How to get your spouse on board with Real Estate Investing?

[Lee McCarthy]

So here it is.....my story and where I want to go, and needing some advice to get me there. The back story. I live in the St. Louis Metro East area. I have a job in pharmaceutical sales that pays me well. 2 kids, and my wife makes 40k/year. I have always loved the idea of running my own business. I am a numbers guy. I am hands on with rehab, but I cannot seem to get my wife convinced that I can do this (get into REO/auction flips in the 20-50k w/100-130k ARV). We had bought a house in 2007 for 85k, put a lot of work into it personally, yet had to declare bankruptcy a little over a year ago because we couldn't sell the house due to the market crash and the neighborhood going to ****. We absolutely were not going to allow our son to go to that school district, so we bit the bullet and lost the house in bankruptcy, and later was purchased for only 32k. I believe this has completely jaded my wife and I am struggling to convince her that this industry is viable and that I have the capacity as a highly motivated, and fairly well educated person to both learn and build a profitable business. What I am asking is, does anybody have any advice as to how to get a spouse or family member on board when they have no interest in being a part of it?

[Charles Moore]

I had a similar situation 5 years ago when I tried to break into real estate investing through wholesaling, then mobile home flipping. My wife was doubtful about them, but resigned herself to possible loss and agreed to let me go for it. Both were like 2nd jobs on top of my W-2 job. In the end I failed at both because I didn't know what I was doing even though I had done a ton of reading, but I had no network or mentor. I learned a lot, though. I later succeeded in renting out a property we moved out of and learned the benefits of buy-and-hold over other methods. And because it's steadier and not like a 2nd job taking me away from my family, my wife was onboard. 

Here are some ideas: 1) maybe see if you can apprentice under an experienced local investor first without committing any money at that point? 2) go to a few REIA meetings, then once you know some encouraging people invite your wife to one. 3) consider altering your real estate strategy - I learned taking the path of supposed quick profits through active strategies like wholesaling and flipping has pitfalls for newbies - do you have the funds to purchase distressed properties? And to pay for materials and supplies? And to pay contractors? And pay holding costs? Then later will you have the funds to pay the irs the capital gains on your profits? If you need funds, your bankruptcy may affect your ability to get a loan. And are you willing to lose all the time away from your family this 2nd job would require?

St. Louis is a great cash-flow rental market with lower purchase prices than many other cities. You could capitalize on that. Plus as a buy-and-hold investor, your tax situation is more favorable, making the strategy more attractive. 

You could also sit down with your wife and have a heart-to-heart with her to explain why having your own business means so much to you and highlight how in the w-2 world, everyone is expendable if it's convenient for the employer. Having some real estate assets in your portfolio is a way to diversify away some of the risk of losing a job - it's always best to have options.