How are people on instagram achieving financial freedom in 3 years or less via RE?

Question

I feel like I see this everywhere where people on social media are boasting about achieving financial freedom in 2 or 3 years from real estate. Are they just leveraged to the max? I figure most people start out with a $100k property or something then they just scale up and start using BRRRR or STR? Can someone explain how these people are doing it?

Also if they are free... Why is everyone and their mothers selling courses on it. If they're rich wouldn't they not need to work anymore? Maybe just diversifying their income?

Scott E. · Answer

Simple answer, they are not. Anybody on social media (or anywhere else for that matter) who tells you that you can be financially free in 2-3 years is 100% full of sh*t.

There are of course some exceptions to this rule. Perhaps you create an app, a piece of software, or invent a product that experiences some virality and a big buyout. Or maybe you hit the lottery. Or win big at a casino. Or you got lucky and rode the crypto growth train.

But broadly speaking, it is just fundamentally not possible to become financially free in such a short window of time (UNLESS you started with a big chunk of capital to begin with. Which in that case, weren't you already financially free?)

The reason that you see this trend on social media is because there are millions to be made selling education. Digital products come with nearly no overhead and unlimited upside. But the problem is that most of these influencers who make these ridiculous claims don't have any experience or credibility. So they need to "fake it til they make it" by acting like they are financially free, until they become financially free selling courses.

As you can tell I'm passionate about the topic lol. It's because these fake gurus make the good gurus look bad. And that's not cool.

John Barbosa · Answer

Don't believe everything you see on social media, especially those who provide little to no value on how to do it but then want to sell you their course.

Darius Ogloza · Answer

As always, the devil is in the definition of what it means to be "financially free."  Some folks can get by on a couple thousand a month and consider themselves "financially free."  Is this model achievable in a few years through some kind of investment program?  Yeah, almost surely.

Others need $500K per year just to "get by."  Can you secure this level of income within a couple of years without simply being struck by lightning?  The likelihood is vanishingly small.

There simply is no unitary standard by which to measure this experience.

Can someone build a sustainable stream of income to last 20, 30 or 40 years in 2-3 years when starting out with no financial resources or experience?  A stream of income that outpaces the need to invest in capital improvements, the rate of inflation, all market and business cycles, etc?  The answer is no.  Can someone generate sufficient income in that time to last a few years, yeah, if they define "financially free" in modest terms.

Andres Murillo · Answer

Some people get rich by convincing you that you can get rich too.

"Financially free" is also so subjective. Their target audience is usually Males under 35. Why? Because there are a lot of Males Under 35 that are in entry or mid-level positions in their current career. Replacing $3-6k a month via REI is so easy to pencil out. They are likely completely burnt out from being subjugated to the bottom of the totem pole. So when they hear "This one four-plex should cash flow $4k per month!" they're hooked. This is very appealing to the guy sitting at his desk getting paid nearly that much at soulless corporation.

It's also an industry where lying is very easy. It would be PAINFULLY obvious when a fake doctor walks in to perform surgery that they aren't who they say they are. But analyzing fictional properties over IG while using 1 or 2 REI terms successfully? You can get middle school kids to do that well. The performance lasts 10-45 seconds but is so impactful that people bite.

Theresa Harris · Answer

I agree with John-don't believe everything you read on social media especially if it is from someone selling courses.  There is a couple on youtube who claim to be financially independent and have a bunch of rentals, but the funny thing is when they went through the actual numbers; they were barely breaking even and most of the money they made was through youtube and some side gigs.

One big thing is if you own your own home-outright, no mortgage.  This cuts down on a lot of expenses and you can get by with a lot less money.  It also depends on their lifestyle and other expenses.  Do they buy a new car every 4 years, go on multiple vacations every year to international destinations, pay for their kid's college, etc.

Devin James · Answer

Hey Jason Lee, they're probably lying or not as financially free as they believe they are. This is a get rich slow game, so i've heard from many investors much smarter than me.

Jeff S. · Answer

@Jason Lee you have an investment in education and a good job. That is your source for investment. The safest way is to leverage your income to be a solid credit risk and stay conservative over time. I never got anywhere until I got a solid w2 and was able to build from there. Relying on cash flow to live is a risky proposition that is dependent on many factors all of which can evaporate in a flash.

Financially free living in a van parked in a Walmart parking lot is one way to go. I would rather start in a van then end up there.

Travis Biziorek · Answer

I can tell you how I did it.

In 2019 my wife and I had a goal to move from the Metro Detroit area BACK to California without sacrificing our lifestyle.

We had access to $280k in capital ($50k savings, $130k HELOC, $50k 401k loan, and $50k personal loan).

I looked at the real estate market and determined that investing in high cash flowing rentals in Detroit proper was the ONLY way we were going to make our goal happen in a reasonable amount of time (3-5 years).

So I bought our first rental for $44,000 and figured "what's the worst that can happen". When I weighed that against the potential upside, it was a no-brainer.

Things went well. I did delayed financing and was left with $9,500 in the deal. I bumped the rent to $900/mo. Then I did it again and again, quickly moving to off-market deals that I could get for below market rates.

Ultimately, by mid 2021 (two years from our first buy) we had 12-doors and we're generating $16,000/mo in gross rents. About half of that is net income. That first house I bought is now rented at $1,200/mo and still has the same tenant. Net cash flow from that house alone was $9,300 last year. Something like a 92% ROI from the cash I had invested. Crazy!

We moved back to California in August of 2022 and couldn't be happier. Are we financially free? Not quite, but largely because we chose to move to a higher cost of living area. If we'd stayed in Michigan we would be though.

What we did was unconventional, even by locals' standards. People told us not to touch Detroit. Our experience has been incredible and I know there's still a big disconnect between market sentiment and what reality is on the ground there.

We're still buying in Detroit, currently finishing a full gut rehab on a duplex across the street where we own another one. And I help others get started investing there as well.

It was a ton of work but very much worth it. Most people will make excuses for why they can't be successful in markets like Detroit but that's a big mistake.

Mo Maktari · Answer

Yeah, I've wondered the same thing lol. I'm sure the process is do-able with different types of niches but there seems to be alot of "picture painting" with these influencers. Charging $1-2k per person, per course is probably the easiest way to not working a 9-5 w2. In today's market, 3-5 years to FI is difficult to achieve with a full time job, just my opinion.

Eliott Elias · Answer

2 years is enough time to build yourself to be financially free. How much time and effort are you going to put to do it? I work 14 hour days to make this a reality.

How are people on instagram achieving financial freedom in 3 years or less via RE?

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