Incentivizing yourself during a deal (re: BP #221 w/ Tim Shiner)

[Jason Howell]

Hi all! I am re-listening to the BP podcast episode #211 with Tim Shiner which was so information dense. He touched on one thing that struck me, but didn't go further into depth on it, so I thought maybe someone else might understand the logistics:

Tim spoke of a friend who had taken a ton of vacations with his family and had pictures everywhere of all their travels... and how his wife may or may not have been completely on board with the risks involved in investing. Tim recommended to his friend that he combine goals: Investing and vacation.

The scenario he spelled out involved his friend having just bought a house for $55k, he said it was worth $80k. Tim advised his friend to "factor in another $5 grand and take your family on a vacation every time you buy a house." That turns the dialogue from "oh no, we just bought another house" to "yeah, we get to go on another vacation!"

Explain how this works exactly. Am I understanding this right that he's advising that his friend take on an additional $5 grand to the loan that he secures for the house? I didn't realize this was possible. How is this fiscally responsible? Or is it one of those things where sure, it's not as responsible as NOT taking out the additional $5 grand but its better than defeating yourself due to the potential risk involved and not doing a deal at all? Or maybe that the tenant will still be paying it all down regardless, so he as the owner wouldn't feel it anyway?

Any help understanding this would be awesome. I like the idea of it (though honestly, my wife is all in on investing already... no convincing needed... but I know from experience that little wins... little rewards go along way in keeping us motivated with things like this.) But I don't want to go this route at all if its actually a horrible idea for a number of reasons.

Thanks BP!