Tim Lyons 0:00
Oh yeah. Well, I’m still getting the hang of this podcast and Greg, it’s only been about two years. So
Greg Lyons 0:04
this is podcast number 92. But keep going.
Tim Lyons 0:07
Plus I was blinded by the light hitting your forehead, so I couldn’t see the top right of my screen. Anyway, I love you, buddy. Here we go. You ready?
Greg Lyons 0:27
Welcome to the passive income brothers podcast.
Tim Lyons 0:30
Here we take the fear out of real estate investing using real life stories of everyday successful investors.
Greg Lyons 0:35
Tim Lyons 0:38
Welcome to another episode of the passive income brothers podcast. My name is Tim whines. And today I’m joined by two absolute rockstars, one of which being my brother Greg, how you doing today, buddy?
Greg Lyons 0:47
Tim, I wish the listener can really get the friendly banter that we have before these things. I wouldn’t call it G rated, but it really gets us hyped up for the podcast. But we I am excited today because we have an absolute Rockstar with us that is for sure. Can’t wait to introduce everyone to Matt.
Tim Lyons 1:06
So at least when we started the podcast, if you’re watching on YouTube, Matt had a big smile on his face. And that’s always a win when we’re starting a podcast. So without further ado, I want to introduce you guys to somebody that I was actually able to meet by the by being a part of the podcast world, right. And I had an opportunity to be on Matt’s podcast which is called ice cream with investors. And we had a great time. So Matt for for a right is a metaphor for like in golf for Yep. Matt for Welcome to the best of naked brothers podcast. How you doing today?
Matt Fore 1:39
I am fantastic. I love the brotherly banter. I was telling Greg, before you join my twin brother was in town this weekend. And we kind of give each other a little bit run for our money as well. So I love to see the banter.
Tim Lyons 1:52
I love it. So Matt, can you I mean, listen, everybody we bring on to this podcast, everybody has a story. Everybody has a journey about you know, when they you know heard the proverbial pop that Greg and I talk about, which is our heads coming out of our rear ends. And when we stopped when we realized that we have to stop trading time for money that we want something more out of life, we want to be doing have more we want to provide for our families, we want to do all the things right. And sometimes it takes us a long time to hear the proverbial pop. But it sounds like you heard it quite early in your career. Can you kind of take us back to the beginning of your journey and just let the listeners know what you were up to? And maybe, you know, when you heard the pop?
Matt Fore 2:30
Yeah, sure. So I, by way of introduction, spent 15 years in sales and sales leadership roles at some of the largest technology companies in the world. And the way I got involved in real estate is I in 2016 was part of a large acquisition pursuit at a net new customer. And for me, as a salesperson, my eyes were wide open on the commission check that I was going to receive. And I knew Gronk growing up in East Tennessee, small, small little town that I’m never big into cars, watches, boats, big houses, shoes, all those sorts of things. So I was trying to figure a way to not squander all this money. So I looked at crypto stocks, bonds, annuities, but then I had a friend and a mentor at the time who said, Hey, you should look at this real estate thing. I own three real estate properties here in Nashville, they’re owned free and clear. They spit off cash flow, they’ve appreciated tremendously. And I get tremendous tax benefits. So I did what everybody does, I read Rich Dad, Poor Dad got on bigger pockets, I was sold on going all in on real estate. Well, then I got the call the week of Christmas from my former VP who said I was not going to get the commission check that I earned. And I’ve never said the number publicly. But ultimately, I was only going to get two cents on the dollar that I earned. And I asked him like, hey, wait a minute, how did we come up with this number? Where did you get this? And he said, Matt, how much money have you made this year? And when I told him, he said Well, isn’t that enough? And so it was at that point that I realized that if I was going to achieve the goals I had in my life, give back to the causes that I truly cared about pursue my passions and all those sorts of things that I was going to have, I have to find a different way for my financial independence. Fortunately, for me, I was already down the rabbit hole of real estate. So I quickly bought my first property three or four months after that. And the rest is history. So I will stop there. But that’s a little bit about my background. You
Greg Lyons 4:19
know, it’s interesting, sometimes we run into these roadblocks in life where it’s just like, you know, what happened? You know, I felt I was on the right track. And, you know, it sounds like you were on the right track. You build a skill, you build a sales skill, and it’s so important to have that no matter what you’re doing. So sales are so important. But then it’s it’s that it’s that roadblock sometimes where someone tells you something that I don’t even know if they’re qualified to tell us that right. But do you have enough? It’s, that’s not up to them. And that’s up to us, especially in the sales world. You should be able to make as much as humanly possible because you’re putting in the time you’re putting in the effort Like, you know, the thing that instead of taking your ball and run it away or just kind of shrinking, it sounds like you went headfirst right into real estate. And I think you kind of reach your financial independence number at some point. And you were able to really live life on your own terms. Can you tell us about going from not getting that? commission check that you thought you deserved that you did deserve to saying, I’m gonna go full speed into becoming financially independent?
Matt Fore 5:31
Yeah, sure. So there’s a couple things. One, I was mad, I was frustrated, I’m not gonna lie and say that I wasn’t. But ultimately, you know, I was happy. The fact that I built this career, gotten these skill sets met a bunch of interesting people learn some cool technology, things and all that sort of stuff. But I knew that I wanted something bigger. So I was already down this path, I bought my first property. And I remember Greg, at the time, I had a lot of people in my network that were like, hey, that’s risky, don’t you remember? 2008? Why are you going to spend all that money on this property? And the first property I bought was a $42,000, downpayment. And in my mind, I had thought, well, that is the cost of an MBA. And except for in instead of a degree and a piece of paper, I’m going to get real life skills on how do I underwrite? How do I finance? How do I find a team that can do construction work, property management, leasing out this, all those sorts of things. So I think anytime something to your point around like obstacles happening to you, anytime something bad happens to you in life, you get a chance to determine what those glasses are that you view that problem? Do you view it as an opportunity to go learn and try something different? Or do you view it as a victim mentality, I heard this statement the other day, and I’ll leave you with this is victory is a choice. And so as being a victim, so which one are you going to choose?
Tim Lyons 6:50
Dude, I love that, you know, it’s this, this is why I love having a podcast, Greg and Matt and talking to folks like you because, you know, everybody has a story to tell. And when we talk about passive income, when we talk about real estate, it, you know, to a lot of people out there, it seems insurmountable, I don’t have the capital, I don’t have the money, I don’t have the know how it’s risky, 2000, AIG, great financial crisis, you know, debt free, you know, is the way to go Dave Ramsey, you know, and, you know, nobody I know, in my circle is doing the things so why should I be the you know, who am I to start going, you know, swimming outside the lane, and maybe I should just, you know, curl back into my lane and do everything that everybody else is doing, right. And then like, the, the opportunity gets shut down. And what I love about this podcast and other podcasts that we listened to, was that we talked to folks that are high performers that are doing the thing that Greg and I want to be doing, and they’re making that change, they’re committing to the process. And, you know, we all have to start somewhere. And as much as I would love to extricate myself from my w two job, and just do this full time, you know, I’m almost there, but we’re not quite there. You know, in reality, we have to, unless we’re born with a silver spoon in our mouth. And I wouldn’t know what that’s like. But, you know, you have to have a WC job or attending denied or be an entrepreneur, you got to stack some capital together, and you got to get financially educated, and then you have to, you know, be determined to, you know, have that burning desire to be do and have more in your life. And I really want to choke your old boss for telling you that you kind of made too much money that one year, and that you were undeserving of the of the commission check. Because, you know, at the end of the day, Matt, you know, you have children, right, if you want to work really hard and stack capital together and create passive income and drive your kids to school, or pick them up, or homeschool them or go on vacation, or whatever you want to do. That should be your destiny and determination. And that’s really, you know, a lot of times and I’d like to talk about mindset real quick, because that’s what you ended on. But people like Greg and I, and yourself seem to really embrace the abundance mindset versus the scarcity mindset. And believe me, when I tell you that Greg and I were firmly brought up in the scarcity mindset, complex of of growth, okay? It’s not only it’s only recently that we’ve been able to embrace the abundance mindset. So with that being said, how do you, you know, what was your mindset like, you know, in the beginning of this journey, where you started to take action, and then you know, bring us in, you know, to till today.
Matt Fore 9:30
Short answer scared. Long answer is I grew up in a coal mining town, like so to your point around silver spoons, and no one people and no one around me is doing this. I didn’t either, right. So I remember that when that incident happened. I called the first person I called was my mentor because he had done real estate. The second person I called was the only realtor I knew who was a friend of mine, and I just started building from there. So that first deal I did was $42,000 my own money. The second deal I did was with private capital and trying to learn how to navigate through all of that. But in terms of mindset, I mean, I don’t know, I was always born. So first of all, I’m dyslexic. I didn’t grow up like, loving to read, that’s an acquired habit, I did it through just five minutes a day, and things like that. And it’s fun to have kids and like teach them, you don’t have to be at 100%. Today, you just have to be going the right direction. And these little actions will ultimately get you there. But I think I’ve just always been that person, one of my desires in life is to reach my physical, emotional and spiritual boundaries, like that is my goal. And so I’ve done things from Iron Man, I’ve done things like getting my master’s degree with dyslexia. And I tried to do some spiritual work every day to help me ground myself and to push myself further. So the mindset thing, man, it’s one of those things that it will drag you down and be cancer if you don’t change it. And I think the easiest way to change it is by spending five minutes a day around a group of people that are motivating you to do something better, whether that’s physically in person, whether that’s virtually on a mastermind group or something like that. Or it could be doing something exactly like this, just putting people in your ear that are doing something different than you are to inspire you to do something better. So I don’t know if that directly answers your questions. But that’s just kind of how I view it and a little bit about my backstory for that.
Greg Lyons 11:30
No, that’s fantastic. And, you know, I think I relay the same thing to my kids. It’s about compounding actions, no matter what it is, whether it’s an athletics, it’s, is it with your schoolwork, you have to do the little actions, reading whatever it is, we’re not asking you to read a novel tomorrow, but read five pages, read 10 pages a day. Now that may be falling on deaf ears right now with a 16 and 13 year old, however, it’s it’s it’s the it’s the thought process of how do I get better? And I think that you are a great kind of a mentor to a lot of people of how do you get better? How do you overcome dyslexia? How do you overcome the discomfort of being an endurance athlete? You know, it’s always pushing me when I hear triathlons and Iron Man’s to me and Elijah shut down right away. I mean, I can’t swim to the other end of the pool. And I’m not talking about a 50 metre pool, I’m talking about the kiddie pool. So just get a little bit winded on stuff like that. But, but you know, you also mentioned getting around people that motivate you, it’s, I am really lucky to have a partner like Tim, because Tim motivates me nearly every day. And in turn, that allows me to vote of eight, my kids, my family, and it’s so important to have that positive influence in your life. doing podcasts like this are really really, you know, instrumental and timid eyes, you know, every day because we meet great people, we meet inspiring people, and is so very important. And you know, as you’ve moved on in your career, you have investors yourself. You look at multifamily carwashes, and a variety of self storage, a variety of different avenues to, to invest. How do you think about the current economic environment that we find ourselves in? It’s a little topsy turvy these days. But how do you talk to your investors about what’s going on in the economic world and climate right now?
Matt Fore 13:31
I’m gonna give you a terrible answer and say, it depends on what you’re talking about. Right? So real estate is not a market. It’s a bunch of small sub niche markets that roll up into a bigger industry. So if you’re talking about downtown office space in San Francisco, it’s certainly a different market than if you’re talking about multifamily and Nashville, which is a town that’s booming, or mobile home parks right outside of Austin, where it’s like booming town, but there’s no affordable housing. So I’m happy to take that question kind of anywhere you want to go, but are you do you want to talk more on like, real estate specific niches in real estate interest rates? economy as a whole? Just don’t tell me where you’re gonna go?
Greg Lyons 14:13
Yeah, you know, we have a lot of multifamily investors, self storage investors here. So if you could kind of comment on the multifamily world as you see it, that would be fantastic.
Matt Fore 14:24
Yeah, so I think multifamily is driven by supply and demand. It’s nothing different than any other market out there. There is supply that we have. And we’re under supplied historically across this country by about 4 million rental units. And there’s demand for affordable housing. So I think first when you’re looking at apartments and multifamily, you have to pick your market before you start looking at supply and demand. It’s easy for me to say there’s a supply shortage, but in places like Boise, Ohio, Ohio, Idaho, there’s a supply glut. So You really have to understand like, what’s the market you’re looking at? I’m under the firm assumption right now, as we look into 2024 and 2025, that there is a mounting debt problem in the real estate space, specifically the commercial space. There was a Marcus and Millichap presentation the other day that says there’s $7 trillion of multifamily of commercial real estate that will expire in 2024, and 2025. So their thesis is like you got to survive to 2025 and survive through it. I believe that going into an election year with the economy homerun on all cylinders, and the 2008 debacle in everybody’s mind that we will not let that just fall through. Now, there are certainly risk factors from that true, yes, but I think something will happen that will allow us to extend at a low cost, push or push interest rates down. So those are kind of the things that I’m looking at right now in our projects is one we are refinancing our debt, getting longer terms, doing bridge to bridge figuring out that problem in our portfolio, as well as I know, other operators are as well. But ultimately, I believe we have one more rate hike at the end of the year, just to say that we did it, we stripped out inflation, yada yada, yada. And then you will see some sort of rate lowering or extension on 30 year mortgages or now 40 year mortgages, seven year terms, or 20 year AMS are now 25 year AMS and pushing those out to lower the payments to make it more absorbent in our economy. So that’s just how I think about it. I’m happy to go anywhere from there. But that’s that’s what I’m thinking about right now.
Tim Lyons 16:42
Yeah, I’d love to stack on top and pontificate for a moment if Greg would allow me. So, you know, I spend an incredible amount of time, you know, listening to podcasts and watching YouTube channels, specifically on macroeconomics. You know, current markets, you know, what’s the stock market doing, you know, government debt, you know, bond, the bond market, you know, trying to figure this all out? Because there’s a lot of I think, Greg called the topsy turvy, it just doesn’t make sense right now, right? There’s a lot of, you know, data out there, forward looking indicators that are telling a very different story than the lagging indicators. And it seems like the Fed is looking at lagging indicators more than the forward looking, but we’re not seeing it reflected in the markets and the stock market keeps on going up and unemployment seems to be, you know, ridiculously, you know, steady, when we should be maybe expecting it to be ticking up every month. And so it doesn’t make a whole lot of sense. And I think what the frustration on my part is for sure, right now is that, you know, how come like in today’s day and age are all our technology and or, you know, you know, software, like we can’t figure this out, right? Why is Why is why do I listen to one channel, and I get a completely different story from what sounds like a really smart, you know, group or guy or a girl, whatever. And then I listened to a different channel. And it’s like the complete opposite, right? I’m like, What is going on right now? And I think that’s why, you know, podcasts are so instrumental in my life right now. Because I don’t want to get that confirmation bias. I don’t want to just because I’m in real estate be like, Oh, this is great. It’s the best thing since sliced bread. Right? I want to know what the good, the bad, the ugly, what’s everybody’s saying? You know, and this is, you know, getting around folks that are doing the same thing, right, being a part of masterminds, being a part of groups being a part of podcast, you know, hearing what other people are going through different parts of the country in the markets. I mean, that all comes into experience, right? And these days, Greg, and I like to, you know, work with people that have a lot of experience, because, you know, because of this exact problem. The second thing I wanted to talk about, in case the listeners are unfamiliar with commercial real estate, is the the debt problem that Matt is talking about, right? Traditionally, in residential real estate, you get a 30 year fixed mortgage, which I think about I think that the last stat was like over 60% of people who have mortgages have a mortgage under 4%. And something like 80, something have a mortgage on their 5%, right. That’s long term fixed rate debt. That’s why people like the consumer is still spending money, it seems because they have these long term fixed rate debts that are just an asset to them. On the commercial side, a lot of deals office hotels, medical office, multifamily self storage, industrial, you know, you name it on the commercial side, there’s a lot of times Matt, right, those three year five year seven year 10 year, those are the most, you know, frequent type of loan deals. And a lot of them are not fixed rate, right? They’re, they’re variable rate debt, bridge debt terms, there’s, you know, shorter amortizations than 30 years a lot of times and what people have traditionally done is roll over that debt once they increase noi or net operating income. And right now what we’re up against is a wave of cash. capital out there debt that needs to be rolled over. However, when they brought it out, you know, they maybe they had a three handle on the interest rate, and now it’s a six or a seven handle. And that is unsustainable. So what Matt’s talking about is, instead of banks and debt funds and the bond market crashing, because, you know, we can’t roll this debt over, we’re going to maybe find a way hopefully, to extend and pretend, right, add a little bit of, you know, pay, pay the current price, but we’re going to add, you know, debt onto the back end of your note, we’re going to, you know, read through the terms, we’re going to, you know, do something so that people can rollover some debt. Now, if you haven’t been, you know, executing your business plan, and you, you know, are increasing noi, and you go to refinance, well, those people are gonna get hurt. There’s just no two ways about it. So, Matt, how did I do kind of summarizing the commercial problem right now. And then I’d love to talk about some of the other asset classes that you work with.
Matt Fore 21:01
Yeah, much better than I did. So good job on that. I want to sprinkle a little bit of optimism in here. Because first and foremost, whenever I hear somebody talking negative about the economy, I first look at their incentive, their incentive to talk negative usually is driving, why they’re talking negative and going on the street and doing all this sorts of stuff. I want to make sure everybody understands if you are in a country outside of the United States, and you have hundreds of millions of dollars at your disposal to go invest and you manage for a global global conglomerate. There are three really safe places to put it one US Treasuries to us real estate, three, the US stock market, this whole idea of like D dollarization. And China’s taken over in yen, yada, yada, yada, like maybe, maybe I’m not saying no, it sure as heck ain’t happening in the next 25 years. 50 years, I can tell you that. So I want to sprinkle some optimism in here because I think so many times when we look at like this debt bubble when real estate and things like that they’re like, Oh, the American consumers tap private banks in America, their balance sheets are spread thin, all those sorts of things. And we just wipe off the fact that, you know, 60% of the money out there is not in the United States and is still looking for a safe place that they can store capital and grow. So I hope that gives everybody a little bit of optimism. other asset classes were in so you talked about it. We’re really bullish on car washes right now. Those things do really, really well for our portfolio. And I’m happy to talk through kind of our strategy there. We are also looking at mobile home parks as well. I tell all our investors, we have captured the higher end of the market with apartment complexes and multifamily. We are capturing the lower affordable end of the market with mobile home parks, and I don’t know a single US state council person today Metro council person, city, Alderman etc. That is saying, Hey, I’ve got some very valuable land over here. Can you guys just throw up a mobile home park on it? No. They’re saying throw that class A amenity on their multi use. I want tax dollars on what jobs they’re not building any more mobile home parks and call it what it is. It is a an affordable, safe alternative for a lot of folks out there. So we’re also very bullish on that space. So long winded way of saying we’ve got a number of different assets in our portfolio. We’re really bullish right now and kind of mobile home parks and car washes going into the end of this year next year.
Greg Lyons 23:27
You know, Matt, you read a lot in Wall Street Journal financial journals about car washes. And I think private equity likes them because they don’t have staffing issues. You know, the labor markets a little bit crazy. You got to pay so much more. Can you kind of highlight the the top reasons that you got involved in carwashes? And kind of like what do you see the carwash industry in the next five years? Sure.
Matt Fore 23:59
So let me start off with the a little bit of background on the industry. So today in America, car ownership is at its highest that it’s ever been, I think quoting off the top of my head, it’s like 94.5, it might be 95.6. It’s like what it’s right there at that height mid 90s. A lot of those cars were purchased in the past two to three years, people getting stimulus checks, people staying at home not spending their money on different assets and going on vacation and going out and things like that. So they had extra money in their pockets. They went out and bought cars. They that for most Americans is one of the if not the most expensive thing that they own. So naturally, if you just bought the most expensive thing you own for the first couple of years, you want to take care of it more. The second thing we notice in the car wash industry is it is extremely fragmented. So when I say toothpaste you think Colgate crest when I say soda you think coke Pepsi. When I say carwash you’re thinking mama up around the corner. When we looked at it, there is one publicly traded car, carwash organization out there, and they own 4% of the market share. Everybody else is like that 1% sub 1% market share. So our initial thesis two years ago, was by the end of 2025, we wanted to acquire 100 locations. By the time we had 100 locations in the southeast, we would be essentially a top 12 carwash provider in the country. Now, when we look at the industry as a whole, any fragmented industry consolidates, at some point, there’s some private equity money, there’s some Wall Street money, there’s some sovereign wealth fund that says, hey, let’s consolidate this industry and use our buying power to increase prices, lower expenses, etc. Well, when a private equity firm does that, they don’t say, alright, let me go buy one mom and pop in Alabama, one mom and pop in Illinois, one mom and pop in Mississippi, no, they start at the top and say, Can we acquire this company and roll it into our portfolio and then start going down the list. So now taking you back to kind of our thesis is by the end of 2025. If we have these 100 locations, and I think we’ll get there before then personally, then we will be on that range where they come in and say, Hey, we want 100 locations in the southeast, we in we will be in the position to demand a higher multiple, because we have the portfolio, just like Procter and Gamble is priced at a higher multiple because they are conglomerate, j&j etc, we believe the same thing. So in terms of our strategy, we’re looking for car washes in the southeast, that were built, essentially, in the last 10 years, preferably with lower maintenance and lower deferred capital expenditure expenses needed, we go in, we buy it, we rebrand it, we put in our management procedures and operating procedures around how we treat clients, how we treat customers, things like that. We lower expenses by using our balance sheet in our locations to go lower chemical costs and things like that. And then last, and probably the coolest thing that probably a lot of listeners don’t know about is we throw a subscription model on it. Everyone from Microsoft to Netflix can now get a higher multiple on their earnings because they have reoccurring revenue. So when we add reoccurring revenue into our income statement, we’ve lowered expenses by using our chemical contracts to negotiate better contracts with our chemical locations. And we have a portfolio, we believe that we’re in a good position to go exit this at a higher multiple. So that’s kind of our thesis and what we’re thinking about it and happy to answer any questions from there, though. So
Tim Lyons 27:51
I want everybody to really pull the car over, get the notebook out, sharpen that pencil and rewind the last five minutes and listen to that, because you know, Greg, last week we had a guy from wealth without Wall Street. I’m forgetting his last name, his first name is Joe Moorea. I think it is Joe Moorea from wealth that Wall Street. And you know, when you grow up in a certain way, that is, you know, focused on going to school, getting good grades, getting a good job, getting a master’s degree, maxing out your 401 K, buying a house, paying it off as soon as possible. Don’t take credit card debt, and then you know, hopefully, you know, smoke some hopium. Right, and hope that you have enough money by the time you’re 65, and you want to retire, right? What Matt just talked about was wealth without Wall Street was private equity was investing on Main Street was putting your dollars to work for a cash flowing asset and what I love and what you what you can learn about when subscription models, like car washes, and Netflix, they end to self storage, even Greg, right. Because wouldn’t carwash, I’m gonna go out on a limb and say it’s $29 a month, they might be higher might be lower. But people will say, you know, what, $29 a month that’s like one or two car washes. If I do a third or fourth, they’re gonna be free, right? So like, yes, sign me up for that subscription model. It gets dinged out of my debit card, my debit card account every single month, they end up forgetting about it, or they start using it or whatever. But at least the free cash flow model on the balance sheet shows that this is actually recurring revenue. We’re getting it every, every month, right? We’re not chasing people down for cash. We’re not chasing people down with checks. It is just instant on the first of every month, and I’ve looked at car washes a lot for my own portfolio. I just haven’t pulled the trigger just yet. But Matt, we’ll have to talk offline about your next. I know I’m sure you do. I can’t wait to see it. So, you know, because this is what we’re talking about right? cash flowing assets. There’s tax benefits, I’m sure I’m not sure but I’m assuming. And you know, it’s just another way that you can put your money to work without having to hope and pray that the employment rate stays where it is the Fed stops hiking, there’s a pivot and all of a sudden, you know, because if it goes the other way, or if there’s a war or whatever else might might come up by COVID, to, you know, 2.0, whatever, and we get locked down again, like, there’s a lot of things that you have to take into consideration. So I absolutely love that. And I just want to stack on top of the mobile home park industry. When we hear about supply and demand right now, if you Google, you know, apartment, investing in apartments to top one of the top stories might be that we’re over supplied this year, tons of new supply coming online, right. And people, you know, have had conversations with Greg and I, in the last couple of weeks when we’ve been doing deals, you know, hey, we’re hearing that there were over supplied in multifamily. You know, what’s going on? Especially some of the sexier markets DFW, you know, Phoenix or Florida or whatever, you know. And the truth of the matter is, this is where education comes down to understanding your market understanding the asset class, and who are you serving? Right? We, Greg and I tend to not serve the sexiest 2023 built palm trees, beautiful pools, doorman, Amazon, you know, distribution centers in the in the in the lobbies, right? Because right now, those are the new supply that’s coming on, right. And not a lot of people are taking that risks to go live in those types of apartments, right? We’re talking about people who need to put food on the table, go to work every day, and they need a clean, safe, affordable place to live. And they’re going to do that because it turns out, people like to have a roof over their heads when they go to bed at night. Anyway, we’re coming up on time. So Matt, I want to I want to just transfer into the last three questions that we ask all of our guests. And just whatever comes to the top of your mind, I’d love to hear it. You know, we’ve had and we’ve gotten some great answers. And this is one of my favorite parts of the show. So the first one is from Robert Kiyosaki. He is the author of Rich Dad, Poor Dad, for anybody who’s been living under a rock and hasn’t heard of Kiyosaki. He’s one of my de facto mentors. And he says something that can turn people off if they don’t know what he’s talking about. And what he says is, savers are losers. And debtors are winners. Matt, take it away. Yeah, I,
Matt Fore 32:21
it took me a very, very, very, very long time to realize that he’s correct. If you look at it, like debt is tax free income into your balance sheet that you do have to pay back into your personal economy that you do have to pay back. And once I learned this idea of arbitraging debt, it changed my life. So arbitraging debt for listeners just simply as if I borrow money at 5%. And I can make 10% on it. Most people think that’s a 5% return. No, that is 100% return $100,000 paying $5,000 a month or a year in debt. And earning $10,000.10 minus five is five, five on five is 100% return. So I tend to agree he’s right. I wouldn’t say savers or losers, though, depending on where you are in your financial journey, you do need to have an emergency savings fund, I would encourage everybody to have it. But ultimately, there becomes a cash drag if you have too much of it. So I don’t know if that directly answers your question, but I think he’s right.
Greg Lyons 33:24
No, it totally does. And, you know, there’s different there’s different answers for everyone on that question. And, you know, I don’t think it’s so much that savers are losers. It’s, we totally believe in having that cushion. 369 a year cushion, you know, whatever it is. But um, but you know, it can be a little bit controversial sometimes. And that’s why it’s Mo is leaves him with that one. Our second thought is from another mentor of ours, Jim Rohn. And he said, formal education will make you a living self education will make you a fortune. I think that we teed this one up beautifully for you. What does that mean to you?
Matt Fore 34:00
So I love Jim Rohn. By the way, that’s how I start my Monday morning is by stretching, listening to his old clips. It’s phenomenal. I love his voice even more. I tend to agree for formal education. My mom has her PhD, she taught for many years, she was an assistant superintendent, it was very good to have a fundamental knowledge of how the world works, how math works, how science works, all that sort of stuff. But you have to go find the things that you’re interested in to get beyond surface level. And then I think once you get beyond surface level, you then go back to your formal education say, Wait, this math problem actually ties into this geography problem. And there’s a business opportunity here. So let me tie those together and I’ll make a fortune. So I do believe you need both of those education’s. We’re working right now with our five and seven year old about how do they be curious and teach them about the things that they’re curious about outside of the school system, and I know there’s a whole train of thought on that. We’re not that deep into it yet. But ultimately, we’re trying to help them be curious about the world. And let’s enable you to go learn the things you’re curious about. Because if you’re curious, you’re more likely to learn on that topic and learn faster. Woof,
Tim Lyons 35:13
love that answer, Matt. The third and final question is, you know, if you’re at a party cocktail party, I don’t know kids soccer game, you’re talking to people about investing on the on the chance you’re doing that. And people say, Matt, you know, what do you invest in? And you’re telling them all the things in the real estate world that you do? And they turn around and say, Matt, isn’t investing in real estate too risky? How would you respond to them? Compared to what?
Matt Fore 35:45
Oh, at and so I take it away? Yeah, I mean, I’ve done I was actually going to add this into some of the commentary we’ve had, what I look for more than anything is where can I invest to add value that already has cash flow. And it comes down to this idea that you were talking about with Joey and wealth without Wall Street of there’s two ways you can live, you can live your investing life, you can bet on appreciation, which means shovel your money into 401 K’s shovel it into the equity markets buried in the ground and hope that when you need it, it is it is worth more than when you put it in there. Or you can invest in something that hopefully will appreciate over time, but provides you cash flow today. I love real estate because it’s a fixed debt. So my payment my expenses remain the same just about from now until perpetuity. But my income allows me to write as my income will rise over time due to inflation and things like that. I have a fundamental belief that the point of retirement, quote unquote, is to get to a point where you no longer have to work because you are living off of your assets. Well, if we bury money into the ground and bet off appreciation, we’re just siphoning off that. So why not start today, building those cash flow streams coming into your personal economy and help you get there faster? Now, I’m not saying real estate is the only answer for that it is certainly a answer. And it has been my answer. And historically, it has been the best answer over centuries and millennials millenniums. But as long as you find assets, where you can get cash flow today that will ultimately appreciate over time and provide you some sort of tax benefit along the way, then that’s usually going to check a box for me that I would be interested in that assets asset class. Oh, I
Tim Lyons 37:33
love it. I absolutely love it. I just want to pull up that string for one second. You know, the SEC is the old accumulation model right versus the cash flow model and you don’t want to kill the golden goose you want to stack up a lot of golden geese and live off that cash flow. So I love that. And I love the way you are the opened up that question with compared to what because there’s a podcast I listened to pretty religiously from Jason Hartman. It’s called Creating wealth through real estate investing. And that’s the the golden question that he always asked is compared to what right it’s a life’s greatest question is what he always talks about. So love it. Well, Matt, listen, how can people they want to find out more about multifamily opportunities, self storage, mobile home parks, car washes, where they just, you know got some value out of your story. They want to connect with you what’s the best way for them to connect? Sure,
Matt Fore 38:24
two places one, I host a podcast as well called ice cream with investors. Your lovely co host Tim is going to launch I think next week, Tim on the show. So go check us out there on any of your podcast apps. And then the second place if you want to just chat, go to next level income.com. And in the top right button, there’s a button to invest that’ll link to my calendar and happy to talk to anybody no matter where you are in the journey. I’m just I love this space. I love teaching people I love enabling people and ultimately, I want to help you remove your roadblocks. So if I can do that to you, please go to next level income.com And click invest. That I
Tim Lyons 39:05
love it and just so before we head out, I wanted to invite everybody to come on down to Jake and Geno’s multifamily conference called multifamily mastery six where mm six is going to be held in Orlando in October. Greg and I have gone out over the last three or four years and Jake and Gino have been our mentors, our early on in our journey. It’s a great way to get around like minded folks who are rowing in the same direction. There’s a lot of great opportunities to network to talk to folks about real estate investing, you know, current market dynamics, mindset, motivation. It’s a great, great atmosphere. Last year, Greg and I actually had the opportunity to dance on stage with vanilla ice. I mean it was incredible. If anybody wants to see that just email me Tim at cityside cap.com. I’d be happy to forward the pictures from within the videos from that night. But there’s gonna be a link
Greg Lyons 40:02
that that is that is a horrible idea, but Oh, horrible.
Tim Lyons 40:06
Those are the 90s. Greg, those were the great time. That’s true. So that is show anybody wants to join us, Greg and I will be down there this year, usually held at the gaylord palms in Orlando. And it’s in mid October, but we’re gonna have a special link with a coupon code. If you want to join us, it’s going to be in the show notes. And, in addition, wasn’t we love doing this every single week. But we could use your support by leaving us a rating and review after you hear this show. Share an episode if you got some value out of today’s episode. But that’s gonna do it for this week’s edition of The passive income brothers podcast and we look forward to serving you again next week. Thank you for listening to another episode of the passive income brothers podcast. We would be grateful for your support of our podcast by giving our show a five star rating and review and subscribing to our show on your favorite podcast platform. Don’t forget to take inspired action after listening to this show so that you can start building out your passive income streams. Finally, head on over to cityside cap.com to connect with us and find out more information about how to get started passively investing in real estate