From Engineer To Financially Free Syndicator of Multi-Million Dollar Deals w/ Lane Kawaoka
On this episode we had the pleasure of speaking with Lane Kawaoka of SimplePassiveCashFlow.com. We learn about his journey to where he is today and about his investment philosophy. Check Lane out at https://simplepassivecashflow.com/turnkey/, and his podcast https://simplepassivecashflow.com/podcast/ --- Transcript Michael: Hey Everybody, Welcome to another episode of The Remote Real Estate Investor. I'm Michael Albaum and today I'm joined by my co host, Emil: Emil, the real deal, Shour. And today we have a really special guests. Lane Kawaoka is joining us today. And he's going to be talking to us about his journey from engineer to massive syndicator and how he got to where he is today. So let's go ahead and jump into it. Michael: Lane, thank you so much for jumping on the podcast with us and hanging out. sure appreciate it. Lane: Yeah. Thanks for having me, guys. Michael: Yeah, totally, Lane: Aloha everybody. Michael: So you're out in Honolulu. Right? Lane: That's correct. Live where you want but investor the numbers make sense. Michael: No, I don't know if you got the memo but that's not possible to do. You can't invest remotely. Lane: You just got to grow a pair, numbers don't lie. Michael: That's true. Lane: We all live in high priced areas, ain't gonna work, dude, like, especially if you want to run it with professional property management and actually do what your highest and best use is which is likely at your day job. Right? Michael: Right. So I would love if you can give us a breakdown. How did you get started? I mean, I know a little bit of your background. So how did you get started? And then where are you today? At the high level? Lane: Yes. So I kind of grew up this linear path. My parents taught me to go to school, study hard get a college education, because I happen to be good at math and science. When I was eight, I eventually came in engineer for some reason. Right? Michael: Did you play with Legos as a kid? Lane: Look, I'm just honest here, right? Like, I didn't care. I just saw engineers get paid pretty good money. You don't have to go to grad school. So I was like, I'll do that one. Emil: Straightforward, man. Nothing wrong with that. Lane: I mean, you know, I'm goal oriented, right? Michael: That's right. Lane: But yeah, so I I went to school, to be an engineer, became an engineer and just start work. And, you know, that's where kind of obsessed me like, there's so much bad financial advice out there, such as buying a house to live in putting your money in this 401k where there's all these fees, and you really not making getting ahead there. And you know, so that's what I did. I bought a house living, go figure. Because, you know, for new guys in professional careers, you're up the road warrior, right? They send send you out on the road, because you don't get any family and you probably like the free Starbucks and expenses and hotel points, you know, that gets old for sure. But that's the life I live probably my first six, seven years working. But it allowed me to save a lot of money, and I bought a house to live in. But I was never home. I was only one Saturday. And I was like, This is silly. So I just started renting it out. The mortgage was 1600, the rents was like 2200 bucks a month and two young 20 something no kid, that was a lot of beer money. I was like, wow, if I keep doing this again, and again, I'll be able to quit my day job. So that was the start of that. Oh, yeah. Michael: And where was that? Lanes: I bought that first property in Seattle, Washington. It was in a class area, everything you're not supposed to do primary market, high end where… Michael: When you're a young kid with money. And you're like, great, I can afford this. Go run and do it. Lane: Right. Yeah. It was a bad strategy for sure. But you know, that's how good real estate is you can have a pretty bad strategy and still do pretty well. Emil: Well, at first it was a bad strategy. But it got your start, right, which is I think how a lot of people get started, you buy your first place, and then you transfer it to a rental and you're like, holy cow. There might be something here. Lane: Yeah, yeah. And then you start that's where I started to get a little more sophisticated start to actually listen to podcasts and blogs, and you know, websites start to learn about the rent to value ratio. And I was like, oh, shoot, I'm not, not 1%, definitely in Seattle. And then I started to learn about this whole great debate that gets talked back and forth of appreciation versus cash flow. And I was like, screw that. It'd be cash flow camp. So I was like, oh, maybe I shouldn't invest in primary markets. Right. But I get it like, that's how it kind of calling people out. Right? It's, I didn't have the cajones still invest out of my backyard. So I bought a duplex in a little rougher area in West Seattle, more of like a deep loss area. And a little bit better numbers, but it still didn't hit the 1% rent to value ratio. So that was a couple years later, after saving a little bit more money, you know, buying the next one working at my job. And then a couple years after that, you know, the prices kept going up and up and up, and I wasn't even able to cash flow. And I was like, What the heck is going on here? You know, I went to I tried everything. I was going to like these auctions. And I just looked around the room. It was just a bunch of unsophisticated old Microsoft guys with too much money. And I was like, This is not this is the dumb money camp. I gotta like, do something else. So that was where I started to look into these turnkey rentals and I bought one in Birmingham and it worked. I didn't get my arm blown off or anything like that. You know, nothing happened to me. You know, people didn't run off with my money. I worked with professionals property management. I got a broker And I sold the Seattle stuff and eventually in 2015, I had 11 rentals out of state. Emil: What did you start buying into? Were you buying single family rentals? Were you buying small multifamily? What did you start out with without a state? Lane: I just went to single family. Initially, my thought process was Yeah, the numbers on the multifamily the duplex triplex or quads are definitely better, but always want to stay above 800 bucks rents, it's kind of hard to do that with a duplex. Usually you got like a 500 $600 on both sides. So $1,000 combined, but I think we need stay under $800 on your tenant, the tenant quality isn't that great. You know, staying above $800 rent, kind of took out those those type of deals. And then I was you also got to think about the exit strategy, right? At some point, you're gonna sell this stuff. And I want to sell it to some emotional buyer who falls in love with it. And the only person who really buys a duplex triplex or quads or you know cheapskate investors like us. Michael: So what do you say to folks who are just getting started, who might not be able to afford the higher end stuff, they're, they're needing cash flow, looking for cash flow and want to go in and buy that 30, 40 $50,000 property? Lane: So just wait till like you can save. I mean, you already got to save up 1015 grand for that piece of junk Anyway, you might as well just save a little bit longer. I mean, most of the people I work with, like they're able to save 30 to 50 grand a year. I mean, so what's that to get from 15,000 to $25,000? Down payment save threshold that's few months for them. Michael: Right? Right? I don't know, just take my word for it. Don't dumpster dive in properties under 50 to $60,000. Just saying that. Yeah, don't be a noob. And just say, well, the numbers are great. The numbers are great on paper, you know, that that paper doesn't mean anything. Michael: Right. paper doesn't have anything to do with performance. Lane: Yeah, pro forma is like fake in French or something like that. Michael: So good. Emil: What was your criteria when you were looking to go out of state? Like, what did you I like that you said, minimum $800 rent. But what are some other boundaries you set for yourself? I think that's super helpful for people. Lane: I didn't want to go to two bedrooms or under, you know, three, three bedrooms, at least, you know, bathrooms that aren't really you could make arguments both ways, less bathrooms, less stuff to fix, right. But again, you know, what family buys a one and a half bath or less. So keep things simple. Just go after three twos or bigger. Four bedrooms are cool. I think that if you're going for section eight, that fourth bedroom really helps out too. Because a lot of times the rents are kind of based off of how many bedrooms there are. So that can really help. But yeah, I mean, just maybe not have a high end constraint, but at least have a low end constraint of three bedroom two baths. Michael: That makes sense. Emil: Yeah. What about market? How did you land on Birmingham? Lane: At the time, this was back in the old days when everybody was like reppin, Memphis. And I was like, Well, I don't want to go where else goes. And I was looking for more of a cash flow market. I didn't really care about appreciation. So at that time, did Birmingham and then I cobbled in Atlanta, which at the time did cash flow back in 2013? To 15. Michael: Back in the day. Lane: Back in the day, yeah. Emil: Yeah. Atlanta been on a tear. Lane: Yeah. So now, or at that time, those two kind of worked its way out to be, you know, good plays. And the way I thought about it was I was going to cluster properties in different areas. So I would get, you know, not just have more than one or two properties with one property manager be at least, you know, not the cheapest bottle of wine right are not the client with just one property just have at least few rights. You're not the bottom of the barrel, right? That's like a theme in my life just not being the bottom of the barrel. Yeah, a little bit better than the worse, right? So I wanted to get these properties. So that would have kind of a little bit more of a pull with the property managers. So I had five in Atlanta, four in Birmingham, and then one in Indianapolis, I was going to start to buy more there. That was like another plan of mine, like what I saw earlier was in 2010, to 2015, the hedge funds kind of picked the market. I think at the time it was Atlanta, and, and maybe Memphis but like for some strange reason they went there and you can't predict it. You can look at all the data you want. But at the end of the day, these institutions are going to go wherever they go. And you just have to kind of react or this case kind of get lucky, right? The way I thought of is if I could just checkerboard, all these great secondary tertiary markets, which by the way are like Memphis, Indianapolis, Kansas City, Little Rock, Birmingham, Atlanta, like you know, you can't go wrong, I think. I think it's good to diversify over a little bit and maybe you get lucky. You know, maybe the person in New York will pick yours to just throw a whole bunch of money in there. Michael: Close your eyes throwing darts at the board. Lane: Right, right. I mean, if not just cash flow, right? Michael: That's right. That's right. And I like what you said to about those being like safe markets, you can't lose from a cash flow perspective, as long as the numbers make sense. At the end of the day, the value is kind of secondary, right? If that's the goal. Lane: Cities that are at least 100,000 population where you have, you know, enough choices for property management. And it's not just like a one trick pony in terms of the economy. That was kind of my big thing. I know, like, a lot of people pull up some kind of po dunk town and say, Oh, you know, the tertiary markets, like, Michael: Dude, look how good the rents are. Lane: That's not a tertiary market, right? Yeah, maybe the rents are super good, because the cap rates are high. But there's a reason why the cap rates are so high because it's out in the middle of nowhere. And it's only like powered by one meatpacking plant. Right. Those aren't the cities you really want to invest in. Maybe if you live there. That's cool. And you know that market intimately. But most of us are just a bunch of dudes in California, Hawaii, Seattle, New York, right? Like, what do we know? Stick stick to the secondary markets, dude. Michael: Yeah. And so what is it that you're doing now? Because I know that you've moved out of the kind of 1,2,3,4 unit space? Lane: Yeah, I mean, turnkeys. For me, it was a great way to get started. That's what I did from 2009 to 2015. As I became more of an accredited investor, I, you know, wanted to go after scale and lead projects of my own. So, you know, that's where I've kind of gone into more apartment syndication, but still same markets, same principles, cash flow. But in these deals, like the differences, we're buying it with force appreciation potential, right? We're going in rehabbing units, bumping rents. Michael Right on. And for those who might not be familiar, what's an accredited investor? Lane: Kind of a rich dude, sorta a guy who makes a quarter million dollars, I think if they're married or single, I don't know, you just got to look it up on the SEC website, or million dollar net worth and above doesn't include your primary residence, because that's not a good investment. That's just my input. But yeah, like a credit investor is kind of seen from the SEC as like, hey, this dude can go into a bad investment and not just be on the streets, right? So when you're under a quarter million dollars, half a million dollars, I don't think you really belong, investing in syndications. Right? Michael: Yeah, it's accredited investor, someone that can syndications can advertise to and it's a requirement from the SEC in order for them to be involved in certain deals, so they don't get taken advantage of assume there's certain level of sophistication. So most syndications have a requirement that in order to become an investor, a limited partner, you need to be an accredited investor. Lane: That's what it seems like. But in reality, like 90 to 97% of deals out there do except non accredited investors, except we are you or I aren't in that that network of the syndicator. So you have to be well connected. And you're probably not connected. If you're a non accredited investor, you probably don't know anyone other than Larry or Glenn in the office, right? investing in the 401k. They're out there. It's just yeah, to get access to the deals that are generally solicited, right. That's the key. Once deals are generally solicited or marketed on a podcast website, etc. Then the syndicator can only accept accredited investors. The key designation. But yeah, I would say if your net worth is under a quarter million and a syndicators willing to take your money. They got to be a little desperate. So I would kind of have caution for that. Michael: Interesting. So I get that question all the time, as part of the Roofstock Academy, our education arm of rootstock is, hey, if you know I kind of want this passive equity thing, that's why I'm attracted to real estate and the diversification away from the stock market. And so I'm kicking the idea around of syndications. As someone who's just getting started, they've never done a deal. Let's say they are an accredited investor, would you recommend going the syndication route and just being super passive or go getting their teeth cut and doing a deal themselves? Lane: I think it's great to see somebody going on doing that on their own, because most investors that are accredited, they've never owned rental properties. They're kind of that unsophisticated, accredited category, I call it. I like to see my investors own a rental property or two, because they get the game they understand that, you know, this is not a smooth ride. You know, so like, Case in point, just a super small deal like a 50 unit. Whenever you turn on the HVAC in May, for the first time the air conditioners, you get 50 of these things, you're going to have a handful of them break, right and if you're a rental property or you're like yeah, you get it right every time that happens. I get like emails from these like newbies accredited guys. What the heck happened here? This is poor due diligence. Yeah, I use my European accent it poor intelligence. This is outrageous. You are horrible. Now they don't really do that. But I know some people think it right. But the people who own rental property, they're like oh, okay, wow, I'm surprised not more broke. Michael: Only seven broke. Lane: Yeah, yeah, yeah. And they're like, oh, okay, okay. Oh, we're not getting distributions this quarter. Okay, well, that makes sense because there was a freakin pandemic, right that, like, I get it, you know, cuz I've owned real properties. they get it, you know, carry on, you know, keep calm carry on. Yeah. Whereas other investors they, you know, they just freak out right is he still understand that they're just used to the stock market, right even though in the stock market you're taking so much advice, right. And that's what started this whole ride when I was investing in a turnkey I was doing like, my projections are figuring out that I was making like 30 35% money I'm on my money with the cash flow was just one of them. Yeah, cash flow, you may only be making 5, 10 percent, but when you add on the tax benefits the mortgage pay down the tenants paying down your mortgage, and then the the appreciation, the leveraged appreciation. I mean, you're making like 30 something plus percent, even on a typical turnkey. And then I was looking at my garbage and my 401k. And I was like, wait a minute, what's happening? What took all my money? Right? Yeah, I mean, the stock market seems smooth, right? But Little do they know that everybody knows that they're getting their retirement just robbed from them. And that's what keeps hardworking professionals working forever, which really frustrates me. Emil: Personally, I don't invest too much in a 401k anymore. But what do you mean by people getting robbed in their 401k? I think that's important thing. Lane: Well, the 401k is kind of a newer thing. I mean, in a way, it's kind of the government getting in cahoots with all these financial companies so that you're kind of guided like cattle, to the slaughtering house to invest in that stuff. Like you're stuck, you can only invest in Vanguard 500, or whatever mutual funds that are out there. Right. Now it's crazy that real estate is called alternative investing. I mean, really, what what's alternative about this, I think, I mean, what's more wholesome, more natural than investing in a life hard asset, right, that produce income every month. But anyway, that's what they call it alternative investing, because somewhere back in the 80s, all this stuff, the 401k wasn't around back before then. But now it created that conduit that now the average guy can go in there and invest in this stuff, which isn't always the good thing. And it made Wall Street very rich. I mean, Hollis, do they have all these big buildings. I'm more of a proponent for, you know, getting off Wall Street, investing in Main Street things that you have control over. Michael: And so what are some steps that somebody can take if they've never invested in real estate before? The thought of investing in their own backyard is scary, let alone outside of their market? How can somebody go best equip themselves and get over that mental hurdle? Lane: Yeah. So that mental hurdle is a thing, I get it. And I kind of very forceful when people because I know it's just them being scared. And until they realize that they can't move forward, they're just going to hem and haw and try and force some rental property in Oakland to happen, which isn't going to happen, because it's in the hood, it's just not going to work, right? Rent to value ratios aren't going to be higher than 1%, probably where you live. So I think what kind of pushes people over the edge, it's like seeing other people do this. And you don't need to be that smart to do this. And but it requires you to network a little bit and build relationships with the right property managers, and the right brokers and right inspectors. But that's daunting, right? Because you can't really go off Yelp, right? or work with just some random brokerage firm. Because if you work at somebody at a brokerage firm, luckily, you're getting the dude who can't sell houses. And yeah, you don't want them managing your your property. But the key is just going off referrals of other investors. I know you guys have your lists, right of people you guys have used in the past or other clients have used in the past. So do I. It's not rocket science, but it's hard to navigate from your board shorts, or what are your sweatpants, sorry. It's not cold out here. But you're required to pick up the phone and talk to somebody and interact a little bit. I know, that's super hard for people these days. Yeah, you have to get some help from people. And the cool thing is in this business, you know, I mean, today, I'm kind of financially free. And it's cool to help out people, right. And I think a lot of people, they were helped at some point, so they like to pay it forward. There's a lot of cool people in this business that are pure, passive investors that are willing to help out a new person, if they ask the right questions. Now, they don't want to give their time that teach it to you. That's another thing. But I think if you approach the right person in the right way, with the right tact, you can get the right connections, and then it's up to you to kind of follow through and connect those people. Michael: Yeah, that makes sense. Emil: I think it's partly like, there's gonna be some trial and error, right. Like when you're first getting started out, you're gonna make mistakes to think you're gonna choose the perfect property and find that perfect property manager, the right partners, you're talking about like, there's gonna be some trial and error. Obviously, you want to do your homework upfront. But I think sometimes people are just afraid of like, going into it saying, I know I'm going to make some mistakes. But I'm going to get better as I as I go along here. Lane: Yeah. But to me, I'd rather do that make some mistakes, maybe I don't make 30%. Maybe I make 20 or 15%. And then just get absolutely robbed by wall street. People can make up their own decisions. But that's the way I look at it. But it is getting off the beaten path, right? It's very uncomfortable. And most people are, they don't get out of their comfort zone. But then this is where it comes down to financial freedom is not for everybody, if everybody did what we were talking about here and bought a rental property this year, and then save up their money and buy another one a few years later. And then now they have more cash flow, they can buy one maybe every other year, every year, there'll be done in five to 10 years. And then who would get us our coffee, who would go and like sit in traffic all day for us. Right? You have to get out of your comfort zone. If not, you can just sit in your car and continue to listen to podcasts all day long, and keep going to work and keep trading your time for money. It's not for everybody. But it's not that hard. That's why you have to talk to people and you start to talk to people and you're like, you see who the person is on the other end. And like, you know, I have people call me all the time and they start to realize that yeah, this is a real dude. He's not super smart. Yeah, he's organized. But I mean, I can do this. Emil: It sounds like we're kind of oversimplifying it, but it's true. It's like just determination a little bit, you know, organization discipline, and just doing it. Lane: Project management skills. Michael: Oh, yeah. Yeah. It's funny how many people I think I'm sure we all talk to that, like, became accidental landlords or fumbled their way into something. And then they're like, Oh, crap, this is awesome. Right? It wasn't this like, calm, cool, calculated approach. It was like, Oh, look at what happened. Okay, I guess I can do that again. Lane: Yeah. I can't say that. I kind of got out of my comfort zone because I was accidental landlord, but I'm the one just sitting at the plank pushing people off because they know that they'll swim. Michael: It's not that deep. It's not that bad. Lane: Yeah, yeah. Don't worry. I got the life rafts out here. I got these light savers or in this metaphor, I have the relationship they have the connections have helped out dozens and dozens of people do the same thing. Right. I mean, you guys gather Academy that does this, right. Like, it's the safety measures are out there, right? Yes, there are some sharks there. We haven't seen them in days. Right. Michael: Right. And we've all got spear guns. Lane: So it's Yeah, yeah. But if you want to just stand this boat, right? I think that's the big thing people need to realize, is, you see on this boat, if you keep doing what you're doing, we know what is going to happen. I'm an engineer, I can build a spreadsheet, I can tell you what's gonna happen, you're gonna be like my parents, they just kept working their job, they bought a house to live in, the money in their house just grew with the price of inflation. It's not a good investment. And they retired in the age of 67 years old, where the government thinks that you'll probably die anyway, which is why they structure Social Security, and pensions the way they are. Michael: Yeah, I think there's this kind of this middle ground that not a lot of people talk about, like the investment community, we talk about financial independence or doing nothing. But I mean, if somebody goes gets 2, 3, 4, or five rentals, I would say that their life is going to change pretty drastically. If nothing else, we're just some additional walking around money. Like, kids college tuition, like it doesn't have to be this extreme thing. Start with 1234. See how it feels. If it sucks, go sell them? If it's great. Well, then see how you know, keep going, or just hang tight and enjoy the cash flow. Lane: It's not binary, right? Michael: It's not binary. Lane: It’s not like financial freedom is 1000 units or nothing, death at office. Yeah, go buy a few. But you'll start to realize that once you buy a few your deal, flow gets better. You pick up better properties in your life, and it gets easier. Michael: Oh, I don't know anybody that just bought a few. It's like, Okay, I'm done. Emil: Yeah, go. I could do more. I could do better. Lane: Yeah. So it seems like there's this great divide. But when you buy your first one after six months, it's it's like nothing. It's like, it's like a new job that you got, like, maybe you went up to positions like one extra position rung higher than you're supposed to. And you're like in the senior like, Oh, no, I'm like, super overwhelmed by this. But in three months, you got it. It's like It's like anything else. It's not no big deal. Michael: Yeah. That's a great, good point. So I don't know if you knew this lane, or you knew this Emil, but we're in you know, California and Hawaii. So you're filthy, stinking rich. I don't know if you knew that. But that's what a lot of other people think. So how do you not get taken advantage of going working remote with folks? Lane: Oh, yeah. So they think we're just some rich person drinking Muay Thais or, Michael: That's right. On the beach. Hanging out. Lane: Drinking cold brew on a surfboard. Right? Emil: That sounds amazing, actually. Lane: Okay, so the remote investor like vendor inflation is real, right? You got to be a little more sophisticated than the average bear and you got to keep these guys accountable. Right? And this is ultimately your job, right? You have a property manager, and they're going to try and get the best pricing for you. But they got time, they don't have much time, then I can put too much effort into this. So your job as a remote investor is to kind of keep them accountable and help out too, right? If it's a large repair over $1,000 $2,000. Yeah, maybe run a couple other quotes out there. Just make sure you don't get gouged. Right. Like, I mean, there's, there's times where I've gotten like a $900 toilet repair bill. And I was like, Are you kidding me? Like, Michael: I’m gonna buy five new toilets. Lane: I mean, maybe I come from the construction industry. So this kind of second nature to me, but like, you know, you break it down per the hourly rate for that professional, the toilet, fixer upper guy, right? I don't know. I mean, I can just go on Google. And I can figure it out, like, what is their hourly rate? Or what I mean, I have somebody fix my toilet here. You know, what, just call up the next or plumbing repair guy and say, Hey, what's your guy's hourly rate to fix this thing? And there you go. Done. Yep. Right. Notice it? 100, 150 bucks an hour, right? go with that. And you just go with this logic. All right. Not an incredibly intelligent person. But I'm thinking to myself what the potential problem could be, how long it could be to fix it, and then multiply it by two, right? Like any good engineer does, right? Michael: Safety factor of two call it a day. Lane: Yeah, that bridge is good, right? So like, you know, like, this is what you do as a remote investor, you just kind of like guesstimate what it should be. And then if it comes up way higher than you like, well, now we kind of press is there some kind of issue going on there? Right? Are there kickbacks happening? You can kind of like train your property manager? You're not no sucker? Because most people are right. Most people are horrible. Investors, they don't even do any of this type of stuff. Right? And, and if he did show a little bit of due diligence on your side, they would they know, like, oh, Michael, Michael knows his stuff, right? And he's going to check us so we're better go get a good quote. But um, but yeah, I mean, it costs what it costs a 12 pair, throw in your box, that's cost what it costs. Right. But that's the beauty of investing in places where the cash flows, because now you can pay it you have the money to pay this stuff. You're not going to run this thing with bubblegum, and and, you know, whatever, duct tape or whatever that stuff is, Michael: You can’t MacGyver it? Lane: Yeah, you're an investor, your job is to go and figure out what your highest and best use which is likely at your day job to just kick butt there and buy more properties. Right? If you're freaking out about the little toilet repair, you don't have enough properties. Emil: That’s so true. I can't… Michael: That should be a bumper sticker. Emil: I can't tell you how many times I would freak out over $150 bill, because I had, you know, you're early in like, every single bill is just like, Oh, my God, but then, you know, once you have some more, it's just, it's just part of it. You mentioned in the beginning, right. Like, that's the good thing about having investors who have a couple rentals themselves, is they're used to that stuff. They know that, you know, they come regularly and it's all part of it. Lane: Yeah, it's like, it's like asset protection, like I work with a lot of credit investors. And for some guys, you know, we might use the bazooka of asset protection, irrevocable overseas trust, and that stuff is not cheap. It's like 30 G's. And like, you know, I see the, the reaction there, right, like, Yeah, man, if you have that reaction, this ain't for you. Like, Michael: Right, it's not the right vehicle. Lane: Yeah. Not the right vehicle for you, right? Yeah. Here's a Camry or Corolla, right? Take that vehicle. Right? Right. This bazooka is not for you. But it just takes a while, right? I mean, you're gonna see this, this frequency of repairs come up, and you're gonna start to learn the normal cadence of this this piece, and then go buy another and then buy another and buy another us to say, because you were talking about this a little earlier, Michael, like once you buy a few properties, I'll tell you, that was where I became a really horrible engineer. And for me, this was maybe five, six years into my career. And I was like, why would I want to work? 50% harder for the next promotion to make, what 8, 10 percent pay increases? You don't really what the rung up is, when I could just buy one property. And that's my eight to 10% in a way. Michael: Right. Lane: It made no sense to me. And after I had a few of these, I just walked around like, I don't care. I don't care. I made more want to have like five or six of these rentals. That was cash inflow, and maybe a grand or two a month, I'm making more than my boss. Right? You know, that's what frustrates me about corporate America. Most people in the office are there because they have to be there, especially in the non senior roles, right, your middle management, your manager, Director level, they're not there because they're shining personalities that they're because they have to be there for the money. And it's hard to work as a subordinate to somebody who's not there because they have shining leadership skills. They're there because they have to be Mm hmm. That's where I was like, this sucks. I got to get out of here. I eventually went to more public sector jobs because I was in private in the beginning. I think that's a good move for a lot of young professionals, you know, kind of Roast Yourself in there and learn learn things. But what because I had these rental properties, I was able to take a pay cut and go to more public sector jobs, or was a lot more chill and better quality of life. And that would probably have been a good lifestyle for me, to be honest. I mean, it just keep working my ad 100 grand your job 00 stress 35 hours a week, if that you know, and just pick up a rental property every year, that would have been pretty good gig, that's not your binary 1000 plus units or death, right? That's kind of in the middle. I think that's a great thing to shoot for. But I think this is a slippery slope. Once you buy one, once you buy five, once you buy 10. It's just your hook your hook. And it just gets easier and easier. It's like, it's like Tom Brady, just throwing the football right. It's so easy for him at this point. Why not? Emil: Yeah, it is nice that you have that flexibility to make that decision, right? Like, I'm tired of private, I'm gonna go work in public where you know, I have a better quality of life, you just you gave yourself that opportunity to have flexibility in your life, which is amazing, right? And that's what this stuff does, right gives you the flexibility to do what you want, where you want with whom you want. And on your own terms. money's not everything, but it helps sure makes life a lot easier. And it allows you to design your lifestyle the way you want. Michael: Yeah, gives you choices. Awesome. Emil, You got anything else? Emil: Yeah. Lane, you've been investing I think 15, 20 years total. Now. Lane: I bought that first round. 109. So it's been a little over a decade now. Emil: Okay. Yeah. So a little over a decade. I love asking people who are kind of on the other end, you know, fully financially free, like, what are the big lessons, you've learned that you would tell yourself, you know, when you were just starting out or in your career, either, before you bought that first property, or when you had a couple and you were going to scale. What were like those big lessons you would tell yourself, Lane: I mean, a lot, some mistakes, but they all could have been mitigated if I had the right network. I mean, that's why around 2015, when I had 11, I joined different masterminds I paid to get into so I could get around other accredited investors, pure passive investors to see what they were doing, you know, some of the mistakes I made, I pay down my mortgages. It's kind of silly. Don't do that. Don't do the whole 15 year thing. 15, 15 or 30 years, right. That's the great debate, dude. And that's the best thing about this stuff. Just get the 30. And if you want to pay it down quicker, I don't know why you would want to do that. It makes no sense to me. You can, right? Yeah. And these are like the financial mistakes or dogma we're taught to do right that if you got around accredited, more experienced investors, they would say, Yeah, man, don't do that. Right. Don't necessarily pay off your student loans. Right? Because I know a lot of people have those things these days, invests right maybe don't buy a house to live in invest. Right? Granted, if you're the 98% of the population who's horrible with their money. Buying a house is a great piggy bank to save money for saving to prevent you from keep your grubby hands off. Michael: That's a forced savings account. Lane: Right? But I think if you're smart guy, listen to podcasts. I think you're smarter than the average bear and you should invest it but run the numbers yourself. Right? Like I say numbers don't lie people do. Michael: That's great. Emil: True. Michael: That's great. Anything else Emil? I want to be respectful of Lane’s time. Emil: That was all I want to ask. Michael: Awesome. Lane thank you so much for hanging out with us today man. I really appreciate it. If somebody has questions for you wants to reach out to you get in touch with you where's the best place for them to do that? Lane: They can go to my website simplepassivecashflow.com and check out my blog there. A lot of turnkey information on there. Simplepassivecashflow.com/turnkey, is kind of the page and then then I have my podcast, simple passive cash flow, passive investing there too, which a lot of the first I think the first dozen podcasts are mostly about turnkey rentals, because that's what I was doing back then. So it was pretty tactical. Who do you go to where do you Who do you talk to? Where do you buy things like that? I would kind of refer people to that. And then yeah, join the simple passive cash flow Kool Aid drinking club of 1000 rentals or more. Just get that first one! Michael: Awesome. Well, thanks again. Lane. Sure. Appreciate it. And you have yourself a great holiday in New Year. Lane: Yeah. Thanks, guys. Emil: Thanks, man. Michael: Thanks. Take care. Alrighty, everybody, that was our show. Thank you so much for listening and a big big, big thank you to Lane for coming on, we appreciate you taking the time out of your busy schedule to join us. If you'd like this episode, feel free to give us a rating and review wherever it is you listen to your podcast. Don't forget to subscribe. And as always, we love comments, feedback and episode suggestions. We look forward to seeing you on the next one. Emil: Happy investing.