All Forum Posts by: Dominik Perrenoud

Ha, I love your mindset! If I can do 40, I guess 41 should be doable as well, right? :-D 

I haven't looked seriously into out-of-country RE investments. However, I'm already investing with a fellow BP forum member in Switzerland who is from the US and also invests there. So maybe you'll see me looking at properties over there before you know it :-)

Haha I have to admit, Züri Fäscht is one of the two times of the year where I get as far away from the city as I can (the other being the Street Parade). Too many people in one place. Being a car enthusiast, I much prefer the empty mountain roads on early mornings.

Sooo, 1+ year later, here's how I fared so far (in case anyone still reads this):

First things first, I actually did buy that rear wing for my car, albeit a used one, to get a better deal. Since I "saved" oh-so-much on that deal, I also added a new exhaust to that bill.

At the same time though, I also managed to squirrel away over 40% of my pre-tax income of the last 12 months and invest it. Not directly in real estate yet as that is still outside of my ballpark financially speaking (prices in Switzerland are insane), but in solid, passive income-producing assets.

If I can keep that pace up, and it looks like I can, I guess I'm on the right track.

@Mary M.

Thank you for confirming my intention! These are exactly the areas I need to get working on - real goals and some fixed amount of "reward money" each month. That way, I won't feel like I am missing out while still building savings.

@Doug Pintarch

I see, makes sense. Except for the one with the curve ball, what does that have to do with the rest? 

@Ernesto Hernandez

Thanks, it's on my list for the next Amazon package.

@Account Closed

"There has to be a 'carrot' that is enticing enough to you that if you focus on it you are willing to forgo other luxuries."

Yes, that is exactly it! It's become clear to me that my next/first step must be to define that carrot for myself. Then everything else will fall into place much more easliy.

Wow, I’m overwhelmed by the number of replies! So much value in there.

Let me try to answer all of them.

*Deep breath*

@Chris Szepessy

Thanks for the tip, I like that idea!

@Christian Montalvo

No, I don’t have that BIG investment goal figured out yet. But I see the point. I should get working on an actual plan for that.
Maybe it would make sense to set aside a certain (relatively small) sum each month for “reward purchases” to scratch that itch somewhat, and when that pool is gone, it’s gone until the next month. I think I might respond well to that.

I also like the approach in “Your Money or Your Life”, where you calculate your actual income per hour (minus all the expenses it costs you to get to work, look nice for it etc.). Then, when you want to buy that next “reward”, stop and think about how many hours you have to work to be able to afford it. Makes you think twice, but I haven’t internalized that yet.

@Alan Pederson

Yeah, it definitely comes down to the mindset. I guess I am lacking the long-term perspective because I have only been earning a noteworthy income for a little more than half a year. I keep deluding myself by telling myself, “After I buy this thingy (e.g. the car), I won’t be wanting anything else for a while.” But sure enough, only a couple of weeks after the purchase, I was already looking at all sorts of modding parts on the Internet.

I guess this ties up nicely with the long-term goal/strategy @Christian Montalvo was talking about. Once you have that in order, it becomes much easier to put that money away.

@Jessica King

Yes, Rich Dad Poor Dad is very inspiring. Luckily, these days there are other ways to get into real estate, such as renting apartments and subletting them via AirBnb.

@Doug Pintarch

“I'm in the car business and don't like cars”, interesting approach to career choice :-)

But seriously, I admire that mindset that you don’t like spending money! How do you manage to get it, though? Because as you say, you work long and hard for it in a job you don’t particularly like. Many people would want to “reward” themselves lavishly and regularly for working like that. Is it all habit from earlier in your life?

@Joe Splitrock

You, sir, are absolutely spot-on! I actually started looking at apartments after I helped a friend move into a place much nicer than mine… I also moved into my current place after a similar experience a few years back. In that instance, I managed to upgrade the apartment without paying more rent, but the trigger was very much the same. Good thing I’m hardly ever on social media, or I would probably be much more hooked on spending.

But it works very much offline as well. A good friend of mine seems to have at least three vacation trips planned at any given time and they are still studying. I’m very happy for him that he can that (and I wouldn’t want to travel around that often anyways). It still makes me feel somehow inadequate and leaves me wondering how he can afford that (it's not his parents).

I know this kind of thinking is ridiculous, yet I can’t escape it. Reading through this thread is a great help, though, like the following of your quotes:

“So the answer is not to deny yourself anything, It is to make careful purchases that add value to your life.”

“Most people driving fancy cars and living the high life are generally broke living paycheck to paycheck.”

I don’t have anything to add to that. Amen.

@Bob Woelfel

“I started asking myself when it came to big purchases if that purchase was going to get me closer to my goal.”

This ties up nicely with earlier posts and I will definitely sit my butt down and work on actual goals and the steps to get to them. This should help a great deal in keeping perspective.

“What opportunities are you giving up by doubling your rent payment or spending the 3k? If I buy this now then maybe I can't buy something else I might want later.”

Thank you, that is exactly the kind of thinking I want to incorporate. It’s there on the surface, but much like the little angel on a cartoon character’s shoulder, it gets pulled down by the little devil on the other shoulder.

I will definitely get behind the numbers on this!

@Anthony Wick

Very true. I don’t have a partner, but being on the same page financially would definitely be quite high on my list for any long-term relationship.

@Steve Vaughan

"What will this purchase be worth in 3 years? 5 years?" "Will this purchase take me towards freedom, or sign me up for more years in the rat race, running on my little wheel?"

I am starting to see a pattern here :-) Thank you for your perspective on this!

“After reaching a savings/debt-reducing or investing goal, reward yourself in some way. A $3000 car appendage will never make sense financially, but as a reward for saving 5x that first, you will build good habits.”

Very much liking this idea! Will incorporate it in my planning!

@Account Closed

Also a very good point. I haven’t considered that when I bought my car. But I think, it being a Honda S2000, the price might actually go up at some point as it’s rather popular. hasn’t been in production for ten years and prices have remained rather high.

Thank you for this insight!

@Griffin Thomas

That makes sense! I’ll add it to my list.

@Ty Zaczkowski

True. I believe I need to get my mindset in order before building discipline. Because if one is still drawn to “doodads”, not buying them requires willpower, which depletes over time. But if the mind is properly set on financial goals, you serve yourself by not buying useless crap and don’t feel any pain for doing so.

@Josh Kredit-Phelps

Yes, it’s become clear to me that my goals have been much too vague so far, diluting my efforts to get there. First step, I’ll have to get clear about the goals, steps to get there and the time frame.

@Jay Hinrichs

Yes, it seems sensible to actively allocate some of your income to “smelling the roses” kind of activities in order to get the right amount of reward and satisfaction while at the same time not binging on crap that doesn’t give you anything back…

@Derek Wissner

I like the idea of tracking your spending/income down to a T. I actually did this for about three months after reading “Your Money of Your Life” but then found it too cumbersome. How exactly are you doing it? Excel entries, pen and paper?

“I need to be able to justify that to myself at the end of the year...did I get "X" amount of pleasure from the boat (absolutely). “

I also like this one very much! I’ll work out some sort “pleasure-o-meter” for the most common “doodads” I’m likely to buy and then evaluate up to what price the pleasure I get from it is worth it.

Thank you very much!

@Dennis M. 

“Delayed gratification is the number one delineating factor between the rich and the poor.” Yes, I think that cuts to the heart of it! With having started making a real income just a bit more than half a year ago, I can’t yet delay that gratification. I’ll have to work on that.

@Michael Doherty

Thank you for this advice! The idea of basically having a budget for little luxuries has come up in earlier posts as well and like it. Will definitely incorporate it in my financial planning.

@Don Gouge

Thank you for providing your perspective on this! It is true, experiences shape a person much more than thing. Plus, most things that are commonly referred to as “assets”, such as cars or one’s primary residence, often are the complete opposite of an asset.

“Make sure what you spend on brings you joy for more than just a few days.” I’ll definitely consider this in my planning as well!

Thank you all again for your insights and tips!

I feel so ridiculous, because I am now at point in life where I could save loads of cash. With relatively low expenses and no debt, I am able to save over 40% of my post-tax income every month. Yet most of my money-related thinking goes to what idiocy I can throw that money at next.

Reading through all your posts has already helped me a great deal though! I the next days and weeks, I will definitely implement many of the strategies discussed so far.

Thanks to reading all your answers, I’ve already made a small step forward today. I wanted to visit a garage to check out modifying options for my car. I’ll stay away from that garage now :-) 

P.s. Holy crap this thread has already been better than anything I could’ve imagined! So much good information in here. I will keep the next weekend completely activity-free to focus on incorporating it all into my life and get a proper planning together!

Thank you so much.

Hello financially intelligent people

How do you not let your expenses grow with your income? This question has been on my mind lately due to significant changes in my financial situation (for the better, luckily).

Let me quickly give you a bit of my background. I read "Rich Dad Poor Dad" by Robert Kiyosaki in 2015. Since then, I've been hooked on everything finance, investment and mindset related. I've read books, listened to podcasts and read many blog articles on BiggerPockets, of course. 

So I thought my money mindset was on point, particularly when it comes to spend less than you make. Until about a year ago, I was living on a student's "income" that more or less covered basic spending and nothing more, which was fine for me and even allowed me to put a bit of it on the side over the years...

...which I then spent on my first car as soon as I got my first real job. And this is where it gets tricky for me. After more than doubling my income in said job over the last year (having started as an intern), I repeatedly find myself looking for loft apartments twice the rent of my current place (where I actually like living), unnecessary modifications for my car and the like. 

I always thought I was above that kind of thinking (aka expanding your spending with your income) because I managed to get by on a much smaller income. Now I'm realizing I'm very much like everyone else in this regard - what a horrifying thought.

Recently, I read "Your Money or Your Life" and very much liked the concept of "enough" in it. Basically, that's the point where more stuff doesn't add anything of value to your life. Also, I started reading a little bit about Buddhism - okay, it's The Dalai Lama's Cat... Given that the author knows what he is writing about, a core learning in Buddhism seems to be that true happiness comes from the inside, not our circumstances. Also a concept which I very much endorse. 

So why the hell can't I stop thinking about that $3000 carbon rear wing for my car?

My guess is that my subconscious tells me that now, finally - with my first actual income after 25 years of, well, basically minimum wage, starting at birth - I deserve to get all the nice things. So by denying them to me, I am cheating myself out of what I have been waiting for for the last 15 years or so. In any case, I find it really hard to struggle against it, even though I firmly believe the right mindset switch is up there in that bald bubble above my eyes.

Now - if you have borne with me until here, let me ask you: How have you managed to not let your expenses grow in step with your income?

What has helped you get your mindset in order so as not to feel you're depriving yourself of anything while your income is growing?

Phew, just finished reading this whole thread. My first thought: I cannot believe the nerve of some people. I read about several prospective tenants demanding the landlord/owner put in granite countertops and stainless steel appliances despite them being on government housing assistance, tenants moving in their whole restaurant staff and the ones leaving the unit a complete mess, get evicted and then reapply for that same unit as soon as it has been rehabbed... unbelievable.

My favourite stories include the liar's fee, the tenant driving up to the building in a new BMW SUV asking whether the landlord accepts Section 8 and the one genius asking whether the landlord was "420 friendly"... And of course I was very sad when I read the squirrel tenant moved out :(

Besides being great entertainment, this thread is also very informative for a complete newbie like me. I have learned that sticking to your policies (credit, criminal, pets etc.) is imperative, no matter how sad a story the prospective tenant lays at your door (or, in one case, offering to put down their pet to be able to move in...). Also, the notion of checking out the applicants (manners, clothes, punctuality etc.) appears to be rather dependable in weeding out duds.  
As soon as I acquire my first property I might have some stories of my own to contribute to this thread. Keep 'em comin' please!

Thanks @Dave Visaya for the link, I'll be sure to check this guide out in the coming days!
And thanks @Account Closed for your input. I will keep it in mind!

Hi there
I'm a 23 y.o. university student from Switzerland. I have taken up an interest in real estate investing after reading Rich Dad Poor Dad by Robert Kiyosaki earlier this year (from what I read on the forums and heard on the BP podcasts so far, this is a popular starter drug among investors). Anyway, I'm at the very beginning of my life as a real estate investor and am not yet looking for actual deals. At the moment, I'm working on my financial education by reading all sorts of books about real estate investing (e.g. several from Kiyosaki's Rich Dad Advisors and BP's Brandon Turner as well as your president-elect), listening to podcasts (BP, Rich Dad Radio Show) and checking out the BP forums and blog posts.
What I'm looking for at the moment is basically any knowledge, best practices and tips you guys can provide, especially concerning the Swiss market, because that's where I will most likely start for practical reasons (living close to your investment). What I'm also glad for are book and seminar/event recommendations, specifically for the Swiss market if possible. Speaking of events, has anybody here visited the "EXPO REAL" in Munich? With that being such a large event, I would assume it's worth the travel/hotel costs?
Over the course of the next year, I will probably be looking out for some good advisors. So if anyone has any leads to good advisory firms in Switzerland, I'm all ears. Advisors/the team is another topic I would like to hear from you about. Robert Kiyosaki and his Rich Dad Advisors keep talking about the importance of having a whole team of advisors together before you even set out on your first investment property: An attorney, an accountant, a real estate broker and a property manager. Later, you can (and should) add more members, including, but not limited to: mortgage broker, a contractor, appraiser, insurance agent and tax advisor. Yesterday, while browsing the BP forums, I found a post of someone saying they own several properties but have never spoken to an attorney. So what is your philosophy here? What are your experiences with team members (or without them)?
Hopefully by now you can see what I'm about at the moment. It's still quite a big jumble up there between my ears, any information you can provide will likely help me out and will be appreciated.