Intro
Hi, my name is Drew Perry. You may not recognize my name…yet. But if I told you I almost called this ebook, “Learn How You Too Can Retire at Age 23 and Do Nothing but Sit in Your Shorts on the Front Porch and Wave at the Mailman”, would you be interested in learning what I have to say? I thought so.
I’m a country boy from Florence, AL. I worked at many different things trying to find what I enjoyed and could make good money at. When I was 18, I learned how to invest in real estate. I have now spent more than $150,000 on educating myself on how to excel in real estate and I set the goal for myself of owning 21 houses by the time I was 21. On my 21st birthday, my real estate portfolio contained 24 houses. I had excelled.
By the time I was 23, I had created a $1.23 million real estate empire, allowing my dad to come home from corporate America and work from home AND I retired. Twenty three seemed a little young to stay retired and it wasn’t long before I had the real estate itch again. So, I’m back at it. I am eager to rebuild my portfolio, quickly. With all the knowledge and experience I have gained, it will not be nearly as hard as you might think.
As far as I know, I am the only real estate investor who is mixing – and teaching – their knowledge of real estate, online marketing and ebay selling. It’s working, and it’s working very well. I have sold over 40 houses on ebay and continue to find success in doing so. (Including a house with holes in the roof, that was full of fleas and stunk to high heaven from dogs - all of which I thoroughly disclosed! More on that later…)
I’m a Turtle on a Fence Post
Imagine your life has been really busy and all you want is to get away and be alone. So, you find a lovely country road and start walking. You can’t see anyone else for miles. It’s just you, the birds, the sunshine and the breeze that’s blowing. Suddenly, you happen to see a big old turtle sitting on top of a fence post. Now, that turtle there is a sure sign of something: you are not as alone as you were hoping, ‘cause somebody helped that bad boy up there.
That describes my journey into real estate investing, as well. I didn’t get to the point of having a real estate portfolio large enough to allow me to retire at 23 all by myself. I’ve been blessed enough to have had many wise people in my life. Some of them have been in the form of real people, others have been in books or through seminars. But, they’ve all been people who are successful at what they’re doing.
It has been said that the fastest way to become successful yourself is to find successful people, learn from them and do what they are doing. That’s what I did. If you’re eager to become or see your family set free financially, even if you’re just interested in adding some additional passive income each month, I’d like to teach you how to do what I do.
Learning to Think Like a Real Estate Investor
The first thing that I learned from my mentors was to think differently. I found that the idea of needing to do well in school, go to college, get a degree, come home and make a lot of money, was no longer going to cut it. Our world is changing and while that used to be the road to wealth and financial freedom, it no longer is. In order to help you be ready to pursue your real estate goals, we need to address how you think, first.
I know, when you read some of the things I’m going to share, you’re going to think I am outside my mind. I understand that feeling very well. When I first arrived for my stay with my “rich dad” Chris Verhaegh, I felt like someone had thrown my brain into a paint shakin’ machine. It felt like I was a bb in a tin can. Chris is the first person to set this turtle up on top of that fence post. (Folks, if you’ve not read “Rich Dad, Poor Dad” by Robert Kiyosaki, I would say that it is a “must-read” for any entrepreneur.)
Every where we went he had something new to teach me. Even things that I had taken for granted were suspect and up for discussion and reassessment. It was a hard time, because I was so far out of my comfort zone, yet it has been some of the most powerful teaching I’ve ever received. So don’t give up, just keep reading the things I’m going to share with you, until they make sense. It may take 2 readings….it may take 20, but when you get it, it will change the way you do business. In fact, I believe it will change your life.
Now, just to give you some insight into how my rich dad thinks, let me share with you a story from his youth. Chris was very good at playing pinball. In fact, he was THE BEST pinball player in his school. Chris attended a wealthy private school, on a scholarship, so he didn’t have a lot of excess spending money. He quickly saw a way to earn that money, while doing the thing he was best at and enjoyed doing most.
Chris would park himself at a pinball machine at a local arcade, after school. He would put his quarter in and play the game to the point that he had 8 or 9 extra balls. Then he would announce to the kids in the arcade, that he would be selling 7 balls at half price. So, the kids would come up and pay him to play out those 7 balls, he’d earn money and when they were down to 2 balls left, he’d start all over again. He could sit and play that machine for hours – and he would sometimes start up a second game on a second machine, so he could be earning from more than one game at a time. Chris did not think like anyone I had ever met before. I can say with pride I now think much more like he does, but it is only because of the time he spent teaching me.
One of the first things that I decided I wanted to develop, once I left Chris’ house, was what I call a Lazy Wealth Mindset…and in this case, being lazy is a good thing. Being lazy means I want to develop passive income. You see, a job, which is NOT passive income, is nothing more than doing the same thing over and over and over again. You’re trading your hours for their money. I decided I wanted to do something a few times – or better yet, one time – and let the money just flow in. That’s what passive income is, pay that you keep on receiving for doing something one time. (I know another investor who calls this “mailbox” money. I like that: money that comes out of my mailbox.)
What else is included in this Lazy Wealth Mindset? Systems. Wealthy people will sit for hours working on something that would normally only take them 10 minutes to do. They will work at it and work at it and work at it, until they have shaved 9 minutes off the process. AND they will never do those same 9 minutes worth of work again. You need to learn to systematize your work. It’s almost like putting yourself on auto-pilot.
Maybe you are not familiar with what I mean by saying you need to systematize your work. Basically, I’m just talking about the procedures that someone uses to keep something organized and flowing well. It’s the established order of something. For example, I bet you guys have a system for putting your tools away. Ladies, I’m pretty sure you don’t just throw your pretty glasses into the kitchen cabinet. The way you put things away, is a part of a system. Having your systems in place will help you make money.
Let’s stop right now and talk about money, before we go any further. Maybe you’ve been told it’s the root of all evil. You see, the problem with that proverb is, it’s been misquoted so many times, that we think we know what it says, when in fact, we’ve forgotten a few words. The quote comes from the Bible – and if you want to go look it up (it can be found in 1 Timothy 6:10) you will see that in fact, it’s the LOVE of money that gets us into trouble. (There are a lot of other verses that discuss the love of money, too.) When money starts being the most important thing in our life, then we can be sure that we’re losing sight of what it really is. It’s a tool. Not too many of us can be accused of having a love affair with a screwdriver, can we? (Ok, except for maybe a Snap-on.)
With money - this tool - we can see our lives freed up to enjoy 4 freedoms. Each freedom builds on the one before it. All of them are for the purpose of seeing us become and do all that God intended us to. There are too many of us walking around with a dream in our heart that simply don’t have the money to pursue it. That is a mighty big shame.
By gaining wealth – more tools - we will experience financial freedom. Once we have gained financial freedom, we will have time freedom. Time freedom allows us to determine what we do with our time, not what the boss says we should do. When we don’t have time freedom, we’re really not a whole lot different from one of those pin balls I was talking about before – being hit around, without any say of where we’re going.
Once we have obtained freedom with our time, we’re set free to enjoy and focus on relationships. No more missing your son’s Little League game or your daughter’s dance recital because you can’t get off work. Relationship freedom will help you focus on the people – not the things – in your life that are most important.
When we are living lives filled with rich relationships (and I don’t mean wealthy relatives, either), we think better, we work harder and we live more fruitful lives. This frees you to put all your time, energy and emotions into that dream or project that lies deep in your heart. God has put those dreams there for a reason. He wants you to do great things. This freedom, spiritual freedom, is “why” we’re doing what we do.
So, what dream is in your heart? What project have you always wanted to do, but couldn’t because you didn’t have the time or the money? Now is the time to pull that dream back out, dust it off and start looking at it with new eyes, because I want to help you make that dream a reality.
As you start allowing yourself to dream that dream again, I want you to take that dream and write it down. You don’t have to share it with anyone yet, if you don’t want to, just write it down. You see, this is something else my mentors have taught me. You’ve got to have goals. If you don’t have goals, you can’t know where you’re going or worse yet, you won’t know when you’ve arrived.
A goal doesn’t become a goal, until it gets written down. When it’s still tucked away in your heart, it’s just a dream, but when it gets real space on real paper, you’re on your way to making that dream become your goal. Besides, your dream is important enough that it deserves to be written down. Then you can look at it and think about it. You’ll need to see it. Some days it’s just plain hard work to keep going and having that goal written down will be just what you need to keep on working away at it.
Now that you have your goal/s written down, it’s time to start thinking about the business models you need to build your wealth. A business model is the design of an organization that explains/defines how the revenue will be generated. When we talk business models, I want you to understand some terms that will help this all fit together in your mind.
The first word is cash. Now, I know you know what cash is – whether we’re talking green backs or the man in black – but I want you to understand it in the context of real estate investing. Cash is a one time out-pouring of money. Generally this comes from doing work. You work: they pay you….once. You spend that money – poof – it’s all gone and you gotta strap on those work clothes and go do it all over again. I’ve got nothing against cash, I just have something against having to go out and make it over and over again.
Now, the other word I want you to grab hold of is cash flow. I have a saying, “Positive cash flow will set you free.” Remember when I told you I wanted to have a lazy wealth mindset and have passive income? This is passive income. You work….once: they pay you. You spend that money – poof – it’s right back in your mailbox next month. Now, do keep in mind, there is some work involved in this. You DO have to go get that check out of your mailbox, sign it and take it to the bank. If you’re a really lazy investor, you might even see if you can’t find a way to have that money automatically deposited, then all you have to do is open your monthly bank statements. Now THAT is passive income. (Not to mention a fine system, too!)
I remember very clearly when the whole concept of passive income became clear to me. My goal was to bring my dad home from his job. I was 18. We were eating dinner in The Tower of the Americas restaurant in San Antonio, TX. Now, you’ve got to remember, I’m from Florence, AL where the only lights we have at night are the Big Dipper and the Milky Way. San Antonio, on the other hand, has lights like we’ve got cows. I was sitting there staring at all these lights and I got to thinking, “Every light out there is one house. All it takes to be financially free is 30 houses. That’s hardly any lights. I can do this.” That night I made it my goal to have 21 houses by the time I was 21.
So, we’ve got our job, which provides us with cash. We’ve got our investments which provide us with cash flow. There’s one more type of income I want to discuss. Residual income is the income that would come from say, selling cars at Jr’s Used Cars. So, in this case you work, they pay you. You spend that money – poof – the money MIGHT appear again next month, it depends on how many cars you sold for Jr. Any kind of sales, network marketing or commission would qualify as residual income. If for any reason you don’t feel like selling, the company isn’t likely to feel like paying you. It’s a little different from a job, but not much.
Now that I’ve discovered passive income, I don’t ever want to go back to working a job. There is no freedom in working. But, with passive income, I have a lot of freedom. Now this kind of freedom may not be important to you. You will need to pick the kind of income that will match your goals. If you have a goal of having a roofing business, I’d be thinking two things. One, “Are you crazy?” and two, “You DO realize your clients aren’t going to be lining up to pay you for roofs that are still sitting in the back of your pick-up, right?” But, that’s me. I’m just a lazy investor. You may like all that hard work and sweat stuff and that may be the only model that lines up with your dreams. (I’ll think of you when I’m breaking a sweat opening my bank statements next month, if that’s any consolation.)
Creating wealth is when you have more income than you need to meet your basic needs, allowing you to invest the rest. How far away from creating wealth are you?
When I was staying with Chris, we watched a guy selling big old tree stumpsfor $500 each. I couldn’t believe it. What fool would pay that kind of money for stumps when I could find 10, just driving my pick up out into our woods? Chris explained that this was because he lived in Idaho. Trees like that just aren’t readily available. The man had created a market where he could be in control. He is the one who determines the price, simply because he’s the one in control. Make it your goal to find a way to be the one in control of all your business deals.
Measurement is another one of those lessons that I’ve learned. If you can’t measure something, how do you know where you were, where you’re at and where you’re going? Measuring is the only tool to know where you’re at and when you’ve succeeded. Remember I said you had to write your goal down? This is part of why that is such an important thing to do. This is also an important part of planning how large you would like your real estate portfolio to be. If you don’t know how much you need to create wealth in your life, you won’t know what you have to do to get there.
Because measuring is so important to Chris, my rich dad, he keeps track of every cent he spends. He taught me to do the same. I have found that rich people do things that poor people think are either an inconvenience or just flat out unnecessary. It may be inconvenient, but if it’s going to help me see my goals realized or help me create more wealth, I can learn to write things down…and so can you.