In it, Scott Trenchwalks through his "investment philosophy," a simple, customizable plan that has allowed him to build wealthat record speedall in less than ten years. If you message me there, I usually get back to everybody within a day or two. Scott Trench is married to his lovely unnamed wife. This doesnt work so well when I have a family. Currently, he is an active investor in the Denver market and manages a real estate portfolio of around $1.5 million. Throw all your additional cash into index funds, model it out using whatever percentage return youre comfortable with. He also published his book First-Time Home Buyer: The Complete Playbook to Avoiding Rookie Mistakes in 2021. Early life and C. Amanda Moye Brown: Do you want to know about Wes Browns Wife? You can click on the 'unsubscribe' link in the email at anytime. buying two houses per month using BRRRR. What Is A 529 Plan and Where to Open One in Your State, How Much Should You Have In A 529 Plan By Age, How To Use A 529 Plan For Private Elementary And High School. Scott Storch is a record producer, songwriter, and former musician who began his career in 1991. What Scott did was exactly what we did since 2010, except we did it differently (regular 2bd condos, not multi-dwelling places) and location (SF, bay area). Mad Fientist: Yeah, you mentioned in the book, youre like, Turn your biggest expense into an income-producing asset, and I think thats really powerful to think of it that way. Amara Trinity Lawrence: Know about Martin Lawrence Daughter? $2,650 at NET-A-PORTER. Mad Fientist: Yeah, thats absolutely crazy! I think that the best type of real estate investments to make in 2022 are the same as theyve always been: plain, vanilla, long-term rentals comprising single-family rentals and small multifamily rental properties like duplexes, triplexes and quadplexes. Body Measurements Another approach that I also use is real estate investing. And the mortgage is about $1700. Scott Trench: And particularly in terms of appreciation and real estate and stock markets. Mad Fientist: Excellent! Search by Name, Phone, Address, or Email So, once you have a hundred thousand dollars in investable liquidity, if youre spending less than $25,000 or $30,000 a year, by definition, that means you have years of financial runway, years of the ability to go and take advantage of opportunities, or just simply the cash to make a meaningful investment, at least relative to your spending. And theres nothing wrong with this plan of index fund investing. Thats awesome. So, the first time that I can figure out anybody actually using the term house hacking was by a guy that works here named Brandon Turner. Poker players, at least the ones that are really good, have this really good outlook on things where theyre like, Hey, heres the hand Ive been dealt. And so, I put down 5% with an FHA loan. Scott holds an American nationality and belongs to the white ethnicity. Mad Fientist: Mindy has been like, Youve got to get him on the podcast. Rich Dad Poor Dad: 20th Anniversary Edition. Mad Fientist: Very cool. For example, we had Erin Chase on there. Trench has focused his career on. Questions About BiggerPockets & Official Site Announcements, Home Owner Association (HOA) Issues & Problems, Real Estate Technology, Social Media, and Blogging, BRRRR - Buy, Rehab, Rent, Refinance, Repeat, Real Estate Development & New Home Construction, Real Estate Wholesaling Questions & Answers, Rent to Own a.k.a. BiggerPockets.com is the worlds largest online network of real estate investors. document.getElementById( "ak_js_1" ).setAttribute( "value", ( new Date() ).getTime() ); Chart Your Progress to Financial Independence! He uses the example of a quadplex I believe in that post. And I also have a quadplex now that I bought as a regular investment property. This has been a big party for many years. Mad Fientist: Absolutely! And I believe that by the end of next yearso thats the end of 2019that Ill be able to get approximately $925 to $1000 per unit, plus I can pass on the utility fees to the tenants. And what caused her to come to me and say, Hey, you needed to talk to this guy? Trench is the author of the 2017 book Set for Life. But if it can cashflow as a piece of investment real estate, then you can always decide to continue living there or keep it as a cashflowing rental. But really, what were after here is a strong personal financial position with a good savings rate, a strong income, strong investment returns, and then the opportunity, if desired, to go take advantage of entrepreneurial pursuits. Invest in real estate and never run out of money! Dont get into real estate investing if you arent willing to invest the time up front to learn this business. He is the founder and CEO of BiggerPockets.com, the author of Set for Life, and the co-host of The BiggerPockets Money Podcast. Who Is Scott Trench Scott is an American perpetual student of personal finance, real estate investing, sales, business, and personal management. Scott Trench: Yeah, Im 27. So, if you spend $40,000 per year, if thats your target goal, and you have $1 million in index funds or wealth in general in your portfolio, youre likely to sustain that in perpetuity. This is what I want to do with money. And the reason for that is because they have no cushion. This is a conventional mortgage brokernot a friend, not a family member. So, if youre following, thats $3200 in rent on a $1700 mortgage. That's the topic of today's show, where we sit down with Scott Trench, author of Set for Life,to discuss some of the simple yet powerful, tactics people can use to increase their income, reduce their expenses, and lead a legendary life. Scott Trench: Yeah, sure. Mad Fientist: Thats cool! Have you enjoyed it? And I think for that median income earner starting with zero, its with that savings position. I think that the two things that come into play there are going to be entrepreneurship, asset creation, and then investing. Congratulations! Yeah, no, absolutely. Rising interest rates are likely to impact cap rates on properties, which will compress values and limit exit and/or refinance options. Mad Fientist: Very cool! So, the goal of the show is to showcase these different perspectives on finance and enable people to think outside the box of Oh, real estate is the only way to go about this or even Index funds is the only way to go about investing or frugality is the only path to financial freedom.. And I do she does a lot of private lending and other various kind of creative ways to invest and maybe get a diversified or different or higher returns than she can with just stocks. So you mentioned your first $25,000. I just think its lower odds of success than maybe focusing on savings first. Start tracking your own financial progress with these money management apps. The author, Scott Trench, has some very wise . And once you have that financial runway, moving into step two here, were trying to get to about $100,000 in investable liquidity. DO NOT Sell My Personal Information. Its been a whirlwind since then. This is like the most opportune time for low cost entry into any sort of business world you can imagine which is super exciting. This is great, I have a friend in Denver doing similar, sadly in UK, increases/changes in Buy-to-let (BTL) taxes, are making this approach nonviable. Mad Fientist: How is that going in Denver? And if they lose, youve got to be able to not tie the result of losing that hand with Hey! It wasnt in the nicest area. I know its a really hot real estate market these days. Scott Trench is the CEO and President of BiggerPockets. Ive received a lot of great answers over the years so I decided to compile all those answers into a PDF, which you can now download for free here! And hopefully, Ill make it out to Denver one of these days and say hello. One of my favorites which will be coming out soon is with David Greene whos a real estate investor. So, that was your first $100,000. We try to be a little bit more creative and adventurous with our investment and money management than maybe just passively investing in index funds. Scott Trench: Yes. And thats the best case scenario, is that you go through all of those rungs of the ladder in 20 years. And this brings up a really cool thing that I liked in your book, which I havent even mentioned yet. But that was not going to get me expediently towards my goal of a several hundred thousand to a million dollar net worth and several thousand dollars a month in passive cashflow. Theater of popular music. They help ordinary Americans build wealth and achieve financial freedom through real estate investing. I was listening to your podcast (which well obviously talk about here soon as well). Of course, that logic works both ways; and, if interest rates come back down quickly, these types of investments might perform even better. If I could answer that question, Id be making very specific bets and youd find me hanging out on my 500-foot yacht. The couple posts a lot of their pictures together on their social media account. You run out of money and you have to go and find similar paying work as your only option. Now, of course, you cant make any bets in the first place if you have no wealth and spend all that you earn. And both Mindy and I are a little bit morehow do I describe it? And I have a couple of other expenses there as well. Scott Trench: So, after the other expenses that went into maintaining the property and fixing some things up myself, I was probably breaking even or maybe paying a little bit out of pocket to live on a monthly basis. So, the final step I think is it goes on forever basically. Theres so many different ways to make money that dont cost anything but your time, and maybe a few hundred to a few thousand dollars to try out. But for those who may not have heard that episode, could you just describe what house hacking is? She now has a net worth of $5 million, and her annual salary is estimated at $1 million. And Im looking forward to checking out the rest. Szane Scott Trench Coat. They feel that they are all politicians and wont allow the economy to slide. Scott Trench: I live in another duplex doing the same thing. I cant really see a political advantage for him in doing that. And so, its all about increasing your odds of success I guess at this point. Subscribe to our YouTube Channel and get one extra LIVE episode from us per week. And how does the duplex compare to the quadplex? Fun, entertainment, healthcare, insurance, all of that falls into that last third. And yeah, back in my poker-watching days, I remember Annie Duke very well. Accumulating a lifetime of wealth in a short period of time involves working harder and smarter than the average person, and Scott Trench--investor, entrepreneur, and CEO of. So, we are interviewing people that have expertise in one of these areas or niches in these areas or stories that embody this kind of approach, so that people are not pigeonholed into one type of investing or one type of real estate. He serves as the CEO of BiggerPockets.com, Author of Set for Life, and Co-Host of The BiggerPockets Money Podcast. I also observe that the federal minimum wage has not increased since 2010 we have the lowest real minimum wage in this country that weve had in nearly 50 years, since the 1940s and 1950s. Hes doing some amazing stuff, which Im really excited to talk to you about. So, you really have to start somewhere. But I didnt realize that passing those first two stages, my first $25,000 and my first $100,000 gave me so many more options and so much more power to make that journey quicker and more enjoyable. He is thirty-one years old. Advertiser Disclosure: Many of the offers appearing on this site are from advertisers from which this website receives compensation for being listed here. It just didnt work out. Youre also not likely to get a big raise at your job at work within the next year. And thats when I found your show, some time in that timeframe. So yeah, you better keep saving a little bit because 7 to 10 trenchlings, Im sure, arent going to be too cheap. So thats what I did! And Im also looking forward to exploring some of the strategies that he used personally to get to the stage that hes at today like house hacking and real estate investing. But on the other hand, if I wasnt saving, if I had no financial runway, it would be too risky to leave. So, thank you for that. When Josh decided to step away to be with his family, Scott became CEO. Scott Trench: Yeah. I know Ive had Chad Carson on the show, and weve talked about it in the 1500s. His parents brought him up in the United States. But theres also this whole realm of entrepreneurship. 4. However, like Scott said, it is absolutely critical to keep positive cash-flows (rents must cover mortgage payments + HOA + property tax, with backup plans, like moving in to the property yourself), weve seen people end up having to sell in down market when losing the job or can no longer subsidize the negative cash flow, therefore cannot reap the long term appreciation or refinance to lower rate, etc.. Mad Fientist: Nice! He released Set For Life in 2017 to help others follow his successful path. Ive been recording this podcast since 2012 and at the end of every interview, I always ask, Whats one piece of advice youd give to someone pursuing financial independence?. But I think a lot goes into putting yourself into position to be lucky. After high school, Scott enrolled at Vanderbilt University where he earned a Bachelor of Arts in Economics and History in 2013. Its kind of a funny phenomenon to me because when I was starting out on this journey, all I could think about was getting to a point where financial independence seemed like a realistic possibility. But thats a huge improvement from paying hundreds or thousands of dollars in rent per month. So that would be cool to read that. See Free Details & Reputation Profile for Scott Trench (32) in Denver, CO. Includes free contact info & photos & court records. 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