (all doen on BP) with people in those areas that can help me i.e. real estate agents, lawyers, other investors, home inspectors then I went and visited them and saw the city and developed my criteria for investing, looked at tons of properties and put some offers in. I also wanted to make sure I could trust these people and look at the operation they were running to ensure it was legit. The other approach is investing in an area you are familiar with and plan to go back to once you retire, I will not invest from a distance in these areas because I plan on living in podunk Alaska, and cannot find good property management so I'll wait.  Hope this helps, theres is tons more PM me if you ahve more questions.

Linda Weygant · Answer

That's really great that you guys have figured out how to make this work.  I think you're pretty lucky in that, while your wife may not understand REI and doesn't care to, she also hasn't put the brakes on your ability to move forward.  In other words, she hasn't (as far as you've outlined above) said "NO" and you just chose to move forward anyways.

To use your analogy of theoretical physics though, consider this.  I don't have to understand it in the slightest to be able to say "whoa... you want to build an unregulated, unlicensed, unsupervised particle accelerator in the basement?  Nope.  Too risky."  Whether it's my lack of knowledge of theoretical physics or my lack of understanding in how to make a basement accelerator safe, I've pretty much said that you're not doing it in our basement.  The risk to me and our (theoretical) children is just too high.

I would like to think that, while you wouldn't have to explain TP to me, you would have to tell me that you've understood all the risks and you've got a plan to mitigate them such that my home will not blow up.

If I said "no, I'm afraid the house will collapse into a black hole" and you said "tough, I'm doing it anyways", I'm afraid I'd be at the courthouse in a theoretical minute with divorce papers in process.

Steve Vaughan · Answer

I only have 2 kids, but I get your meaning.  Would have been easier if I had started with nobody but me. Can you imagine?  Live in your flip, move to wherever you need to, house hack an apt building and live in the studio?  Must be nice!

Change is tough.  This may just be an easy barrier she is reaching for. I budget and spend my time wisely when with my family.  The TV is not a focus of anything.  I would rather spend 10 minutes wrestling/ playing a game than watch the tube for 2 hours together in the same room. I'm hardly perfect.  Easy budget items to save for your next rental are brewing your own coffee, brown bagging your lunch and avoiding malls and car payments. Thousands are flying out the window every month for most people without a clue.   Save up and spend your time wisely.  Think of the why and place it above immediate wants @Weldon Malbrough!

Joel W. · Answer

@Weldon Malbrough

Welcome Weldon, I to have four kids and am Active Duty. I just got two duplexes under contract two weeks ago and have a short sale triplex I have an offer in, so by 12 June I will have gone from 1 SFR (rental) to 5 units in places I am not stationed at (SFR in Alaska, and duplexes in Cleveland). I had a hard time pulling the trigger because I've been deployed over 8 months every year for the last 5 years, and I just got extended at my current duty station, 1 more year sailing to Antarctica. We have no idea what will happen next. My successes have not come in the REI realm yet. I do look at our personal finances and feel like we have succeeded because we are living off of 50% of our base pay and BAH etc, my wife doesn't work. We have cut our family operating expenses in half by keeping to our budget and recording every expense, and if we are over we don't spend it. We have saved a lot of money over the last couple years. We are in a very good position because all cash flow from REI will be rolled back into future REI, as well we can add capital from my steady military pay. There will never be a perfect time, place, or situation especially in the military, so you really have to prepare and then take action.

Colleen F. · Answer

I can't give you a personal success story but I can tell you I grew up in a family of 7 and my parents home was a two family which they bought when they had 5 kids. It sure helped them make ends meet through the years.  It was flexibly used as a rental, a family member rental, and all ours depending on family needs.  It was the thing that helped them most when my fathers union went on strike.  I still remember some of the tenants and the successes and  issues my parents had so it was a learning experience for me as a kid too.   I don't specifically recall being asked to help with turnover but I will just say that child labor was frequently used so I am sure we were expected to help.

Weldon Malbrough · Answer

First off, I would like to thank everyone for taking their time to weigh in. I believe I wasn't as clear as I could have been in my original post. My wife's biggest push back (read push back very loosely) wasn't the actual act of REI, but of figuring out how to save enough seed money with four kids. Which, I will admit, isn't going to be easy, but we will figure it out as we adjust our budget as necessary.

@Linda Weygant

…she's afraid that she and the children will be destitute and homeless if you get into real estate. She's supportive, but only if you can guarantee this won't happen. Since you can't guarantee that, then your choices are to either address her fears …

… instead of only talking about successes, talk about what the worst possible scenario …

Linda, I must say that after living a comfortable life with my wife and kids I too would be concerned about being destitute and homeless if we didn’t have the security of our current employment. I must thank you because I believe addressing those fears are exactly what must be done. By that, I mean we need to ensure our business model/plan contains contingencies.

@Joel W.

Welcome Weldon, I to have four kids and am Active Duty. I just got two duplexes under contract two weeks ago and have a short sale triplex I have an offer in, so by 12 June I will have gone from 1 SFR (rental) to 5 units in places I am not stationed at (SFR in Alaska, and duplexes in Cleveland). I had a hard time pulling the trigger because I've been deployed over 8 months every year for the last 5 years, and I just got extended at my current duty station, 1 more year sailing to Antarctica. We have no idea what will happen next. My successes have not come in the REI realm yet. I do look at our personal finances and feel like we have succeeded because we are living off of 50% of our base pay and BAH etc, my wife doesn't work. We have cut our family operating expenses in half by keeping to our budget and recording every expense, and if we are over we don't spend it. We have saved a lot of money over the last couple years. We are in a very good position because all cash flow from REI will be rolled back into future REI, as well we can add capital from my steady military pay. There will never be a perfect time, place, or situation especially in the military, so you really have to prepare and then take action.

Joel, Thank you. This is exactly what I was looking for. What resources would you suggest when investing at a distance? My wife and I have been trying to narrow down the locale for our investments. Initially, our thought was to invest in whichever area we are stationed, but have recently began discussing the potential to invest in our hometowns or other areas.

@Steve Vaughan

…Think of the why and place it above immediate wants

Thank you Steve! This is a great way to think about it.

@Randy E.

…my wife doesn't understand how REI can work for the little guy… …She'd rather use her brain power considering other things in life. I am completely okay with that, and don't feel I need to keep sitting her down and explaining REI to her over and over and over……It's not about the understanding. It's about the m-o-n-e-y.

Randy, I think this is a part of my issue as well. She wants to be involved in REI in the sense of that is what we are doing, but is not quite as interested in the learning the minor details that I like to learn.

I would like to thank everyone again for taking the time to respond to this. My dear wife, without me pressuring her, even decided to create a profile here on BP. I look forward to getting her involved soon in the discussions here so we can build an even better knowledge base. @Brandy Malbrough

Linda Weygant · Answer

Well that's the rub.  You and I are saying pretty much the same thing, I think.

The key for me is to address the irrational fear and make it go away.  While it sounds like you'd move forward anyways if the fear is still present, I would not.  I despise marital (or any other) strife, so it would be worth it to me to continue to chip away at the fear until it's gone.  In my personal opinion, what's best for the family unit is harmony and unity, regardless of foregone profits.  The idea that one partner is living in fear while the other boldly forges forward would not be a relationship I personally would want to be in - on either side of the coin.

In many cases, it's easier to beg forgiveness than get permission.  But taking what the other partner sees as big risks when an opposition has already been registered is just begging for disharmony and unhappiness on at least one person's part.

It's a bit of a moot point for me anyways since my current partner is as into REI as I am.

Randy E. · Answer

@Linda Weygant

I appreciate what you're saying and I agree.  But I also think that if one spouse says "No, you/we should not do that" out of irrational fear, the other spouse has an obligation to do what is best for the family unit.

Randy E. · Answer

I disagree.  People are individuals, and they don't always have to agree.  Not even spouses.  And one spouse should not skip the opportunity to help the family just because the other spouse doesn't quite understand how something works.

I look at it this way.  Say my wife was a theoretical physicist.  I might have no idea what her job entailed, much less understand what she does on a day to day basis.  I would not expect my wife to quit her job simply because I didn't understand it.  Well, my wife doesn't understand how REI can work for the little guy.  I make good money doing it, and I'm not going to stop just because she doesn't understand it.  In reality, she doesn't want to understand it.  She'd rather use her brain power considering other things in life.  I am completely okay with that, and don't feel I need to keep sitting her down and explaining REI to her over and over and over.

It hasn't led to the end of our marriage.  In fact, after two or three more acquisitions I'll be able to divert some of the cash flow toward lifestyle improvement.  Personally, I wouldn't do it for another two or three years, but I know it will please her, so I'll do it this year.  As I'm able to improve our family's lifestyle (I should say improve it "more" because our lifestyle has been enhanced over the past few years,) I have no doubt my wife will be wholly on board.  It's not about the understanding.  It's about the m-o-n-e-y.

Full Time Job, Children, and Spouse. What next?

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