Aside from solely finding wealth, investors can benefit from learning how to improve their overall lifestyle which is what we aim to help with for our Accredited Lifestyle Investor audience. In this section, you will find content related to lifestyle improvement tips for passive investors. Ranging from physical and mental health, good habits, and personal growth tips, we’re excited to provide lifestyle content for the wealthy passive investor.

How to give a hand in unexpected ways

Volunteering and donating money provide a myriad of benefits, both to the people doing the giving as well as the recipients. Of course, we all know of the common ways to give a hand. These include donating money to worthy causes such as the Wounded Warrior Project and the American Red Cross and donating time to places like homeless shelters and children’s hospitals. It is great to spend your time and some of the benefits of your wealth building on these sorts of things. However, consider not limiting yourself to the commonly known options. Also branch out to other types of activities.

Benefits of volunteering time and money

Regardless of how you decide to volunteer your time or money, it is important to note the benefits that you and others will experience.

A benefit to consider is doing activities such as these as a family. One of the best ways to get your children into the habit of using any generational wealth that they are fortunate enough to have received on others is to have them engaged in volunteering activities from an early age. Doing so will help them see the world from a different perspective.

It is also important to teach that the difference between those who have wealth and those who struggle is often much smaller of a margin than many young people and even adults realize. The more time that is spent volunteering helps make this point clear to those taking part in these activities.

Donate a used or scrap car to charity

One of the most significant ways that you can use the benefits of your passive investing to help others is by donating your used or scrap car to charity. If it is still running, this vehicle can be such a welcome surprise to someone who needs it to get to and from work or school. If it is not, the money that is earned from the value of its metal and parts can help an individual or charity organization.

Also consider donating bicycles. Many people rely on them for transportation but cannot afford them.

Donate your time to an elderly person

Although the monetary benefits of investing are significant and it is great to pass on what you have earned to those in need, donating your time can often be more meaningful to those involved. In many cases, elderly people do not speak to others on a regular basis and could really use these types of interactions to keep from feeling so isolated from others and to live richer lives.

Deliver food

A great way to combine donating items of financial value with donating time can be done by surprising those in need with personally delivered food. This can be food that you purchased or dishes that you cooked yourself. Regardless, having a bright face at the door delivering it and willing to stay a while exponentially increases the surprise factor and the overall value of this type of donation.

Host dinner, sell tickets

Hosting a dinner is a great activity in and of itself as spending time with the ones you care for is a fun way to spend your time. Consider combining doing this with providing a helping hand to those in need by selling tickets to your dinner. You could create an evening that is focused on providing information on real estate with all of its proceeds going to a charity. You could also utilize a raffle-type scenario with half or more of the proceeds being sent to those in need. Consider also incorporating a theme to help your guests more fully get into the festivities.

You could also inform your guests in advance that donations in any amount will be accepted in lieu of selling tickets with those attending donating whatever figure is right for them.

Participate in a pie-in-the-face challenge

This may be a common way to secure donations from others – offering your face to be splattered with a pie if a certain donation amount has been met – but it can also be completely unexpected, depending on your personality. In other words, if you are the type of person who others could not imagine ever taking a pie to their face, this would be a great way for you to shock them and, as a result, greatly help your cause.

You could even offer to do this as a family. However, ensure that every member of your family is 100% comfortable with this as pressuring someone to do it who is not comfortable with the idea should be avoided.

Share your pet

Do you have one or more beloved pets scurrying around your own real estate property? Consider sharing your furry friends with others. Some organizations focus on providing means for critters such as yours to brighten the lives of others. You can also check with local community service organizations to see if they or anybody they know organize these types of activities.

Foster a pet

What foster parents do is commonly known, but not nearly as common is the act of fostering a pet. If you would like to own a pet but just for a limited time, this is a great option. You could give a dog who is recovering from heartworm treatment a safe place to do so until it is healthy and ready to be adopted. You could also provide a temporary home for kittens or puppies.

Fulfill wish lists provided by hospitalized children

A touching way to use your wealth to surprise people is learning what hospitalized children have on their wish lists and fulfilling one or more of those wishes. If you are able to learn what specific children have on their own wish lists, it is great to take care of one or more of those items. However, this may not always be possible for privacy and other reasons. In lieu of that, see if a local hospital has a general wish list, and offer to secure some of those items for that facility’s children.

Volunteer at poetry events

A unique way to donate your time is by volunteering at poetry events. If you spend some of your time away from investing and researching investing opportunities on creating poetry, consider sharing that passion with others. In many communities, numerous poetry-related volunteering opportunities exist, and you may be able to help children and adults cultivate that same love of poetry.

Also consider that, if you spend much of your time with other types of artistic activities, similar opportunities are available for musicians, sculptures, photographers and non-poetic writers.

Share your knowledge with at-risk youth

Subjects such as wealth building and passive investing may be second nature to you. If so, consider sharing that knowledge with others, including at-risk youth. Show how the future can include activities such as these and how a more positive life can be had than what they may have experienced so far.

Donate greenery

An interesting way that many unexpectedly give a hand is by using their generational wealth to donate greenery. This can include providing wreaths, plants and small trees, and it can also include substantial donations of swaths of beautiful grass or even acres of tree-adorned land. These unexpected gifts could be given to places such as museums or to individuals who will appreciate the beautifying of their homes.

Paying it forward

Although paying it forward is a well known method of donating money, it is generally completely unexpected by recipients. Consider selecting a day and doing this multiple times in multiple locations on that day. Offer to pay for the person in front of or behind you in line at a coffee shop, fast-food restaurant, grocery store, sports facility and other venues. Another common way to pay it forward that is known to especially surprise beneficiaries is to take care of people’s layaway items.

An additional option would be to leave especially large tips for those in the service industry.

Carry and give thank you bags

Keep one or more small bags with touching items inside them with you, and give them to those who have done something particularly nice, whether that was to you or to someone else. Few things are more unexpected than a gift from a stranger after doing something of a giving nature. This is a great way to provide a positive feeling to others and to spread positivity to those you do not know.


Of course, the best way to unexpectedly give a hand is to do something that has not been done before or at least something that would most likely shock those on the other end of this positive deed. So, make sure to also brainstorm yourself, and see what volunteering ideas you can come up with that are not amongst the common ones that most have heard of.

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Stoicism & Real Estate – How To Be A Stoic Investor

Stoicism was an ancient philosophy of life that was very popular for hundreds of years in ancient Greece and Rome but its wisdom can still apply to us today. It is my belief that Stoicism can help you and I become better investors while being more fulfilled in the pursuit of our life-long goals.  

Make no mistake, Stoicism is not a religion; rather, it was more a form of personal development and moral guidance. Stoicism’s most famous practitioners were engaged in society in roles such as statesmen, writers, teachers, merchants, emperors and even slaves. 

Marcus Aurelius the Roman emperor from 161-180 AD was one of the most famous Stoic philosophers. Other famous Stoics include Seneca, a wealthy adviser to the Roman emperor Nero, and Epictetus, a former slave who later became a teacher to the elite of Rome.

Stoicism has very practical ideas that you and I can apply in our own life. Let’s explore a few practices that we can use as real estate investors and entrepreneurs.

The Philosophy = The Art of Living

According to Epictetus, the primary concern of philosophy should be the art of living; just as wood is the medium of the carpenter and bronze is the medium of the sculptor, our life is the medium on which you practice the art of living. Let’s break that down a bit further… 

The root of the word philosophy comes from the ancient Greek words “philo” meaning love and “sophia” meaning wisdom. Wisdom in this context was less about abstract knowledge and more about practical knowledge in life. Essentially, philosophers were lovers of knowledge and the art of living. 

In today’s world, most of us spend the majority of our time in a career earning money. Many philosophers today also embrace money; however, most of them learn to use money so they can spend their time doing what matters most to them. This is a fundamental concept that I have been teaching for years. The reason I transitioned years ago to a passive investing approach (in regard to real estate) and why I have a passion for educating others on this topic is really quite simple. The ability to create multiple income streams that can pay for lifestyle expenses, provides the ability to free up our time so we can pursue what matters most to us. This, as compared to trading our time in exchange for money in a career or job we may not be passionate about or being caught up in the corporate “rat race”.

“If you don’t find a way to make money while you sleep, you will work until you die” – Warren Buffett

The Foundation of Stoicism

“The chief task in life is simply this: to identify and separate matters so that I can say clearly to myself which are externals not under my control, and which have to do with the choices I actually control.” – Epictetus 


The foundation of Stoicism is simply this… some things you can control and some things you cannot. The only things you can control are your thoughts and behaviors in the moment. External events, the opinions of others, the past, and the future are all outside your control. Therefore, focus on what you CAN control. 

I recently read the book Man’s Search For Meaning, which highlights the life of Viktor Frankl during World War II. The Nazis in Germany had killed his family and put Frankl in a concentration camp for several years. Out of this most extreme of hardships, he learned one simple truth:

Everything can be taken from a man but one thing: the last of human freedoms – to choose one’s attitude in any given set of circumstances, to choose one’s own way.


While Frankl was not a self-proclaimed Stoic, his ideas echo in the core of Stoic philosophy. Frankl has taught millions of people through his books and lectures that we all have a choice in how we respond to the circumstances of life.

So how do we apply this to our own life?  Like any skill, we have to learn it and practice it consistently. Below are a few quotes that I found useful while reading The Daily Stoic, a book written by Ryan Holiday which contains 366 meditations from the ancient Stoics. 

“We might not be emperors, but the world is still constantly testing us. It asks: Are you worthy? Can you get past the things that inevitably fall in your way? Will you stand up and show us what you’re made of?” – Marcus Aurelius

Let’s relate this to real estate. Have you ever had a problem renter, an investment that lost money, or a business partnership that went bad? I know I have, and I often get anxious and stressed when these things happen. This is where Stoicism can help. 

Since we cannot control the behavior of a tenant, market conditions, or other people’s reactions and opinions; we must consider what we CAN control, which are our own behaviors and reactions. When a challenge or stressful situation arises, try to pause and not immediately react for a few moments. Then, look objectively at the situation and remind yourself that this is only a challenge; not a threat. Ask yourself “what is in my control?”


This simple practice reframes a “problem” from something that threatens into an opportunity to grow. Think of challenges like competing in sports or playing a game. The feeling of a challenge is completely different than a threat. A response to a challenge is much more productive, helpful, and enjoyable.


The Power of Simplicity 

“Set aside a certain number of days, during which you shall be content with the scantiest and cheapest fare, with coarse and rough dress, saying to yourself the while: “Is this the condition that I feared?” … Let the pallet be a real one, and the coarse cloak; let the bread be hard and grimy. Endure all this for three or four days at a time, sometimes for more, so that it may be a test of yourself instead of a mere hobby. Then, I assure you, my dear Lucilius, you will leap for joy when filled with a pennyworth of food, and you will understand that a man’s peace of mind does not depend upon Fortune; for, even when angry she grants enough for our needs.” – Seneca

My days in college taught me so much about Stoicism, but I didn’t know it at the time. I was broke during that period of my life, but I refused to take on student loan debt or credit card debt to get through this phase of life. I limited myself to $6 a day for food, I slept on an air mattress for over a year, I drove a $2,000 car that didn’t have air conditioning (in Florida) and I asked for clothes and practical everyday living items as Christmas gifts rather than acquiring the latest gadgets and fads. During this time, I earned approximately $8,000 a year working part-time until I landed my first “real” job after college…which paid $10 an hour.  

I am fortunate that I had an opportunity to live this way; I learned how to be happy while desiring very little. What was important were my friends, having a loving and supporting family, and learning so much about life during this time. I’m not sure that school itself taught me very much, but I had my basic human needs covered. I was a happy minimalist.  

It’s easy for us to become accustomed to material circumstances; I found this out later in life. But with each move up the comfort ladder, we often become unsatisfied once again and feel that we need “more” to be happy. This is a trap! There were several years where I bought fancy cars, expensive homes, brand name clothing, high-end watches and many other non-essential luxuries. Why did I do this? I suppose for a brief time, I thought that was the American way?

Here is the interesting thing. Taking away some of the comforts and securities that I took for granted, turned out actually making me happier. Cooking food at home rather than eating out, downgrading from a luxury home that I owned to renting a 645 square feet apartment instead. My wife and I even sold our Porsche SUV and exchanged it for an eco-friendly hybrid car. Here’s the thing. Did you know the average individual income worldwide is around $10,000 per year? If you’re reading this post, you already hit the lottery. 

Wealth consists not in having great possessions, but in having few wants – Epictetus


The lesson: Your life will not fall apart if you decide to experiment with removing unnecessary items. Practicing simplicity can positively interrupt the consumer programming we are all exposed to in the modern world. As a real estate investor pursuing financial independence, living with simplicity can help you make better decisions about what’s really important in life, and what is not…

For more on this topic, check out my blog post “High Net Worth Frugality – How To Save Like The Wealthy” 

Your Life Is Your Masterpiece

“Be true to yourself, help others, make each day your masterpiece.”– John Wooden 

The ultimate virtue for Stoics was a Greek word called arete. It’s translated as “excellence” or “virtue.” To me, this is about striving to do your best in each moment. If in this moment you apply these philosophies with excellence, you are living with arete.

How can arete relate to real estate investing and the pursuit of financial independence? Try asking yourself as an investor; how can I play this role with excellence? Am I willing to overcome the challenges that will be placed upon me? How can I make this moment, and the next, part of my masterpiece?

This game of life to become our best is an ongoing pursuit, and that’s a great thing. Striving for arete is a daily mission, moment-by-moment, until we take our last breath. 

I hope you found these Stoic practices to be helpful. What is one Stoic principal you can implement in your life, starting today?

To Your Success

Travis Watts

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The only suits you need for every occasion

Most men have heard that they need to own at least one good suit, but the reality is that you will need several suits to wear for various types of events and occasions. With your focus on wealth building and passive investing, you understandably are focused on reinvesting as much of your wealth as possible into real estate and other types of investments. However, it is also important to invest in yourself.

When you look at bold suits worn by sports commentators on TV and then at the classic suits worn by top business executives, the incredible variation in options is apparent. The reality is that there is a perfect suit for every occasion, and some suits may work well for multiple occasions. Nobody wants to run out at the last minute to shop for something as important as a suit. Now is the perfect time to shift your focus away from generational wealth for a moment and to focus on sprucing up your wardrobe.

Elegant Evening Attire


What will you wear on a fancy dinner date? The right suit may work just as well for that date as it would for an awards ceremony, a formal evening wedding and other similar events. For this type of suit, consider a darker color. If you want to maximize the life of your suit, consider traditional colors like black, navy and gray. Slim-cut suits are in style now, or you can choose a traditional fit for timeless appeal. Your suit should also be well-suited for your body type. For example, larger men may look better and feel more comfortable in a jacket with two vents.


A Professional Suit for a Special Business Function


You may be able to find a multi-functional suit that is ideal for evening use and professional use. This is not your run-of-the-mill work suit. Instead, it is reserved for job interviews, power meetings with other real estate investors or lenders and other special business functions. The attire will make a bold statement about your success and wealth. Depending on your personality and your unique style, a classic evening suit may work great for this purpose as well.


A Casual, Daytime Suit


Men who focus on passive investing may spend many leisurely days in comfortable clothing, but there will be times when a casual suit for daytime use is needed. During the warmer months of the year, lighter colors and fabrics may work well. Think about khaki, light brown or light gray. In some situations, it may be suitable to take the jacket off and to show off a well-tailored shirt with cuff-links and a stunning tie.


Office Attire


If you are still focusing on wealth building, you may need to wear a suit daily to the office. The specific style of suit and colors that are suitable for one office will vary from what is acceptable in another office. Generally, it is acceptable to purchase solid pants with a printed or off-color jacket. This matched style may not look right for evening attire because it tends to be more casual. However, pairing the slacks with a jacket can give the professional look that you need while you are at work. In most offices, you may need to keep the prints and colors on the tame side.


A Smart Suit


When you need to look sharp without looking like you are trying too hard, a smart suit is the perfect option. You may be able to mix and match pieces from the other suits that you have acquired to put this look together. For example, you can pair nice slacks with a more casual button-down shirt, no tie and a sport coat. On the other hand, you could also dress up a pair of nice khaki pants with a button-down shirt and a nicer jacket.


A Somber Suit


While nobody wants to think about attire for a somber occasion, the time to plan for these events is before they arrive. Dark colors are expected at these events. You want to look respectable and respectful. Avoid making a bold statement with your attire. Remember that there is a time and a place for all types of attire.


Essential Factors to Consider When Selecting a Suit


With so many suits available to choose from, the color and style are only some of the factors to pay attention to. Both the fit and the material will impact your experience in a specific suit. Before finalizing your purchase plans, turn your attention to these factors.




For some men, investing in a custom suit that is tailored perfectly to their form is worthwhile. For others, buying a suit off the rack is a better option. If you opt for the latter solution, be aware that most men will not find a suit that fits perfectly on a rack. You should plan on visiting a tailor so that essential modifications can be made. Your shape will change over time, so you should plan to have your best suits tailored periodically until they need to be replaced.




It is easy to overlook a suit’s material and to focus on its style and fit. However, material will impact the suit’s longevity and durability. It will also affect how comfortable you feel wearing the suit. The texture of the material may also make a statement about its style. What are the most common types of suit materials?


  • Wool: This material is natural, soft and easy to care for. Because it is a breathable fabric, it may be suitable for wearing on both warmer and cooler days. However, some men find that it is too bulky for their taste.
  • Worsted Wool: This is a unique type of wool that is both durable and smooth. Its special qualities are the product of the material’s combing and carding processes. Worsted wool may also be used in tweed jackets.
  • Cashmere: Cashmere is another type of wool, and some cashmere is a wool blend. This material is known for having a beautiful sheen to it. The sheen may make it better suited for evening attire than for daytime or professional attire.
  • Cotton: Cotton is a lightweight, durable material that may be used in more affordable suits. Its properties make it ideal to wear for outdoor events and during the spring, summer and fall months. While it is a breathable material that is comfortable to wear, it can wrinkle and crease easily while it is being worn.
  • Linen: Linen generally is a lighter material than cotton. It is preferred by men who live in very warm climates. However, it is prone to staining and wrinkling. If you purchase a linen suit, you may need to dry clean it after each use.
  • Polyester: If you want to save money while investing in a suit, a polyester or polyester blend suit is a smart idea. This synthetic material has a modest shine to it that you will not find in a wool or cotton suit, so its lower quality may be apparent when you wear it. Because polyester is durable, however, it may be a good material to choose for an everyday suit.
  • Other Materials: Suits are also made using special materials, such as silk and velvet. These are high-end materials that are generally not suitable for everyday use, casual use or sophisticated formal events. Instead, they may be a better option for trendier occasions. These suits will require special care after each use to keep them looking great.

Colors and Prints


The most traditional colors of suits are black, navy, blue, charcoal and gray. While many suits continue to have a solid hue, it is increasingly common to see stripes, plaids and other designs. The variation in colors and prints may also extend to accompanying vests. The color or print of a suit may make a bolder statement than the suit’s cut, so careful consideration in this area is important. This will also impact how versatile the suit may be for use for other purposes.


Shirts, Ties and Shoes


The look of your new suit will be directly affected by the accompanying clothes and accessories that you choose. The tie and shirt require special attention because of how visible they will immediately be to everyone who glances your way. The shoes should never be an afterthought. When you invest in a pair of quality shoes, you will make a solid statement about your style from top to bottom.


Focusing on building passive income streams and establishing generational wealth are primary goals, but there are other factors to consider. You want to look as successful as you are, so investing in a new suit or two soon is a smart idea.

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How To Improve Your Public-Speaking Ability

Public speaking is one of the most important skills that you can have. It’s also one of the greatest fears that many suffer from. However, there is much that you can do to improve your ability to speak before small and large audiences. Being better prepared, which will reduce your anxiety, will help you in various aspects of your life. These benefits can range from now being able to speak to a group of youngsters about fire safety to helping adults engage in investing and wealth building.


Public Speaking Focuses


It’s important to learn the ways that public speaking is important. One is that it’s a valuable way that you can inform others. Note that convincing people of something is not important if your focus is simply on informing. You just want to get the information out there and allow them to come to their own conclusions. The more demanding forms of public speaking involve you convincing them of something or motivating them. It’s at that point that preparing for the emotional aspect of your speech becomes important as well.


Perhaps you want to describe the local real estate market to a group of students at a community college. In that case, your focus would just be on informing them. Conversely, if you’re looking to convince someone to engage in a specific type of passive investing, that’s when you’d want to motivate or convince them to do what you’d like them to do. Informing will, of course, be part of that, but there’s going to be a lot more to the process than if you were just informing them.




The best thing that you can do prior to engaging in any form of public speaking is preparing for the experience. A nice side benefit that will directly impact the level of confidence that you have when you’re in the act of speaking is that being well prepared tends to decrease anxiety levels. Preparing should be done in a general sense, which is what you’re doing by reading this, and it should also be done specifically related to a particular speech.


In regards of the latter point, make sure to thoroughly research what you’ll be talking about. Do this even if you know the topic well. If you’ll be speaking about something that you feel that you have expert knowledge of, you don’t need to do as much research, but you should still touch up on the information. In many instances, you’d be surprised at how much of what you had assumed to be true actually isn’t. You also want to see if there’s any new information that you had missed.


Memorable Introduction


Journalists quickly learn how important the first few sentences of an article are. The initial moments of a speech are just as important. You want to grab the audience’s attention. This can be done with a related story, a statistic that would surprise most in the audience or a question that you want them to think about over the next few minutes. You want to establish your credibility and state your purpose in the early moments as well, but getting their attention is of utmost importance.


Note that most recommend that you write your introduction after you’ve finished the bulk of the speech. This is not as necessary when you’re already knowledgeable about the topic or you’ve started to be able to initially formulate much of your speeches in your head beforehand, but in those cases, you’re going to still want to carefully review your introduction later and be ready to make changes to it.


Establish and Satisfy the Need


Unless you’re solely focused on informing your audience, you should establish a problem that must be solved. The status quo is not working. We’re destroying our rainforests. This needs to change. This is why this needs to change and why you should care. That naturally translates into satisfying that need. Here’s what we can do to solve it. Make sure that you provide facts whenever possible throughout these parts of your speech.


Next is providing imagery for what the future will look like is nothing is done versus its appearance if that need is satisfied. It helps to be as vivid as possible when telling these stories. This is partially where being emotional comes into play. Be passionate and determined when you’re discussing this need and about what these differing types of futures will look like.


Even if your focus is on informing those you’re speaking to, emotionality can come into play as well. For example, if you’re telling your audience about what happened to the dinosaurs, you could incorporate stories about dinosaurs that lived then or otherwise tug on their heartstrings.


Your Conclusion


The conclusion of your speech is important as that is what will generally linger in the minds of those there. You want to briefly summarize the main points of your speech at this time, but you want to do so in a manner that involves you paraphrasing your points, not simply repeating them. You may also want to include a short story or a memorable quote to help you end on a solid note.


Know Your Audience


Part of the preparation process includes being prepared for your audience and tailoring your speech to that audience. In most cases, you should have a general idea of what to expect audience-wise, from the size of it to, more importantly, who they are. For example, speaking to those who are recipients of generational wealth is going to necessitate a different focus than an audience filled with people who are looking to engage in investing in order to build wealth. Also, educating kindergarteners about dinosaurs will require a different focus than doing the same with adult students.


Be Prepared to Ad-Lib and Go With the Flow


It’s best in most cases to not expect to deliver your speech word for word. You want to have general ideas in mind and then expand on those. Thoroughly research for your speech, but you don’t need to write a word-for-word speech and stick to that exact script. You also want to respond to the audience, read the audience, as you go along. That may be a skill that you should focus on later if you’re new to public speaking, but it is something that you should focus on sooner rather than later.


As you gain public-speaking experience, you’ll improve your ability to respond to both positive and negative body language and audible responses. This can even mean going completely off-script at times. Also take into account that doing thorough research in preparation for your speech allows you to more easily ad-lib.


Visualize and Practice


Practice your speech multiple times. You’ll be working towards a powerful presentation and will increasingly get a better idea of how to word certain parts of it. As you practice, visualize the setting as best as possible. If you can actually rehearse in the same facility that you’ll be delivering the speech, that’s even better. If not, visualize the experience as best as you can, including what the audience will likely look like and how its members will likely respond.


As far as your overall speech-giving skills go, continue giving speeches. Toastmasters is an organization that is one of the best at presenting speech-giving opportunities to people who want to improve. You could also ask to speak more often at work and in other types of situations in your life. Volunteering your time often presents numerous public-speaking opportunities as well.


Why Is Public Speaking Important?


Public speaking provides numerous life benefits. Those who become more experienced at it tend to experience a greater level of self-confidence and more comfortableness when interacting with others in all types of settings. Being more versed in public speaking will also allow you to make a greater difference in life. Anything that you can do to influence others’ thoughts is powerful, and public speaking has been shown to be amongst the most powerful things that any of us engage in.


Public speaking also provides you with tremendous learning opportunities. If you’re researching the local real estate market for a speech to give those engaged in passive investing, you’re also going to be teaching yourself a lot about wealth building in the process. And when you’re looking through information about generational wealth and how to keep that wealth transitioning through the generations for some time to come, you’ll learn a lot about that topic that you can also bring to discussions and interactions with people.


As with anything in life, taking the time to prepare for what you’re about to do will exponentially increase your ability to succeed at that task and decrease how much related stress you may experience from it. Public speaking is no different. Get out there. Give speeches. Be thoroughly prepared for them. Get comfortable going with the flow while giving them. Help people. Grow.

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The 5 Types of Millionaires

I took a day off to ponder on the topic of millionaires. I’ve had an increased curiosity lately in studying millionaires in order to understand the different ways people achieve this financial milestone. I came to an interesting realization that most people never talk about. There are several categories of “millionaire” and they are not created equal. Today, I would like to share with you these five types and examine their differences…


#1 Make 1 Million Dollars a Year

Some people define being a millionaire as making a million dollars (or more) per year. While this may not be the net-worth definition, it certainly meets the criteria. But here is something interesting to think about. What if you actively earn $1,000,000 a year from a salary or in W2 income and you spend $600,000 per year on your lifestyle expenses? It seems you would be living below your means – right? Not so much. You would essentially be left with $0 at the end of the year due to taxes (federal, state, and payroll) and in some high tax states, you might even be underwater and owe more if you spent $600,000 after-tax dollars. We are all too familiar with the many professional athletes, celebrities, and lottery winners who went broke after making their millions. It’s not what you make, it’s what you keep. 


#2 Save 1 Million Dollars

Some attribute saving a million dollars as the path to achieving millionaire status. Consider someone living frugally throughout their working career while earning an annual salary of $100,000. They might pay somewhere in the ballpark of $30,000 in taxes each year and perhaps they live on a modest $40,000. This means they could potentially save $30,000 a year – right? Possibly; however, this process would take over 30 years to accumulate 1 million dollars “in the bank” ($1,000,000 / $30,000 = 33.33 years). This strategy can be a very long pursuit without investing the money or benefiting from the power of compounding. Additionally, inflation works against you by often outpacing what interest you may receive from the bank. This begs the question…how much will $1,000,000 buy 33 years from now?


#3 Owning a 1 Million Dollar House 

Many of us chase the good old American Dream of owning a nice, big, paid-off house. While a big home may be nice, Robert Kiyosaki, the author of Rich Dad Poor Dad said it best: “your house is not an asset, it is a liability.” Why? Even after paying off a house, there are still property taxes, insurance, maintenance, and expenses that go along with it. Therefore, it takes money out of your pocket every month. Without having a job or investment income to pay for these expenses, you may risk losing your home. This begs the question…do you ever REALLY own your house?  


#4 Invest 1 Million in Equity Investments 

There are two primary ways you can invest. You can focus on equity or income. An example of equity investing could include buying a stock at $10 a share and hoping it goes up to $15; then selling the stock if it does. Or buying a rental home for $100,000 and flipping it for $150,000. The profits are your “equity”. While there is nothing wrong with either of these strategies, the fact is that you must keep working and stay active to produce these equity gains. If you choose to walk away from this business or side hobby, the profits are likely going to stop or reduce significantly. Time is money. 


#5 Invest 1 Million in Income Investments 

Finally, we arrive at the income investing approach. Income investing is not based on “buy low and sell high” although that very well could be the icing on the cake in some investment types. This strategy is primarily focused on income-producing assets that produce cash flow, interest or dividends. The real benefit of this strategy is having the option to live on the income. These passive income streams could potentially replace your day job, or at least provide additional sources of income in the event that you lose your job, choose to take some time off, switch to part-time work, or retire altogether. Examples of this type of investing might include, owning real estate where tenants pay rent to you every month, buying REITs (Real Estate Investment Trusts) which are commonly traded on the stock market and usually distribute a large portion of their profits in the form of a monthly or quarterly dividend. Additionally, bonds, CDs, annuities, tax-liens, notes, ATM machines, producing oil wells, and dividend-paying stocks are a few other examples of income-producing investments. 


No matter which type of millionaire you currently are or wish to become, it is important to know the differences between the types. This was an eye-opening discovery for me and I hope it helps you clarify your approach to wealth building. Which type of millionaire strategy suits you best?  


You can be rich by having more than you need, or by needing less than you have – Tony Robbins 


To Your Success

Travis Watts 

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Rich Fettke on Supercharging Remote Teams

Real estate is a high-touch business that must now adapt to working remotely. If you want a more effective team or professional network, real estate investor Rich Fettke has actionable insight for you. Rich is co-CEO of Real Wealth Network and took his company completely virtual almost ten years ago. As a guest on the Joe Fairless Best Ever Show podcast, Rich offers tips on building a happy and motivated remote team.

About Rich Fettke and Real Wealth Network

Rich Fettke is co-CEO of Real Wealth Network, an educational and referral service for the passive investor in single and multifamily properties and other opportunities. He brings a strong track record in business and personal coaching helping entrepreneurs grow their businesses.

A turning point came when Rich was diagnosed with terminal cancer. He and his wife, Kathy, scrambled to plan their children’s futures should the worst happen. After much research, Kathy determined that real estate investing was the path to financial security.

The diagnosis was overly dire, and Rich survived cancer. Inspired by Kathy’s research on income generation, the couple founded Real Wealth Network to help friends learn to invest in multifamily and other real estate. The company has grown to include brokerage and syndications operations that offer opportunities for passive investing.

Rich develops teams and systems for his 25 employees, all currently working remotely. Here are his must-haves for a dynamic remote team.

Define Your Culture

Some business areas need pruning during tough times, but your company culture is not one of them. If Rich Fettke has one key takeaway for you, it’s this: “Be sure to determine your core values and use them as hiring criteria.”

Know Your Core Values

Almost every company lists impressive-sounding values and claims to honor them. But when pandemic constraints or other hardships test a business, the truth reveals itself. You must commit to executing on your values every day and holding yourself and the rest of your team accountable.

Here are some of Real Wealth Network’s values that translate directly into actionable tips for remote work.

  • Integrity
  • Transparency
  • Connection
  • Accountability

Get your team’s input and buy-in on the company core values. Employees are more dedicated and self-directed when they feel some cultural ownership.

Hire to Your Core Values

An employee or partner is either adding or subtracting value. No matter how alluring a candidate’s profile, he or she will compromise your team if core principles are misaligned. Even a passive investor can impact your network’s wellbeing.

Rich suggests including core values in your interview questions. Tell candidates one of your values and ask them to walk you through a scenario when they had to act upon that value under pressure. What was at stake, and how did they handle it?

To help vet leaders, Rich also asks prospective employees how they would manage others in light of those values. If your team member fails to deliver, how do you address that? If your ordinarily effective peer is dropping the ball, how do you intervene? These spontaneous answers can reveal a lot about a candidate’s values, strengths, and fit for your unique team.

Lead with Values

After you document your core values and refine your hiring process, the hard work begins. Each day, your remote team has to show up and live those values virtually. Unlike when working onsite, the in-person feedback and social cues that help keep us on our toes are lacking. Subtle employee behaviors or oversights are also easier to miss. Your remote team must understand behavioral expectations and the exact consequences of falling short.

Expect Integrity

You’ve probably known quality employees who were let go with seemingly no warning, or perhaps experienced this yourself. Rich explains how Real Wealth implements the three-strikes rule transparently so that everyone is clear on accountability. This approach avoids the murkiness that often surrounds many companies’ evaluation process, especially in remote environments.

As a manager, you hold a one-on-one with the employee having the issue, advise this is strike one, and explain why. You make sure the employee understands and can repeat it back. You reiterate the three-strikes rule and that a third strike means termination. If employees gain a third strike and are terminated, they almost always admit responsibility and a lack of enthusiasm for the job.

In contrast to giving three chances, don’t be afraid to jettison employees who consistently violate integrity standards. Everyone has an occasional off day, but people who don’t meet your company’s ethical standards need to move on.

Show Transparency

You want to set up transparent systems and processes and encourage open, honest communication. It’s essential to let your team know the metrics evaluating their behavior. Rich shares that at Real Wealth, flagrant integrity violations merit instant dismissal. Breaking the core value of connection by being rude, on the other hand, might call for three strikes.

Gossip and complaining might be a little tougher on a remote team but still occur. Rich and Kathy decided that transparency meant no behind-the-back talk, however seemingly innocent. When you don’t interact in person, it’s easy to blindside employees with poor feedback after it’s too late for them to correct deficits.

In a rush to execute under pressure, businesses sometimes skip transparency basics such as creating an organization chart and job roles. Even a real estate investor with a small team will benefit from organizational clarity. It’s especially important to document in a remote environment, as the days of yelling a question over the cube wall are over.

The documentation should be concise, visual, and stored in an accessible central location. Your team members need to know:

  • What’s expected of them
  • The performance metrics
  • How to get help
  • How much problem-solving ownership they have
  • Who the managers and experts are

In a unique spin on visioning, Rich suggests creating an org chart for your business as it will be in five years. As your company grows and you fill positions, you’ll be encouraged to replace your photo with those of hires who can do their roles better than you can.

Build Connection

Effective systems encourage people to connect in productive and enjoyable ways. You want to avoid typical group time wasters, such as unnecessary meetings.

Rich and Kathy hold quarterly all-hands meetings to communicate important news. This “state of the company” address covers accomplishments, financial performance, profit sharing, and upcoming changes.

When conditions permit, Rich believes in the old-fashioned company retreat for much-needed team bonding. At the yearly three-day event, team members focus on what went well and not so well, what they learned, and the roadmap ahead. They also celebrate each other’s accomplishments. This in-person time builds relationships that help power the group through the rest of the remote year.

Accountability: Rock Your Team Mindset

If you work remotely, it’s easy to fall prey to distractions or a sense of disconnection from the company mission. Real Wealth met this head-on by implementing the Entrepreneurial Operating System®, or EOS, a holistic operations toolkit for smaller businesses. This method sets specific expectations for employees, helps them focus on the bottom line, and gives them ownership of results.

If you’re wondering which system Rich uses to track employee progress, his answer is rocks. Each team member has three to five “rocks” that represent quarterly targets. Rather than micromanaging employees, managers tell them, “Here’s your rock.” The employees own delivering results.

To make quarterly targets more tangible, people can place actual rocks in jars on their desks. That visual reminder of what’s essential helps them prioritize work and minimize distractions.

Another strategy is to partition teams under leads who can work closely with the smaller group. This model promotes individual accountability and open communication.

Run Lean on Tech

The right platforms for your business enable remote collaboration without intruding. How do you balance tech need and overhead?

For starters, Real Wealth doesn’t always meet over video. Skipping the virtual face time cuts down on complexity and that angst of having to look good on camera. The company holds a monthly all-hands meeting, and teams hold weekly meetings. Most video calls involve screen sharing but no distracting faces, allowing attendees to focus on the well-structured agenda. The monthly meeting is an opportunity for people to see each other and connect visually.

After grappling early on with tech overkill, Real Wealth now leverages a few platforms with high returns. For project and portfolio management, Rich and his team use the tried-and-true Basecamp. To help manage meetings and follow-up items, they use Ninety, which implements EOS principles. GoToMeeting and Zoom are favorites for video calls.

Your Turn

Remote teams are the new social business climate. Even if passive investing, you want to mind your business relationships actively. Use Rich Fettke’s experience to help you hone your professional core values and processes. You will enrich your team or network on all levels.

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Accepting the Risks of Reaching Success

If you truly develop your mind as an investor, you’ll eventually see risk as an inevitable part of a successful portfolio. Avoiding loss is certainly our goal, but in achieving success as a passive investor, accepting risk enables us to act with surety. Millions of people who search for passive income tend to overthink it. Some are “paralyzed” by the prospect of loss instead of using it to their advantage.

In every deal we enter, there’s a way to turn uncertainty into a benefit. Interestingly, a portfolio that consistently profits is also consistently exposed to risk. The balance we achieve as lifestyle investors comes from first analyzing our costs. As you profit, I encourage you to be bold but to know the cost of doing so.

Being Risky Without Accepting Loss

We have to accept risk for what it is because we can’t eliminate it. Profits must outweigh deficits if a portfolio is to succeed. Notice, however, that risk remains even within a winning record. No one generates profits without first paying a principal sum. This means that even if you did find a risk-free investment, the money you put into it is your first loss. My message to passive investors is to balance their risk by knowing the part it plays.

Risk doesn’t tell us not to enter a position. It tells us how to, when and where.

Risk—Accepting It vs. Taking It

You might have heard it before: “Take risks.” My expectations for your financial future is much more secure than that. Don’t take risks that you can’t handle. Never go into an investment without knowing the dangers involved with it. The difference between taking risks and accepting them are the pursuits behind each. If you “take” risks, you might also find yourself habitually searching to do so.

When you “accept” risk, however, you decide on the lowest denominator in order to keep losses at bay. Here are some examples that explain my point:

*Taking It
The loss, duration or long-term repercussions won’t matter. Being motivated to “take risks” means that as such arise, you take it. You won’t worry about doing analysis or asking yourself if you can handle it. Any method that takes on risk in its full capacity will lose money over time. Some investors find the opposing stance, as their response, to be that of eliminating risk. Notwithstanding, your balance is struck by accepting the reality that your risk doesn’t go away.

*Accepting It
The first step in solving any problem is to know that it exists. Accepting the truth that risk is always there helps you to strategize from a point of logic. You have to clearly know “what you’re getting into.” Only then can you devise a plan that outperforms the damages of loss. Accepting risk allows us to think intuitively.

We each need to create strategies that allow risk to exist but at a lesser degree than our profits. Your investment with me, for example, covers maintenance, advertising and repairs. The rewards we later receive outweigh but won’t negate the initial risks we had. Eliminating risk is not the objective; outperforming it is.

How Much Risk can You Tolerate?

Before taking your first step into an investment, you must decide on how much loss you can handle. We know risk will be there. How much of it will you be exposed to? Wealth building in real estate is ideal because of the passive way it generates money. Passive investments enable you to decide on the risk you’re comfortable with. Risk tolerance is the level of loss that you can handle in any situation. Now for ideal success, tolerance must be a number.

How much can you lose before the loss makes you think twice? Will you have to remortgage the house just to stay in an investment? Will your employer condemn you; will your spouse consider separation? The extremes that come from financial loss are the risks you’re faced with. Deciding on how much loss you can handle requires you to analyze your emotional stability also. You can then enter an investment once the amount that you can lose is determined.

Know the Cost Up Front. That Cost Equals Your Wager.

When done right, evaluating the risks you have should result in an exact figure. I don’t recommend general figures because we need to cap your losses. Putting a cap on your deficits means that only a specific sum is at stake. I’m always positive about your investment potential, but your profits should never lead you to forget the costs involved. Accepting risk is how we humble ourselves and prepare to succeed. You can also scale your rate of success by determining:

How Fast to Enter—Costs that are clear prior to investing can become an indicator regarding how you should invest. Investments that, after basic analysis, show a low cost of entry but a high-profit potential require fast action. The mistake of not knowing your risk leads you into toxic deficits. Acting with haste is only profitable when you’ve confirmed your likely margins of profit. I then suggest that you double check to confirm that the cost is low during any ideal moment for investing.

How Quick to Let Go—Cost, which can be measured as risk, also tells us how or when to exit an investment. The closer we are to hitting our profit targets, the longer we want to hold such underlying assets. Moving closer to our initial levels of risk is what signals a need for exiting an investment. It’s even possible to profit from an asset and then see it revert toward a measure of loss. As long as you’re aware of the risks, you can exit a bad deal before it gets out of hand.

Reward and Risk Analysis—Why?

Being that risk is “acceptable,” we need to ask ourselves if our investments are worth it. In doing so, we’re not only asking if the potential profits are alluring enough. Successful investors need to ask if the potential loss is worth the trouble. The way that smart investors enter a position starts with cost/reward analysis. In such study, the first ratio we need to confirm is a 1-1 outcome.

This means that for whatever you spend, you get the same amount back. This is how we insure our principal. Ratios that then hit 1-3 are those that triple our initial investments. An investment that fails to produce a 1-1 outcome isn’t worth it. The first rule to any successful investment is to return your principal in all cases.

Automation—How a Good Track Record Solves Your Worries

Building your confidence in accepting risk helps me to ensure your success. This is why I want you to know that the best deals are those that have first proven themselves. No one can guarantee what the financial markets will do. What we can do together is decide on the worthiness of an asset by looking at its history. Past performance is the closest thing we have to a “best bet” when investing.

Profit automation occurs when an investment asset consistently shows profits as outperforming the deficits. A proven history of success ensures that we don’t blindly take risk into our lives.

*Freedom and the Dangers Involved—Financially, it’s easy to get carried away when you forget about your potential risks. A lifestyle built on wealth gives us a certain freedom that we might take for granted. The danger of living on passive income is the delusion that that money is generated without cost. This is what the sensation of winning can lead us into. By looking for investments that are backed by historic performances, we won’t negate risk, but we’ll manage it logically.

Letting Passive Income Reduce the Uncertainty

An ideal way of creating generational wealth is to reduce risk via passive investments. The less work you have to do, the more analysis your mind is free to initiate. It’s easier to make decisions that are good for your portfolio when you’re not overwhelmed by huge losses. Reducing risk can be successfully done by reducing how much work you need to put forth. My work, as a result, can substantially reduce your uncertainty.

Take a Larger Step Into Passive Investing

Wealth building is complicated if risk overburdens your thoughts. Real estate is being bought every day however. Reducing risk calls for investments that perform even when world economies don’t. Passive investing is an approach that has mastered the art of boosting profits while confidently accepting the risks involved. I need you to be bold in this manner. Follow your passion but with a realistic perspective of the cost.

Generational wealth is easier to create than you might think. You need a logical approach to managing risk while being prompt to take profits as they come. We can make your passive lifestyle better than you had imagined. All of us will inherit potential lost but not being deterred is what guides us into our greatest potentials in wealth.

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Philanthropy – The Most Common Organizations to Help

A majority of the world’s wealthiest people have a story of “rags to riches” to tell. Many of these leaders dropped out of school and came from the direst conditions that mankind can be found living in. When we look at the fact that people like Thomas Jefferson singlehandedly ensured the existence of public libraries across the USA, it’s clear; the opportunities we have don’t stem from our own brilliance.


Wealth is built on the contributions that others have made. Even the real estate we profit from wasn’t built by our own hands. I want you to define charity in your own words and to see giving as part of generational wealth and wealth building.


Wait. Can Philanthropy Make Your Rich?


What if I told you that your wealth can only be measured by your ability to give? You might have heard it before, “Give to the poor.” No one can give to nor help another person if they have nothing themselves. Power and philanthropy go hand in hand. At times, it’s not so much a display of humanity as it is a display of capability. Many people desire to make a world impact but lack the resources to even start.


Giving is so pivotal to society that we get tax benefits the more we do it.


The Benefits and Freedom of the Untaxed


As an itemized contribution, anything you give to legal nonprofits counts as a deductible from your taxable income. The amount you give is personal, but in doing so, you lower the rate at which your income is required by the IRS.


Seek Charity, but Fuel Yours With Passive Investing


What makes a charity ideal is the passive way that you can use them to change the world. Whether you leverage your earnings from passive investing in real estate or from personal income, you don’t need to lift a finger when investing into a regulated charity. Now if you hope to realize the wealth building potential of investing into the philanthropic way, consider the following charities to start with:


*1. Feeding America

What Gets Done—Answering every call of hunger in the world is the objective of Feeding America. The United States is the organization’s primary focus, but the aid it musters finds its way into many global crises. “Working together to end hunger,” is the agency’s motto.


Who Benefits—Over 18-million children are expected to deal with caustic levels of hunger during the pandemic of 2020. Both adults and youths receive aid from this agency however. The focus of Feeding America isn’t just for those without the means but also for those who’re struck by natural disasters. Expect this nonprofit to rally resources together, primarily focusing on food shortages during hurricanes, earthquakes, tsunamis and even economic downturns.


How—Being the United States’ largest advocate for food, Feeding America uses its wide reach of influence to achieve its mission. Donors play a role in keeping Feeding America functional. This includes volunteers who help to deliver meals, package and preserve food products as duty calls.


*2. Direct Relief

What Gets Done—Disaster relief, as it pertains to war and “acts of God,” is the core focus of Direct Relief. This nonprofit measures its own work based on its vision of “global health.” What this interprets into is humanitarian aid. The specific issues, be they social, economic or political, dictate the aid Direct Relief delivers.


Who Benefits—The United States is the first in line for “direct relief” when resources and labor are dispatched to emerging needs. Over 80 countries now qualify for aid, being stated by the nonprofit as, “ … anyone in need.” Wildlife, as it pertains to fires, floods and endangered species, benefits from the agency’s work.


How—With nearly a billion in accounts payable, Direct Relief has a substantial fund to lead its humanitarian projects through. Roughly seven-million pounds of medical supplies have been delivered by the group since 1948. The transportation of resources makes up a big part of the agency’s competencies. Simply getting things to where they need to be is proven to be a big challenge. Direct Relief offers training and humanitarian work to over 2,500 volunteers.


*3. Open Society Foundations

What Gets Done—“Freedom, democracy and human rights” are the core focuses of George Soros’ Open Society Foundations. In the developing world, the principles of democracy are considered new. The work calls for an agency that realizes the challenges that still exist in removing authoritarian power. Over 50,000 grants have been awarded by the fund so far. These are used to raise the voices of anyone living in conditions of oppression.


Who Benefits—Children who lack formal education are a key focus. Adults living with income inequalities benefit also. Developing democracies are key beneficiaries along with journalists and discriminated groups in the working class.


How—The foundation issues grants to innovators who’re determined to promote the agency’s mission. As long as these promoters develop functional ideas for democratic change, they stand a chance at changing the world forever.


*4. Wounded Warrior Project

What Gets Done—The study, treatment and education of post traumatic stress disorder (PTSD) is the work of the Wounded Warrior Project. This U.S. military nonprofit focuses on rehabilitating veterans. The organization targets substance abuse and provides counseling to give vulnerable veterans a sense of meaning in human relationships.


Who Benefits—Veterans who need to return back to their civilian lives are the leading beneficiaries. Statistics show that roughly 24% of all vets are substance abusers while an additional 20% are living with PTSD. Those with mental and physical injuries are also challenged in ways that require therapy in group sessions.


How—A board of directors is responsible for guiding the direction of this nonprofit. Therapy and rehabilitation are its core competencies. “Alumnus,” who are donors like you, make the work of Wounded Warriors possible. Free programs with a proven methodology are available to anyone who needs them.


*5. Ford Foundation

What Gets Done—Leading a global fight against inequality and social injustice is what the Ford Foundation does. In its own words, the foundation is responsible for, “ … disrupting systems to advance social justice. …” The circumstances, people and goals dictate how the money raised by this nonprofit is used.


Who Benefits—People living with gender inequality find aid from this organization. Racial and ethnic injustices are targeted by the Ford Foundation and deemed unacceptable in a modern world. Low-income workers also find refuge through the lobbying efforts of this agency. The work of modern artists and other creatives is important to the Ford Foundation. Technological and environmental impacts are also, and those with disabilities are likewise given aid.


How—Through a $1 billion fund, the Ford Foundation strategizes and allocates resources for its projects. It recently raised $75 million for COVID-19 and even provided $20 million for the rights of low-wage earners.


*6. American Heart Association

What Gets Done—Having nearly $5 billion spent on research and development, the American Heart Association leads the nation in seeking a solution for heart disease. By targeting what is now the leading killer of American adults, the AHA promotes general health by making people aware of the risks they face. Directly fighting against the development, onset and mortality of stroke or heart disease puts the sole goal of “an eventual cure” within the scope of this nonprofit.


The agency, on a national level, also leads the charge in monitoring how medical professionals treat heart disease. Malpractice is its concern as well as any medical agency that lacks the needed resources to combat stroke and heart disorders.


Who Benefits—Women and men equally benefit from the work of AHA. People who have underlining medical issues are a key-study group for this agency. Those who’ve already experienced a heart issue or stroke receive financial aid at times. As far as smokers and drinkers go, the American Heart Association is determined to minimize the probability of heart disease in aging patients.


How—Through voluntary aides, the American Heart Association ensures that it’s equipped with medical professionals from all walks of life. Roughly 33-million volunteers are ready to progress the agency’s mission right now. Public education and awareness play a large role in convicting every American regarding the risks they have and why donating or getting a checkup is important.


You might feel a need for substantial generational wealth before you can partake in charity. Helping someone you encounter in public, however, is also a form of giving. Making life as a passive investor truly profitable starts with realizing the charity you once needed to get to where you are now. No one becomes wealthy alone.


In the same way that I strive to make your investments profitable, put the money you generate back to work for yourself also. Develop your community, teach the youth and give people the opportunity to make your enterprise more successful. Such steps are how you make charity as financially rewarding as it is morally.

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What Type of Investor Are You? – A Quick Self-Awareness Guide

Even though no two investors are exactly alike, there are patterns to investors, and generally speaking, they fall into two types:

  • The Passive investor
  • The Active investor 

Knowing which type resonates best with you can help align your investing to your personality and lifestyle preferences. Having this self-awareness is key when it comes to achieving your desired outcome. To help you figure out the best path and to understand the differences, let’s dive into these two investor profiles.


The Passive Investor

This is the most common type of investor, although, I’ve noticed over the past few years, there are not a lot of educational resources to help clarify the passive side of real estate investing. That is why the Best Ever Team and I have recently doubled down on creating free resources for passive investors. Learn more here


Common Traits of a Passive Investor Often Include:


  • Lacks the time to frequently monitor investments
  • Enjoys reading financial news
  • Likes to own a little bit of a lot (values diversification)
  • Seeks to match, not beat, the market


This type of investor is often unemotional about the investing process while being more “active” on the portfolio management side rather than on the investment itself. Passive investors have an understanding of multiple types of investments, as well as the overall associated risks. 


Portfolio Investments May Include:


  • Real estate syndications
  • Private placement offerings
  • Notes or hard-money loans
  • Tax liens 
  • REITs (Real Estate Investment Trusts) 
  • Stocks, ETFs and other publicly traded assets 


Generally speaking, this type of investor is proactive when selecting investments, and then tends to sit back and enjoy the ride. The philosophy? Primarily long-term buy and hold, hands-off investments. 


The Active Investor

In contrast to the passive investor, an active investor may also enjoy reading financial news; however, they often spend several hours each week or month actively monitoring and managing their investments.


This person may seek to have involvement in a number of areas in the investing process. An active real estate investor could be similarly compared to an active day trader who follows the stock market, even if they don’t execute dozens of trades each month.


This kind of investor usually prefers a more hands-on approach to their investing. An active investor is often more interested in the “business” of a particular investment or industry. 

Common Traits of an Active Investor Often Include:


  • Likes to create their own unique strategy or business plan
  • Doesn’t necessarily value diversification as a top priority
  • Seeks control over his or her investments
  • May have a unique skill or upper hand compared to competitors
  • Seeks to beat the market


Generally speaking, this type of investor is actively involved when selecting and underwriting investments. The philosophy? Short-term and long-term, “do-it-yourself” approach.  


More About Your Personality

Consider how you respond to financial transactions, emotionally. This can help you invest in a way that’s aligned with your comfort zone. For example, if you’re investing and you sometimes feel nervous about making a mistake, this is a sign to be aware of, especially if it causes you to buy or sell on a knee-jerk reaction. As another example, if you tend to develop an emotional attachment to a certain stock or piece of real estate, this may cause you to hold onto the investment longer than you should, in hopes that it will rebound; this can hurt your investment portfolio returns. 


If these two examples describe your personality type, you may decide that a passive investing approach is more suitable. No matter what investing decisions you make, there can be real value in having insight into your investing personality, which ultimately allows you to feel more comfortable with the investing process. The sooner you identify what suits you best, the better off you will be in the long-term. 


Emotions connected to money and finance can be traced back as far back as your childhood. For example, if your parents were anxious about how to invest; you may have picked up that habit yourself. It is helpful to be aware of these emotion-based patterns and break them as soon as possible, so they do not hinder your financial future. 


Understanding Your Risk Tolerance


How Do You Handle Risk? There Are Four Common Personalities When it Comes to Risk:


  • Cautious
  • Systematic
  • Spontaneous
  • Individualist


If you are cautious, you may be extra sensitive to losses in your portfolio, and you may feel more comfortable with safer or more conservative types of investments. Fear is usually playing the primary role with this personality type.


If you are systematic, you likely make investment decisions based on hard facts and data. Details and analysis matter and this personality type will often refer to research to make a decision. This personality type can also have a lower risk tolerance, but will rely on “the facts” to make a decision. 


A spontaneous investor often has a higher risk tolerance as does the individualist. If you’re spontaneous, you may quickly switch from one investment or strategy to another. Perhaps on advice or knowledge you’ve recently received, or because of a new developing trend. This personality type finds satisfaction from frequent change and new investing ideas. 


Individualists, typically seek unbiased research and due diligence to make decisions independently. They are often willing to take calculated risks because they are confident in their research. New trends and media hype often do not persuade an individualist.


Getting Started

No matter what personality type you have or what your risk tolerance is, self-awareness is a key ingredient to a successful investment strategy. Whether active or passive, investing is not a short-term endeavor, so it is beneficial to take a little time to reflect on your goals, your strengths, and the lifestyle you desire. 


Step one is to simply get started on your own self-awareness 


To Your Success

Travis Watts 

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Clever ways to deal with requests for money

Through years of hard work and a smart wealth-building strategy, you can amass a small fortune. Passive investing enables you to ultimately enjoy a comfortable lifestyle. Income may be coming in regularly from real estate investing activities and other types of passive investments. Once your passive income streams are established, you will not have to spend so much of your free time working.

Friends and family members will undoubtedly admire your lifestyle. At the same time, when they need extra cash, they may immediately think about asking you. An important aspect of building wealth involves making savvy financial decisions. Regardless of how wealthy you are, you understandably cannot lend money to everyone who asks for a helping hand. How can you handle these requests without burning bridges with those who are close to you?

Establish a Personal Policy


It is easier for some people to lay down firm personal rules about lending money. After all, the alternative is to potentially look like the bad guy because you do not lend money to everyone who asks for it. When your friends and family members know that you hold a hard line about not making personal loans or simply handing out cash, the requests for handouts and loans will dry up.


Avoid Giving an Explanation


Whether you establish a strict personal policy or you analyze each request on a case-by-case basis, you will need to turn down at least a few people over the years. Some people give a long, drawn-out explanation about why they cannot give out their money. They want the other party to know that all of their money is tied up in other ventures or that other factors are pending so that they do not look like a bad guy.


In reality, you do not owe anyone an explanation regardless of how close they are to you. Your finances are your business, and what you do with your money is not their concern. In some cases, providing an explanation can actually result in ill will. For example, if you are honest that you do not believe the person can pay you back, you may step on toes. In many cases, a better approach is to simply state that you are not interested in considering or available to satisfy their request.


Be Blunt and Swift


As soon as somebody asks you for a handout or a loan, you need to know how to respond. Answering bluntly and swiftly may work best for some people. After all, you do not want to create false hope by giving the illusion that you are seriously considering the request. However, this approach may not work well in all situations. If you always maintain a policy of not lending or giving money to friends and family members, this is a great approach. On the other hand, if you have a solid desire to help the person, you need to try a different approach.


Pause Before Responding


An alternative to the blunt approach to turning down requests is to take a day or two to actually consider the option. Only use this approach if you have the means to follow through and if you are giving it serious thought. When you tell the person that you will respond in a day or two, you are no longer placed on the spot. Nobody should make hasty financial decisions, and this extends to making personal loans or offering large financial gifts to friends and family members.


When you give yourself this extra time, you can review your finances to ensure that the loan or gift will not impact your wealth building goals. At the same time, you can determine if it is a worthy request or if the funds will likely be squandered. Because you have worked so hard amassing wealth and passive income, you do not want to essentially throw it away.


Schedule a time to circle back around to the individual in the next day or two. Generally, this type of conversation should be completed in person when possible. If you intend to agree to the request, you must have firm terms in mind. The person must agree to those terms, and you may want to put the agreement in writing. On the other hand, if you decline the request, you should develop the right strategy before the meeting. Will you deliver the news in a blunt manner without an explanation? Otherwise, how much of an explanation are you willing to provide?


Suggest Alternatives


Regardless of how frivolous or serious the financial request is, you are not the only solution available to your friend or family member in need. The reality is that there are several alternatives that may work well in different situations. When you present these options to your friend or family member, you can offer to assist with their efforts in these ways. For example, you can offer to contribute a limited amount of money and to spread the word through your network to raise awareness.




Does the individual need money to start a new venture? Crowdfunding is a way of obtaining funds from both individuals and organizations. In some cases, the money is given as a gift. It may also be invested. For example, if the person is starting a business, they may use crowdfunding to offer a small share of ownership in the business.


Peer-to-Peer Loans


Whether the person is trying to start a business or needs funds for personal reasons, applying for a bank loan could be a feasible option. When bank funds are not available, peer-to-peer loans are a smart alternative. Through a peer-to-peer lending platform, the full amount of funds needed may be raised by small loans from many people.


Private Donations


Has the individual experienced significant hardship recently? These events can pull at your heartstrings, but you do not need to be the only person who pulls the person up out of their situation. There are several reputable websites that facilitate private donations, such as GoFundMe.


Offer Other Types of Support


Giving money is not the only way that you can help out your friend or family member. Whether you extend a loan, offer an alternative or simply say no, you can offer various other types of support. By doing so, you can maintain great terms with the individual and may legitimately help him or her to achieve essential goals. How can you support your friend or family member without handing over cash?




Is the person trying to start a business or to pursue a project that you have some experience with? For example, is investing in real estate his or her goal? Rather than extending funds, offer to provide ongoing guidance and support. This may even extend to helping the individual make connections through your network.


Part-Time Employment


Does your friend or family member need extra cash to get by? A cash shortage may be tied to overspending, unexpected bills and many other things. Rather than give the person money, give him or her the opportunity to earn much-needed cash. For example, do you need a maintenance person at one of your investment properties? If you do not have a job opening in mind, put out some feelers to help your friend or family member find extra cash. Some people are able to work, but they are not willing to do the hard work and lift themselves up.


Know When and How to Give


There are several ways to give money if you decide to do so. For example, you can pass generational wealth down to an heir through a gift. Generational wealth can also be passed through several types of trusts. On the other hand, you could become a real estate investing partner with the individual. By doing so, you can contribute half of the down payment so that her or she can begin passive investing activities more easily.


If the individual has an urgent need for cash, you must decide if you are offering a gift or if you expect the money to be repaid. It may be advisable to have a formal loan agreement drafted and notarized. This way, you have some means to obtain the money through the court system if he or she does not honor the terms of the agreement.


Wealthy individuals who enjoy the benefits of passive income streams can feel proud of their accomplishments. After spending so much time and energy building income streams, you are in the driver’s seat regarding how you manage your funds. While a family member or friend may ask for a straight loan or a gift of funds, you can see that there are many alternatives available. Keep all of these options in mind the next time you are faced with this type of situation.

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The CashFlow Quadrant – How I Save Thousands on Taxes (Legally) 

One of the most life-changing discoveries came to me years ago when I realized I was earning income the wrong way. This was uncovered when I read the book, “Cashflow Quadrant” by Robert Kiyosaki. It’s a powerful book that helped guide me to become a full-time investor and to make financial freedom a top priority. Additionally, this book has single-handedly helped me save thousands in taxes over the years.  



As you can see in the diagram above, each quadrant (E, S, B and I) represents a different way to generate income. Some people earn money in only one of the quadrants, while some earn money in multiple quadrants. There are advantages and disadvantages to each quadrant.

The two quadrants on the right side (B and I) are the primary paths to financial freedom. The majority of the Cashflow Quadrant book is about the unique skills and mindsets required to succeed on this path. If you haven’t checked out this book, it’s a worthwhile read. You can learn more here.  

Let’s Explore Each of The Four Quadrants:

E – Employee

An employee earns income via a job. This is the quadrant where most people earn their income. The job itself is owned by a business, which could be a single person or a large corporation. The employee exchanges his or her time, energy, and skills to an employer in exchange for a paycheck and often other benefits such as healthcare coverage and/or a retirement account match.

Employees can make a little or a lot of money, but when an employee stops working, or if the business goes under, the income stops.

The lack of control over income is a serious consideration of the E quadrant and something I became intimately aware of when I worked in the oil industry and layoffs began to occur around 2015. An employee’s financial freedom is dependent upon the success of the employer and the ability to show up to work and exchange time for money. 

Kiyosaki points out that the reason as to why most E quadrant workers pay around 40% of their income in taxes (as shown in the diagram above) is simply because most personal expenses aren’t deductible. You can’t, for example, deduct the expense of your personal car from your taxable income. Below is a simple illustration for educational purposes only. Please seek professional, licensed tax advice from a CPA for more information. 


Tax Example: 

Federal Tax: 27% 

State Income Tax: 5% 

Social Security Tax Rate: 6.2% (half paid by the employer) 

Medicare Tax Rate: 1.45% (half paid by the employer)

Total = 39.65% in Tax


S – Self-Employed

Many employees eventually get tired of the lack of control over their pay and schedule and choose to work for themselves instead. A self-employed individual still exchanges time for money, but they “own” their job. 

Common examples of the S quadrant workers include dentists, doctors, insurance agents, realtors, handymen, among many other skilled trades. It is possible as a self-employed individual to earn a large income, but like an employee in the E quadrant, when they stop working, so does their income.

Self-employed workers have more control compared to an employee, but more often than not, they also have more responsibility. As a result, success usually means working harder and working longer hours. Over time, this can lead to burn out and fatigue as I also experienced first-hand in 2015 when I was actively investing in real estate with fix and flips and vacation rentals. 

Kiyosaki points out that the reason why most S quadrant workers pay the highest taxes, around 60% of their income (as shown in the diagram above) is that Social Security and Medicare Taxes are paid 100% by the self-employed individual (they are not split by the employer as is the case with an employee). Additionally, an S quadrant individual often earns more income compared to an employee and therefore can be in a higher tax bracket. Below is a simple illustration for educational purposes only. Please seek professional, licensed tax advice from a CPA for more information.


Tax Example: 

Federal Tax: 37% 

State Income Tax: 5% 

Social Security Tax Rate: 12.4%

Medicare Tax Rate: 2.9% 

Total = 57.3% in Tax


B – Business Owner

Those in the B quadrant own a business system and they lead other people. In this quadrant, the business often has 500 or more employees. The systems and employees who work for the business can run successfully without the business owner’s daily involvement.

Unlike the S quadrant where a plumber, for example, might own and work in his own plumbing business, a B quadrant business owner might create a plumbing company and hire 500 or more plumbers, administrators, managers, and other staff to run the systems in the company.  


The wealthiest individuals in the world typically own B quadrant businesses. A few of these individuals include Bill Gates of Microsoft, Jeff Bezos of Amazon, and Mark Zuckerberg of Facebook.

Kiyosaki points out that the reason why most B quadrant business owners pay around 20% in taxes (as shown in the diagram above) is because businesses can deduct a wide variety of expenses from the income of the business, which can lower the businesses income taxes. Additionally, the recently passed Tax Cuts and Jobs Act in 2017 allows for a qualified business income tax deduction of an additional 20% for eligible businesses. You can learn more here. Below is a simple illustration for educational purposes only. Please seek professional, licensed tax advice from a CPA for more information.

Tax Example: 

C-Corporation Flat Rate Tax Rate = 21% 

Total = 21% in Tax


I – Investors

Now to my favorite quadrant. The I quadrant is comprised of investors who own assets that produce income. This is the quadrant for truly passive income.

Investors in this quadrant have usually accumulated capital that was earned in one or more of the other quadrants and now they place that capital into income-producing investments to produce even more income. This is the magic formula for financial freedom. 

For example, an investor might purchase shares of a company privately or publicly owned in the form of stock. This influx of capital from the investor helps to fuel the systems created by the business owner, and this fuel can lead to even more growth in the business and for everyone involved. Investing in real estate is a common example of an asset that can produce passive income from collected rents and other income-generating aspects on the property. Investing passively in private placements (apartment syndications) has been my preferred asset class in the I quadrant. 

Kiyosaki points out that the reason why most I quadrant investors often pay as little as 0% in taxes, legally (as shown in the diagram above) is that long-term capital gains tax rates (for assets like stocks or real estate held the long-term) are between 0% and 20% depending on the individual’s tax situation. You can learn more here. Below is a simple illustration for educational purposes only. Please seek professional, licensed tax advice from a CPA for more information.


Tax Example: 

2020 Long-Term Capital Gains Tax Rate (For Single Individuals) Earning $78,750 or Less = 0% 

Total = 0% in Tax



There are many paths to financial independence, but most of them lead to the right side of the Cashflow Quadrant – B and I. If you want to achieve financial freedom, it will pay to learn the skills and mindset required to make this move to the right side. I have earned income in the E, S, and I quadrants but the I quadrant has been the most impactful. This is because of a concept I refer to as “Time Freedom”. Which to me, means having freedom and flexibility over your time. When you have more passive income than you have lifestyle expenses, you become financially free. This is where a new world of opportunities and possibilities open up and the world becomes your oyster.     

To Your Success

Travis Watts 

Disclaimer: Travis Watts does not provide tax, legal, or accounting advice. This material in this blog/article has been prepared for informational purposes only, and is not intended to provide, and should not be relied on for, tax, legal, or accounting advice. You should consult your own tax, legal, and accounting advisors before engaging in any transaction, investment, or other change. 


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High Net Worth People Pay Taxes…A Lot Of Them

There is a general misconception that high net worth individuals do not pay as much in taxes as those who fall under lower tax brackets. The reality is that wealthy individuals can pay a modest fortune in taxes each year. In fact, they may be subject to a higher income tax bracket and many other taxes that may not apply to those with a lower net worth.


Without the right tax planning strategy, high net worth individuals could see a substantial portion of their wealth eroded by taxes. As a wealthy individual, it is important that you understand the many types of taxation that affect you both while you are alive and after you pass away. This is the first step toward developing an effective tax reduction strategy.


Common Taxes Paid by High Net Worth Individuals


The vast majority of Americans earn a regular income from a salary, hourly wages or profits from a small business that they have started. The median income for a U.S. household in 2018 was just higher than $63,000. For the majority of Americans, regular income is applied to making ends meet and maintaining a comfortable lifestyle. Through a conservative lifestyle, some of the household’s money may be left over for savings, modest investments and extra items. Because of their common financial situation, these Americans pay the majority of their taxes in the form of income taxes. They may have common deductions, such as those related to business expenses, mileage, mortgage interest and property taxes. Many of the other types of taxes and types of tax deductions available simply will not apply to them. As a result, high net worth individuals are subject to a higher income tax rate and additional types of taxes.


What are the more common types of taxes that wealthier individuals are responsible for?


Income Tax


Do you earn income from a salary, commissions, royalties and other similar sources? For families who sit comfortably around the nation’s average household income of $63,000, the tax liability would be 22 percent. While this is a healthy sum of money, it pales in comparison to the tax rate that wealthy individuals pay. Wealthy individuals who are in the highest tax bracket are required to pay 37 percent of their annual income to the IRS.


This means that if an individual with $1 million in income did not take full advantage of tax deductions, the taxpayer would pay $370,000 to the IRS for that single year. The high net worth individual’s tax liability would be more than the total income that the average American earns in 5.5 years.


Capital Gains Tax


Wealth building becomes more challenging when you look at how you are taxed on the sale of assets. Whether you sell stocks, investment properties or other assets for a profit, that profit will be taxed separately from your income tax. The long-term capital gains tax may be as high as 20 percent.


Keep in mind that the capital gains tax does not have a flat tax rate. For households earning less than $40,000, no capital gains taxes are owed. If you are married filing jointly, the capital gains tax does not apply unless the family’s taxable income is more than $80,000. This means that the average household is not affected by capital gains tax. For high net worth individuals like you, however, this tax could significantly contribute to the erosion of the wealth that you have spent years building.


Estate and Gift Tax


Taxation even impacts generational wealth and your ability pass your assets in full to your heirs. After you pass away, your heirs will be assessed a 40 percent tax on your taxable estate. Your taxable estate is offset by several deductions and a sizable exemption. The exemption is reduced by taxable gifts made throughout your lifetime. Even with the deductions and exemptions, very wealthy individuals with a high net worth must have an exceptional strategy to avoid losing a large chunk of their estate when they pass it on to their heirs.


Investment Income


The net investment income tax is an additional tax on investment income that exceeds a defined amount. Investment income is specifically from dividends, capital gains, royalties, interest and a few other types of investments. If you file as married filing jointly, any investment income over $250,000 will be charged a 3.8 percent tax. Keep in mind that this tax is in addition to the regular income tax that applies to the full amount of investment income.


Business Income Tax


Many high net worth individuals are self-employed or own their business. If you are self-employed, you are required to pay a separate self-employment tax on top of your regular income tax. As a self-employed individual, your net income from your work activities is taxable.


If you are a business owner, you must pay taxes on the business’s net income. The specific taxation rules vary based on the business entity type. In addition to paying a tax on the business’s net income, your business may be responsible for excise tax and for various types of employment taxes. These include the federal unemployment tax, the federal income tax withholding and Social Security and Medicare taxes.


Asset Protection Strategies for Wealth Building


You have worked hard throughout your life to build a healthy stream of income and valuable assets. To maximize the benefits of your hard work, you must develop an excellent taxation strategy. This should take into account ways to reduce your tax liability on an annual basis. It also should plan ahead to protect generational wealth after your passing.


Charitable Donations


Whether you need to reduce your personal or business tax liability, making charitable donations could be a smart solution. Individuals may deduct cash donations up to 60 percent of their adjusted gross income each year. The specific limits and rules for charitable donation tax deductions for businesses vary by entity. Regardless of whether you make a charitable donation personally or through your business, the charity must be an approved, non-profit organization.


Pass-Through Entity Income


One of the newer deductions that may apply to some business owners is the pass-through entity income tax deduction. For select business entities, up to 20 percent of the business’s net income may pass through to you personally without being taxed. There are several limitations and restrictions that apply. Also, this deduction is not available for C-corporation entities. However, it does reduce the corporate tax rate to 21 percent.


Real Estate Investments


For many high net worth individuals, investing in rental properties is advantageous. This type of passive investing activity provides you with the ability to grow your nest egg. The full value of the property will appreciate even though you may leverage your purchase with a loan. At the same time, tenants pay gradually pay off your loan for you through monthly rent payments. The property is also appreciating throughout this period of time. However, all of the operational experiences, mortgage interest and depreciation are written off. Therefore, the taxable income on some of these properties may be negligible even though you are enjoying a solid stream of income.


Notably, this type of passive investing activity offers another tax benefit. Through a 1031 exchange, you can transfer your net profit from the sale of real estate or some other types of assets into another approved investment without paying taxes on the profit. There are rules associated with a 1031 exchange, such as the types of qualifying assets and the time frame.


End-of-Life Planning


There are numerous strategies that you can apply in your living years to protect generational wealth from burdensome taxation. For example, you may re-title some of your assets into the heir’s name before you pass away. You could also purchase life insurance. Life insurance proceeds are not taxable. Therefore, you can instruct your heir to pay all estate taxes with the life insurance proceeds.


There are also numerous entities that you can roll your assets into. These include limited liability companies, irrevocable trusts and asset protection trusts. If your ownership stake in a business will be passed on to an heir, creating a succession plan now is essential. Each of these strategies has unique benefits and consequences. Consulting with an experienced estate lawyer is essential.


The Importance of Strategic Tax Planning


Through your hard work and strategic investing activities across your lifetime, you have amassed considerable wealth. Protecting your assets from various types of taxation in your living years and beyond is essential. Through passive investing, the smart use of various types of entities and other efforts, you can manage taxation so that your income and the value of your assets are preserved as much as possible.


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Being careful about lending money to friends and family

If you regularly make investments in real estate, stocks, bonds, and other investment types, you may feel like investing some of your money with friends and family members if ever they request it. As a high net-worth individual, it’s important to understand that the only way to maintain the lifestyle of an accredited investor is to build your wealth by making smart investments. While it’s possible to make smart investments with friends and family members, it’s also important that you’re careful about lending money to these individuals. The following provides a detailed guide to the precautions you should take when lending money if you want to maintain your generational wealth.


Why You Should Be Careful About Lending Money to Friends and Family


To effectively maintain and grow your wealth, it’s essential that you make wise investments that can generate a reasonable return. At the very least, it’s important that you don’t make bad investments that cause you to lose all of the money that you’ve invested. No matter the type of investment you make, you always run the risk of losing some or all of the money that you’ve invested. The same is true when making investments with friends and family members.


Before you lend some of your money to a friend or family member, it’s important to understand that making these investments should be a financial decision only, which means that your emotions shouldn’t be a factor in the decision you make. Many investors make the mistake of providing their friends or family members with a kind of informal loan, which means that nothing is put into writing and that the terms of the loan are only spoken. If you want your loan to be repaid and possibly provide you with a return, every facet of the loan needs to be in writing.


In the event that the terms aren’t put into writing, it’s possible for relationships to be ruined if the individual doesn’t repay you. Before you make this type of investment, it’s highly recommended that you treat this investment like any other that you make. You’ll want to perform the usual due diligence while also making sure that the terms of the deal are in writing. Without placing these terms into writing, you should merely consider your loan to be a gift that won’t be repaid.


The way you go about lending money to friends and family members also depends on what the money is needed for. If a family member requests $500 for some medical bills, consider providing the funds as a gift if you can afford to. On the other hand, there are times when people close to you will take business and investment opportunities to you. If a friend of yours requires a loan to help them invest in a property, the terms of this loan should be written down to ensure that this transaction is treated as an official investment. Before you consider lending some of your money to a friend or family member, there are some tips that you should adhere to.


Set a Deadline for Repayment


The loans that you provide to people close to you should never be open-ended, which only serves to damage your efforts in regards to wealth building. While the friend or family member you provide the loan to may not repay you, it’s still very important that you set a deadline for repayment to occur.


If the borrower doesn’t know when the loan should be repaid, they will likely avoid repaying it in a timely manner. Before you lend money to friends or family members, make sure that you write down the exact date when all of the money needs to be repaid by. This document should also include guidelines for monthly payments if the loan is a sizable sum of money. While this form of investment is less formal than most, it should still follow some simple guidelines.


Clearly Communicate Loan Restrictions


Whenever you lend money to friends or family, you should be prepared for the possibility that this individual will eventually ask you for more money. This is particularly common when the individual in question is starting a business venture and runs out of cash to support business operations. Before you provide anyone with a loan, it should be clear that this is a one-time deal.


Understand That These Loans Don’t Typically Earn Interest


Lending money to a friend or family member is a very straightforward process when compared to traditional loans. For instance, these loans don’t typically earn interest, which means that you may be unable to obtain a return on your initial investment. However, there’s no reason that you can’t charge interest on the loan in the event that the amount of money you’re lending is substantial.


If the money is going towards a real estate investment or a business that the individual is starting, there’s a possibility that they will receive a return from this investment, which is why you should consider charging interest on the loan. Let’s say that a friend of yours is starting a business and wants you to provide them with a short-term loan that will allow them to cover the initial operating costs. If the business venture is a successful one, the company will likely make money, which you should benefit from through interest payments.


How to Effectively Engage in Wealth Building


Wealth building is a practice of accumulating wealth over a certain period of time. Even if you’re currently considered to be an accredited investor with a net worth that tops $1 million, you could easily drop below this threshold if you don’t understand how to increase your assets. There are three primary components that are involved in building up your assets, which include making money, saving money, and investing money. In order to increase your total assets, you will need to make enough money to cover the necessities of daily life and any debts that you owe.


Once your income is able to cover your basic expenses, you can start saving money by crafting a detailed savings plan. Eventually, you should be able to start meeting some of the savings goals you’ve set, after which you can start looking into various investment opportunities. Different investment opportunities provide different return amounts. The top low-risk investments include savings bonds, high-yield savings accounts, and corporate bonds. On the other hand, it’s possible to net high returns through hedge funds, crowdfunding, and making investments into private companies.


Lending money to friends and family would be considered a riskier investment. These investments likely wouldn’t be backed up by collateral, which means that you won’t have any recourse in the event that your loan isn’t repaid. Even when you’re loaning to people close to you, it’s essential that you continue to make prudent investments.


If you want to make this type of loan but find that the risk is higher than you’re comfortable with, consider balancing your investment portfolio with a couple of low-risk investments that will net you consistent returns. In order to build generational wealth that you’ll be able to pass down to your family members, every investment you make should be a wise one even if the loan is being provided to a friend of yours.


Utilizing Passive Investing When Lending Money to Friends and Family


If you want to increase your net worth and maintain the lifestyle that you currently lead, it’s highly recommended that you utilize passive investing, which is a form of investment that makes it possible to generate returns without being actively involved in managing the investment. Passive investments are entirely different than the active ones that occur in hedge funds and mutual funds. If you decide to make this kind of investment, you won’t need to deal directly with the usual buying and selling that takes place with active investments.


While the passive investing strategy has become increasingly popular on the stock market, it is also commonly used with real estate investments. These investments include everything from crowdfunding and remote ownership to trust deed investing and REITs. For instance, making an investment in an REIT gives you the opportunity to invest your money with income-producing properties. The returns that you obtain from these investments may make it easier for you to lend money to your friends and family. If you can generate steady returns from your passive investments, it’s possible that you could branch out into riskier investments.


Lending money to your friends and family members should never be taken lightly. Even if you trust this individual completely, you always run the risk that your money won’t be repaid on time or in the full amount. If the loan is a sizable one, every detail of the loan should be recorded to ensure that you don’t lose money in the process. By taking certain precautions and by knowing what to expect from this process, you should be better equipped to handle any frustrations that occur along the way.


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Financial Freedom Doesn’t Mean STOP Working

What is financial freedom anyway?

One of my favorite conversations comes when I meet someone who loves their career or profession and is passionate about what they do. There are those who love what they do and those who hate what they do for work. For many years, I was on the wrong side of this coin, but thankfully in the past few years, I’ve been on the right side of the coin. I now have the privilege of sharing my passion for passive investing with those who are looking for a hand-offs approach to real estate. 

Are You Pursuing Money to Avoid Pain or to Gain Pleasure?

A lot of the benefit of being a full-time passive investor is the time freedom that cash flow can generate. Which is essentially, the ability to choose how to spend your time, or at the very least, to have more flexibility over your schedule. With this said, the word RETIREMENT has a lot of people confused as to what that actually means. I think of it this way; it’s having the OPTION to work, but not the OBLIGATION.  

If working sounds miserable, perhaps the problem is not with this proposal, but rather with your definition of what “work” really is. The problem is likely that you are doing work because of money, rather than fulfillment. There really is a better way…

Why “Retired” People Work

I know quite a few financially independent people. This has come as a result of networking for many years, attending real estate meetups, seminars, and leveraging high net worth mentors. And many more have come out of the woodwork once I started blogging, making video content, and speaking at live events. Financially independent retirees, young and senior, are great to have in your network. You become who you surround yourself with. 

Here’s the reality; financially independent people no longer NEED to work for money because their investments cover their lifestyle expense and yet, almost all of them are still doing things that appear (from an outside perspective) to be… work.  Some are expanding their companies, others are writing books and investing. Some are helping others start companies of their own. But there’s a reason behind all of this work-like activity, and in most cases, it’s not the love of money.

What Do You Value? 

Once you have enough money, getting even more doesn’t do you much good. 

Related Blog How Much Is Enough? How to Know When to Retire

I’ve learned over the past several years, with the help of my wife, that having stuff does not bring more happiness. As we were once in the rat race of accumulating things, upgrading to bigger houses, driving fancy cars, and our stuff started to own us. And for the record, “The Joneses” could care less.

Fast forward to today, my wife and I could easily upgrade our base model Lexus to a Ferrari or Lamborghini if we chose to, but this upgrade would make us slightly less happy. Why? Because it would take us further away from our travel, family, and financial goals. 

We discovered that spending on items that truly bring value to us is much more satisfying than buying luxury toys. A couple of examples include a pair of shoes I bought before we backpacked Asia. The shoes are extremely comfortable, they have a lifetime sole, they are lightweight, breathable, washable and can fold down to the size of a flip flop (which is great for backpacking) The cost: $99. Happiness = 9/10. For my wife, I bought her an inversion table to help her stretch out her back and neck, (which provides major pain relief due to her scoliosis) The price: $40 pre-owned. The happiness = 8/10. An upgraded car doesn’t add value to us because it does not make our life easier or more efficient, nor do we value that type of purchase. 

Related Blog Mindful Spending – How to Save For Happiness 

Now for the work side of the equation; the philosophy is interesting. My favorite days are the ones where I learn something new or create something of value. Conversely, my worst days are those that I spend sitting around with not much to do. In other words, pina coladas on the beach are fun for a while, but this leisure can lose its appeal rather quickly. Work can be an incredibly powerful source of happiness, but the key is to find work that is creative, social, engaging, and brings you towards a purpose you believe in. 

When you take money out of the equation (due to being financially independent), it is much easier to make decisions that bring you a better life.


I find that when people reach financial independence, they usually don’t stop working, especially in their 30’s, 40’s, or 50’s. Instead, they start creating their best work

Looking at many of society’s highest achievers, the world leaders and many founders of large companies, I see mostly people who have already made it in financial terms, and yet they are still working because there is meaning, purpose or a mission that goes beyond the money. 

Early retirement does not mean “stop working”, even though it may involve quitting your current job. Rather, it is the ability to focus less on the things that do not bring you fulfillment and focus more on the things that bring you joy. 


  • An early-retired Doctor might set up a smaller practice which operates without any pressure for optimizing profit, and without dealing with the hassle of insurance companies. 
  • An early-retired Attorney might refuse all cases that are based on questionable ethics.
  • An early-retired Engineer might continue to work or contract part-time to achieve a more efficient work/life balance. Or he or she might feel compelled to create a completely new invention with a newly freed mind. 

How would you run your life differently, with a desire to create, and without the need to trade time for money?

There is nothing to lose and everything to gain from helping others uncover their own financial independence path. It is out of passion and purpose that I give back my time to others and educate in the space of passive investing, so more people can live their highest and best.  


To Your Success

Travis Watts 


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How to Calculate Net Income and Distributions as a Passive Investor

Net Income and Distributions Across the Board

We don’t buy homes or invest into complexes because we expect to work forever.

Automated income, as it relates to you doing nothing, is a real potential in real estate. It’s one that I’ve achieved. Dedication in this business starts when you don’t see better options to invest in. A passive investor looks to real estate because they know that, with the right property, they’ll make money while sleeping.

Freedom is why some choose passive investing. I chose it because living the life you desire starts only when you have the time to. Wealth building is how I lead people into real estate and what I want you to keep a focus on. Being an accredited investor is great, but your financial decisions are as critical as your lifestyle ones.

Keeping these in mind, you’ll need to know how your net income and future distributions work. In general, net income is tallied as your investment returns minus any fees in generating that income.

How do Passive Investors Earn Financial Freedom?

Passive investors generate net income by first setting a “preferred return” based on their total investment. This preferred rate is how much, being in the form of a percentage, that they’ll receive. The income you set as your preferred rate is paid out residually. That is, there is no work required on your end to generate this income.

Wealth building is a lifelong commitment to financial excellence however.

No one makes great financial decisions all the time, so we need income diversity to balance our lives with. To grow money passively, you must think about your lifestyle alongside the distributions we pay out. Distributions, being the route that passive investors earn through, is what makes your freedom lifestyle possible.

Distributions—How They Work

Regarding property ownership, accredited investors receive their preferred return on a set time scale. Whether yearly or monthly, the income earned by a property investment gets “distributed” to all investors. Those who invested $200,000 with a preferred return of 12% will earn $24,000. This is paid out yearly or monthly.

A monthly distribution payment from a $24,000 return equals $2,000. Distribution payments can even come to you in larger amounts than your scheduled monthly or yearly quotas. Agents who you invest with must provide advanced payments in the event of them selling your investment property. “Cash-out refinancing” also occurs when a new loan is taken out on a property that’s already owned but has a profit margin in equity that you can partake in.

*Doing More with Distributions
Distributions aren’t the sole promise we give our investors. The quality of their lives is just as important as their ability to choose their net incomes. My goal is to keep investors aware of their responsibilities in balancing their lifestyles as much as their money. Following are some key points to help you live out both to their fullest:

Making Your Life Complete

Accredited investors receive their gains as net income, which is their realized profits from passive investments. Passive income, as it relates to financial freedom, is a type of residual income. It is a taxable sum, but we must first subtract your fees and losses from it. The total amount of your net income is based on your preferred rate. Investment losses are even tax deductible, yet taxes don’t apply to deferred investments.

Properties can be placed into IRAs, for example, and in doing so, you defer tax payments.

Only when you use or prematurely take out your net income will you encounter taxes. As a general rule however, the net income tracked from your scheduled distributions, when withdrawn, is taxed at a rate of 3.8% to 20%. Investors incur a rate of 20% depending on their income or level of distributions received.

Is Passive Income the Same as Active Income?

Active income, which is what you earn from “material participation,” is not labeled as capital gains.

Net income and capital gains are the same, but “capital gains” is a term used primarily within taxes. Any taxes on capital gains, which is net income, can be deferred or delayed by reinvesting it. Net income comes from passive earnings while gross earnings come from wages and salaries. The IRS says that as long as you don’t operate a business, your stake qualifies as a passive investment, being that all you did was invest.

*Which Deductions Can Be Made From Net Income?

You can, based on profits and losses, make deductions from the following:

– Any requirements needed to create your royalty income—i.e., fees
– Any investment expenses that arose miscellaneously
– Any loss due to state taxes on income
– Any casualties related to a property

What is it About Passive Investing Anyway?

A passive investor is someone who realizes their need for financial diversification.

These investors want to put their money to work without lifting a finger. The science that keeps investors “betting” on property investments is saturation. Even in times of peril, people will buy homes, pay rent and travel lodging. With an experienced agent helping them, there’s no season or natural disaster that calls for a passive investor to labor.

Property markets inspire these investors with the idea of long-term incomes.

Here are some key reasons to keep your investments diverse and passive:

1. Time in Your Hands—No Work on Your Mind

Being a financier enables you to use your personal time for diversification. As you put money into one asset, you are free to then research more investments without losing your initial one. In most investments, however, we’re required to give a lot of attention to them.

2. A Future to Look Forward To

Though short-term investments do work for passive financiers, we look at passive income as a long-term strategy. If you want to retire early, then look at the passive income of investment properties. The opportunities you find do promise a real future—not just a quick payday.

3. Investments That Last Lifetimes

Wealth is about building strong foundations within your finances. We choose passive assets because they’re built on the concept of longevity. Tomorrow, people will still be looking for residential, commercial and industrial properties to buy. Just don’t settle for an asset that pays you quickly but once. Investments that last lifetimes pay you indefinitely.

Do You Ensure Consistent Net Income for Investors?

We position our investors for steady profits in net income through the following:

Watching Market Conditions—We don’t need market conditions to tell us if we should invest into property ownership. We watch market conditions in order to know when. Being a long-term asset, investment properties are always worth considering. Since most economic pullbacks are temporary, a long-term hold on a property often brings you back to your profit level or higher. Additionally, finding properties at bargain prices is best done when you take advantage of market conditions as they arise.

Profiting Strategies—Steady profits are a result of good investing strategies. Finding a reliable asset is good, but knowing how you’ll purchase it, when and then where you’ll get out is how you create a strategy. Our entry point must always be when prices are low or favorable. The final step in an effective strategy is in knowing when to get out. We don’t need to anticipate failure, but knowing how to leave minimizes loss.

Using Due Diligence Each and Every Time—Every investor in a property market needs research to guide their decisions. Around the country, millions of people enter this industry, and their work makes competition a big factor. Entering a property investment should only occur once you research the details of its market.

Investing and Pushing Your Net Income Higher

It’s our desire for you to thrive as a wealthy individual. It’s our desire to also share a warm warning. If you think that success as an accredited investor doesn’t relate to your work in tracking net income, then you’re sadly mistaken. Through a property market, you have a real potential of making passive income to support your entire life through. The benefits of passive investments, however, are meaningless if you haven’t set your preferred rate of return.

Now is an ideal time to think about your wealth. How will your money go to work for you now that you know how? Thank you for being supportive throughout our relationship up to now. The favor I want to return comes from my passion to see you achieve more. Money management, financial and self-control are still major factors in your life of freedom. Follow us as we guide you into the rate of net income you seek.

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How to Travel Like High Net Worth Individuals

Wealth building allows you to do so much more than just creating a nest egg and generational wealth. If you are an investor with a high net worth, your affluence also allows you to travel in style. In recent years, wealthy investors have embarked on a range of new travel trends. From mindfulness to experiential travel, the following trends are popular among elite investors like yourself.

Enjoy Experiential Travel

Experiential travel is the industry’s new byword. For people who have a high net worth, value matters. Hedonism and conspicuous consumption are less important today than the value that experiences can deliver. Rather than show off their financial resources, affluent investors are searching for trips that give them unique insights, learning opportunities and a sense of wellbeing.

Learn While You Travel

Passive investing requires knowledge and planning. Unsurprisingly, many passive investors want to gain knowledge during their trips as well. For example, there are now sanctuaries for thought leadership where participants can learn new information while skiing, surfing or diving.

Many affluent individuals hire experts like world-class photographers, writers or wildlife experts to teach them new information. While the affluent may still go to the same destinations as before, their goals are different. Now, they want to get more than a weekend away from home out of the experience.

Enhance Your Wellbeing

Another trend among wealthy travelers is to focus on their wellbeing. Many people who have a high net worth plan trips that allow them to return to nature. For example, they may visit the Antarctic, Iceland or the Galapagos.

During these trips, travelers want a chance to reinvigorate their mind, body and soul. They may use mindfulness meditation or similar techniques to relax. The overarching goal of these trips is to develop better mental and physical health.

Take Part in Responsible Travel Programs

Because you have spent so much time on wealth building, you are able to travel the world and discover unique cultures. Your affluence gives you the power to change these destinations for the better. Many affluent travelers want to find opportunities for responsible travel. They search for activities that improve social, economic and environmental sustainability.

These types of activities may involve destinations like Song Saa Island in Cambodia or El Nido Resort in the Philippines. Thanks to their wealth, affluent travelers can hire travel specialists and event planners to create responsible itineraries. From Machu Picchu to Bhutan, these travelers use their vacation dollars to improve the world around them.

Hop on a Private Jet

Private jets are not just for ultra-rich families anymore. Now, there are private jet companies like NetJets, XO and Surf Air that offer a private experience without the high price. Instead of having to own the jet by yourself, you rent it for individual trips. By doing this, you save money on the overall costs while still getting the same experience.

While traditional airlines are dealing with demand that is as low as 10 percent of 2019 levels, private jets remain extremely popular. When someone charters a private plane, they get the entire plane to themselves. Depending on the jet company and what you are willing to spend, you may be completely alone on the flight or have just a handful of other passengers.

Luxury travelers can invest in a private jet through fractional ownership. With this option, the traveler buys a portion of the jet. Then, they pay reduced costs in exchange for sharing the jet with a handful of other people.

With jet membership programs, the traveler gets a set number of hours in the jet for a fee. Other companies charge per flight. In most cases, you can bring as many friends or family members as you want if you charter the whole jet. If you just buy a seat on a private jet, you may have to share the flight with a few other people.

Focus on Services

Thanks to Instagram, the travel industry has democratized the appearance of luxury. Many hotels and restaurants strive to create luxurious rooms and decor. While a hotel may look luxurious in Instagram photos, it lacks one important detail. When it comes to wealth and traveling, people who have a high net worth want luxury services instead of just a lavish look.

After investing in real estate and other passive income sources, you deserve to treat yourself. By traveling like the global elite, you can enjoy luxury services like a personal concierge, private guides and bespoke offerings. The best travel organizations pay attention to the tiny details. While many companies market trends like glamping tents that look great in brochures, these companies do not pay attention to details like indoor restrooms. To achieve a luxurious experience, these organizations have to focus on details like the products they use in their facilities and client services.

Discover Bespoke 2.0

People who have a high net worth want to experience things that no one else has ever experienced before. They want to create a personalized trip that only they can enjoy. To achieve this goal, many affluent individuals pay luxury travel agencies to create personalized trips.

Like many people, uber-wealthy individuals search for outdoor adventures in destinations like Norway, New Zealand and Iceland. Unlike the hoi polloi, they have an exclusive, comfortable experience of these locations. For example, they may experience gorilla trekking in Rwanda through a private guide, luxury hotels and personal drivers. They may use a helicopter to tour the backcountry of Papua New Guinea or discover the Great Rift Valley from a comfortable seat on a private plane. Other wealthy travelers may enjoy a week at a private estate on Mount Kenya or unwind at a villa in Ecuador.

How Much Should You Spend on Travel?

You are spending your time and energy investing in real estate for a reason. While passive investing allows you to earn an ongoing income stream and save for retirement, you are also building wealth in order to live a better lifestyle. The real question is not whether you should spend some of your passive income on travel. Instead, you should be considering how much you can safely afford to spend.

Among ultra-rich households, a family may budget $100,000 to $250,000 on traveling per year. This can vary from one year to the next because sometimes families bring along other family members and friends. While some years involve local, inexpensive trips, other years may involve expensive, international outings.

Often, financial consultants factor in extra money for traveling during the first few years of retirement. During these early years, many people spend extra time and money going to destinations around the world. While most wealthy retirees spend 5 to 10 percent of their money on traveling, some people spend up to 20 percent of their annual budget on traveling. The important thing is to figure out how much you want to travel so that you can create an accurate budget.

A New Trend: Digital Nomads and the Travel Industry

Some investors are able to earn enough money to travel like ultra-rich families and enjoy luxury trips around the world. With passive investing, your options really open up. Right now, digital nomads are a part of a new trend in the travel industry.

Because they have the ability to work from any location, digital nomads can spend all of their time traveling. While many of these individuals work remotely, some of them earn their money through real estate, stock dividends and other passive income sources. When you live off of passive income, you can live at any location around the world.

According to remote workspace provider IWG, 70 percent of workers work remotely at least one day per week. Since 2005, the remote workforce has grown by 140 percent. By the end of 2019, 7.3 million Americans were digital nomads.

By working remotely and creating passive income, you can enjoy the same travel experiences ultra-rich families get. Instead of cutting into your investment accounts, you can keep earning money as you explore the world. You can discover mindfulness retreats, thought leadership conferences, outdoor adventures and exclusive hotels during your globe-trotting expeditions.

Set Reasonable Expectations

Ultra-rich investors plan on passing down generational wealth to their children. More importantly, they plan on having enough money left at the end of their trip to enjoy a fulfilling, comfortable lifestyle forever. They do not spend more than they can afford to spend on each trip.

Even though ultra-rich families have a high net worth, they do not have a completely unlimited amount of time or money. Because of this, they set reasonable expectations about their vacation plans. More importantly, they do not try to outdo their previous trip each year. Instead, they create travel plans that work with their budget.

Many of these trends are not exclusive to ultra-rich households. While you may need a high net worth to charter a private plane, you can easily take advantage of trends like traveling for your personal wellbeing and taking experiential vacations. With a little planning, you can jet off on your next adventure and enjoy your financial freedom.

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How to Be a Hands-Off Investor

Real estate investing can be truly passive, but it might not be in the way you think. Being a “hands-off” passive investor can be one of the most powerful ways to make your money work for you. But before we dive into the benefits, let’s clarify what this type of investing is and explain how it is different from active investing.

Many investors starting out on their real estate journey envision buying and renting out a piece of residential property, such as a single-family home, condominium, townhouse, or perhaps a small multi-family complex like a duplex or triplex. Many investors mistake this business model as being “passive” because it’s easy to imagine the strategy playing out perfectly. After all, you simply buy a piece of property, rent it out, and then collect the checks every month from your tenants.

Sounds pretty passive – right?

But unfortunately, this is not a passive real estate strategy. Those of us who have used this model, we know at a bare minimum, that we must select a property to purchase, and then work with a property management company to make ongoing decisions about the property e.g. whether to fix or replace an appliance when problems arise, or how to address unforeseen issues when they pop up. Should you re-carpet or paint the property? When is a good time to do that? Which company or contractor should be used? If you choose not to outsource these operational tasks to a property management company, you will have to manage the day-to-day responsibilities on your own. In either case, this is an active investing approach because of the ongoing time commitment and asset management required. 

Try scaling this investing model to 20 properties and you quickly learn how active this investing model can be. Even if a rental property only required 5% of your time, you can see how 20 properties x 5% of your time = 100% a full-time job. There’s nothing wrong with using an active approach to investing, just be aware that it can be time-consuming and difficult to scale. 

What does a passive investing approach look like?

Passive investing is the strategy of acquiring income streams on autopilot. For example, as a passive investor, you make an upfront capital investment in a private placement offering (AKA real estate syndication) REIT, or stock and then receive an equity ownership stake in that investment, from which you are paid passive income or portfolio income. The biggest difference between active and passive investing is that you are not directly or indirectly managing the investment as a passive investor. It is 100% hands-off, in terms of your time commitment, after making the initial investment.  

You can passively invest in real estate in several ways. I mentioned REITs (Real Estate Investment Trusts) which are essentially companies that pool investors’ capital together to purchase large real estate deals. I also mentioned private placement offerings or “real estate syndications” where you can make direct investments in individual real estate. Private placement offerings are not publicly traded on the stock market and are usually structured as a Limited Liability Company (LLC) or Limited Partnership (LP). This is a structure in which you “pool” your capital together with other investors in an equity or debt-based investment, so you can enjoy the benefits of being a real estate investor rather than a landlord.  

5 Reasons Passive Investing Might Be Right For You:


  • Taxes


In an equity real estate private placement, there are typically tax-deferred cash returns that allow you to keep more of your earnings throughout the hold period of the investment.

This is one reason real estate (in general) can be a more powerful passive investment compared to other asset classes. Interest payments or stock dividends can be taxed at the highest income brackets. The pass-through potential benefit of real estate ownership allows a share of the depreciation and expenses to offset the distributed income you receive from the partnership. 


  • No Dealing with Tenants, Toilets or Termites 


When you are a passive real estate investor, you do not deal directly with the hassles of day-to-day management. Clogged toilet? You’re not going to get a call at 3 am. Broken garbage disposal? It’s not your responsibility to call a handyman or make an emergency trip to your property. 


  • You Don’t Have to Deal with Banks


Working with banks to obtain financing on your own properties can be difficult. Since the Great Recession of 2008-2009, banks started to require more documentation for you to get loans, and the loan underwriting process can be very time-consuming in itself. Not to mention banks will typically stop lending to you after you hold several mortgages due to debt-to-income ratio requirements. 

When you are a passive real estate investor, your investment is handled by a professional real estate investment company that already has relationships with banks and lending agencies. They navigate the bank financing so you don’t have to and the loans are based on the property itself and the loan guarantors (not you). 


  • Passive Investing Lets You Leverage the Expertise and Experience of Others


Quite possibly my favorite aspect of passive investing is the ability to leverage other people’s expertise and track record. In real estate, you have the option to go it alone (e.g. buying your own investment property) or you can leverage an experienced team to find and manage the deals for you. 

The fact is, there are people who devote their lives to learning the ins and outs of specific markets, building broker relationships, finding off-market deals, and becoming masters in a specific niche. As a passive investor, you have the opportunity to benefit from this deep education, without sacrificing your own time and energy. If you can’t beat them, join them. 


  • You Can Make Money While You Sleep


Passive investing in real estate can be as “active” as you choose to make it. Typically, you do your due diligence on the investment firm, market, and the deal, sign legal paperwork online and then transfer funds. As soon as your investment is processed, you become an equity owner in the real estate venture and can then start to realize the potential passive income and/or equity growth from the deal. In other words, you have the potential to make money while you sleep. 

What are the Risks?

Of course, real estate investing carries risks, just as investing in any asset class carries risk. When you invest in any asset, you carry the risk of the loss of your principal. In the case of both a stock or a REIT investment, this can result when the value of the investment goes down, either due to internal issues with the underlying asset, the company whose shares you’ve purchased, the real estate portfolio itself, or a downturn in the market. In either case, the value of your asset can decrease.

This is why it is so important that before you make any type of investment, whether in real estate or other asset classes, and whether active or passive, you must first do your own research and due diligence. No investment, person, or company can guarantee you a return or protection of all your principal. But your own due diligence can help you find safer and possibly more lucrative avenues to place your capital.


Having a passive investing mindset can be truly life-changing. However, real estate is only one asset class you can choose from. If you are interested in passive investment opportunities other than real estate, you can research other asset classes such as dividend stocks, tax liens, private notes, bonds, annuities, life insurance investing, ATM machines, venture capital, and many more. Creating passive streams of income is faster and simpler than it has ever been. One thing I have learned from speaking with thousands of passive investors, is nearly all of them wish they had started sooner. Don’t let that be a regret for you, keep up the education. Thank you for reading. 

To Your Success

Travis Watts 

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Minimize The Effects of Aging – Technology and Natural Solutions

A wonderful benefit of wealth that lets you explore choices can matter to your health. It makes the hard work that you accomplished through investing give you a reward of great value.


An opportunity to delay the appearance of age can contribute more to self-image and a sense of well-being than almost anything else.


The outcomes of good nutrition or the acceptance of technological anti-aging advances can help you retain the appearance of energy and vitality for years to come.


Fresh fruits and vegetables display vibrant colors for a reason. As an attraction that beckons you to shop the outer rim of your grocery, fresh fruits and vegetables display vibrant colors that enrich your health.


While exposure to cold temperatures may not offer the same level of convenience as a trip to a store, just one cryotherapy session can make a difference.


These tips can help you with investing in your health that pays off maybe more than a great real estate deal.


Using Good Nutrition to Delay Aging


Generational wealth can occur in nutrition as surely as in finance, and both provide lasting benefits to you and to those who follow.


Studies show that caloric restriction can delay the occurrence of “age-changes,” emphasizing the long-term consequences of nutrition.


You know the benefits of passive investing in real estate and that it does not require your active participation. An investment in nutrition that can prevent the signs of age requires your fulltime attention, however.


The plentiful benefits can let you enjoy the unlimited wealth of good health, but you must actively pursue them. No one else can generate healthy wealth building for you.


Taking a General Approach


Almost everyone has a working knowledge of the foods that support a healthy lifestyle.


The advice to consume fruits and vegetables, whole grains, lean protein and low-fat dairy and oils encourages you to eat a nutritious diet. They may not resonate, however, until you think about how they can delay the aging process.


You know from your experience in passive investing in real estate about the importance of location, location, location. Other than packages of whole grains, none of the products that nutritionists want you to eat have a spot on the shelves in the interior aisles of your grocery store.


When you shop the outer rim, you can avoid choosing products that contain high levels of salt, fat and sugar. While it involves active participation to find the nutritious items, the choices that you make can produce generational wealth for your family by keeping you healthy.


With easy access to fresh fruits, vegetables, nuts and dairy, you can start improving your nutritional intake and watch for anti-aging changes to occur.


Looking at the Specific Choices


When you consider each food choice for its ability to delay aging, some of them may gain your respect as an ever-increasing value of healthy wealth building. Many may sound familiar and appear on the nutrition lists that your mom used. However, nutritional science has advanced since your youth, and you may find quite a few new entries on the list.


The difference between food science then and now lies in your decision to pursue a specific goal. The wealth that you seek for your health comes from nature’s gifts that can help you delay the effects of aging. No one can hope to stop the aging process, but you may slow it with proper nutrition.


  • Avocado

Essential nutrients that make your skin soft and supple include fatty acids, and vitamins A, B, C, E and K prevent the effects of aging. Vitamin A helps rid your body of dead skin cells, and the carotenoid content can protect against the sun’s rays and skin cancers.


  • Blueberries

The deep blue color comes from anthocyanin, an age-defying antioxidant. One-half cup every day can help your skin avoid wrinkles, fine lines and lack of firmness. Preventing the loss of collagen can combat the effects of sun, stress and pollution on your skin.


  • Broccoli

Vitamins C and K help your body produce collagen, the main protein that gives your skin the elasticity that diminishes with age. The vegetable that may receive more topical discussion that most others contains oxidants, fiber, folate, lutein and calcium.


  • Carrots

A source of support for repairing cellular damage and the effects of age, carrots help reduce inflammation of your eyes and other areas of your body.


  • Citrus, Strawberries, Peppers and Guava

The colorful fruits contain vitamin C that supports your eye health and gives your immune system a boost.


  • Eggs and Corn

Your body absorbs lutein that benefits your eyes and helps you maintain the ability to focus, a condition that tends to lessen with age.


  • Green Tea

The antioxidants in at least two cups every day can fight free radical damage, guard against hyperpigmentation that sun rays produce and protect your memory as you age. Green tea can help you cope with heart disease, cholesterol levels, arthritic inflammation and blood pressure.


  • Kale

The phytonutrients in kale help prevent damage to your skin from the sun’s rays.


  • Nuts

Almonds have the potential to prevent cognitive decline as you age, and walnuts help reduce the risk of heart disease. Pistachios have a positive effect on type II diabetes. Nuts help repair your skin tissue and retain moisture while protecting your skin from sun damage.


  • Olive Oil

The anti-aging properties in olive oil come from oleic acid and the polyphenol that it contains. Monosaturated fats and the B and D vitamins contribute as well. The oil that enhances the flavors of food that you enjoy can diminish the appearance of new wrinkles and make existing ones less visible.


  • Papaya

Among the more unusual shapes of items in your grocery’s produce section, the papaya can help improve your skin’s elasticity and prevent the fine lines and wrinkles that you want to avoid. An abundance of antioxidants includes calcium, potassium, phosphorus and magnesium in addition to vitamins A, B, C, E and K. They can delay the appearance of aging, and the enzyme papain helps reduce inflammation. As it helps dead skin cells shed, your skin can look vibrant and healthy.


  • Pomegranate

The ruby red color invites you to try a fruit that can slow the aging process as it helps rebuild cells. The vitamin C that it contains can guard against the sun’s effect on creating skin wrinkles. Pomegranate juice fights free radicals with ellagic acid, and it provides your body with a super nutrient that preserves collagen. Punicalagin enhances the production of the connective tissue that makes skin soft and supple. The fruit, while a little unusual looking, contains nutrients that help maintain bone density as you age. Ancient peoples used the seeds as healing medicine.


  • Red Bell Pepper

Production of collagen provides an excellent benefit from the pepper, and the plant’s high level of vitamin C contains powerful antioxidant carotenoids that produce the bright shades of yellow, orange and red. Not only beautiful, these peppers help protect your skin from toxins in the environment, pollution and the sun’s rays.


  • Sweet Potatoes

Beta-carotene in the vegetable gives it an orange color, and it converts into vitamin A to help restore elasticity to your skin. Contributing to the delay of the effects of aging, the vitamins C and E in sweet potatoes help protect your skin from free radicals and retain the resilience of your skin.


  • Spinach

Three cups of spinach each week can provide lutein and beta carotene that can improve skin elasticity. A concentration of vitamin C helps your body produce the collagen that keeps skin soft and firm. Spinach can promote strength and shine in your hair and assist in reducing cell inflammation.


  • Watercress

As an internal antiseptic, leafy watercress increases the distribution of minerals throughout your body and helps oxygenate your skin. Its vitamins A and C produce free radicals that help prevent fine lines and wrinkles.


  • Watermelon

The sweet flavor of the watermelon provides a delightful treat, but the fruit can help stop the aging effect on your skin as well. With an ample supply of vitamin C, lycopene and potassium contributes to maintaining a nutrient balance and water regulation.


Taking an Alternative New Approach with Cryotherapy


Temperatures that range between negative 200-300°F provide cold therapy for one area or your whole body, and practitioners deliver it through ice packs or ice massages, ice baths and coolant sprays.


  • Arthritis

The discomfort of arthritis that you may grow weary of tolerating can find relief with localized cryotherapy or whole-body treatment.


  • Dementia

Research has not reached conclusions about the effectiveness of cryotherapy on dementia and Alzheimer’s disease, but some theories hold that the inflammatory responses may respond to its anti-oxidative effects.


  • Mood Disorders

When age produces negative feelings, cryotherapy may alter them by triggering physiological and hormonal responses. Endorphins, adrenaline and noradrenaline can help reverse feelings of anxiety and depression often associated with age.


  • Tumors

Treatment of low-risk tumors such as prostate cancer with targeted cryotherapy works by surrounding cancer cells with ice crystals and freezing them.


Anyone who wants to delay the onset of the aging process can do so with delicious food or through technological advances that make cryotherapy available. Both approaches offer health benefits for the whole body, or each one can focus on a specific area. With a desire to protect your natural beauty and health, you can choose to resist the changes that come with aging.


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How to Know When To Retire – How Much Is Enough?

It might be difficult to imagine the idea of having too much financial success, but it’s a real thing in society, and it happens more often than you might think. Especially with an “overachiever” mentality that so many of us seem to have.  


Consider this scenario…


George is the founder and CEO of a tech startup company. His work is intense, stressful and the hours are long, but his company is almost over “the hump”. His company went public last month, and George owns shares of the company that are worth over $5 million dollars at today’s price. These shares will vest over the next five years, so he just needs to grind it out, and then he will be set for life.


Sounds like The American Dream, right?


Except this is George’s third financial career success. He was already set for life after his second company was sold, and even before that, in his first decade of climbing the corporate ladder at a Fortune 500 company, which left him with over $2 million in investments and a paid-off house.

George had more than enough to retire, twenty years ago


Many people who are less fortunate, might view George’s situation as a great success story, and perhaps in some respects, it is.   


But consider this… George is now 60 years old, with a collection of back and neck problems and several medical prescriptions piling up. He has two grown children nearing their thirties, but he wishes he had been able to spend more time with them as they grew up. He has all the money he needs and then some, but still has almost no free time (something I refer to as Time Freedom) and these next five years of vesting are starting to seem like an eternity.


Suggested blog “The Journey To Financial Independence – A Few Life Hacks


What happened?


George is not alone. Many hard-working people fall into this success trap and many more climb the corporate ladder for decades to eventually find themselves trapped in “golden handcuffs”.  They have talent and great work habits, but they are missing one important concept – that is the concept of having “enough”. 


George could have stopped grinding it out after leaving the first company early in his career or perhaps after his second company was acquired, but his career success was addictive, so he kept doubling down without stopping to consider WHY he was doing this – and more importantly, what he was giving up in exchange…


Suggested blog “The Top Two Regrets of The Dying – How To Buy More Time


If you tune in to the concept of having “enough”, you will start to notice people who are caught in this “success cycle” like George, all around you. The key is to take some time and identify what you really want in life. Once you understand what is most important to you, you can begin the process of figuring out how much is “enough” in order to achieve the life you desire. Here is a question to consider…are your goals focused more on quality of life or quantity in life? 


Suggested blog “How to Earn Less and Have More – $200,000 vs $300,000 Income


To Your Success

Travis Watts 

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Standing on the Shoulders of Giants

Whether you want to build generational wealth or learn about passive investing, your success will be determined by how much you know. If you are just getting started, you should take time to learn from famous investors like Warren Buffett, John Bogle, Carl Icahn, Peter Lynch and Thomas Rowe Price Jr. These investors have become legendary because of their ability to control their emotions, find long-term investments and learn from their mistakes.


Learn Important Lessons From the Financial Greats


Back in 2008, Thomas Thwaites was inspired by an author who said that a single man could not rebuild a toaster if he was left to his own abilities. Thwaites bought the cheapest toaster he could find to see if he could replicate the entire machine on his own. He discovered that it contained more than 400 parts and 100 different materials. Even though he eventually limited his goal to only recreating five components, Thwaites still ended up mining his own iron ore and mica. The completed toaster melted immediately after it was plugged in because the wires lacked insulation.


As this nine-month journey shows, mankind has learned from the past and developed intricate systems for working together. A single individual cannot make a toaster alone, but they do not have to. Instead, we work together and learn from the achievements of other people. When it comes to financial matters, you can flatten your learning curve by studying the successes and failures of top investors.


Pay Attention to the Details


John Bogle is known for founding the Vanguard Group in 1974. Before he created Vanguard, Bogle developed the idea behind index funds. He realized that few investors could outperform the overall marketplace over the long run. Even when a mutual fund had world-class analysts, it had to charge large fees to pay its analysts. Because of these fees, the best mutual funds still earned less than the general marketplace over the long run.


As a result of his research, Bogle created index funds that invested in the marketplace at large. Because there were no stock pickers, Vanguard’s index funds could charge surprisingly low fees. Today, these funds are a perfect example of passive investing. Instead of having to constantly research stocks, you can buy an index fund and forget about it.


Bogle shows the power of passive income and the importance of details. His revolutionary approach to investing was only possible because he spent time researching commission rates, fees and average earnings per share. As a result, he was able to create one of the world’s top mutual funds.


Be a Value Investor


In 2020, news came out that oil was trading for less than $0 because of a lack of demand. Speculators were trying to unload futures contracts because they only wanted to invest in the security and did not want the underlying asset. While the decline in oil prices was fueled by the start of a recession and black swan events, the situation shows an important lesson. When it comes to buying an investment vehicle, it is important to focus on value and the underlying asset.


Carl Icahn was famous for focusing on value whenever he made an investment. He understood that stocks were not just documents. They represent shares of an actual company. Because of this, Icahn never invested in a company’s stock unless he believed the company was worth investing in.


Thanks to his focus on value, Icahn took an active role in the companies he invested in. He became famous for hostile takeovers. After taking over a company, he would work to improve the company’s value. Because he was known for this approach, the stocks he purchased enjoyed an Icahn lift because other investors would purchase them as soon as they heard Icahn was interested.


Create Long-Term Investments


Warren Buffett is also known for buying investments based on the company’s value. Since he first created Berkshire Hathaway in 1965, he has become one of the richest men in the world. Known for his discipline and patience, Buffett is famous for taking a long-term approach to stock ownership.


Buffett is fond of saying that his favorite holding period is forever. He does not speculate about which stocks will be profitable tomorrow or next week. Instead, he looks for undervalued companies he can keep for years or decades. Because of this approach, an investment of $10,000 in Berkshire Hathaway in 1965 is worth $50 million today.


Do Your Research


Thomas Rowe Price Jr. and Warren Buffett share many of the same features. They both took a disciplined, long-term approach to investments. Price is also known for doing in-depth research before buying shares in a company. Unlike other investors of his era, he focused on going against the crowd to invest in companies over the long run. He believed that financial markets were cyclical, so stock prices would always rise again.


Like Price, Buffett is famous for the intensive research he does on each investment vehicle. One of the best pieces of investment advice he gives to new investors is to learn about accounting. Whether you are focused on real estate or wealth building, accounting knowledge will help you research a company and determine how financially sound it is.


Focus on What You Understand


One of the reasons why people get fooled by Ponzi schemes is because they are willing to invest in something they do not understand. They may think that the Ponzi scheme is supported by the sale of a product or service, but the real revenue is driven entirely by new investors. To build wealth, investors must do their research and invest in things they understand.


Peter Lynch was a good example of this approach. From 1977 to 1990, Lynch was the head of the Fidelity Magellan Fund. During his tenure, the fund grew from $20 million to $14 billion in assets. The fund gained an impressive average return of 29 percent each year. Additionally, it beat the S&P 500 Index for 11 out of 13 years.


Lynch achieved this success because he was able to adapt to different investment styles. He never picked stocks that he did not easily understand. Some of his best stock ideas came from going to the grocery store or chatting with loved ones.


After finding an opportunity, Lynch would spend time researching it. For example, he would consider the price/earnings to growth (PEG) ratio. This ratio shows the level of expectation built into a stock. Ideally, these companies would also have a strong cash position and a low debt-to-equity ratio.


How You Can Learn From Great Investors


If you are interested in building generational wealth, you need to start learning about wealth building from the greatest investors in history. These investors did not pick one successful stock or create a single company. Instead, they became famous for consistently beating the overall marketplace. By learning from the greatest financial minds in history, you can enjoy some of the following benefits.


  • Secure your retirement future.
  • Get dividends and a return on your investment.
  • Reduce your risks.
  • Boost your earning power.
  • Earn passive income.
  • Gain peace of mind.
  • Build wealth you can pass on to your children.

Read Books


If you do not have time to take a course, you can always read books from financial experts. You can also invest in books on specific topics like real estate and passive investing. Beginners should read books about financial concepts and accounting terms. Many websites also offer tutorials, glossaries and guides to different financial topics.


View a Company’s Shareholder Letters


You can make your learning process easier. Some of the world’s best investors publish their thoughts on investments online. Warren Buffett has released his annual shareholder letter each year since 1977. In the letters, you can see updates about Berkshire Hathaway and his outlook on the world’s financial situation.


Watch Videos


If you are a visual learner, you can watch videos as well. Other than documentaries and how-to videos, you can also watch interviews with world-class investors. Some investors also offer courses and conferences on wealth building.


Take a Course


There are thousands of courses you can take to learn about investing. These courses are available online and offline from accredited universities and non-accredited organizations. With these courses, you can learn about specific topics or get a broad overview of the industry.


Once someone becomes a successful investor, they are still not done with their education. Warren Buffet spends around five to six hours a day reading newspapers, books and corporate reports. While Mark Zuckerberg reads a book every two weeks, Elon Musk used to read at least two books a day while he was growing up. Meanwhile, Bill Gates reads 50 books a year.


Even though all of these individuals are at the peak of their careers, they still devote a significant amount of their time to learning new information. Companies, economies and stock markets are constantly in flux. By devoting your time to learning from top investors and educating yourself about the marketplace, you can begin building wealth that you can pass down to your descendants in the future.


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High Net Worth Frugality – How To Save Like The Wealthy

Frugality has played a major role in my life, starting in childhood and being brought up by two very frugal parents. I have tremendous gratitude looking back on the lessons learned and seeing the impact that saving money has had. In this post, I want to share with you some interesting data I recently came across and a unique perspective on frugality.

Americans spend the majority of their money on three expenses: Housing, Transportation and Food, according to the U.S. Bureau of Labor StatisticsYou probably already knew that, so I want to dive a bit deeper in a direction I think we could all benefit from. I want to share with you how High Net Worth Individuals save and spend their money compared to everyone else in these three primary categories. Obviously, there is no official handbook or methodology that all wealthy individuals follow; so I compiled some data and research so we can take a peek behind the scenes. 

#1 Housing 

You might be familiar with the fact that Warren Buffett paid $31,500 for his home in Omaha nearly 50 years ago and he has not increased his spending in this category ever since. This is an extreme example, but how much do you think the average American spends on housing as a percentage of household income? To my surprise, the data shows nearly 30% of household income is spent on housing costs according to the U.S. Bureau of Labor Statistics


Now let’s take a look at another High Net Worth example; we’ll use Tim Cook (the CEO of Apple). Tim Cook has an estimated net worth of 650 million dollars and he bought his California residence for 1.9 million dollars. This home purchase represents less than 3% of his net worth (if he paid cash) or a mortgage payment of approximately $7,500 a month if he financed the home with a traditional loan and 20% down payment. If the house is mortgaged, that means Cook spends approximately .072% of his annual income on housing costs based on the 125 million in compensation he received from Apple in 2019. It’s interesting that Buffett and Cook have the ability to buy nearly any home they desire, but they chose to embrace a reasonable frugality in this category. There are, of course, hundreds of other High Net Worth examples like these, but it is fascinating to consider this mindset when the majority of American homeowners max out their debt leverage to buy the most expensive house they can afford.  


#2 Transportation

According to a study done by researchers at Experian Automotive (and published on Forbes), 61% of wealthy individuals (defined as earning $250,000 or more in income per year) drive Hondas and Toyotas and Fords. You may also be familiar with the fact that many billionaires drive inexpensive vehicles as well, many of which are valued under $30,000. A few examples include:


  • Steve Ballmer (Billionaire) Ford Fusion Hybrid MSRP $30,000
  • Mark Zuckerberg (Billionaire) Acura TSX MSRP $30,000
  • Jeff Bezos (Billionaire) Honda Accord MSRP $20,000
  • Ingvar Kamprad (Billionaire) Volvo 240 MSRP $25,000


According to AAA research agency, the average American spends $9,282 a year on their vehicle, which equates to $773.50 a month. The median household income (for 2018) was $61,937 according to Current Population Survey and American Community Survey, which are surveys conducted by the U.S. Bureau of Labor Statistics and the U.S. Census Bureau. Americans dedicate nearly 15% of household income to a vehicle. 


#3 Food

This is one of my favorite topics when it comes to personal finances. In this post, I will keep it brief, but you can check out some of my other blogs and articles that dive deeper into the topic. According to The National Study of Millionaires, which is a 71-page nationwide study conducted on 10,000 U.S. millionaires and their spending habits, it was found that 36% of millionaires spend less than $300 each month on groceries and 64% spend less than $450, and only 19% spend more than $600 a month on groceries. The punchline; non-millionaires spend about 57% more on groceries compared to millionaires. But that’s just groceries, so what about restaurants and dining out? I’ll get right to the point on this one… 


To turn a profit, many restaurants charge around a 300 percent markup on the items they serve. When you go out to eat, you are paying for service, convenience and atmosphere. There is certainly a time and place for restaurants, but if you are eating out frequently, consider that you could make a $15 meal in a restaurant for $5 at home. The statistics are also interesting. According to a study from the JPMorgan Chase Institute that focused on fifteen specific metropolitan areas, studying credit and debit card purchases from more than fifteen billion anonymous transactions and characterizing them by quintiles of income, the poorest 20% spent 16.6% of their income at restaurants, trailing the wealthiest income quintile at 17.8%.



Perhaps it’s time to remove “The Joneses” from our life and start keeping up with ourselves instead. 


There are two sides of the money coin. One side is about making money and the other side is about saving money. Long-term financial success requires a commitment to both. We can’t forget about mentors like Mike Tyson, who amassed over 300 million dollars in a career and filed for personal bankruptcy in 2003 after going completely broke. Or perhaps the more recent example of Johnny Depp “losing” his 650 million-dollar fortune due to wild spending habits like $30,000 a month on wine and renting 12 storage facilities to store his “memorabilia”. We all know of athletes and celebrities who unfortunately were not taught about frugality, or simply chose not to pay attention. The goal for you and I may not be to join the Billionaires Club, but perhaps it’s a worthwhile pursuit to find a balance between having enough and living life on your own terms. 


To Your Success

Travis Watts 

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9 Things to Consider When Converting Apartments to Condominiums

Besides the traditional three apartment investment strategies (turnkey, distressed, and value-add), condo conversions is another less common business plan that can be very lucrative.

The condo conversion investment strategy involves purchasing an apartment community, converting it from individual rental units to individual condos, and reselling the individual condos for a profit.

This post isn’t going to discuss which investment strategy is the best, because like most things in real estate, it depends on what you are interested in and what your goals are. However, if you do decide to pursue the condo conversion investment strategy, here are the 9 things you need to consider:


  • Speak to an attorney: First and foremost, speak with a real estate attorney that specializes in condo conversion projections. You need to know the state and local laws on condo conversions and the step-by-step process you must follow.
  • Vacating the property: The largest potential challenge is the process for vacating the apartment building. An attorney will tell you the laws that protect the rights of the existing residents. In some markets, the residents must be given a specific time frame of the notice to vacate. You may even be required to cover their relocation costs and give them a chance to purchase a completed condo. The longer it takes and the more expensive it is to vacate the property, the greater the holding costs.
  • Hidden fees: There are a lot of hidden fees involved in condo conversions, which the attorney can help you uncover. There are application fees with the city, surveying fees, attorney fees, and fees related to code compliance. Once the conversion is completed, the city will inspect the condominium for code violations, which you will be required to address. Therefore, another fee is associated with hiring a private condo pre-inspection specialist to inspect the property to give you an opinion on potential code violations and the costs of the repairs. Another hidden fee is the increase in insurance costs. Insurance on condominiums is generally higher than apartment insurance, so make sure you obtain a quote for the new insurance premium. Last are the upfront and backend fees you charge for putting together and managing the project.
  • Financing: You will need to speak with a mortgage broker who specializes in condo conversion projects to securing financing. This conversion needs to begin prior to placing the deal under contract so that you can estimate the debt service and other important loan terms, like I/O periods, loan term, interest rates, prepayment penalties, financing fees, and closing costs.
  • Timing: To determine the holding costs and hold period, you need to know the estimated timelines for each step in the condo conversion process. First, how long will it take to vacate the building? Once vacated, how long will the renovations take? How long will it take to list the condo units for sale after the renovations are completed (i.e., post-conversion requirements like setting up the HOA, inspections, etc.)? Lastly, what is the average days on market and closing timeline? Add these all together and you have the hold period and can calculate the holding costs.
  • Holding costs: The holding costs are the ongoing expenses paid during the hold period. These include insurance, taxes, utilities, and debt service. Since you will be generating no cash flow (or some cash flow in the beginning while vacating the property), these expenses must be covered by initial equity.
  • Renovation costs: There are four aspects of the renovation costs to consider. One is the cost to convert the apartment units into individual condos. Two is the investment amount is required for the common areas. Three is the cost to address deferred maintenance. Last is the size of the contingency budget.
  • Sales process: The first thing you need to know is the projected after-repair value of the condominium units, which requires a sales comparable analysis. You also need to consider the costs associated with marketing and selling (i.e., the broker’s commission) the condo units.
  • Limited partner compensation: Lastly, you need to determine the compensation structure offered to the limited partners who invest. What type of return will you offer (i.e., preferred return, profit split, or both) and when are they paid (i.e., after each condo is sold or when all condos are sold)?


To address all the above, you will need to work with at minimum an attorney, a mortgage broker, and listing broker, and a contractor – all who specialize in condo conversions.

Purchasing an apartment community and converting the rental units into individual condo units is an alternative to the traditional apartment investment strategies. However, you need to understand the laws surrounding condo conversions, the added costs, and the required team members to properly underwrite the deal, successfully complete the conversion and conserve and grow the investors capital investment.



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Using Your Mortality to Pursue Goals

The Roman philosopher Seneca the Younger once wrote, “There are more things … likely to frighten us than there are to crush us; we suffer more often in imagination than in reality.”

Around a century later, the Roman co-emperor Marcus Aurelius mused, “It is not death that a man should fear, but he should fear never beginning to live.”

You may be thinking, “Easy for them to say,” but nothing could be further from the truth. Seneca was installed as a tutor and political advisor to Nero; when his influence over Nero waned, the relationship quickly soured and came to a terrible end. Aurelius’ reign was marked by the tremendous losses associated with war and a years-long plague that killed millions.

The ancient philosophers’ wisdom might have greater relevance today than it has had in a long, long time. We have enough very real fears to grapple with without letting the groundless ones prevent us from achieving our goals.

It’s one thing to take realistic stock of our finances, our health, our relationships and the state of the world. It’s quite another to let every little fear cripple us into complacency and inertia. We won’t be around forever, and we can’t build the kind of wealth that ensures optimal quality of life if we entertain what-if scenarios that aren’t likely to happen.

James Gordon Gilkey, a pastor and author who penned “You Can Master Life” in 1934, estimated that legitimate worries account for less than 10 percent of the anxiety that keeps us up at night. The fact that his book is still touted on the internet in 2020 speaks volumes.

Generally speaking, fear is our friend. It’s useful to have a racing heart and hair that stands on end when we hear a low growl in the woods or when things go bump in the night.

Fear becomes a bad thing when we decide to just live with it rather than face it and respond sensibly. Fears that go unaddressed keep people from starting valuable businesses, making lucrative investments, scheduling yearly health checkups, retiring to exotic locations, and pursuing relationships after wildly successful blind dates. It keeps them from fulfilling lifelong dreams such as learning to play the violin, skiing in the Alps or running for city council.

The trick is to confront fears as they arise and evaluate their legitimacy. It is to approach apprehension from a logical standpoint rather than an emotional one. It is to thoughtfully calculate each risk rather than shy away from all risks.

Is an investment unreasonably risky just because you’re afraid of a bad outcome? It’s a mistake to assess the level of risk based on your level of fear about it. If we made every decision solely based on our emotions — namely fear — none of us would ever get anything done.

If people hadn’t pressed on through fear there might be no Microsoft, Apple or Amazon today. Oprah Winfrey would probably have retired in obscurity from a local TV news station by now. Mark Cuban might still be tending the bar and sleeping on the floor of the apartment he shared with six roommates.

Risk-taking, no matter how scary, is a crucial component of building wealth and achieving personal goals. Sure, it was easier for Cuban to take risks when he had nothing to lose. He admitted in a recent interview that now, given how much more is at stake, he’s “terrified of risk.”

However, he mitigates fear through preparation like keeping current on industry trends and doing comprehensive market research. Since he relentlessly educates himself on the sectors he invests in, he can avoid all but the most calculated risks.

Winfrey urges, “Do the one thing you think you cannot do. Fail at it. Try again. Do better the second time. The only people who never tumble are those who never mount the high wire.”

Jeff Bezos was fortunate enough to land a corner office on Wall Street immediately upon graduation, but entrepreneurship called. He kissed a lucrative salary goodbye to found Amazon and peddle books from his garage. Now, that’s scary.

Fears of financial failure, loss of security or losing face are not the only fears holding people back. Neophobia, which is fear of the unfamiliar, is equally paralyzing. Successful people work through it in a few ways.

First, they do their homework before they buy stocks, purchase real estate or develop new streams of income. They know the pros and cons of things like passive investing or investing in rental properties. They’re tireless learners in their industries, so there are very few unpleasant, neophobic surprises. A former employee of Bill Gates swears that he once read 14 educational books while on vacation.

Second, successful people chalk up the missteps along the journey to valuable experience. They leverage their failures, for lack of a better word, to become better risk-takers and build greater wealth in the future. As the unfamiliar becomes more familiar, they can avoid making the same mistakes.

Finally, they rob neophobia of its power by envisioning a better future. Did Bezos envision the Amazon of today? Perhaps not, but one thing is for sure: He saw himself doing something that he’d rather be doing. For Cuban, the vision could have been as simple as having his own bed to come home to.

Someone who doesn’t take time to contemplate life after a potential career change or move to Maui could be stuck in a rut, drudging on in fear, for years to come. The same is true for someone who steers immediately to the worst-case scenario and parks there.

When you set business, personal or lifestyle goals, the ability to envision positive outcomes goes a long way. Vision may be the strongest motivator there is.

In the context of building wealth, there’s nothing wrong with money in itself being the motivation, but few billionaires cite wealth as their primary goal. It’s simply a byproduct of their success in some other endeavor. Examples include making a social impact, improving quality of life, building better products, and having complete freedom and control over one’s life.

You may envision providing amply for your heirs, establishing a nonprofit or becoming a YouTube star. Don’t laugh; 23 million subscribers tune in to DanTDM’s Minecraft commentaries. His net worth is £25 million.

No one denies that some fears are perfectly valid. That’s why a distinction should be made between envisioning outcomes and daydreaming. Envisioning outcomes involves extensive research.

By all means, picture yourself launching a startup or sending your kid to Harvard someday. However, by the time you’ve decided to take a risk or aspire to a lofty goal, you should have examined potential outcomes from every angle. You should be well aware of the pitfalls. You should know what the monetary cost will be, know where you stand now, and know specifically what it will take to ensure that the risk pays off.


In short, worst fears realized are often a direct result of failure to plan.

Nothing alleviates fear like setting goals, and all the experts agree that physically writing them down strengthens commitment to them. Setting goals and deadlines provides you with a road map, and you should consult it frequently to measure your progress. It will most likely need tweaking now and then as interest rates rise and fall, the tax code changes, the market sags or your family grows.

Let’s say you hope to buy real estate in New Zealand and are saving accordingly. You plan to purchase a property in five years. If you don’t keep an eye on the rate at which properties are appreciating in value, you could come up significantly short. Your worst fears could be confirmed.

That’s how setting goals, planning and measuring progress keep fears at bay. You may need to save more each month, channel funds into investments with higher yields, or explore other income streams, but fear of the unknown won’t defeat you.

Some unavoidable life circumstances, either directly or indirectly, have monetary impact that could derail your current plans. Naturally, everyone fears long-term health problems, the death of a spouse or child, and loss of cognitive ability. Global pandemic, of course, is a new one.

Compared to those alternatives, a job loss or stock market crash should be the least of your worries.

The worst approach is to obsess over legitimate fears. The best is to face fears and put them to work for you in the form of preparedness. It’s one of the most valuable financial tools you have.

As you educate your children about saving, investing, passive investing and other tools, be honest. Tell them what you’re afraid of. Explain how you face fears and press on despite them.

Fear reinforces our own sense of mortality, but the ancient philosophers’ advice to keep it in perspective is still valuable today. After all, growls in the woods and bumps in the night often turn out to be nothing.


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Health + Wealth – The Celery Juice Health Hack

What does celery juice have to do with real estate? Well… nothing really, but it might change your life. Hear me out on this one! 


My wife is a big health advocate and a master researcher and experimenter. We started experimenting with “health hacks” in 2014 and we continue to do so today. 


Below are a few of our adventures:


  • Raw vegan diet for 3 months (Excellent, but very difficult to sustain when traveling) 
  • Veggie/Garlic/Aloe Papaya Seed Smoothies for 30 days (Do not try this one) 
  • Eating the same meal for 35 days in a row (Boring, but can be convenient) 
  • Juicing cleanses (Stick to vegetable juice if you’re looking for health benefits) 
  • 3-day water fasts (Feels like death on day #2, but day #3 usually gives an energy boost)
  • Wheatgrass shots every morning (Seems healthy, but had little noticeable difference) 
  • Cryotherapy and Red Light Therapy (Noticeable skin improvement, but costly) 
  • LOTs of exercise routines and various programs (Still a work in progress…) 
  • Sampling nootropics and Vitamin B12 shots (B12 is effective & healthier than caffeine)


I want to take a minute to explain why celery juice is so amazing and can help improve your life. Of all the health experiments listed above (which are only a few of our adventures), celery juice has had the biggest impact. BUT, you must consume it the correct way. 


For those that may not be familiar with the benefits of celery juice, a few benefits are listed below. Please keep in mind that I am not a doctor or a licensed health professional, I am simply a real estate investor and “health hack experimenter” under the supervision of my wife. 


A Few Celery Juice Benefits:

  • Can reduce brain fog – contains sodium cluster salts that are critical for the brain 
  • A powerful tool for reducing bloating, inflammation and joint pain
  • Lessens sugar cravings 
  • Neutralizes and detoxes toxins in the liver 
  • Helps reduce acid reflux 
  • Can help eliminate or reduce migraines and/or headaches 
  • Fights autoimmune disease 
  • Helps restore adrenals 
  • Reduces eczema/acne/psoriasis 
  • Aids in weight loss 


The bottom line is celery juice can be useful for overall health improvement and it’s easy to implement into your lifestyle. For those of you who frequently read my blogs and content, you know I am a big advocate for seeking mentors, coaches, and surrounding yourself with successful people. The reason is simple; it’s to cut the learning curve and “hack” the traditional system. You can literally cut years and sometimes decades off the learning curve by leveraging other people who have already accomplished what you want to do. To this point, I added some additional resource videos at the end of the post from several people who have done far more research and testing than I have on the health benefits. But for now…


How to Juice:     

  • My wife and I use an Omega NC800HDS juicer (*Note there are cheaper models out there)
  • Yes, you can use a blender, but you’ll need a nut milk bag to strain the juice 
  • We juice (1) stalk of organic celery, which equals approximately 16 oz of fresh juice


Helpful Tips:

  • If you do not buy organic, make sure to wash the celery thoroughly with non-scent soap
  • Do not dilute the celery juice with water, ice or other juices (the effects are not as potent) 
  • The juice will maintain the majority of its nutrients for 24 hours (if you prefer to juice at night and place it in the fridge until morning, or drink it later in the day)
  • Drink the juice on an empty stomach (ideally) and do not eat food for at least 1 hour after


That’s it! 


This is not my typical real estate post, but I felt compelled to share this information with you in hopes that a few of you will try it out and experience the positive health benefits for yourself. I’d love to hear your feedback and results; feel free to reach out to me or leave a comment below. I’ll leave you with a simple final thought…


If we don’t have our health, what use is our wealth? 


To Your Success…and Health

Travis Watts 


Celery Juice Resources:

A 3-Minute Breakdown of the Benefits – Anthony William 

Life Hacker Couple – 10 Month Testimonial 

How to Make Celery Juice with a Blender 

20 Powerful Healing Benefits of Celery Juice 

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Why Multi-Family? Why Now?

Why Real Estate? 

Most people who are career focused and have money to invest or people who are coming to the end of a professional career, often look to real estate as a viable investment option either for building equity or for income generation. Unfortunately, real estate investing is typically thought to be a sole ownership strategy. Very few people are aware of the passive investing opportunities in multi-family private placements or “apartment syndications”. 

Why Multi-Family?

Syndications and/or private placement offerings are all about “pooling” your money together with other investors to purchase large assets that may otherwise be unattainable as a sole ownership purchase (for example, a 300-unit apartment building). If you have 10 million dollars to use as a down payment, you might have the means of purchasing an asset like this individually; however, if you prefer to only invest $100,000, that’s where a syndication structure can be a huge benefit and allow you to participate in a deal of this size. 

Why Value-Add?

I tend to invest in value-add projects. In this business model, the General Partner or Managing Partners and their teams often add value to the apartment community in a number of ways. Common value-add strategies include renovating the units, updating to modern appliances, countertops, in-wall USB ports, smart thermostats, on-site storage lockers, improve the landscaping, renovate the clubhouse, gym, pool, parking lots etc. Every property is unique and the business plan will be different for each; the overall goal is to update the property and match the current market demand while increasing below market rents along the way.

The value (price) of an apartment complex is primarily derived from the NOI (net operating income), which is comprised of the total collected rents and income minus expenses to operate the property. When the net operating income increases, the value of the complex increases. For example, let’s say the annual net operating income on a property increases by $100,000 a year. A $100,000 a year rent increase could potentially bump the purchase price up by nearly one million dollars (for example/educational purposes only). 

Why Invest? 

Multi-family real estate investing has a lot to do with diversification of an investment portfolio. There are two common reasons why people invest in real estate. Most people either invest and wait for the property to increase in value or “force” the appreciation (equity investing) or they rent it out and collect the cash flow (income investing). Why not do both? Value-add business plans are often designed to capture both of these strategies. 

Multi-family real estate is a diversified asset in itself. This is largely due to the fact that when you buy an apartment building, you are investing in many units. With single-family homes, you have (1) unit and (1) tenant. If your tenant moves out or doesn’t pay rent, you are 100% vacant and 100% unprofitable. With a 300-unit property, it is not uncommon to have the ability to lose 70-90 tenants at any given time, and still be profitable. The diversification does not stop there. Many people invest passively in syndications because they can spread out their risk geographically among several properties and Sponsors.  

Why I Decided to Invest in Multi-Family

In 2015, after a complete burnout of trying to expand my single-family portfolio, I decided to return to the drawing board in search of a more sustainable and scalable approach to investing in real estate. I was desperate to become a hands-off investor after realizing how active this business can be. In 2015, after reading 52 books, listening to podcasts, networking in real estate groups and seeking mentors, I ultimately decided that multi-family real estate was my solution. More specifically, investing passively in apartment communities via private placement offerings (syndications). 

These Were a Few of My Reasons:

  • I needed a hands-off approach to invest in real estate 
  • I wanted tax advantages equal to or exceeding single-family 
  • I wanted geographic and asset type diversification 
  • I was seeking a recession-resistant asset class
  • There was (and still is) a nationwide demand for affordable housing 
  • I wanted to leverage other people’s expertise, track record and deal flow

Whether you decide to be active or passive in the multi-family space, I wish you success in your journey. This asset class has truly been a blessing for my family and I. I have a passion for helping educate others in real estate. If you have any questions, please reach out anytime. I would be happy to connect on a call or email to help in any way I can.  


To Your Success

Travis Watts 



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