An engineer used up his entire 401k to invest in Real Estate

And is now making $9k per month cash flow income from it.

An investor case study🧵👇

A lot can be learned from folks who have achieved tremendous scale.

Eg - I talked to an ex-colleague this week raising a $100M dollar fund in the niche of active senior housing and learned a lot about granular tactics.

But nothing is as refreshing as meeting someone taking a  counter-intuitive path.

They remind me that you’ve got to try to think like the little kid who hasn’t had his inventiveness beaten out of him.

That's where the best ideas come from.

This thread attempts to radiate one such story I had come across.

My goal is simply to educate and motivate without taking any stance.

Everyone is different so please be thoughtful about the risks.

Let's jump in.

I'll be using a QnA style:

- to avoid including any bias
- because paraphrasing dilutes the insights

Two clarification points to give more context before we dive in:

1. He did not borrow against the 401k but liquidated all of it, which was the surprising part for me.

2. 9k is just cash flow income. Does not include:

- Principle paydown
- Any appreciation
- Tax breaks

Here we go!

👉What is your cash flow income per month right now?

About 9k per month after subtracting debt service, taxes, and expenses.

👉When did you start doing REI? How many units do you have?

I started at age 34 - I am 46 now.

I have 6 duplexes and 1 triplex.

At what cash flow income would you consider quitting your full-time job (if you wanted to)and have the lifestyle you want?

$200k/year.

👉How many hours per week do you devote to REI? How many hours do you work on your W2 job?

I am a full-time 40+ hours a week automation engineer. I spend about 10 hours tops a week on RE.

👉What led you to get started in RE?

My wife. She knew investing in real estate was the financially right thing to do. I was opposed to it first.

👉How much initial capital did you start with? How did you get this funding to invest?

I used every penny from my 401K which was $116k. After penalties, I was left with a little over $80k.

👉What's been your strategy?

I use the tortoise strategy - in no rush but I know the power of RE to amplify my retirement income.

I buy in a C-level area of Rochester NY. Only buy houses that need no work and are in above-avg condition. I buy to hold and rent, no flips.

I keep every penny I earn in a separate “business” account which I let grow until I have enough to buy the next.

Now that I'm nearing my 10 mortgage limit, my strategy is to pay off the one house which I owe the least, to finance the next.

👉What's your buying criteria and how did you decide on it?

I want my investing to be passive so I look for good roofs, vinyl siding, or asbestos so less maintenance.

I want to see a good DRY foundation. The interior can be fixed.

The exterior is what takes the brunt of mother nature. I want to see the house already filled with tenants that are current with their rent.

Numbers-wise - my minimum income per house, after mortgage/tax/escrow/insurance is > $700/house/month. If I can't get that, I don't offer

👉Did you have partners? How did you decide who to work with?

My wife is my only partner.

👉Was there a turning point that helped you go faster? Or what was the best decision you made?

The turning point was realizing when I hit 5 properties, I could afford to pay someone else to do my work. Huge relief!


The best decision I made was to pull every penny out of my 401K. My return on investment is currently 4x faster with real estate. As I grow, that return will be greater and faster.

But as you start to gain traction, it's like a snowball rolling downhill.

👉What were your biggest fears? How did you get over them?

At first, it was the fear of non-paying tenants. But then like any fear it was unfounded.

It sucks, but I don't struggle when a tenant doesn't pay.

👉What's been the hardest part of your journey so far?

Easily the damn pandemic. At first, I heard talks about a rent strike, so I contacted my banks and asked for forbearance which I received. I told every tenant to NOT pay me for 3 months straight.

They were all thankful. After the 3 months, I asked for rent and they all paid. It could have easily ended very differently.

👉What were the biggest mistakes you made? If you had to start over, what would you do differently?

Being nice to my tenants sometimes bites me in the short term, and I feel like it's a big mistake but in the long run, they all pay their dues and more.

Be human first!


👉What tools, apps, resources, skills, techniques, and habits were most useful to you?

I, fortunately, was able to gather many skills over the years.
I was a patriot missile operator and system mechanic in the army, I went to school for the electric trades.


All these skills helped me do the majority of repairs on the houses when needed and save the costs.

I’m at the point now where I have a handful of guys that I pay to do the job for me but I know when it’s a good job vs not!

👉What's your advice for W2 earners setting out to be their boss?

It's not a race, as you've heard before. Start early in life. If I could start over at 25, I'd buy a duplex or triplex and live in one and rent the others.

Save that rental income, DON'T SPEND IT!! Use it to grow the business and have the reserves.

You never know when you have to replace the lot line to the street because the tree roots destroyed the originals causing the basement to fill up with shit water.

Ask me how I know!

👉What are your future REI goals?

My goal is to hit 16 properties.

When I hit that, I will officially retire and be my own manager. I will continue to buy more properties after retirement and keep growing until I die so I have something to pass to my children when I'm gone.


👉What are you looking most forward to when you reach FI?

I just want to wake up in the morning without having to worry about making it to work on time. Like any parent, I want to travel and see my kids succeed.

That's a wrap

Hope the story shows what's possible and that anyone can do it.

Also, note that the goal of this thread is to expand your purview.

Not advocating that you should do the same.

Everyone is different, so please don't just blindly follow the insights here.

Consider your unique dynamics before picking your strategy.

If you want more of such stories/insights, join >8,000 subscribers on:

https://supermode.io/newsletter



From 401k to Real Estate Success: An Investor's Journey

How to give effective feedback (without sounding smug)

A tool I learned at Mckinsey when stakes were high 🧵👇


Often it appears in corporations the only people getting ahead are those types of yes people.

To get what you want at work, the advice you often get is to be agreeable, don't strain the relationship, and don't say anything that might offend anyone.

This is bad advice.

If two people don't give each other feedback, it’s a sign that at least one isn’t thinking critically—or speaking candidly.

This means best ideas or improvement opportunities are often lost.

The feedback culture at McKinsey is no joke.

The feedback constantly helps improve collective output and raise the bar.

But it’s not all downward feedback - Upward feedback, even from juniors to a Partner, is expected and encouraged.

The minimum is a 20-minute chat with a partner every 2 weeks, but it’s very common to give feedback on the spot after client meetings, on PowerPoint, and on your data modeling.

This makes everyone anti-sensitive to feedback and enables faster improvements.

Personally, this framework has been life-changing.

I hate confrontation and, in the past, found myself compromising what I wanted or needed to keep the peace.

It taught me how to analyze social situations and apply problem-solving skills to them without appearing difficult.

But there is a specific way to give feedback without making the listener defensive.

And that is what I am going to discuss in this thread:

I'll go over...

• What is McKinsey feedback model
• Why it works
• How to use it?
• Examples

Let's dive in:

What is it?

Quite simply, it's a tactical model to give feedback so it will be heard and understood without leading to negative sentiments.

The model intends to make the feedback:

• Precise
• Fact-based
• Less personal
• Actionable
• Incontestable


The model’s greatest strength is that it diffuses disagreements by emphasizing facts

...so that the person you’re addressing is less likely to take your words too personally.

How to give it?

There is a structured format, which is


"When you did A, it made me feel B. In the future, I would love it if you could do C instead"

• A is the specific action, event, or behavior you want someone to change.
• B is the impact of that behavior, in other words, how it made you feel.
• C is a suggestion for what the person could do differently next time

The first two steps(A and B) aim to set the stage for giving the recommendation without getting derailed by debating the context.

Why reference A?


• The more specific the example, the more memorable the feedback
• Being fact-based keeps the feedback from feeling too personal
• The first part is incontestable as long as you remember and communicate it in time.

Why include B = How it made you feel?

Explaining how the recipient's action made you feel
is also unarguable - your feelings and reactions are your own, and no one can deny them.

You are just stating them.

Why does recommendation C have to be specific and actionable?

The point of providing feedback is so that we can improve.

If someone receives feedback that is too vague or beyond their control, it does nothing to help them do better the next time.

Example - "Can you respond faster next time?" is not specific or particularly actionable.

Can you respond within 3 hours when the email subject line has the word "Urgent" in it?


Feedback should be provided in such a way that if the feedback recipient does what you recommend, it will solve the problem and
prevent A and B from occurring again.

Let's take a full example here:

Opener(to show empathy) ->I totally appreciate your concern about the project.

A - But when you check in every 30 minutes,

B -  it makes me feel like you don't trust me to complete the project. I lose my focus, which slows us down

C - A better way to do it would be to agree on milestones & their deadlines and have check-ins to ensure alignment + progress.

That's all for the tactical framework, but here are some actionable tips from my personal experience of being on both sides dozens of times.

- Don't wait to give it. Make it immediate

"The passage of time diminishes the effectiveness of your praise or criticism"

-  Use the sandwich method - eases the blow

Start with something positive to disarm the person and ease into the conversation.

End on a positive note. Give them a roadmap and express your confidence in them.


- Make it regular and make it positive at times.

Studies show for the recipient to act, the ideal praise-to-criticism ratio is 5:1.

Have positive sessions too.

If you find yourself in a cycle of negative feedback, that's a sign there is a communication gap.

That's a wrap!

Feedback sessions need not be a ceremonious event.

They should be frequent, instant, and methodical.

That's a wrap 😊

If you made it here, I really appreciate you reading it through.

Hopefully, it's actionable enough for you to apply it.

If you liked it and want more detailed breakdowns of concepts

Join >8,000 subscribers for my free newsletter here:

https://supermode.io/newsletter

The Power of Feedback: Lessons from McKinsey

Mckinsey makes millions on a single presentation.....yeah👀


Here is the central business storytelling framework I learned in my 4 yrs there🧵👇


First, why should you care?

If you closely observe, most people do academia-style communication.

They stream details(situation, complications, etc) first and then slowly build up the conclusion.

And it works ...

but not when you have to be persuasive and sell your ideas.


A consultant at Mckinsey, Barbara Minto, realized this anomaly in the 60s and capitalized on it.

She built a framework that would change the course of the firm.

Eg-  Mckinsey currently boasts a roster of 90 of the top 100 companies in the world.

Quick aside to acknowledge that Barbara Minto is a badass

- one of the first Harvard female MBAs

- and the first female Mckinsey consultant

What she proposed was so influential -  other consulting firms also adopted her principles.

The framework is also a secret weapon....

It makes consultants appear sharp = accelerates their growth.

eg- many top CEOs are ex-Mckinsey.

Sundar Pichai - Google
Sheryl Sandberg - Facebook
James Gorman - Morgan Stanley

CEOs at Vodafone, Boeing, Footlocker, LEGO, Grammarly, Best Buy.

Full list at the end:

So how does the framework work?

It narrows in on the traits of busy execs:

• Interested in the high-level, big strategic questions
• No time for details
• They think about multiple issues
• Action-oriented
• Facts, not guesses

So Barbara proposed a framework that

• is structured
• is Top-down, not bottom-up
• is Concise
• clearly articulates what needs to be done
• is grounded in the analysis, not anecdotes

The above might seem overkill, but many of the CEOs are on record explaining how the communication and storytelling skills they learned at Mckinsey supercharged their growth.

Best of all, it's a skill anyone can learn.

With practice, it becomes second nature.

You still need to hustle, and you still need to hit your targets.

But all else being equal....

the person who advances the fastest is usually the one who knows how to tell a succinct story with sound reasoning.

Lets double click and work with a simple example:

A media client is struggling with declining profits and asks you to present a solution.


You spend some time & your analysis reveals some facts:

• Customer communication is the largest cost = 60%
• Magazines= 7 times newsletter costs = 80% of total comm costs.
• The majority of business is focused on magazines output
• 98% of customers want digital communication

It's time to present to the CEO a solution.

Here comes the central framework: Pyramid Principles.

The idea is to flip the status quo and hit the exec with the answer right away, and then go on to supply supporting information.


I'll break down the pyramid in a sec but:

Why use this approach? 4 reasons:

Reason 1
It uses vertical relationships, which
- present an idea,
- allow the reader to absorb it
- then provide answers and supporting evidence.

= better comprehension = more persuasive

Reason 2

You stand out!

Most workforce communicates in an "academic" style.

- starts with details 1st
- gives rambling "bottom-up" recs
- a ton of irrelevant info
- delivers the answer at the end.

leaving the CEO wondering when they will get to the point.

The pyramid instead

- relays salient information as efficiently as possible

- in a time-pressured setting

the recommendation is kept around 30 seconds.


Reason 3

Execs are busy and

- often are top-down thinkers who appreciate a direct approach.

- get impatient when they feel like someone isn’t getting to the point


Reason 4

You are more persuasive when you are direct.

By answering the executive’s question first,

- you sound more assertive and confident.

- You’re not searching for words or wavering. You are plainly and directly answering the question that was posed to you.


OK, back to the framework,

Always start with the most important idea/recommendation in your story.

This "key takeaway" is what the exec really cares about

- the answer they have paid thousands in fees to find out

- and it needs to be the first thing out of your mouth.

Features of the main idea

- Succinct - ideally 1 sentence
- Pertinent - Answers the main question
- Synthesis, not summary

This is important:

Don't restate facts; boil the details down into a single crucial directive for the exec/Investor/LP etc.


At McKinsey, “start with the answer first” was drilled into us.

When a partner or an exec asked a question

“What should we do?”

— you were to start your response with,

“You should do X,” very crisply and directly.

If they ask why then the details arrive.


In our example,

the findings showed that

- magazines are such a large fraction of costs
- customers prefer electronic communication

can be synthesized into the key takeaway that

✅ we should remove magazines as the main form of communication.


Now, moving to the middle layer of the pyramid.

You need to offer some arguments to actually support our takeaway.

Follow these rules

* Keep these succinct

* Independent - Each argument must stand on its own

* Fact-Based - Avoid generic statements

* Level Consistent - Same level of importance for each argument

* Strongest argument first


• Use MECE (another principle by Minto)

This is huge at Mckinsey - The arguments should be

Mutually Exclusive(No overlap)

Collectively Exhaustive(No gaps remain)

This makes the audience think clearly.

A quick example:

Amazon Revenue:
- Americas Revenue
- Non-Americas Revenue

This is MECE because the categories do NOT overlap and collectively make up all of Amazon's Revenue.

This ↓ would NOT be MECE:

- Americas Revenue
- Europe Revenue

What about Asia et al?!


• Lastly, Rule of 3 - Try to keep to 3 arguments

Why?

• It forces you to prioritize and choose the top three answers
• It makes you look decisive and composed.
* It avoids overwhelming the audience
* It helps the audience remember your points

Let's apply these rules to our example.

Our main rec was "Kill the magazine's dept"

So the arguments would be:

• Magazines account for around 50% of total costs
• Magazines can easily be replaced by email
• Making this replacement would increase customer satisfaction


3rd layer of the pyramid = DATA

At the bottom

- We need the facts validating the arguments

To do:

- have one or two "insights" associated with each of the arguments at the level above.

- These insights might be facts or further arguments.

For eg, to validate our argument that magazines account for around 50% of total costs,

Say:

• Customer communication comprises 60% of overall costs

• Magazines account for 80% of communication cost

Now the pyramid is complete and you can open for Q and A


Not done yet 😇

Here is how to stand out more:

Think ahead of the questions and add details in the Appendix to provide visual reference.

Execs get impressed when you have thought ahead of the questions.

That's about it for the framework.

Rest of the thread answers questions you might have:

Here is a real example of a slide(It's publicly available)

Also, there is a real-world Mckinsey presentation link at the end.

🆀What if my advice is wrong?

Yes, your rec may be wrong.

But the framework's purpose isn’t always to convince everyone that you’re right.

It’s to lay out your argument in the clearest terms possible so that listeners can understand your thinking and engage more fully.

If you’re right,

it will allow the audience to grasp the idea quickly and easily.

If you’re wrong,

it will make your thinking clearer so that a listener can point out the flaw in your logic and collaboratively provide you with constructive feedback.

Another upside of coherent ideas is that executives know how hard it is to do what you’ve demoed.

They’ll want you around!

Many consultants are offered gigs by clients multiple levels above their current level.


🆀 When to use it?

It's not just to use with Executives or Investors.

But it’s effective to communicate with anyone:

Whom you wish to persuade with an argument.

I urge you to use it when:

- writing your next proposal,
- making your next elevator pitch to an investor,
- even the next time you respond to an executive’s question.

Make it the default mode of your comm. style.  :)

🆀 Where you shouldn't use the pyramid?

Try not to use it when delivering bad news or surfacing an issue.

Invert the pyramid here with details first.

Also, there were times when I sensed the audience was hostile, I would not use the direct answer first approach.

They would derail my presentation if they had a different answer in mind.

So use your judgment if you have had interactions in the past and you send they are not cooperative.

In short,

Hostile audience? Go Indirect

Friendly? Go Direct

Also,

notice I didn't follow the pyramid principles approach in this thread because:

I am not answering a specific question but explaining a concept.

🤷‍♂️

🆀 Anything else you can do?

It would be good if you just followed the above framework.

But I filtered my presentation through 2 more principles because they worked even better for me:

1) The 7Cs

With the 7Cs, the Pyramid Principle becomes second nature.

Your presentation is:

Clear: No clever words

Concise: Avoid repetitive and redundant words.

Concrete: It should be credible and backed with facts and data.

Complete: No important info missed out!

Correct: It should follow the rules of grammar and spelling.

Coherent: No gaps in the storyline from top to bottom

Courteous: It needs to be friendly with no undertones of passive aggression or hostility.

2) Iceberg Principle

90% of communication is about ‘how’ you say something and ‘not’ exactly what you say.

How = gestures, facial expressions, and tonal variation.

They hugely influence how your audience receives your message.

But don't overdo it - Keep it subtle.


My overall take:

2 points

1) Consulting problem-solving requires a slightly imaginary level of belief that you can learn new things about a new industry or a business function in just a few days

AND

provide new solutions or identify new problems better than the clients.

But, it is usually achievable because most clients are not incentivized to find and solve new problems.

2) The structure helps you jumpstart your thinking and create a baseline.

It just plain works, but it cannot remove big-picture thinking, which requires zooming out.

They say knowledge is working with information, and wisdom is working without it.

The execs have more experience,

so use the framework as a baseline to create a strong direction and a frame

but then lean on to ask good questions to calibrate the recommendations.

APPENDIX 1 of 4

Barbara Minto wrote a book on Pyramid Principles - Should you buy it?

It’s a bit of a long read, so just 80/20 it.

Read the top 50 reviews posted on Amazon.

That will get you 80% of the way there.

Or see this mindmap of the book I found online.



Appendix 2 of 4

Here is the list of Mckinsey Alumni.

https://en.wikipedia.org/wiki/List_of_former_employees_of_McKinsey_%26_Company

Appendix 3 of 4

A real-world Mckinsey presentation from a USPS study I found online:

https://about.usps.com/future-postal-service/mckinsey-usps-future-bus-model2.pdf


Appendix 4 of 4

The pricing info is public. ↓

A usual engagement/study/project is 3 months and has a full-time EM + 2 associates/analysts.

= millions!
https://www.afr.com/politics/federal/revealed-mckinsey-partners-charge-16-000-a-day-before-discounts-20190808-p52f2a

That's a wrap 😊

If you made it here, I really appreciate you reading it through.

Hopefully, it's actionable enough for you to apply it.

If you liked it and want more detailed breakdowns of concepts

Join >7,000 subscribers for my newsletter here:

https://supermode.io/newsletter

Mckinsey charges $10,000 per day for a consultant at my level.....yeah👀

No its not for their problem-solving prowess but for phenomenal people skills.

Here is the most powerful people skill I learned there:👇🧵


Note: The per diem info is public - a simple Google search will reveal the numbers.

I'll leave a link at the end:

Moving on....

Mckinsey is known for lending brains to solve the toughest problems.

That is true, but its the people that surprised me.

Grow or Go is the main motto there.

Every single person is put through mandatory world-class training, and every training is highly tactical and actionable.

Nothing is left to chance and whim.

Everyone speaks the same structured language.

There is a framework for everything & I mean everything:

- MECE
- Pyramid Principles
- Concept Sprints
- Issue Trees
- First-day answer
- Airport Test
- How to disagree
- How to give advice
- How to give feedback
- How to hire well
- How to deliver bad news

The list goes on..

Please comment "more" below if you want me to do breakdowns for the these frameworks in the future.

I know what you are thinking:

"Everything can't be solved through frameworks."

That is how I thought, but I was shocked at how well they work for a simple reason:

The more structured you are, the more persuasive you are.

And we are all just selling at the end of the day.

One such framework that has helped me not just professionally but also personally is the ability to

"Say no like a pro."

It's the most impactful thing I learned in my 4 years there, and today I wanted to give you a highly tactical way to negotiate all around.

Let's dive in:

Why should you care?

Consider these cases:

- Your boss proposes a new initiative you think won’t work.

- Your partner wants to buy a large item that you think is unnecessary. Good luck there 🤨

- A new client wants to start now, but you don't have the time.

How do you disagree with someone who has more power or is important to you?

How do you decide whether it’s worth speaking up?

What exactly should you say?

I have been awful at disagreeing all my life.

Relationships were burned, or future chances were missed.

Boldly put, this framework has literally changed my life.


Anyways, let's dive right in:

We will cover three questions:

🙋‍♂️Why is it difficult to say No?

🙋‍♂️When is it worth it?

🙋‍♂️What tactics can help?


🙋‍♂️ So why is it difficult to say no?

Let's understand the cause to be able to better implement the proposed tactics.

5 major biases hold us back 👇

1)Seniority Fear

You are concerned that the requester holds power over career progression, and you “have no choice.”

Consider this:
Recognize most often, people just “need help”

They are not seeking an explicit exchange like- if you do this, it will help with your promotion.


2) Professional Background

Your previous organizations had different expectations and norms, leaving you in flux in your current setting.

Consider this:

Recognize every group is different. Observe and customize your approach.

3) Conflict Aversion

Such a situation triggers a deep emotional response like “fight or flight”, making it harder to engage constructively.

Consider this:

Reframe “conflict” as “collaborative disagreement”, in the interest of finding a better answer for all parties

4)Cultural Background

Some cultures are more direct and nonhierarchical, while others are more subtle and deferential.

Consider this:

Understand “easy” degrees of freedom (where you can be more direct) and also “read between the lines” when you can't be as direct.

5)Personal Style

Factors like MBTI type and work style, e.g., you don't want to  “let someone down.”

Consider this:

Customize your approach to your preferences, e.g., “rather a small let-down now than a bigger one later.”

🙋‍♂️When is saying No worth it?

“You need not attend every argument you’re invited to”

Draw out two coordinates
Y Axis - How much does it matter to them?

X Axis - Net cost to you.
(Consider effort, success likelihood, shared/personal goals, timelines)

Now consider 4 scenarios

1) Low Benefit to Them, Low Cost to You

Politely but firmly assert that you’re not in a position to help;

But if deflecting is harder than doing, you may choose NOT to Say No.

Since it's low cost, you can decide to just do it.

2)Low Benefit to Them, High Cost to You

Be clear about the trade-offs & implications.

Make them understand the low upside for them & explain the work involved for you.

Then help them problem-solve instead of direct No.

This should not be contentious.

3)High Benefit to Them, Low Cost to You

Don’t push back too hard; either do it since it's low-cost to you or help them figure out how to get it done.

You don't have to say NO most time here.

4)High Benefit to Them, High Cost to You

Here’s where the rubber hit’s the road; let's focus on tactics to assess and handle this scenario

🙋‍♂️What tactics can help?

Use a framework called 4Ds.

1)Delay - Propose an alternative timeline if capacity is a hurdle for you.

Application:

The requestor always has a standard timeline like “yesterday” or “asap”. Often there is a degree of freedom here.

Examples:

"This is a great approach, I can definitely do this. I’ve committed other deliverables this week so I can get this done by next Wednesday – would that work?"

2) Diminish /De-scope

Proposing alternative (more feasible) activities to achieve the same shared objective

Application:

Often requesters will ask for what they think will solve their problem rather than what is strictly ideal; you can help identify better options.

Examples:
Could we meet this need by doing x, y, z instead? Are we solving the right problem? Is there an 80/20 approach?

3)Deflect or Delegate

Proposing an alternative delivery mechanism – same work, quality, and timeline, but not all done by you

Application
In some situations, the requester just needs help getting things done – not necessarily by you.

Be aware, though, that sometimes they may be explicitly trying to create an opportunity for you.

Examples:

This sounds like a great project.

A friend is building expertise in this area – can I connect you?

My background might not do this task justice.

I reckon my friend can do a much better job with his experience.

4) Dialogue
If all else fails, you need a dialogue.

Don't lead with your response. Make it about them.

"Bubblewrap your No"

How?

- Actively listen
- Ask questions to clarify
- Empathize

- Enter your No here

- Empathize again, and problem-solve with them.

Example:

Start: I see, yeah this seems critical because…

Middle: I am wondering if I might even have the bandwidth to do a good job because…

End: I’d like to figure out how best to help you…

That's all for the framework 🙌🏼

Other meta nuances to apply:

- Empathize a lot in the beginning, Ask questions instead of directly rejecting. Make them feel heard.

- Phrase your No like a question. "I am wondering if it makes sense given my limited bandwidth"

A great tactic everyone knows from Improv

Use of "Yes, and"

Words like "but" puts people on the defense and diffuse the collaboration potential.

Example-
❌ "Yes, but the costs are not going to allow that"
✅"Yes, and we should also think about the costs"


You can really shape your relationships and, in turn, your trajectory through intentional (dis)agreement.

Remember, this skill takes practice – it may feel unnatural but will become second nature over time.

So keep practicing till it's a part of your sub-conscience. 🙂


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A police officer acquired 37 units in 4 years. 

And is now making $8k per month cash flow income from it.

yeah 😲

A thread explaining his tactics 🧵👇

Usually, you only hear stories of big-time RE investors making millions.

And a lot can be learned from those who have achieved tremendous scale.

But to me, nothing has been as refreshing and inspiring as coming across people living under the radar and leveraging RE investing in living a very fulfilling life.

I learn way more!

This thread attempts to radiate one such story I encountered.

My goal is simply to educate and motivate without taking any stance.

Everyone is different, so please be thoughtful about the risks.

Let's jump in.

I'll be sharing the story in a QnA style:

- to avoid including any bias
- because paraphrasing dilutes the insights

👉What is your cash flow income per month right now?

My portfolio cash flows around 8k per month currently. 

👉When did you start doing REI? How many units do you have?

My first accidental live-in flip was 2012-2015. I was hooked and started saving while learning on the side.

It took me almost 2 years to save enough cash and find the right property in the right location to be comfortable enough to pull the trigger. My current portfolio is 7 rental properties totaling 37 apartments and 15 storage garages.

👉At what cash flow income, would you consider quitting your full-time job (if you wanted to)and have the lifestyle you want?

My goal is 10k per month total, 5k net for myself personally (after paying partners). I should hit that when my current projects are completed.

👉How many hours per week do you devote to REI? How many hours do you work on your W2 job?

This varies dramatically based on what phases I am in of projects, leasing, renovations, new acquisitions, etc. 

I would say on average, I spend about 5 hours a week managing my rented portfolio (communication with tenants, minor maintenance calls, etc.). 

When we have major renovation projects ongoing (apartment turns, full gut renovations, etc), which I have 2 currently being renovated, the weekly time can be 20-30 hours or more. 

If I have several vacancies come up at the same time, I have more time to lease to new tenants as well. Luckily, for the most part, my vacancies have been minimal. For my w-2 job as a police officer I typically work 40-50 hours a week. 


👉What led you to get started in RE?

I have been a full-time police officer since 2012, and after about 3 years I looked around and realized that most of the older cops nearing retirement were all miserable. They were overweight, unhealthy, divorced several times, grumpy, etc. 

They were living comfortable middle-class lives here in Cincinnati, Ohio, but almost none of them were happy people. Not to mention, after retirement most cops don’t live very long; the years of stress, lack of sleep, and unhealthy diets tend to kill you sooner than average. 

I just knew that even though I enjoyed my career, I did not want to spend my life doing it, and end up the same way that they did. So I started making major changes in my life about 6 years ago to give me options, and one of them was learning about REI.

👉How much initial capital did you start with? How did you get this funding to invest?

The first duplex I purchased required 22k as a 25% down payment with conventional financing, I saved that money over 2 years while educating myself on real estate investing. 

By the time I felt ready to buy and found the right deal, I had saved enough money to make it happen. I did not make a ton of extra money for savings each month, I usually was about to set aside $500 per month by cutting a lot of expenses at the time and living frugally.

👉What's been your strategy?

I have done a couple of live-in flips, but my main focus is to buy and hold small multi-family properties. I typically go after very distressed properties that require full gut rehabs. 

I built a construction company a few years ago as an ancillary business for my investing, which has allowed me to take on massive renovation projects. We have done several rehab projects that were taken down to the frame and completely rebuilt. 

After renovations, I am typically able to rent these apartments for the top of market rents, and refinance them to pull all or most of my capital out while remaining cash flow positive and use that capital again to fund new investment properties.

 I have also had my real estate license since 2016 and I use that extra capital to fund my investments and also as a tool for finding on-market properties. 

👉What's your buying criteria and how did you decide on it?

I typically buy in C neighborhoods, in my market B neighborhood do not tend to cash flow well, and D and F neighborhoods are much more management intensive with low-income tenants. 

As for metrics, I look for a minimum of $200/door cash flow after fixed expenses (meaning everything except maintenance and Capex). I also look for a minimum 15% CoC return. 

But since most of my deals are “BRRRR” deals, I am typically able to remove all or most of my capital after I refinance and my returns typically end up infinite. 

👉Did you buy in an LLC when you were starting out? What was the reasoning behind it?
My first 3 properties were held in my and my ex-wife’s names only. I have since started holding title in an LLC because most of my financing now is from commercial lenders who prefer that model

I personally do not have any major preference, either way, I get strong insurance policies to reduce liability risk as well. 

👉Did you have partners? How did you decide who to work with?

I got divorced in 2019 and as a result, my ex-wife stayed on as a silent partner on my first 3 rental properties. 

We both agreed it made more sense to keep the properties as they cash flowed well, and now we split the cash flow and future equity if we sell or refinance. She is an accountant and also does my books, while I self-manage the properties. 

I also partnered with another silent equity investor who put up the initial funding on an 8 unit property, we are 50/50 partners and I manage the property and manage the full gut rehab on the building. 

I chose to work with him because he had offered to invest in other projects of mine and I wanted to build that relationship in the event that I had larger deals in the future that may need outside capital, so we had a good track record together.


👉Was there a turning point that helped you go faster? Or what was the best decision you made?

When I decided to pursue my real estate license. Initially, it was just so I could make my own offers and access the MLS. 

It ended up becoming a nearly full-time career that quickly surpassed my W-2 police officer job in terms of income. After I leave my police job I will continue growing my agent business to help fund my investing business. 

To a lesser degree, I did the same thing with my construction business, while it does provide some extra capital, the main benefit is having a team of full-time employees who work mainly on my major renovation projects, which can be done at cost. 

This allows me to take on deals that would otherwise not be possible to complete. 

👉What were your biggest fears? How did you get over them?

Fear of failure, fear of losing capital, letting my family down, etc. Eventually, I realized that staying where I was, being average, & not giving my kids a better life & an opportunity was more terrifying than my fears


👉What's been the hardest part of your journey so far?

Staying consistent. Real estate tends to come in waves; sales, renovations, acquisitions, and more. If I could systemize my businesses better, it would be more consistent and less feast or famine. 

👉What were the biggest mistakes you made? If you had to start over, what would you do differently?

I have made countless mistakes, but one highlight… trusting contractors at their word. Always verify or have a third party verify if you do not know what you are looking at. 

I have paid for services countless times that were either not completed or were done incorrectly that either I had to fix myself or pay someone else to do over. Always overestimate renovation costs. Most if not all of my rehab budgets go over budget, 

There are so many variables in construction it's hard to manage. Delays, rising material costs, labor management, miscommunications, mistakes, code changes, inspector demands, and the list goes on. 

All of these can drastically affect the total project costs, and much of it is out of your control. I have learned that the best way to mitigate this is always to have plenty of reserves over and above your worst-case estimates, you will need it! 


👉What tools, apps, resources, skills, techniques, and habits were most useful to you?


Networking - joining private communities is so crucial. Podcasts, real estate, and business books, both written and audio. Without those, I would not even be close to where I am today. 

Getting out there and doing face-to-face networking is critical; many of my good friends, clients, investors, and people who are where I want to be someday are people I met going to real estate meetups. You have to make meaningful connections to have success in this business. 


👉What's your advice for W2 earners setting out to be their boss?

Make the leap of faith as early in life as possible. I waited until 25 to begin thinking bigger about my life aspirations, while 25 is certainly young; 

I already had made many critical life choices and had obligations that made my journey much more difficult. I was married at 24, I had my first child at 26, we bought a massive house that ate up a ton of my investable capital each month. 

If I could go back in time, knowing what I know now, I would have worked on my dreams and financial goals first, then built my lifestyle and family life around that. 

It is much easier to take massive risks when you do not have a lot of bills and people relying on you, & even if you take massive risks and fail, you have the rest of your life to figure it out. So, no matter how old you are now, sooner is always better.


👉What are your future REI goals?

My first goal is to net 10k a month in passive income (personally, not counting my partner cut). I want to scale my businesses and invest to become more passive, and have people and systems in place to reduce my workload by about 90% 

so I have the freedom and flexibility to travel and do the things I want to do with my family and friends. I plan to continue expanding my portfolio indefinitely as I enjoy value-add real estate for many reasons. 

It is very rewarding to take a useless run-down property and bring it back to life to provide great housing options for our tenants. 

I also want to have the free time and financial ability to give back in charitable ways, including spreading my experiences and education in financial literacy and wealth-building to others who are where I was 6 years ago. 

👉What are you looking most forward to when you reach FI? 

As I mentioned, my dream and “why” has always been to have the financial and time freedom that my parents did not have. I have a growing family and want 2 more children. 

I want to be there for everything they do in life, and this will give me that opportunity. I want to travel and focus on my physical health more. I want to give back in several meaningful ways and focus on philanthropic efforts both financially and with my time and expertise. 

That's a wrap!

✔️Please comment "more" if you want more stories like these. 

Hope the story shows what's possible and that anyone can do it. 

Also, note that the goal of this thread is to expand your purview.

I am not advocating that you should do the same.