Cướp:
Welcome to the BiggerPockets show, #628.

Henry:
Just keep in mind that if you’re on this path to quit your job, that you need to keep what you’re doing in focus and keep that scorecard, that running scorecard, like people say as an investor, you should keep your scorecard of your personal financial statement, right? So you track your net worth. I think you should also track your hourly rate. The more money you start to make from side hustles, the things you should continue to update that hourly rate and kind of keep that in front of you, so you can see where you might hit that threshold of like, all right, it might be time to start thinking about transitioning over from one to the other.

Cướp:
The BiggerPockets Real Estate Podcast show is all about keeping you the art of investing in real estate and, hopefully, achieving financial freedom one day. Whatever that means for you, whether that means quitting your nine-to-five job or having an entire portfolio that sustains your lifestyle. We’re here to show you how to do that. And I’m joined here by my good friend and co-host, Henry Washington. How you doing, man?

Henry:
Boom. What’s up buddy? Glad to be on the microphone with you again. You’re like my unofficial twin. Our stories are so similar.

Cướp:
Right, we are. We’re spirit animals.

Henry:
We basically look exactly the same, and so I don’t know how people don’t get us confused more often.

Cướp:
I know, man. I know. Someone at the airport the other day was like, “Are you?” And I was like, “Yeah, Robuilt.” And they’re like, “No, Henry Washington.” And I was like, “No, why do people keep saying that.” What’s new with you, man?

Henry:
Hey man, life is fantastic. I am enjoying kind of growing and scaling my business. We kind of got to this kind of poop or get off the pot moment with my business. And so we’ve been growing and scaling and kind of taking this entrepreneurship to the next level. So it was fun to kind of get to talk to you about that whole journey on this episode.

Cướp:
I know, man, this is, it’s very eerie because you and I have very similar stories. We both quit our job about a year ago, it sounds like. And yeah, a lot of things really lined up for us. So I’m excited to actually get into it because we’re going to be talking a lot. I mean, we’re going to be talking about our backstory, four things that you need to know before you quit your job, things that you should be aware of, like health insurance, people judging you, taxes, all that kind of stuff. And then we really wanted to end this episode, I think, with actionable tips for people that really are set on quitting their nine-to-five job, tangible things that they could do to kind of move towards that path. What were some of your favorite parts about today’s show?

Henry:
So I really enjoyed talking about some of the unsexy things with quitting your job that people don’t talk about, right? Everybody talks about all the fun stuff, right? Like you get all this time and then you can take that time and you can make a bunch more money and then you’re going to be this multimillionaire, and it’s super awesome. But people don’t tell you about some of the ugly stuff, some of the expensive stuff like taxes suck and so you need to be prepared for it. And yeah, health insurance is expensive and you need to have that as well. That was a well-timed cough, I like that. Health insurance, cough, cough.

Cướp:
I know, I keep muting myself every time I cough. I’ve got this cough, man.

Henry:
Yeah. But, all these things are things people need to be aware of as they prepare for this part of their journey in their life. And so I love that we were able to touch on some of those things that people don’t talk about in 15-second videos on Instagram.

Cướp:
Yeah, that’s right. We only talk about the good stuff in the 15 seconds, but not the bad. But yeah, before we jump into it, let’s jump into our quick tip, which is going to be brought to the audience by sir Henry Washington himself.

Henry:
Awesome. Yeah. So the quick tip for today is to go and check out the On The Market Podcast. On, On The Market, we focus on talking about actual current events happening in the real estate space and how it’s affecting our businesses, what we’re doing or what we’re not doing because of things. So we talk about things like inflation, higher interest rates and how that’s affecting the real estate space and what we may or may not be doing because of it. So go give us a listen. We’ve got myself, Kathy Feki, James Daynard and Jamil Damji, and it’s hosted by the-

Cướp:
We were gushing over him a little bit.

Henry:
We were, I mean, there’s a little bit of a man crush on Jamil. Jamil’s…

Cướp:
Look, the guy’s got good ads, all right.

Henry:
There’s those people who just do everything well and then, like that guy’s good at all the things, right?

Cướp:
Yeah, he is.

Henry:
And then the data deli man, the data guy himself, Dave Meyer is the host of the show and it’s a ton of fun. So go give us some views, some likes, some comments and some shares.

Cướp:
Awesome man. Well with that, let’s dive straight in. Hey man, you know what’s really crazy?

Henry:
Cái gì vậy?

Cướp:
I have been a full-time real estate investor for just over a year, for about a year and three months or so.

Henry:
Hey Rob, you know what’s really crazy?

Cướp:
Những gì?

Henry:
I have been a full-time real estate investor for just over a year, like a year and three months or so.

Cướp:
That’s right. I think we found this out not too long ago, that we both quit our full-time careers, our nine-to-fives, in April of last year, right, of 2021.

Henry:
Absolutely man.

Cướp:
So I think what we want to really impart on the audience today is sort of our thought process, like our evolution, things that we went through and I don’t know, maybe some actionable tips on what you can actually do to bring you closer to actually quitting your nine-to-five job. How does that sound?

Henry:
That sounds amazing. That is a question I’ve been getting since before I even quit my job, is people asking me when they should quit, so let’s do it.

Cướp:
Yeah, man. I mean, this is a really big topic and it’s something that I’ve actually talked about on the YouTube channel many times, because I just, honestly, I wish when I was quitting my job, there was content like this. I don’t think enough people really put stuff out there because a lot of people are very scared to, I don’t know, A, be vulnerable about how scary it is and there’s also the financial component, which is a little bit taboo. But I’ll be really upfront and say, I had a really good career. I’ve always loved the career that I was in.
I was a creative copywriter in the advertising industry and I worked my way up. And I was in the industry, I would say, seven or so years if you include internships and stuff. And I was making a $110,000 at my job, so it really, it wasn’t a bad gig, right? And when you combine that with my wife’s salary, I think she was a teacher in California, she was making like $75,000. So together, her and I were both making about $185,000, which, in California, obviously there’s some living expenses that go into it, but we were really comfortable. We didn’t have any reason to actually quit.

Henry:
Yeah, man. It’s super funny because I, similarly, was in a role that I truly enjoyed. I was actually working in the real estate industry. I was an asset manager for an apartment fund, and so I was getting an education in large-scale real estate and getting paid for it. I also was making a $110,000 a year and my wife-

Cướp:
This is so weird, man. This is like crazy. It’s like everything lines up for both of us.

Henry:
My wife was making about 85,000 at the time. And so we were both very similar, both in careers that we liked and so it was a, making that decision was a struggle. And so I love being transparent and I love sharing with people the hows and whys of that we did it and hopefully there’s some gems people get from it.

Cướp:
Yeah, totally. So is your wife still working now?

Henry:
No. We retired her two or three months after I retired.

Cướp:
Oh wow. Okay, cool. Yeah. So my wife is also not working now, as well. I mean she wants to get back into it and we’ll talk about this in a little bit, which is like as beautiful as quitting your nine-to-five job is, I do want to make it known that Henry and I, we’re best-case scenarios. Things have really worked out for us. So this is not us saying, today’s the day you’re going to quit your job. You have to actually work for it. You have to earn your rite of passage here. And I think you and I kind of did. I mean, for me, I was making, again, $110,000 at my job and I had always been developing my Airbnb portfolio. And just by the way, just small caveat, I’m going to toss out numbers. I’m very financially transparent. I talk about this a lot on the YouTube channel. I don’t hold back on this just because I want people to really understand where I was coming from and I want to make it feel as approachable. I don’t want to hide anything.
So, this is not a flex or anything like that. All right. So with that, I’ve been working on my Airbnb portfolio for about four years at that time, and I had really built it up to the point where I was making about $25,000 a month in net, after all my partnership splits, after all bills and everything like that. That was my take-home. And on top of that, I also had started developing all these other sides of income. All these income streams, like side hustles, if you will. And when I started to add everything together, I just started to sort of realize that I was actually making a lot more money with the other stuff. I don’t know about you, but for me, I was like, oh, at the very least I was breaking even.

Henry:
Yeah, no, it was very similar for me, and so I kept my job as long as humanly possible. A, not only because I enjoyed it, but you do the Airbnb strategy, I’m more of a long-term buy-and-hold guy. And I love using small local banks. And one thing banks love is a good old nine-to-five.

Cướp:
They [inaudible 00:09:20].

Henry:
They want to see that nine-to-five. Right. They want to see that nine-to-five income, and so I knew keeping my job was going to help me continue to be bankable. And so that was always on the back of my mind. And so there was some strategery, if you will, around.

Cướp:
Tôi sẽ.

Henry:
Around how long I kept the job because the strategery there was I wanted my LLC to have been profitable for at least two years, so that I could at least show that I’ve had the profitable income in the LLC business. So that if and when I did decide to leave my job, that I had that track record and provide them that level of comfortability.

Cướp:
Oh, that’s actually, that’s a really, hey, you got to, you’re supposed to save that till the very end, when we get into the actionable tips, but there’s a very good one. So, I guess, I’ll tell you a little bit about my story and maybe you can tell me about yours. But I was making really good income and I calculated it out. And I was just realized that while I was making, I guess, 110 divided by 12, about $9,000 a month in that job, I was making like 35, 40,000 when you added up all of my side hustles. And I just realized, I was like, oh my gosh, I can’t possibly make more money with all of my side hustles in my real estate business until I get my time back and my 40 hours a week. And so I was just so scared.
And that one thing that was really holding me back was, well, I guess, all right, let me backtrack. So I had been telling my wife for a bit and she was like, “Just do it, dude.” I’m like, “I can’t.” And so I remember I set up a Zoom meeting with my bosses and, because this was during the pandemic, and I was going to quit. And so as soon as they both got on, one boss was trying to make small talk and he was like, he could just tell that something was wrong. And then the other boss finally joined. And then I was like, “Okay, I brought you here.” And they’re like, “Oh my God, are you okay?” And I was like, “I’m sorry, I need a second.” And so I was crying because, and by the way, every time I’ve ever quit a job, I always cry, but this cry was special because I was so scared.
And they were like, “Oh my God, is everything okay?” And I was like, “Yeah.” And they’re like, “Okay, well, what’s up?” And I was like, “I got to quit.” And they’re like, “Oh, thank God, you’re fine. You’re just quitting.” And I was like, “Yeah.” And they were like, “Are you going to be okay? Like financially?” Because, obviously, I was crying. And I was like, “Yeah, I make way more money doing everything else.” And they’re like, “Dude, you’re going to be fine. Obviously you were going to quit. We don’t even know why you’re still here. Should have quit a long time ago. We’ve been watching your channel. We know you make more money doing this.” They’re very reassuring. And so I remember after I wiped all the tears away and I said, “Thank you guys, y’all were the best bosses I ever had.” I closed my laptop and I was like, this is the greatest relief I’ve ever had. And I was a new man. I really was. It was a crazy feeling.

Henry:
Yeah. Dude, our stories are so similar. It is uncanny, because I had a similar experience by, so I knew it was time to go. And well, I thought, I figured I should start figuring out if it was time to go because I had my boss who, again, we’re talking full transparency, right? And so my boss reached out to me and was like, “Hey bud, I think you need to be putting in a little more effort than you are.” I had dropped a ball on something and so I kind of got called out and then I kind of took it personal. I was like, because I do a good job at my job, I felt like. And so I took it personal.
And then when I took a step back and I took my emotions out of it and looked at what he was saying, I’m like, yeah, well, that’s probably fair, right? But him saying, “Hey, I need you to put in more effort,” triggered me to start thinking now that I had all this other income coming in, does it make sense for me to give you that effort or should I give it to myself? And that’s when I started to do the math and before I even started to do the math, I similarly went to my wife and she was like, “Yeah, just quit.” And I was like, uh.

Cướp:
That’s what they always say. They’re like, just quit.

Henry:
How are you so cool with that decision?

Cướp:
Tôi biết.

Henry:
And so, yeah. And so I did the math and after doing the math, I basically just broke it down to what is my time on my own, what am I making an hour, essentially, versus what am I making an hour giving my company more time that I was working for. And it wasn’t even close Rob. And that’s when I knew, I was like, I hear that you want more of my time, but it’s literally going to cost me money. And so I had the same meeting with my two bosses and I told them that, “Hey, I’m going to go out on my own and continue this real estate path.” And they were like, “Well, yeah, you should do that.” Right.

Cướp:
It is so obvious. I mean, if you’re to the point where you’re quitting to become… If you’re working in real estate, like you for example, they know that you’re making… They know that you’re doing Multifamily, they’re probably watching the journey. It’s like, I have a YouTube channel. I talk about finances very in depth. And I know everyone at my job was like, “I don’t understand why you’re here.” And I’m like, “Neither do I, honestly.” It was my goal to, exactly what you’re saying, which is like be a terrible employee and I think that in a very, I say that in like, with perspective now, because it’s like it was a solid income and I was like, “Well, if I get fired, I’ll get severance, but I’m just going to hold onto this security while I build all this other stuff.” And the one thing I had going for me is I had a good rapport with my bosses, liked all my team and all that stuff. So even when I was sucking at my job, they were like, “Well, we still like it. It’s all good.”

Henry:
Đúng.

Cướp:
So I’m very thankful for that. But I think for us to have gotten here and for anyone who wants to quit their nine-to-five job, I think that there are really like four things that are needed to quit your job. And obviously, I’m sure we could spit out like 10 different things. But I wanted to talk about a few of these things because for me, first and foremost and I think we’re on the same page here, spousal approval, right? We need to, the wives need to be on board. Would you agree with that?

Henry:
100%. This is not a marriage counseling episode, but I promise you, your life will be exponentially better.

Cướp:
Yeah.

Henry:
If you get that spousal approval. 100%. Now, and I get it, right? Some people it’s going to be more of a challenge than others, right? Some people’s spouses are already bought in and some aren’t. I was fortunate enough that my wife was all in from day one. And so that eased the entire investing journey for me. And so I, literally, wouldn’t be sitting here talking to you if she hadn’t been on board. And I’ve had people say, “Well, how do I get my wife on board?” Right. “What’s the practical application for that.” And no one can tell you how best to talk to your spouse, but it’s your spouse, so you probably know the best way to communicate to them, right?
You probably know. Everybody wants in any conversation where you’re talking about needs, there’s always an element of what’s in it for me, right? And so think about how your spouse likes to be best communicated with and the what’s in it for me and you have the conversation, and sometimes you’ll have to have more than one in different ways. But don’t get discouraged, if you have the very first conversation and it gets shot down. That happens for a lot of people. It doesn’t mean that you can’t continue to work that.

Cướp:
And several times too.

Henry:
Chắc chắn rồi.

Cướp:
It’s not just, yeah. And I think that’s okay. I mean, I think here’s a good and bad thing about any marriage, which is like, if you have a good partner, they should be keeping you accountable and they shouldn’t just be a yes-man or yes-woman, right? If you give them an idea, if they’re supportive most of the time, they’re going to say yes, but if it’s a crazy idea, it’s their job to be like, “Hey, that’s a little crazy. We should talk about this.” And there’s nothing wrong with that. I think there is a really pivotal moment for my wife and I, we were on the couch during the pandemic and I was like, “What if we quit our jobs and move to Tennessee and built a tiny house village.” And she was like, “That’s crazy.” And I was like, “I know.”
But at that moment it was nighttime, we were sitting on the couch, we had just had my daughter and she was asleep in my wife’s arms, and I was like, “But isn’t it crazier to work a nine-to-five job and not see our kid every single day for as much as humanly possible?” And she was like, “Yeah, I guess if you put it that way, it kind of is.” And again, if you work in a nine-to-five job, there’s nothing wrong with that. But for our situation, I think it was just like, for me, I was like, “We can do this.” And we had that talk many times. So we got to the point, this kind of move into the next, the second thing that you need, which is side hustle income. But it got to the point with my side hustles, I was really developing stuff outside of real estate, too.
I think if you’re looking to get out of your nine-to-five, you’re not just trying to match your salary, you’re actually trying to make more. You’re trying to make more because now you’re a 1099, effectively. You’re self-employed. You no longer have your health insurance. You no longer have your 401k match. It’s expensive to just match what you were getting at your company. And so I was really growing all these side hustles. For me, that was content creation. For me, that was, I think, oh, I started consulting as a result of my YouTube channel, and I started charging a $150 an hour. And it turned out that, got booked a couple times a week. And then the next week I was fully booked out, and to the point where I was booked out a month in advance. And I kept raising rates to the point where it was like many hundred dollars, I don’t remember, I think like $500 an hour.
And I was doing that four times a day on top of my full-time job. And I was just mathing it out, and I was like, “I can’t consult more unless I quit my job.” And so it was so obvious because my wife was watching me work 80-, 90-hour weeks, and she was like, “You can’t keep doing this to yourself and you make way more money doing the thing that you love. I think it’s time.” And so I think side hustle income, whatever that means for you, for me, again, that it’s, we’ll get into that a little bit later too. But I think developing a financial system around making money, that’s not your W-2, because at the end of the day, if your goal is to become a millionaire, for example, most millionaires have seven or eight streams of income, and I took that to heart. So I was always chipping away about that. What about you? Do you have any side hustles that you don’t talk about often?

Henry:
Oh, man. Yeah, absolutely man. Again, very similar. I think you did something with furniture at some point, right? And so for me, I used to buy stuff at auctions, like pennies on the dollar, like Amazon returns and Target, Walmart returns. So I would go bid on these things at auction, get them for pennies on the dollar, and then I would sell them on Facebook marketplace and Craigslist to make some extra money. And so like, that was kind of how this side hustle thing became a reality for me. Like, oh wait, you can actually generate some legitimate money just by spending a few extra hours doing something. So that was my proof of concept that side hustles work. And then that transformed, as I got into real estate, into consulting. So I very similarly, I was charging a hundred to a 150 bucks an hour and I was getting booked up.
And as I was doing that, I was enjoying the calls man. And my wife, she saw me one time after a call and I looked bummed and she was like, “Hey man, why are you bummed?” And I was like, “Well, I just keep answering the same questions over and over again.” And she was like, “Well, why don’t you just make something that you can put out there that people can just check out.” And so that’s what got me started on the path to creating courses of some kind. I didn’t know there were courses at the time. I just wanted to save myself some time and allow myself to help more people because, you mentioned it, your calendar would get booked up, right? You can only help as many people as hours you have in the day, right? And so once I got on BiggerPockets as a guest, it obviously drew more eyeballs to my page and the amount of people that I could help, it was harder.
It was harder to help more people. When you only have a thousand followers, if 10 people want to have a call over the course of a few months, you can figure that out, but as that grows, it gets harder. And so I put this content out there and it started to make a little bit of money and that’s when I started to really look at, hey, this is something that if I can provide value in the right way for people and then provide the scalability, I can have the income, potentially, to quit my job. And so that’s how the side hustle thing kind of evolved for me. And then once that income grew to a point where, hourly, I was going to be able to make more for myself than my company, that’s how I knew I was going to be able to quit. So 100%, it was like this side hustle evolution for me.

Cướp:
Yeah. Definitely. I mean, man, dude, I used to answer the same question every single day and I loved doing it because I genuinely helped people, but it is hard. And I think it was sort of a trap too. With real estate, if you read Rich Dad Poor Dad, we start to, the thing is you can’t sell your time for money. So I always quit my job because I was like, “Oh, well, I’ll get my time back, and I’ll be able to consult for four hours a day and make way more than I was at my job.” But then I realized I was just selling time.

Henry:
Đúng.

Cướp:
I was just selling my time. And so even at $500 an hour or whatever, even if I was booked out a year in advance at 40 hours a week, which I would never recommend to anybody’s vocal chords, that’s, I don’t know, I think a million dollars a year, which is a lot of money, but that is it. That is the most I can make.

Henry:
Đúng.

Cướp:
And so I quickly realized that too. And so it’s like it ignited this fire to keep chipping away at this real estate fire that I had. So that kind actually brings us to step, the third thing that you need to quit your nine-to-five, which is proof of concept. We had our side hustles, we had the spousal approval, but proof of concept just means I’ve done it. I had done the Airbnb thing. I was good at it. I was really good at it. And people saw that I was good at it. And they were offering to partner with me and they were offering to give me their money to go and buy a property and split it 50/50. I was doing that with several partners. And for me it’s like, okay, if I could do this on the side, then certainly I could probably do it full-time too. I mean, that kind of was at your trajectory too, I assume it’s, based on the rest of the conversation, is probably the same exact thought.

Henry:
Right. Absolutely. Yeah, man. It 100% was like that for me because as I was starting to think through, all right, what’s it look like if I quit because there’s obviously a fear factor, even though you’ve got a proof of concept. I knew I could always find under-market value properties, add value to them and rent them out for profits or sell them for profits. I had that down, and still when it came time to actually pull the trigger and quit, there was some apprehension. And what helped me kind of, one of the things that helped me get over that apprehension was to think about like, hey, I’ve been able to build this real estate portfolio part-time on the side while working a full-time day job and doing side hustles and I’ve still been able to build this portfolio.
If I just take the same amount of effort that I’ve put in, but now I give myself 40 hours a week to continue to put that effort in, I’m naturally going to be able to scale that at a higher rate without putting in any more effort. The level of effort stays the same, you just have more hours to focus that effort on. And so when I thought about it from that perspective, I was like, oh, well, of course I’ll be able, I’ll be just fine, right? And so 100% I felt the same way.

Cướp:
Yeah, for sure. And I mean, last one here, we’ll touch on this. And this is really going to just depend on, really, your financial situation. But last thing you need out of the four things before you quit, again, there’s probably a lot more than four but for the sake of a nice, concise little crunchy podcast here, reserves. You want to have some money set aside because, I think it’s not necessarily advisable to say, “Hey, I was making 110, but why not? I’ll quit. I’ll figure it out.” If you don’t have your systems and your income stream set, it’s going to probably be a bad decision.
So I can’t really advise you on that. And again, Henry and I aren’t, well, this is the first time I’m saying it. I say again as if I’ve mentioned this before, but I always do that. I’m always like again, and it’s like, well, what do you mean again? You never even said it the first time. We’re not financial advisors. All right. So none of this is financial advice, but I think the good rule of thumb here is if you can have like six months of reserves to kind of cover you and your bills, that’s always going to be a safe way to go.

Henry:
Yep. I totally agree. And we thought a little non-traditionally about the reserves because, again, that fear factor was setting in as it got closer and closer for me to actually have the conversation to quit. I was like, “Well, how are we going to find this money?” And so what we decided to do was just take the profits of a flip that we had coming up, that we were going to close, and instead of putting that money in our business account, which we would normally do, and the other benefit we’re not talking about is, Rob and I also developed the side hustles so that we wouldn’t have to touch our real estate business money.

Cướp:
Ồ, vâng.

Henry:
So that we could keep reinvesting that, right? And so, because we made that smart decision of not using that money, when I got to a point where I was ready to quit, I just said, you know what, I’ll take the income from this flip that I’m going to make, and that happened to be about what my wife’s yearly salary was, and I threw that in an account just away from everything else, just as a safety cushion for me to know like, hey, I have 12 months of my wife’s income right here. And so if things don’t work out, I know I’ve got this cushion and we been living off that cushion for years now. So it’s there. It made me feel safer. It made it easier to take the leap. We actually didn’t have to end up touching any of it, but just having that reserve there and knowing that it’s there, gave me the confidence to really put my all into entrepreneurship.

Cướp:
Yeah, for sure. And there’s something that you sort of touched on, which is really great, because I want to talk about the things that you need to be aware of before you quit. And you were sort of talking about that 40-hour work week, and now that you could focus on that full-time. But I sort of want to talk about the, I don’t want to say the not so glamorous part of the nine-to-five, because it’s a net positive, I will say that, but things that you should be aware of. And I think, we think, oh, okay, we’re going to give away or we’re going to get back 40 hours of our week and it’s going to be great. We’re going to have so much time. But the idea of work-life balance is, I’m not going to say a myth but it’s, basically, it’s non-existent, right? There’s that old adage that’s like entrepreneurs will not work 40 hours for someone else so that they can work 80 hours for themselves.

Henry:
Đúng.

Cướp:
That’s really true. I mean, I work a lot more than I did, because at my nine-to-five job, as I said, I was a terrible employee. I was trying to milk that cow for as long as I could. And what I really quickly realized is I was really giving about 10, maybe 15 hours of my actual time and effort to my job, which I think most people realize during the pandemic, they’re like, “Oh, I don’t need to work 40 hours.” And so I thought, oh, I was going to get 40 hours back, really I got 10 or 15 back.

Henry:
Đúng.

Cướp:
And it just turned into this whole thing where now I’m working 70-, 80-, 90-hour weeks often. Not as much now, thank goodness. I’m figuring that out. But for the very first year, quitting my job, my focus was to make money and I succeeded. I was able to more than 10x it. And it was a really crazy time for me just because I was just going so freaking fast and furious. And yeah, I mean I think the nine-to-five job, I kind of miss it in a sense because it kept me to 40 hours and now I work a lot more. I don’t know about you.

Henry:
Oh, dude. Yeah, absolutely. That smacked us in the face when we quit, because there’s also this thing that we don’t think about, this added pressure now of you’ve got to go produce because you don’t have that salaried income coming in every month, no matter if you produce in your real estate business or not. And so there’s this pressure to go produce, plus you’re an entrepreneur, you enjoy what you do. And so you just end up cranking extra hours. And I really had to have a sit-down with my wife to talk about how do we establish some boundaries and what expectations do you have for me in entrepreneurship versus when I was working a salaried position, right? And I wanted to have those conversations. So I knew on the front side kind of what she wanted for me and how she wanted me to spend the time and we could have that kind of a conversation, because now you’ve got this added layer of entrepreneurship and pandemic life, and so there was a ton of time at home.
And so you really had to draw that hard line in the sand of when you call it quits and go focus on family and kids and those kinds of things. And so it was a lot in that first month or so but luckily, again, I have an amazing wife and we had that sit-down and we’re able to draw some boundaries. And I’m not perfect with them, but we’re getting better. And so now I come to an office, I moved everything from home to an office, so that I give myself those boundaries physically. I have to get up, get ready, physically go to work, physically take my laptop, physically take my laptop home. And so you’re mentally saying I am taking my laptop home, right? Which means you are planning to go do some work versus leaving it at work. And so that physical office has also provided us some boundaries.

Cướp:
Yeah. It’s hard. It’s really tough. I mean, because especially in our first, in our house in LA, when we were doing this, because my wife was like, “You’re right there. Why can’t you help me? The kid is crying or you got to change the diaper.” And I’m like, “I’m sorry.” I know that I’m here, but I’m also like I’m drowning. And there was a lot of those moments where we had to have heart-to-hearts where it’s like, look, it’s not that I don’t want to be around, but it’s like at my work I could mess around and still get paid. And if I don’t work, we don’t make money. And I was way too just in my head about it.
And I think, other things that were really tough for me was like healthcare. Part of the story I didn’t talk about was when I was crying and they were like, “Are you going to be okay, financially?” And I was like, “Yeah, I make way more money.” My bosses were like, “Then what’s the deal?” And I was like, “Healthcare, it’s expensive.” And I was over here getting in my head about $2,000 a month of healthcare, when I was making, I don’t know, at that point like $35,000 a month with everything together. And so healthcare is expensive and that’s something that you have to think about.

Henry:
Vâng.

Cướp:
And there are a bunch of different options. You’re no longer getting your 401k match. Qualifying for a mortgage is really tough when you’re self-employed, like you said. I make significantly more money than I’ve ever made and a bank still won’t give me a loan because I look poor on paper and it’s really annoying. Now after I get my taxes season, this is my second year of making income like this, I’ll finally be able to count it and finally buy a house without having to jump through so many hoops. But it’s really tough.
So I think, if you’re in this world where you want to become a real estate investor, close on those houses first. I closed on a house and literally as soon as I closed on that house, I quit the next week because I was like, all right, that was it. I did it. So, yeah, qualifying, I think, I don’t know if you had any judgment in your life when you told people that you’re quitting, but I did. I had people that, as supportive as most people were, I had some people that were like, “That’s crazy.” And I’m like, “I think you’re the crazy one. You rely on one income at your job.”

Henry:
Đúng.

Cướp:
I was like, that’s crazy to me. And I was just getting defensive because I was like, “Why not just support me?” That, it hurts. And it was family, at first, because it’s just, no one in my family has ever done this before, and so it’s so weird to them that I would leave a six-figure job.

Henry:
Yeah.

Cướp:
And what they didn’t understand was that like kind of what I was working on in the background. So yeah, did you have any judgment in your life or was it relatively smooth sailing for you?

Henry:
Oh, dude, absolutely. It’s been throughout the whole journey. And yes, absolutely, a lot of the judgment, for lack of a better term, will come from your friends and family, the people closest to you because they know you before, they know you as the guy that didn’t do any of it, right? If you’re just getting started on this entrepreneurial journey, right, they don’t know that you, that part of you, they see the old you. And so as you start doing these things that seem crazy, right? You get some judgment and sometimes that judgment comes from a good place. Sometimes it’s, “Hey, this is risky. I love you. I want you to be able to pay your bills and I want you to take a safe path.” And sometimes that judgment is, “Hey, I don’t want you to be doing better than I am.” Right?
And so you can piece together who’s being judgy for what reasons, but absolutely. And just remember folks, this journey that you’re on, this vision that you’ve been given is for you, it’s for you to act on, it’s been given to you. It’s that nobody else has to understand it for you to be successful in your journey. And so don’t let that hold you back. There’s a reason that being a trailblazer is painful. You’re the one going down the path first, you’re cutting down all of the obstacles and barriers that are in the way. And so you’re going to get the nicks and the cuts and the things that come with being the leader. You’re going down a path, maybe people in your family haven’t gone down before.
And so yeah, that judgment is just part of those nicks and cuts and things that you’re going to have to endure as you start to blaze a new trail for people in your family, behind you. It’s a blessing that, that’s something that you get to do. And so don’t see it as a negative. See it as like, I am creating this new path of wealth that other people in my family, behind me, get to go down, and I’m okay taking the brunt of the judgment and the nicks and the bruises so that I can make the lives of people behind me and my family better. I love it.

Cướp:
Yeah. Let me just be clear. You are crazy too. When people say you’re crazy, it’s like, “Yeah, you’re right. I am.” Embrace it. Embrace the craziness because I think that’s what’s going to set you apart. I really actually liken this. I used to have like the, like when I bought my house in LA in 2016, I actually had family members that were like, “You’re crazy.” Indirect family members are like, “You’re crazy. You’re buying at the top of the market. We’re in a housing bubble.” And I was like, “Well, I’m still going to do it because I want to buy a house and no one’s going to stop me.”
And fast forward to five years later and my house has doubled in value from 624,000 to 1.2, 5 million dollars. They still don’t own a house. And funny enough, they’re looking to buy a house now. If it wasn’t the top of the market then, you could probably argue that you’re pretty close now. So I think you just got to take action and not worry about what other people think. You know what I mean? And I think that’s kind of how the nine-to-five thing is like, quit your job. Don’t worry what they have to say. Just do it and figure it out, because at the end of the day, if you’re the one that’s right, that’s all that matters.

Henry:
Chắc chắn rồi.

Cướp:
So I’m kind of curious, man. What changes actually happened when you became a full-time real estate investor? Did your investment strategy change or are you doing the exact same thing?

Henry:
Yeah. So from an investment standpoint, we’re pretty much doing the exact same thing, the difference is I have more room to grow and scale that because of the time I got back. And then I can also, the one thing that is changing now is we’re adding people to the team so that I can start to grow and scale the business without me having to put in all the actual work myself. And so that was more difficult before, because there was so much focus on me having to do my nine-to-five and do that the proper way to be able to think about hiring people and making enough income to hire people in my business was a challenge.
And so now that we are producing the income that we need, I’m realizing that I quit my job, that bought me some hours. What if I could pay somebody to buy their eight hours a day, right? And so the more people you bring on the more hours you’re adding to your business and you can get an exponential return. And so we’ve just hired our first person, which is actually my content manager, and we’re actually looking to bring on an acquisitions manager next to help with the acquiring properties.

Cướp:
Yeah. So I’m curious because I’m sort of at that point now, I have my team consists of my assistant, who’s effectively like my property manager and everything, social media manager and community manager. And then I’ve got my business partner, he basically executes the whole real estate side of my business. I mean, obviously, I’m still involved from a higher-up level, but the day-to-day he’s doing that. And I’m at this point now where it is time to build a team. So I don’t know, what’s your thought process on, because obviously I’m cheap and I think most real estate investors are, so.

Henry:
Same, bro.

Cướp:
Curious like, what are your thoughts on sacrifices of payroll versus getting your time back? Because, obviously, paying people is expensive unless you’re not paying them and you’re giving them equity, which is a lot more pay in the future.

Henry:
A lot more expensive too, right?

Cướp:
Yeah, exactly. For sure.

Henry:
Yeah. So, for me, my thought process around hiring people has been around two areas. So high dollar activities, right, that take a lot of time. And so if something produces me a lot of income and takes a lot of my time, I’m going to look at it as is this something that makes sense for me to hire someone to do? The other thing that I’m looking at is, essentially, marketing, right? What is driving more business for me? And so my content manager is essentially part of my marketing budget because we all know social media is less about social media and more about marketing. It’s getting eyeballs to you. And so I wanted to take the things that are going to be the highest impact to the bottom line and take the most amount of time, and see if it makes sense for me to bring somebody in to do those activities.
What I call relentlessly consistent, because I think relentless consistency is what truly builds businesses, right? It’s the ones who are consistent no matter what’s happening. And so right now, those two activities, like I said, for me, are content and keeping the content flowing, as well as keeping the marketing for deals and the acquiring of those deals going, because those two things are going to generate the most amount of income. And if I can have somebody else’s time to do those things, then I can use the time that I have in my brain to think of more income generating activities and get involved in more things than we’re involved in now.

Cướp:
Yeah. So quick tip, mid episode quick tip here. Mid episode, quick tip. We just released an episode with Brandon Turner and we talked about all things personal brand and building content and everything like that. So if you want to learn more about content creation and how you can utilize that in your real estate business, definitely be sure to tune in on that. But yeah, man, that makes a lot of sense. I think, you’re a much better influencer than me, I really, I hate saying that, but I just, I can really do one YouTube video every single week and that’s it. I’m like, it takes so much of my time and effort to do one YouTube video right. If anyone’s ever seen it, there’s a lot that goes into it. There’s a lot of editing. I don’t even do the editing, my editor does, who is like the foundation of my marriage because he saves me so much time.
But really, it’s hard. And so I try to put stuff out on Instagram too and everything, but I just can’t do it every day. And I know that you’re right. Putting yourself out there, getting those eyeballs out there, is really important. I know that Pineda and guys like that, I think he spends like, I don’t know, I want to say like 40 grand a month on content creation.

Henry:
Tôi tin nó.

Cướp:
And I spend about, I don’t know, five, $6,000 on content creation. So I’m actually in that phase now where it’s like, okay, if I want a 10x, do I go and spend 50K a month doing this? And it’s really hard because it’s like such a seemingly vain thing to spend my money on, but I know that it’s like the, I don’t want to get into content creator conundrums, but I know that it can help people more if [inaudible 00:43:13].

Henry:
First world problems.

Cướp:
Vâng chính xác.

Henry:
Yeah.

Cướp:
So on the acquisition side though, moving back to that, how do you even figure out how to compensate someone like that?

Henry:
That’s a phenomenal question, because we’re looking at all of those strategies right now. And so some of the things I’m thinking about are do you just pay somebody a flat salary, and flat salaries are awesome because it’s stability, but is it motivating enough for someone to continually go out there, make offers, talk to sellers and kind of grow and scale from that level? We’re also toying with the idea of leveraging the eyeballs on social media to bring in somebody who already maybe like, knows and trusts you from your brand and may be good at sales and talking to people and then maybe bring them on as an intern to see how they do and then pay them per deal that they bring down. And so there’s tons of different strategies. And I, honestly I’d be lying to you if I told you I knew which one was the right way to go.

Cướp:
I mean, they’re all right. It’s whatever’s right for you.

Henry:
But my gut is telling me that I want to pay somebody based on the deals that they close, and so there’s probably some level of both, where you get some kind of a base but that pay can increase drastically, the more deals that you close.

Cướp:
Yeah. Well, look, I’m really in line with it. This is where I’m at in my business because things are going really well as is. And right now I’m at, I think, 15 or 16 short-term rentals, we’re currently negotiating a hotel deal, which is 20 doors. That’ll double my portfolio, effectively, overnight. I’m raising a couple of things. I’m raising a fund where I’m building 20 houses in Joshua Tree with Tony Robinson, Real Estate Rookie. If you guys haven’t listened to that, awesome podcast as well. All in the family. And then I have another fund with Superhost Labs, where the goal is to start raising a lot of money to go and acquire a hundred properties. And I’ve got another investor that we’re working with, who wants us to help him scale up to a hundred homes.
So we’re moving, and I’m like, okay, we have faked it for a long time in that, like fake it till you make it, right. And I’m what I mean is, obviously we’re really good at this and we’re doing it, but it’s like, we were good at doing the single family acquisitions, one at a time. But now to go from one acquisition to acquisition is becoming a really big drain on our time. And so we’re quickly realizing we got to go for like 20, 30, 40 door deals or syndications where we can have a lot more money. The returns don’t have to be 50%, they can be 10%. And then we can just start buying a bunch of short-term rentals around the country. So, for me, as I scale, I understand how to get there but the building the team is very crucial because one thing that has changed for me in a very significant way, obviously I assume this is for you too, but my time is a lot more valuable. You know what I mean?
I hate even saying my hourly rate, so I’m not going to say it, but it’s very expensive. And when you start to scale and when you start to understand that your hourly rate is very high, then it doesn’t make sense for you to go out and buy a two bedroom, one bath Airbnb, you got to go buy 20 of them or build 20 of them. You know what I mean?

Henry:
Yeah.

Cướp:
So for me, I think scaling in my business means I’m now evaluating deals based on if they are seven-figure deals or not. So if something is not a seven-figure opportunity for me, I just, it costs me money to pursue it.

Henry:
Yep. It’s the same. It’s like the same analysis you put into quitting your job, right? You have to sit back and think about what’s the best use of the time that I have available. What’s the best return on that. And if it’s not going to provide me what I feel like is what I need for my time, then it doesn’t make sense, right? And so I totally understand that. Yeah, we’re at a place where our normal operations, as far as acquiring properties, is the same but we’ve been focusing a whole lot more on holding multi-family. And for a very similar reason, because I can find single-family homes all day, but they don’t provide the return on investment that the multis do. And so our strategy shifted from buying and holding everything to, we’re going to dispo the singles, build the capital and we’re keeping multis, and heavily looking for more multis. So 100%, I get it.

Cướp:
Yeah, man. And I think obviously the big benefit here of scaling, like a big benefit, if you’re doing this right and you’re actually making money doing this, even if it’s 25, 35, kind of where we were at, or let’s say that you’re to the level where I am, where I’ve 10x my income, and taxes, taxes suck, right? So scaling is so important because you’re going to be able to lock down a lot more real estate and wipe out those taxes. I’ve really gone down a huge rabbit hole on taxes because I hate paying them now. Before I was like to pay Caesar onto Caesar, what is his? And now I’m like, oh, I got to pay like hundreds of thousands of dollars.

Henry:
Oh, dude. I met with my accountant yesterday and it was a very painful meeting. Oh, boy. Yes, taxes. Think about that before you go down this path, because, boy, making money is expensive.

Cướp:
Yeah. But someone told me this and I try to, it was cheesy when he said it, but it’s so true. He said, “Paying taxes is a good thing, because if you’re paying taxes, that means you made money.” So as much as I want to complain about spending hundreds of thousands of dollars on taxes, I’m like, okay, but the plus side is I made the money that is getting me to pay that tax bill. So with that said though, I figured out, basically, how to wipe out taxes. And it said, yeah, it’s acquiring luxury real estate. Me and David Green just did a deal. We bought a 3.2, 5 million dollar house in Scottsdale. I’m doing these syndications. I’m, hopefully, really going to buy millions of dollars of real estate this year. And when we do cost aggregation and bonus depreciation and all that stuff, it should knock my tax bill down, I’m not going to say a hundred percent because I actually do want to show an income on my taxes, so I can buy a house like we talked about, but it’ll be significant.

Henry:
Yeah, man, 100%. I was recently recording an episode of On The Market and where we were all doing some deal analysis and you’ll be proud of me, Rob, the deal I brought to the table was the first property that I’m buying, specifically as an Airbnb, so I’ve never-

Cướp:
Oh man, proud dad over here.

Henry:
I’ve never bought one with the purpose of me buying it to be an Airbnb. Now I have two Airbnbs, but it’s a duplex that I had, a long-term, that I converted. And so this is my first actual Airbnb purchase, so that’s the deal I brought to the table. But Jamil brought a deal to the table where he talked about an apartment building that he got a great deal on. And Jamil, by nature, he’s a deal-maker. He likes to flip stuff. He likes to buy it low, sell it high, right? It’s in his-

Cướp:
He’s a everything guy, man.

Henry:
Dude, he’s a rockstar.

Cướp:
He’s like a freaking hilarious guy. His ads are, I mean, I’m an ad guy and my ad should be good, and like his ads are like insane. He does funny parodies of lawyer commercials, and oh my gosh, that guy. Yeah. If you guys haven’t listened to the On The Market podcast, go, do yourself a favor because yeah, that guy, well, you guys both, but Jamil, we’re talking about him right now, Henry, don’t be selfish. Jamil’s awesome.

Henry:
Yeah, man. And so he was talking about buying this apartment complex and he could make 1.2 million on an assignment fee if he assigned that contract.

Cướp:
Wow.

Henry:
But he also talked about, he just had to pay $800,000 in taxes. And so the benefit to him buying this property, wasn’t the cash flow it was going to produce. Right. It wasn’t the appreciation. It was the, I need a tax shelter, I need something that’s going to help me to reduce that tax bill. And so real estate, yes, making money is expensive but the awesome part about real estate is if you buy the right assets, right? If you use the skills that you’ve developed to grow and scale your business to where it is now, and then strategically buy the right assets, you can use those assets to kind of help offset that tax bill, just like you said, with acquiring the millions of dollars of Airbnb properties, because it’s going to do that for you.

Cướp:
Yeah. I mean, so this, look, if you want to quit your nine-to-five job, obviously there’s a lot that we’ve covered here, but I think one of the biggest watch-outs is you have to understand how taxes are going to work and how they change because you’ve been making money passively in real estate, and if you can qualify as a real estate professional, I believe that changes to active. I’m not a CPA, but it changes things for you. And the benefits are astounding, if you just nerd-out about it. So many people always say that taxes are boring and they’re like, “Oh yeah, they’re boring.” And I’m like, “No, they’re not.” It’s actually a very exciting game because it’s making money. If you do it correctly, making taxes is making money.
So last kind of section here is going to be actionable tips. And I really just want to get into this. I want to leave people with just things that they should do. Things that you can tangibly do today that will set you up for quitting your nine-to-five job. All right. So for me, this was a really big thing for me. It was very impactful. I call this talking to other quitters. The term quitter’s always a bad thing, but it’s actually a great thing when you’re in this position.

Henry:
Đúng.

Cướp:
I remember I Zoomed with a lot of founders of companies, people who had like 7-, 8-, 9-figure exits, CEOs, just I’ve met a lot of cool people in my real estate career. And because of YouTube, it’s just, it’s opened up the door for me. But one thing was in common when I spoke to all of these guys and they were all like, “Why are you still working your job?” They were like, I see, I watch your YouTube channel. You talk about how much you make. You’re charging me this much for a consultation. I don’t understand why you’re still working.
And they just, after hearing that so many times in the span of a couple months, I was just like, okay, these guys obviously have figured it out and they obviously believe in me more than I believe in myself. Maybe this is something that I have to do. So I think talking to someone else that’s been through this, talk to someone else that’s quit their nine-to-five job, chances are, and I don’t know Henry, if you’ve met anyone that this didn’t work out for, but for me, the quitting your nine-to-five and going full-time at this field or like the thing you love, it usually works out for people, usually.

Henry:
Yeah, absolutely. I don’t know anyone who is in this industry, who has left their nine-to-five and then ended up having to go back.

Cướp:
Right. I don’t know anybody.

Henry:
Not a single person. And I did the exact same thing. My wife was like, “Yeah, quit.” And I was like, “Let me go talk to somebody else.” Right. So I went and I talked to my buddy, Zach, he owns storage facility. He’s a rockstar in the storage facility game. And he’s been an entrepreneur as long as I’ve known him, like full-time. And so I went to him and I was like, “How do you make this work? I’m thinking about doing it.” And he was like, “Honestly, I thought you should have done this a year ago.”

Cướp:
Is what everyone says, man.

Henry:
Right. And I said… But it gave me a place to take my fears because what happens a lot with stuff like this, it was the same way when I was getting started in real estate, we have these fears and a lot of the times they’re not really rooted in anything real, right? And so he gave me a place to be able to ask those whys, right? And those what ifs. Like, hey, I’m thinking about quitting. I know you did it. Here’s a big fear. Here’s my big what if, like what if I quit and I can’t produce the income that I need to live monthly? What if I quit and X, Y, Z. And he was able to put some real life to it because he’s lived it.
Like what if I quit and we struggle with the healthcare. So he was able to help us figure out. Give me some actionable advice on this is how much it costs, this is what we do for it, right? Here are some other options you might think about. And so talking to quitters was the best thing I could have done, as far as getting advice on if this is a good move or not, because it helped me realize which fears of mine were actual legit fears that I needed to go create a mitigation plan for and then which fears of mine were just my brain overworking itself for no reason.

Cướp:
What’s really funny is that it’s so easy to see what they saw, now that I’m doing it, because to them, they’re like, “Just quit.” And I’m like, “What do you mean? Just quit. That’s so dumb. Why would you say that?” And now I’m like, whenever people approach me, I’m just like, “Yeah, just quit.”

Henry:
Đúng.

Cướp:
And they’re like, “What do you mean? That’s so dumb.” I’m like, “Look, you’re going to figure it out.” I actually just had a conversation with a friend who wanted to go full-time in photography. And he called me, he’s like, “Man, I’m just, I’m thinking about doing it. And I’m at the point where I can’t make more money with photography unless I quit my job.” And I was like, “Look, if it’s costing you money from photography and that’s the only way you can scale, then quit.”
And even if you make half, as long as you can pay your bills with your wife’s salary, who, they both make pretty good money. I was like, “You’re going to be fine.” And he’s like, “All right, well, I appreciate it. This was really meaningful.” And I was like, “Yeah, no worries.” And then I like, this was two weeks ago and I met with him two or three days ago. And I was like, “Yeah, man, so what’d you end up landing on it?” He’s like, “Oh, I quit.” And I was like, “What do you mean you quit? You didn’t tell me. You didn’t text me. I talked to you for two hours about this.” And I’m just really happy for him because I can see it. I think this is a whole mindset thing that you just don’t see it in the moment. Actually a very mind-opening, is that the phrase?

Henry:
Eye-opening?

Cướp:
Eye-opening. It opened my mind too. An episode of BiggerPockets that I did that was very eye-opening, was the one that we did with Jason Drees. I believe it was episode 601, and that’s how eye-opening it was for me. We talked about mindset and just imagining who you were 10 years from now, thinking of the version of you 10 years from now. And if you can imagine that person, you can just effectively manifest them in your life. And so, I talk to a lot of people who they make 50,000 or 75 or a hundred thousand, and I’m like, if I ask them, “Can you make a million dollars this year?” They’re like, “What? No, what are you talking about? That’s such a dumb question.” Where if they ask me, I’m like, “Heck yeah, I can.” Because I understand that it’s all mindset. And really just believing in yourself goes a long way. So this is a very long tangent to just say, talk to other people that have done it because I think it’s going to be more eye-opening than you think.

Henry:
Chắc chắn rồi.

Cướp:
Second actionable tip here, which we’ve already sort of covered, but I think it’s just develop your multiple streams of income. I really don’t want people to dip into the real estate income, personally. I want you to grind on that for as long as you can. That’s what you’re going to retire on, but you should really be working on it, like planting those seeds, watering those seeds. And for me, my side income now is I do mentorship, I do coaching, content creation. I’ve got affiliates. This is a very easy one. You can go make a YouTube channel and you can say, “Hey, I’m going to review this item right here.” And if people click that link, you’ll get a 3% commission on it, if it’s like an Amazon product.
It’s crazy. You can make six-figures doing this. You can make six-figures just promoting other products. A lot of people just don’t want to do it because its hard work, but you can do that. Airbnb was my side hustle for a long time. Now it’s my front hustle, if you will. For you, I know that’s probably it’s multi-family, you did that.

Henry:
Đúng.

Cướp:
For a long time. And then a side income, I think, that’s very actionable because a lot of people are like, “Well, what if I don’t have money?” Partnerships. Partner with people. OPM, other people’s money. They will pay for your portfolio, if you can pitch yourself and if you have a track record of doing this. The proof of concept that we talked about.

Henry:
Yeah. 100%, man. You can go get a side hustle within the real estate space, right? You can go be a bird-dog, find deals and partner with somebody. You can go out and, dude, there’s so many ways to make money right now with just your phone, that it’s insane. And so you don’t have to know exactly what that side hustle is right now. And so a little mindset for everybody, just tell yourself, I’m going to find a side hustle that produces X amount of income for me per month, and just write that down. Say that to yourself three times in the morning, and I promise you, as you’re browsing Instagram, as you’re listening to this podcast, as you’re listening to some other podcast, you will overhear someone say, this thing is cool or this technology is cool. And then you’ll be like, “That’s it, that’s the side hustle that I can do.”
Because Rob’s, 100% right. There’s YouTube channels. There’s people that have YouTube channels that just upload calming sounds and make six-figures a month. It’s crazy. Is that the path you should take? I have no idea, right? There’s opportunities for you to just do affiliate sales for products that already exist. There’s literally websites you can go to right now, pick some products and start promoting it as an affiliate and you’ll get 50% of the sales from it. You just have to figure out, as you start to research side hustle, something’s going to stand out to you and then dive into it.

Cướp:
Yeah. Actually this gets into my next tip here, which is, I think this is a big one and it just helps you visualize it. We think about all these side hustles and they’re always in the ether of our head. I think you actually need to put pen to paper and literally map out three financial scenarios. Good, better, best. Hey, here’s what I make from side hustles or here’s what I make from my job, if I want to keep doing that and sort of wean myself off, and here’s what I make from real estate. And actually, I just searched for this on my computer and, again, in the name of transparency, I sort of just want to read you what I mapped out, my good, better and best-case scenario. All right.
So conservatively, I was like, all right, if I just kind of just do what I’m doing. If I just quit my job, I can get to $23,000 a month or $276,000 a year. That was like, if I really just mail it in, that’s what I’m going to make. My medium-case scenario. I really, I put time into this and I foster all of these different things and I really just put time and effort into it. I can go up to $35,700 a month, which is a yearly salary of $428,000. And then in my best-case scenario, I was like, all right, if I just totally crush this, I’ll make $38,500 a month, which is $462,000 a year. But the big difference on that best-case scenario is that $462,000 paycheck that I was working towards, actually was if I quit my job, what I could make. And I obliterated it. I just totally, I met those goals by far and just putting them on paper and mapping out how I was going to make that, helped me out so much, man.
It was just seeing it and being like, wow. And it really helped me believe in myself because I, that was really going off of money that I was already making, so it wasn’t really that crazy. So I was just like, all right, so now let me just do a little growth plan and fast forward to today, I just did that last week. And it’s really crazy. It is really sign… It’s like so crazy to just map out what’s possible next year and I would never have seen that, I would never have a number to work towards, had I not just jotted it out. It’s very unofficial. It’s just literally income stream 1, 2, 3. If I open up this Airbnb, if I grow my channel by 20%, if I grow my affiliates by this, if I, just those simple steps really were eye-opening for me. And I was really motivated to just beat the numbers that I set forth for myself. What about you? Did you map out anything like that? Or were you just kind of like, “Ah, I’m good.”

Henry:
So I’ve always been a ready, fire, aim kind of guy. Right, wrong, or indifferent. But I did want to make sure that I highlight for people how amazing of a tip that is. Because as you were saying it, I was like, that’s brilliant, I should have done something like that. And then as you continued to talk, my next thought was like, “Do it now.” You’re looking to hire somebody, do your good, better and best-scenario for hiring that person. What kind of volume do we think it can do in your business to get deals closed, if you don’t hire the person.
Stay the course, right? How much do you think you can grow, deals per month? If you hire the person, how much you think you can grow deals per month, and then you subtract whatever that income is from what you’re currently making. Right. And then give a best-case scenario. If you hire a rockstar, right, and you pay them more, how many deals do you think they can do per month? And that might help open my eyes and ease that pain of having to figure out should you go out and hire this person to do that thing? So I’m about to steal it and use it right now. Great advice.

Cướp:
Yeah. I mean, I think even with just hiring someone, just like what you’re talking about. The worst-case scenario is maybe you lose a little bit of money and they didn’t perform, but you got your time back, so that’s not really that bad of a scenario. A pretty good, like a medium-case would be you just break even, which is still awesome because they’re doing the work, you get your time back. And then best-case scenario is they make you money. You know what I mean?

Henry:
Đúng. Vâng.

Cướp:
For the most part, I think you can, if you’re a good manager and you know how to train people and you can mentor them, someone told me, because I was talking about hiring people and I was like, “Yeah, I need to delegate.” And actually I think it was David Green. I’ll give him the credit on this, because he’s awesome. He was like, “No, it’s not about delegating. It’s about developing.” Develop people and develop loyal people, and they’re more than likely going to produce for you.

Henry:
Absolutely. 100%.

Cướp:
Yeah. So, basically, hit me up if you need a job, no, I’m just kidding. [inaudible 01:05:28].

Henry:
DMs are about to get blown up.

Cướp:
No. Okay. So last couple of tips here. I’m going to just breeze over this one because I already said it, but buy real estate before you quit your nine-to-five job. If you got a house that you’re thinking about or a second home, like my dad was about to retire and I was like, “All right, let’s buy an Airbnb and then you can quit.” He’s like, “Great.” And then he’s like, “Hey, I ended up retiring, so let’s just buy the Airbnb anyways.” I’m like, “We can’t, you don’t have an income anymore, dad.” So I think it’s very important. Yeah, try to close on that house or that Airbnb or that multi-family or whatever, because it can be, your journey to financing is about to be a little tough. And then last one here, give yourself an end date for your career.
This is, effectively, why I didn’t quit for so long. I had meant to quit in October of 2020. I didn’t quit until April 2021, which I think is about six months. And it’s just because I kept putting it off. I was just like, “I can’t, I don’t know.” And then I think eventually I was like, “All right, April 7th, I’m quitting. That’s it. That’s going to be the day. I’m going to give it two weeks from now and I’m going to do it.” And my wife was like, “Great, finally.” And I was like, “Okay, I’m going to do it. You can’t stop me.” She was like, “Yeah, I don’t want to stop you.” And I’m like, “Just try bud. Just try.” And she’s like, “Dude, just quit.” And so I gave myself that end date and guess what? I quit on that end date, and my life has changed in a really positive way ever since.

Henry:
Yeah. And it’s almost like a mindset thing, right? Because if you set that date in the future and you now have that date planted in your head, you’re going to start preparing for that date. And by the time it comes, you should be more prepared to make that transition. And then if you’re not, I mean, you can move the date. You’re not, it’s not the end of the world. But just from a preparation standpoint, if you listen to this, you take down these tips and these things and you start to, you give yourself a date. Now you’ve given yourself, essentially, a timeline to start to prepare yourself and implement these things. And then by the time you get there, you’ve just made your transition into full-time entrepreneurship that much easier.

Cướp:
Yeah. And you know what, just a little bonus onto that. Tell, if you’re serious about it, tell other people. You probably don’t want to tell your coworker, but tell your best friend, tell your mom, tell your dad.

Henry:
Don’t tell your boss.

Cướp:
Yeah. Don’t tell your boss, but tell people, your close friends, “Hey, I’m quitting on April 7th.”

Henry:
Đúng.

Cướp:
Just say that because guess what? They’re probably going to check in on you on April 7th.

Henry:
Đúng.

Cướp:
And so it’s on you to really kind of, if you want that extra bit of accountability, if you’re like, “Dang it, I shouldn’t have said that.” And that, like on my YouTube channel, I do that all the time. I just put out huge lofty goals because I’m like, dude, if I tell 180,000 people that I’m going to make this much, or I’m going to buy this or I’m going to do that, I kind of have to because I don’t want to let them down. So I’m always just like throwing goals. I think there’s a big argument to be made that you shouldn’t tell people your goals, but that’s a whole nother episode, probably. But I think if you put it out there, then it’s up there, you don’t want to go back on your word. So [inaudible 01:08:26].

Henry:
I know, I thought it was totally crazy when you were like, “Henry, on July 17th, I’m going to give you a million dollars.” And I was like, “That is crazy.”

Cướp:
And now it’s like, I got to do it though. I got to say that because I’m going to do it on that day. You just wait, man. You just watch that Venmo, pal.

Henry:
I’ll just-

Cướp:
Here’s the problem though. Venmo is like, it only gives you $2,000 at a time, so it’s going to take a little while to actually get it to you.

Henry:
I’ll live with that.

Cướp:
But that’s it, man. That’s I think, I don’t know, do you have anything else, any other prolific thoughts that you want to leave us with?

Henry:
Yeah, so I just want to tell people, we’re not saying nine-to-fives are terrible, quit your nine-to-five right now. What we’re saying is that if you’re on this path, because you want to get out of your nine-to-five, we want to help you strategically do that by sharing our experience with you. We’re, literally, living this right now, almost in the same weird time.

Cướp:
Vâng, tôi biết.

Henry:
And so, we’re not bashing nine-to-fives in any way. I tell people like my nine-to-five was my first investor in my real estate business. I wouldn’t have been able to grow and scale to the point that I got to as quickly as I did, if I didn’t have that nine-to-five there helping to keep me bankable, helping to keep me liquid enough to be able to go buy properties, helping to fund my emergency fund for if things broke on properties. And so my job was my investor in my real estate business, and helped me get to where I needed to be.
Just keep in mind that if you’re on this path to quit your job, that you need to keep what you’re doing in focus and keep that scorecard, that running scorecard, like people say as an investor, you should keep your scorecard of your personal financial statement, right? So you track your net worth. I think you should also track your hourly rate. The more money you start to make from side hustles, the things you should continue to update that hourly rate and kind of keep that in front of you, so you can see where you might hit that threshold of like, all right, it might be time to start thinking about transitioning over from one to the other.

Cướp:
Yeah. That is all, dude, I mean, that’s gold right there, man. I don’t really have much to add to that. I think you’re exactly right. We’re not saying nine-to-five is bad. Please don’t take anything we say that, I actually loved my job. I genuinely loved advertising. The only reason I left was because, well, a couple, I wasn’t really that good at it, if I’m being honest. I was good, but I wasn’t ever going to be great. And I’m okay with that. I’m, I mean, I quit for a reason, right. But I was really, I had the opportunity to be great at Airbnb. I had the opportunity to be great at real estate, to be a great content creator. I knew that I could get there and that I can get there still. I’m still working towards that because I’m good at this stuff and I love this stuff.
And because I was actually having success here, it just made me realize that I couldn’t do it for other people because I wanted to do it for myself, so that I could help people in my network, help my mom, my dad pay for their retirement. My brother-in-law, my sisters, my kids. I really started to understand that if I could do this for myself and I could do it well, everyone in my family, in my direct influence, I could change lives and help everyone live a better life. So nothing wrong with nine-to-five, do it for as long as you possibly can, be a terrible employee, get fired. No, I’m just kidding, don’t do that. Do it for as long as you need to.
I always say that there is no right or wrong, there’s just what’s right for you. So that might mean that you’re going to quit in five years and that is okay, it doesn’t have to be today. In fact, it shouldn’t be today if you haven’t been working on it, but it could be next year. It could be in two years or three years. It’s like, whatever, it just depends on your personal situation. So I’ve got nothing against the nine-to-five, do it for as long as you need to. And I promise you, if your goal is to become a full-time real estate investor, it’s going to happen.

Henry:
Amen. And you’re going to be so glad you did. When I had that conversation with my buddy, who was a full-time entrepreneur, he told me, essentially what he told me, he was like, “You should have already done it. You should do it today, and if you do it today, when we talk a year from now, you’re going to tell me it’s the best decision you ever made.”

Cướp:
Yeah. And you probably told him that the day you quit because that [inaudible 01:12:49].

Henry:
Đúng.

Cướp:
Cho tôi.

Henry:
Anh ấy không sai.

Cướp:
Well, awesome, man. Well, I think that’s it for today. I would typically do the, try to do a David Green ending call sign here, but I butchered it the last time we did this. So I’m just going to say goodbye. Oh, actually, before we go, where can people find you on online, man?

Henry:
Yeah, best place to reach me is Instagram, @thehenrywashington, same thing on TikTok. And you can check me out at henrywashington.com.

Cướp:
Cool. You can find me @robuilt on Instagram. Robuilt on YouTube. I don’t know why I said Instagram first. YouTube is my main love. Find me on YouTube, Robuilt, R-O-B-U-I-L-T. Or TikTok, @robuilto. But with that, we will catch you guys on the next episode of BiggerPockets.