So it gets harder to save, and you need way more the more your average monthly spending increases. Information about his parents and/or siblings is not available at the moment. But in a bad market, its really important because in a bad market, you cant sell. Well, thank you so much for coming on the show. He is also a real estate investor, an executive at a large online corporation, salesman, real estate broker, and author. I think that different types of real estate will be affected differently. Earning an $8000 raise after a year is great. Scott Trench: Get to a 50% savings rate. And so, its all about increasing your odds of success I guess at this point. Scott is of white ethnicity and has American citizenship. Scott Trenchreal estate investor, . Mad Fientist: Yeah, thats absolutely crazy! Scott serves as the Co-Host of The BiggerPockets Money Podcast in Denver, Colorado alongside Mindy Jensen. that is a huge expense. The thing I liked most about the book was that he broke the journey to financial independence down into three distinct stages, each with their own focus. This is a loan at the best rates available. This is it!. Melissa hence worked as a reporter for the Great Neck Record and later on began her television career working for CNN Financial News and Bloomberg. But having that thing that youre working on as youre trying to reach financial independence, then hopefully, by the time you reach it, youll have something there that youre really passionate about and that you can spend a lot of time doing. And Im plenty happy doing what Im doing and kind of continuing along with things. Im going to put that book in the show notes, a link to the book in the show notes. And in a good market, thats not so important. You run out of money and you have to go and find similar paying work as your only option. A lot of people will go with something in the 8% to 10% return range for index fund investing over the long term. Set For Life: Dominate Life, Money, and The American Dream. I think that its increasingly difficult. Scott Trench: Yeah. So yeah, the Bigger Pockets Money Podcast, how has it been going? In 2021, he also released his book First-Time Home Buyer: The Complete Playbook to Avoiding Rookie Mistakes. Yet more reason for Powell and the Fed to go after inflation with a single-minded focus. Mad Fientist: Wait, let me interject. More luck is involved in rapidly going from $25,000 to $100,000 than there is from going from zero to $25,000. However, like Scott said, it is absolutely critical to keep positive cash-flows (rents must cover mortgage payments + HOA + property tax, with backup plans, like moving in to the property yourself), weve seen people end up having to sell in down market when losing the job or can no longer subsidize the negative cash flow, therefore cannot reap the long term appreciation or refinance to lower rate, etc.. I bought a house in Edinburgh and Ill definitely be able to do house hack in the short feature with the prices in this city. And I knew that my salary at financial analyst 2 would be about $56,000 to $58,000 (again depending on performance). And thats the best case scenario, is that you go through all of those rungs of the ladder in 20 years. Im now working very long hours and trying to figure out how to grow the company and all that kind of stuff. Scott Trench: Yeah, Im 27. Scott Trench: Sure! Obviously, some chance plays a part. And yeah, your last name is Trench, and you want how many trenchlings? Yeah, thats a great way to look at it. So, that was your first $100,000. People doubling their income in a corporate type situation, its not heard of. So, the final step I think is it goes on forever basically. I had the good privilege to discover this personal finance movement and have it make sense to me very early on, and then just kind of dive in or read it. So the only criteria that I have that I think that you should really kind of strictly enforce is: Will this property make sense right now?, the day you buy it as an investment property if you dont live there. It just didnt work out. So theyre investing from a position of financial weakness and using some form of creative finance which is kind of, for a new investor, often a code word for extremely risky leverage and not investing from a position of financial strength. Mad Fientist: And I really think you make your own luck too to an extent as well. I was listening to your podcast (which well obviously talk about here soon as well). Ive received a lot of great answers over the years so I decided to compile all those answers into a PDF, which you can now download for free here! And once you get to $100,000 in investible liquidity, now how you invest that money begins to become really important. Theres so many different ways to make money that dont cost anything but your time, and maybe a few hundred to a few thousand dollars to try out. I mean, if you think about that, how on earth is their market cap less than that? Your first guest was the same first guest that I had way back in 2012, Mr. Money Mustache (which was a great episode). What Is A 529 Plan and Where to Open One in Your State, How Much Should You Have In A 529 Plan By Age, How To Use A 529 Plan For Private Elementary And High School. So, its kind of the opposite of FI at this point. I was like, Oh, Im a smarter guy than the market. This company in China is a Chinese fruit juice company. Since joining BiggerPockets in 2014, Scott has authored the bestselling wealth-building book Set for Life and joined Mindy Jensen as co-host of the BiggerPockets Money Podcast. You could try starting a blog or a podcast. Nice episode! Bigger Pockets Money podcast did a show about this recently. This is a business that requires, literally, hundreds of hours of self-education from the investor prior to getting started. Im very excited to be here. One, youre accumulating that all in savings which is 100% gain because its after tax savings that youre accumulating. So hopefully, it will happen. A rare picture of Scott Trench with his wife. Scott is someone who came on my radar a few years ago because Mindy Jensen, aka Mrs. 1500, from 1500Days.com mentioned quite a few times that I needed to get her colleague, Scott, on the podcast. He has some family things that are going on. So, for example, on a basic level, Mr. Money Mustache has an incredible intro because I believeand Mindy agreesthat the basis of personal finance, the foundation, is always in that frugality and having the mindset of the end goal of happiness and using money as a tool to live out that ideal lifestyle I guess. But for those who may not have heard that episode, could you just describe what house hacking is? What about equity in rental properties or home equity lines of credit (extremely cheap money that can be used as a down payment for more properties). So I really like how you structured it. Mad Fientist: How is that going in Denver? I think that the two things that come into play there are going to be entrepreneurship, asset creation, and then investing. marion dupont scott net worthNitro Acoustic. Youre welcome any time. That's $1 MILLION. So, those are two approaches for investing. At the time that were recording this, Im finding it very difficult to find properties. Scott Trench: But yeah, that interest in personal finance is kind of what spurred my ability to save and the accumulation of my first $20,000 to $25,000 for me. And my rents were $1150 from the other side and $550 for my side. You can download a free copy there. By clicking Accept all you agree that Yahoo and our partners will process your personal information, and use technologies such as cookies, to display personalised ads and content, for ad and content measurement, audience insights, and product development. I have a very sizable chunk of my money in index funds for that exact reason. Well, the reason is because Chinese companies all the timeI dont know about this one in particularlie about their financials. So, I mentioned your podcast briefly, but I definitely want you to talk about it because your co-host is one of the people that has been on my show probably more than anyone else. Scott Trench: Yeah. I moved out a couple of years later. Mad Fientist: There was! Yeah, no, absolutely. Scott Trench: Yeah, you know, I had the good privilegeand this is not like an intelligence thing. Mad Fientist: Yeah, this is a long time coming. And you mentioned in the book something called scalable careers, which thats a great phrase that I dont think Ive really heard before. So, I spent all my money throughout the rest of my college, all the money I saved up working in summers and all thatall fun in college, and then a three-month backpacking trip when I graduated. BiggerPockets is a complete resource for anyone looking to succeed in the world of real estate investing. And if people want to find you, wheres best to find you online, just go to Bigger Pockets? Just search my name in the search bar, Scott Trench. They have nothing to fall back on. His parents brought him up in the United States. So, if youre following, thats $3200 in rent on a $1700 mortgage. Listen to the Podcast Here Watch the Podcast Here Help Us Out! Kin Shriner is an actor from the United States. And yeah, back in my poker-watching days, I remember Annie Duke very well. Scott is a lifelong learner of personal finance, real estate investing, sales, business, and personal management in the United States. marion dupont scott net worth Tatko na pesmaricu. You dont have to be a superstar investor when you dont have much to risk luckily. But its funny because I hear these people, theyre like, Oh, Im very well into FI. I also observe that the federal minimum wage has not increased since 2010 we have the lowest real minimum wage in this country that weve had in nearly 50 years, since the 1940s and 1950s. And then, I actually stumbled upon your podcast, the very first episode, and Mr. Money Mustache. She was right! Mad Fientist: Yeah, yeah. But that wasnt a huge mistake. So that would be cool to read that. But as long as I can find a property that cash flows in a sense where I basically have a very, very good odds at having long-term $500 to $800 a month plus in cashflow on a $50,000 to $100,000it may not be the best cash in cash return, but I do believe that I can see some solid appreciation over a 30-year holding period in Denver. And yeah, hopefully, Ill speak to you soon. $2,650 at NET-A-PORTER. Turning Your Largest Expense Into An Income Producing Asset, The Financial Impact Of Housing Decisions, An Introduction To Investing For Early Financial Freedom, Habits And Their Impact On Financial Freedom. Mad Fientist: Oh, nice. So you have to have some baseline of stability, and then work as hard as you can to acquire excess so that you can then go on to take these chances in life that you believe, to the best of your ability, are great, and then obviously do whatever work you can to increase the odds as much as you can to your favor. I just mention I have the three properties. So do you want to talk about that final step? And I wanted it as soon as possible. No, all of these things work. This doesnt work so well when I have a family. A family that reached financial independence while raising children. Go find a career or an opportunity that you believe offers you the potential to scale, but will not allow you to lose money on a monthly basis. I wish that people knew that real estate investing is a double-edged sword. And your boss was on the show, Josh Durkin. . So yeah, I really enjoyed it. Is Scott Trench Married Yes. Scott Trench. The corners that you can cut when you are single are way more than if you have other people you are caring for. So, house hacking as I define it is buying a piece of investment real estate that will make sense as a rental property, as a cash flowing rental property for you after you move out; or otherwise, using your housing to build wealth. If you message me there, I usually get back to everybody within a day or two. Mad Fientist: which is great. We go into just incredible personal stories. It wasnt in the nicest area. Have you bought any other property since then? The next $75,000, youre looking at housing and income generation. document.getElementById( "ak_js_1" ).setAttribute( "value", ( new Date() ).getTime() ); Chart Your Progress to Financial Independence! Before I go, I just wanted to remind you that I went back through all of my previous episodes and collected the answers to my final question that I always ask: Whats one piece of advice youd give to somebody on the path to financial independence? And I put all the answers into a free PDF that you can download. And it contains all of the answers Ive received since I started this podcast back in 2012. . Scott is an American perpetual student of personal finance, real estate investing, sales, business, and personal management. Why Frugal Living Will Only Get You So Far. Scott Trench: And I do it while Im on the clock. Mad Fientist: Alright, good. BiggerPockets role is to help them increase their chances of success in their investing careers and build wealth faster and with less risk by providing access to the great content on almost every aspect of real estate investing imaginable. Amara Trinity Lawrence: Know about Martin Lawrence Daughter? And so what Im trying to do with Set for Life and with some of the other things Im doing is try to help people put themselves into a position where theyre saving enough, where leaving a career track like that where they have very limited upside becomes the bigger risk than taking a chance on something that they believe to be a good opportunity. I wasnt really interested in that line of work. And that is my question. And thats why I really like how you laid out the book, is because its like, Okay, you may not have that much money to invest and you may feel like its a long way out. I managed to lose money because I knew better than the market about this couple of Chinese stocks that had more cash than market cap and I dont know. They help ordinary Americans build wealth and achieve financial freedom through real estate investing. He earns his wealth from his career, therefore, he has amassed a fortune over the years. I would have been FI in my 30s. Congratulations again on the promotion and the book. Currently, real wages are still at relative highs, and asset prices are finally moving back towards what seem to be more sustainable valuations. Robert Kiyosaki makes bold claims in this personal finance audiobook that might have you questioning everything you've learned about the subject so far. So can you talk a little bit about that? Going back in time to the 1970s and 1980s, weve seen that the Fed is willing to push interest rates as high as they need to go to fight their first enemy inflation and that they are willing to conduct brutal monetary policy that affects jobs to do that. Scott Trench: Yeah, I got promoted to president of Bigger Pockets maybe last Tuesday I think. So, the Bigger Pockets Money Show started as kind of a spin-off, an alternative to the Bigger Pockets I guess real estate podcast. You have no ability to even attempt to put yourself to put some money on that or take the shot on that new career or whatever. Accumulating a lifetime of wealth in a short period of time involves working harder and smarter than the average person, and Scott Trench--investor, entrepreneur, and CEO of. And I think I can read my opponents as well as I can to feel comfortable with those odds and set myself up. This is like the most opportune time for low cost entry into any sort of business world you can imagine which is super exciting. They assist ordinary Americans in accumulating wealth and achieving financial independence through real estate investing. But if youre starting from that point, you dont really have the option of going out and starting a business because youre working full time and starting a business is hard work and unlikely to be successful on a part-time effort in the short run. On the flip side, wealth inequality skyrocketed as asset prices inflated with low interest rates. Yeah, Ill put a link to the first episode in the show notes. He spent a few months and some more of his savings to renovate the building before moving in and finding tenants, officially beginning his house hacking journey. Mad Fientist: Thats cool! Mad Fientist: Mindy has been like, Youve got to get him on the podcast. She said hes a 20-something whos doing incredible things with real estate and investing and finances in general, so I needed to talk to him. So how did you get interested in real estate? So, we are interviewing people that have expertise in one of these areas or niches in these areas or stories that embody this kind of approach, so that people are not pigeonholed into one type of investing or one type of real estate. But one of the things I loved most about it was how you broke it down to three phases. And so, thats the biggest hack that I can think of, like the biggest trick that a median income earner can do on the side to drastically cut their expenses, and then automatically put yourself in a position to have a significant cash flowing asset after a year or two. I believe I currently was able to getI remodeled and got one of the units up to $925. 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