What are your thoughts about REI?

[Nicole Pettis]

Is it smart? Is it high risk? Will you go bankrupt? Is staying with your 401k's and mutual funds the best way to retire?

The reason why I bring up these questions is I had a big discussion with my father in law tonight. I have fabulous in-laws. They are sweet, loving people who don't judge and will only give an opinion when asked. My father-in-law is very smart with money, however he is a tortoise when it comes to investing, which has done well for them.

He worked for Owen's Corning for 39 years in various management positions and is now doing contract work for them. He is well invested in mutual funds and 401k. He owns two pieces of real estate, their home and then a lake house. Their house is paid off, however they are still paying on the lake house. I have no clue what they are worth, because they don't talk about their finances, but I do know that they are comfortable.

So I asked him today what he thought about my strategy of wanting to invest in Real Estate and he said you have to have deep pockets and then he proceeded to ask do you want to go bankrupt? Because that is what will happen. He feels I am putting our family at a huge risk if I choose that venue. We then proceeded to have an excellent discussion & I tried to explain to him about the 70% rule, how you make your money at the purchase price. How flipping works. How others are doing well & are even successful at it, making a good living and running a good business. And it didn't matter because of his investment beliefs and philosophies. Which is fine, I wasn't offended, I asked for his opinion.

Will it affect my strategy, and our pursuit to do REI, probably not. Right now financing has been our biggest hurdle, but I think it is for many. However I know we will figure it out.

Just wanted to get your input and thoughts?

Thank you!

Nicole

[Taylor Shapiro]

Hi @Nicole Pettis

I can't speak for everyone here but I would think it's safe to say that we've all run into others, both family members and friends, who just flat out don't understand what it is we do. It doesn't have to be REI related, too. I've been involved in the fitness industry for nearly a decade. Many of my past clients' struggles are/were the same as mine and others when I first decided to switch over to REI. Is it possible? Can I actually accomplish this? How long will it take? etc. For someone whose grown up in a family where food was a means of "comfort" instead of something we do to "be fueled", it's understandable how difficult a shift in perception can be.

Like any other lofty goal, it works if YOU do. YOU need to put in the work. Listening to others tell you how it can't be done isn't "doing the work".

I'm relatively new to the forum. This past year I decided to commit to REI. I left my job and apprenticed for an investor in my area. We rehabbed 3 houses together. Life threw the both of us a curve ball when his wife became very ill which sidelined him for the foreseeable future. This was just last month. Since then, I've maintained communication with my mentor, signed up for my RE classes which start tomorrow night, have sat down with 4 potential private money lenders, 2 of have given me a verbal "i'm on board" and have begun picking out 3 towns that seem to be good areas for fix and flips.

If you had asked me a few months ago what my plans were, I would tell you what a majority of newbies say which is "I want to invest in real estate and make a lot of money!" Since quitting my job, working with an actual investor, seeing that this works first-hand and then writing a plan on paper of my own, my goal(s) have become crystal clear.

If I were you, I would do a few things.

- Only bounce your ideas off of people who have "been there, done that". They will give you real world advice, however, you shouldn't blindly accept everything they tell you. Just because they've tried it doesn't mean you should always listen.

- Go find a mentor in your local area. See first hand how this business works. Offer to work for free- like I did. He picked me out of 70+ craigslist replies because I offered to work free of charge just to learn. Thankfully he decided to pay me although it wasn't much :).

These 2 things alone have gotten rid of 80% of whatever doubt I was clinging to beforehand. Of course self doubt always creeps in, but now I have a mentor who I plan to pay a consulting fee to when I get a deal under contract to make sure my numbers work, I have at least 2 different PMIs willing to fund my deals, I will have my RE license by November and access to the MLS as well as a better understanding of a few specific areas I'll start making offers in.

Everyone here has their own story, but I can guarantee you each one starts with taking action. Take the necessary actions that will get you closer to your goals. I would tell my clients "if you want to lose weight, you gotta eat less". That's how it works. Do what it takes to get to your desired results. Not what you're comfortable with. I hope this gives you some guidance and perhaps a clearer vision of the journey you're embarking on.

Good luck!