All Forum Posts by: Hart Pearson

@Syed H.

Agreed. Not saying flipping is a useless tool. Just one that gets too much spotlight.

@Ryan Hazelwood

34 yrs old

9 SFHs. Mostly BRRR. Sold 1 last month. Self managing. Avg. maybe 700 in monthly cash flow

Wish I had never sold a flip. Would probably have 25 and those would be the best of all of them. Flipping is overrated.

@Anthony Gayden 401k is an excellent long term savings vehicle. But you aren't "creating" a lot of wealth. You're saving your way to wealth with the best return possible for a liquid long term savings vehicle. I think many people are happy with Dave's plan, and it's solid advice for the masses. I do notice that $1,000,000 retirement accounts like you mention seem to be overly exciting to the "savers." Do you think they are they planing to pull a conservative $30k a year of income or overly aggressive $50k a year in income off of that? I've noticed they are very disappointed when you tell them that's what their $1,000,000 investment account really equals. They suddenly don't feel rich. I'd focus on cash flowing investments. It takes a bigger pile of savings than people think... and most of your better years in life to get where you really want to be at retirement age.

@Aaron Hunt You’re not alone! Awesome that you’ve opened yourself up to small business too. It’s interesting... you are likely a very smart guy. In real estate and small business THAT MATTERS. All you have to do is outsmart the other guys in your market and you win. In your 401k it means NOTHING. Intelligence gives you virtually no edge. You won’t outsmart Goldman and Berkshire etc...

Also think of this... your rental cash flows a slightly weak $300 per month. That’s $3600 per year worth of income. When you retire you’ll safely take 3% of your assets as income. So it’s takes 118k in retirement assets to produce equivalent cash flow! A little cash flow is worth a lot!

My observation from my wealth management days... There are two general paths. 

1- Sell your time and work to earn a high income. Save as much of that income as you can stand too and put it primarily in 401ks iras etc. the stock market, when done properly, is the best yielding long term savings vehicle there is. These people at a certain age will switch from growing the pile of money with savings to monetizing the pile they’ve grown and be FI. This works with exceptionally high income earners who can resist spending it. Docs, execs, lawyers, good sales people... they don’t have the time left to do real estate correctly.  

2- learn to invest in real estate and businesses (cash flowing investments). Grow the cash flow. Nobody from this side of the equation Should invest in the market UNTIL they’re rich enough to worry about asset preservation and diversification. Otherwise a 401k is crippling their growth by sucking their liquidity dry. These people can get richer and don’t need a lot of income or high degree level to get there. But broad is the path and narrow is the way. 

@Randy Bloch I think it depends on your definition of success. In my mind, if you aren’t financially free yet, then 401k and diversification offered by 3 buckets is slowing you down. If you’ve achieved your goals then by all means diversify and worry about taxes. I don’t want to become free when I’m old. I want to pump everything into passive income and expense reduction. Not stuff it all in a time capsule of a 401k and then, when I’m weak old and institutionalized, start asking “so how do I actually create some income with my money?!”

@Andrew B. I’ve always considered diversification more valuable to someone who is trying to preserve wealth. I’ve never met someone who credited the accumulation of their wealth to diversification.

@John Teachout Fayette can be a bear, it's true. It's also relatively expensive. Pike's great though, good schools... HAS to appreciate over the coming years I'd bet.

@John Teachout thanks for the reply! I’m curious why the Fayette properties are a pain in the neck for buy and hold?

@Kase Knochenhauer- Thanks for the info.! That makes sense to me... I'm hungry for more distressed properties and would like to pursue some form of off market lead generating this year, but had some mild anxiety at the amount of ibuyer marketing activity around Atlanta lately.