May 19, 2022
Something I’m Reading
I’m reading Love and War by John and Stacey Eldridge. It is a Christian, marriage book by the author of one of my favorite Christian books - Wild at Heart. I’m really enjoying this book and the reminder that a great marriage is an adventure for both parties - not two separate adventures and not just lovingly gazing into each other’s eyes on a beach in Tahiti forever. It’s an adventure!
Something I Teach
Yesterday, my partner at Open Door Capital, Brian Murray, mentioned something he saw on TV. It sounds so obvious when you say it but we often don’t stop and think about it. A lot of times when the economy is in a bit of turmoil or confusion and especially in times of heavy inflation, the natural tendency for people is to hold onto cash and stockpile it. The irony is that by holding onto your cash during an inflationary market, your money is actually losing value. In real estate, we talk about having a 10-12% return on your money but you’re pretty much losing that when it’s sitting in cash.
I’m not saying you should take every penny out of your bank and invest it in something because thats not wise. You need to have cash reserves but be smart and have the reserves you need while investing in things that work. And currently, real estate works and its working really well. Thats why Open Door Capital and myself personally are continuing to buy real estate and put our money into deals rather than keeping cash and losing 8%. What are your thoughts? Comment below!
Something I Photographed
Little boy doing little boy stuff
Something I’m Excited About
I’ve been traveling the past several months and my road trip is finally coming to a close. I’m excited to be back in Maui next week and do some surfing again.
Something I Can Answer
Every week, I answer one question asked by a BTB subscriber. Have a question you want me to answer? Reply to this text with your question!
Question: “If you work a W2, how can you go about finding a side hustle with scalable income?” -David
Scalable income is something I'm really passionate about lately and is a key in building wealth. Scalable income is a business or way of earning money that is not directly tied to the hours you work. In other words, the smarter you are more, the longer you're in it, or the more effective or efficient you become, the more money you make. For example, a teacher gets paid a certain salary, regardless of how many hours they work - that’s not scalable. But for a real estate agent, the more clients they meet, the more advertising they do, and the smarter they are then the easier their job becomes and the more money they make. There's almost an inverse relationship to money earned versus hours worked.
So how do you find that? Well it really comes down to almost entirely entrepreneurship - you have to run some sort of business and sell something.
Another route is to be an intrapreneur and sell something at the company you're at. For example, at BiggerPockets, I was an intrapreneur. I worked for years, but I wrote books for them at BiggerPockets. I made money that's not tied to my hours worked by releasing books through BiggerPockets. So you could look around you at your current job and see if there’s opportunities for intrapreneurship.
Ultimately, you need to ask yourself what are you currently doing? What are you good at? Are you good at selling some product? Could you sell roofing products? Could I do door to door sales for vacuum cleaners and then hire a team? What are you passionate about? And more importantly, what does the market need? What is a problem you can solve? The key to entrepreneurship is just solving problems. So what problem can you solve?
If you can cross that with something that you're good at and something you're willing to devote the next several years of your life to doing it, then that's how you create scalable income.
The last piece is to hone your business skills and get smarter by studying, reading, learning, and growing through books, podcasts, and webinars
A few examples of scalable income could be a real estate agent, insurance person, starting a service-based company like tutoring where you hire tutors, or starting a contracting business. Hope that helps!
Your Friend,
P.S. Comment below and let me know your thoughts on this week’s BTB! Please be friendly :)