The other day I sent you an email about my recent Bank of America experience with a personal vs. business credit card.
And I think I proved that you'll always get more -- much more -- when it comes to business credit, even if you have a fairly new business.
Here's an example of the power of taking a conscious effort in building business credit for your company:
Because of all the promotional materials, ad space, trade show booths, equipment, raw materials, and printing I have to do for my newest company (which is only 2 years old), I've been using my business credit cards a lot.
On the other hand, Global Success is over 5 years old but I've used my business credit for that particular business minimally due to wanting to stay as solvent as possible.
Britney at US Bank talked me into a business credit card for my newer company and for Global Success. Since I was doing other banking business there I said, "Sure, why the hell not?"
Both companies were instantly approved for business credit cards except...Global Success got approved for much less! What?!
Let me reiterate: The older company with more "seasoning" that has made millions every year (as per our annual tax returns) is approved for...less? Much, muchless?? WTH??
Then I put 2 & 2 together in almost an instant.
Because I've been consciously building credit for the new company (because I know what the hell I'm doing due to plenty of practice), the new company has kick-ass credit while the other one never had the need for credit and therefore didn't build it up well enough.
The newer company is only 2 years old. Two years and 3 months, to be exact. There is only one good tax return (for 2012) that actually showed that the company did decent (but still not as well as Global Success). The year before was at a lossdue to its first year being in business.
I didn't start actively building business credit for this new company until I got anAmerican Express card for it last summer. Then I got a 2nd American Express card for the company about 6 months later.
I used those credit cards to death and all of the activity was immediately reported to my Experian Business credit report (through the company's EIN).
Last month I applied for a Chase Ink business credit card for the new business. It was instantly approved for an unsecured credit line of $18,000. (In the meantime, I can't get approved for a personal unsecured credit card for over $5,000 if my life depended on it!)
And I just mentioned that Bank of America just approved the company for an unsecured credit card with a credit line of $30,000.
Meanwhile, Britney at US Bank is shoving a $250,000 unsecured loan down my throat that I really don't need but I think I'm going to take it today. I can use the money to build up more credit simply by borrowing it and then paying it off within 6 months...or less, and never really using the money at all for anything.
Between this new loan and a small handful of business credit cards, I'm at $313,000 of unsecured credit not including the one American Express that has no pre-set spending limit.
And I pulled this off in less than a year without busting my ass or anything like that. All I did was get a couple of business credit cards, use the hell out of them, and...that's basically it! That's all I did!!
Okay, so there are a few other steps that I didn't quite mention. But it's all simple stuff that you have to work on regularly and religiously.
In the next entry, I'm going to break it down to you so you know exactly what you need to do to gain access to this type of credit and then, after that, I'll tell you how to access the credit for things like down payments on apartment buildings. (My strategy for accessing this credit, especially unsecured credit cards, will probably surprise you.)
I have this perpetual battle with some of my students who don't quite "get" how important both personal and business credit is in this day and age...
Yet they wonder why a bank won't finance them to buy a stick of gum because they have a 425 personal FICO score.
And it actually shocks and amazes them.
But think of it in terms of this:
If you were a bank and someone wanted money for, say, a $10 million apartment complex and yet they had no assets, no personal credit, no business credit, and can barely "vouch" for the fact that they're an American citizen (if they can even do that)...would you give up the money?
I didn't think so.
Remember the giant credit debacle of the 21st century? Remember when lenders were giving home loans with 100% LTVs (and even over 100% LTVs) to people who had "stated" income...meaning they simply "stated" what they made and they were financed?
And remember where that got us, right?
Yes, exactly right. Foreclosure-ville-galore!
And the banks don't want a replay of that. At least not quite yet. At least until they've forgotten about the 21st century lending debacle, that is.
So, in the meantime, it all boils down to credit.
I've been working diligently on my credit since I filed bankruptcy back in 2003. I've fought with creditors, even sued a couple. I've chiseled all the bad marks off my credit reports, even having hard inquiries removed.
Fixing and rebuilding personal credit came first. My personal credit was so bad that I had to get secured credit cards in order to start building credit. Between those and getting a car loan, I was on a fast rebuilding track for my personal FICO score. Within a year I dramatically increased my FICO just by doing those 2 things.
Once I got my FICO above 720, a whole new credit world opened up for me but...
It wasn't about personal credit.
You see...
I now have excellent credit. In fact, I have a banker by the name of Britney who calls me literally every other day to give me business loans. She called me yesterday (for the 3rd time this week) when I was standing in the middle of Universal Studioswondering what the "status" was of my considering her latest loan offer...which was somewhere in the neighborhood of $250,000.
I told her to call me back on Monday. I don't need the money. But maybe I can use it for something to keep building my credit. Or I'll just borrow the money, stuff it into a bank account, and then pay off the loan in 6 months to beef up my Experian Business FICO score.
One of the biggest changes with business credit is DNB vs. Experian Business. I've noticed a huge change in how to build business credit over the past couple of years. Building business credit used to be an endless chore that would be equivalent to holding down a part-time job just to keep up on it since DNB (Dun & Bradstreet) requires you to build (and maintain) your own credit profile.
And that sucks.
Plus they have limitations on which types of creditors you can have.
That sucks even worse!
Then Experian Business came along.
And it's freakin' seamless to work with.
For example, you have a Social Security number. You apply for a personal credit card and the bank uses your SS# to tie you to your credit profile. When you use the credit card, all of your activity is reported to your Experian, Equifax, and Transunion credit reports via your SS#. This happens automatically.
Experian Business works much the same as the above scenario except using your company's EIN (employer's identification number) to tie your business into its own credit profile. Therefore, any business credit card you use with the EIN attached will automatically be reported to your Experian Business credit report.
Automatically without you doing a damn thing except for using and paying your business credit card.
Told you...freakin' awesome!
So, why tinker around with DNB -- building profiles, fighting with a customer service rep over which accounts you can add to your profile, arguing with them over your tax returns -- when you can have Experian Business build credit for you? Just by using a business credit card??
DNB has its place in the food chain. But it's not really something you concern yourself with until you start needing higher dollar amounts such as $500,000+. Then you need to have some type of built up DNB credit.
Until then...you build business credit the easy way!
I have a 4-month Personal & Credit Mentorship Group starting on Wednesday, August 7th. It's my last group for the year.
This group will show you, step-by-step, how to fix and rebuild your personal credit while building business credit at the very same time.
And yes, you can still do this if you don't have a business that has "gross receipts" or tax returns. You can do this if your business is brand new!
In my next entry, I'm going to tell you how my newer company gained access to over $300,000 in unsecured business credit while my older company didn't...and why. (It'll actually surprise you! What'll surprise you more is how easy and quick it was for me to build up so much business credit with my new company in less than a year!)
A couple of days ago I laid out how awesome it would be to have someone fund your deals with 100% LTV but I think I may have skirted over something that's rather important.
It's awesome to be able to have access to these 100% LTV financial resources in my new2014 Motherload Resource Directory but, since these are private investors that you'll be working with, they're not just going to write you a check for any deal.
You do have to prove that your deal is a cash flowing investment. This is done through an executive summary and, in some cases, a mini business plan.
Each private investor has different requirements to what they want to see (and they let you know in full detail what that is).
Here's a few tips for you if you're interested in using these investors for your deals:
1) When doing your numbers on a deal in the CFE (Cash Flow Evaluator), make sure you account for a higher interest rate on a 100% LTV loan. This can range from 9% to 16% on average and these loans are typically interest only which means no principle is ever paid. If you borrow $1,000,000 you'll still owe that same $1,000,000 in 10 years from now.
2) Make sure you're targeting deals that are slightly underperforming where you can still get a deal on the asking price. You don't want properties that are at a 50% occupancy level and you don't want to pay top dollar for a fully occupied property either otherwise the numbers won't work on both accounts.
3) You will need to have a solid future proforma of the property regardless of how it's performing right now. Even a 100% occupied property (today) will still have a higher cash flow value in the years to come provided that you find the right value-add opportunities for the property. The more you can show a higher future cash flow value, the faster you'll be able to get private investors and lenders to write checks to cover your 100% LTVs.
So, again, private investors and lenders won't lend to you based on you knowing how to pick up a phone to call them and on the sheer fact that you're flapping your lips to hit them up for money.
You have to show them that you have a solid cash flowing deal.
Here are some ground rules when you get the 2014 Motherload Resource Directory:
1) Do not call any of these people unless you have a deal. Period. Otherwise they won't talk to you. (And I don't blame them because without a deal you're wasting their time.)
2) Make sure your deal has at least an 8% CAP rate at a 100% LTV.
3) The "hotter" the area, the faster these people will write checks for your deals. They love Florida, Texas, California, Arizona, New York, and most other states. Believe it or not, they're not seeing value in areas that are still borderline "depressed" such as Memphis, Atlanta, Detroit, and Las Vegas to name a few.
The deal on the Motherload is running out. Click on the link below to check it out:
The other day I saw this picture of a mansion in a magazine that some celebrity was on the verge of purchasing and I thought to myself...
How could someone -- anyone -- go from wherever they are in life and be able to purchase a mansion like this in 12 months or less?
Of course, my initial answer is that it would be improbable for most people to pull it off simply because they don't realize or believe it's a possibility unless they win the lottery or some great uncle who is a multi-millionaire kicks the bucket and leaves their entire fortune to them including a mansion, of course.
Then there are those out there who want this level of success, believe they can attain it, and even have a viable means of grasping onto it but...they don't follow through, work hard enough, execute their plan properly, or give up at the wrong time.
But what if...?
What if -- in addition to you already knowing the bona-fide path to financial success (i.e. real estate investing as a means of passive income) -- you had a means of getting 100% of the cash you need to invest in real estate?
And no, I'm not talking about transactional "wet" funding for flipping either.
I'm talking about being able to hit up someone like a long-lost rich aunt who is willing to shell out any type of funds for you on any real estate deal ranging from $250,000 to $100,000,000 provided that you can show her that the deal will make money (vs. being a loss).
And the terms?
Don't worry. She's not going to ask for a stake in any of your deals. She won't be asking for a piece of the monthly cash flow or a percentage of the gained equity.
All she wants is to be paid back...plus interest.
And because you've shown over the years through some wavering on what you wanted to do with your life, maybe a couple of failed businesses or stupid business ideas, and perhaps thumbing your nose at some of your creditors, your aunt isn't going to charge you the lowest possible interest rate. She's going to charge you between 9% and 16% depending on the deal and how risky it is.
But...this isn't a problem. Right?
After all, she is giving you 100% of the money needed for your deal so paying a higher interest rate isn't that bad of a deal, especially since she'll be forgiving of your past credit problems that may still be reflecting on your personal credit history.
If there was such an aunt in your life who could pull off everything I mentioned above...and knowing what you know now about how powerful passive income real estate investing is in MHPs, apartment buildings, and commercial-commercial properties...how long would it take you to be able to afford that mansion I was talking about at the beginning of this email?
A year? Six months? Less?
It would take as long as it'd take you to buy up as many properties as you could to buy the mansion and where this mansion would be. Obviously a mansion in Malibu is a lot more expensive than a mansion in Tulsa of equal square footage.
The bad news...you don't have an aunt who can do all of this.
The good news...I now have lenders who can!
It seems that we have fully economically "recovered" when it comes to the confidence coming back in the real estate market because I've seen some changes so powerful in the past couple of months that didn't even exist back in 2005.
And what is that? 100% LTV financing for commercial and residential-commercial real estate.
These programs are brand new, available through only a handful of private lenders, and the benefit to them is getting a higher interest rate on a market they now believe is "secure" based on the newly found strength in our economy.
Plus, this is also based on a demonstrated current and future value of the property you are investing in which means you aren't going to be going after vacant REO apartment buildings (not that there are many left anymore anyway) that need millions in rehab.
And yes, some of them are forgiving if you've had personal credit issues. (When I say "forgiving" I mean they'll accept minor or older credit problems provided that you've shown you started fixing and rebuilding your credit. I don't mean they'll accept you with a recent bankruptcy with 10 foreclosures piled on top, all in the past 12 months. No one -- not even God Himself -- would finance you with credit that bad. If that's your story, find someone --anyone -- to "partner" in with you until you get your personal credit squared away.)
For the first time ever, I'm able to present these sources to you in my 2014 Motherload Resource Directory. I have 6 of these 100% LTV lenders. I have 1 lender who works exclusively with Florida commercial properties. I have a lender that is actively and aggressively looking to fund properties at a 100% LTV but they want to be part of your deal as an equity partner.
Plus I have several more new lenders and brokers with a wide variety of different exciting loan programs available for the first time in my 2014 Motherload Resource Directory.
If you've purchased a prior version of the directory, you'll get an "upgrade" discount. Otherwise, you'll still get a discount for my 4th of July Blow Out which is ending soon.
If you've missed any other offer I've ever done before, this isn't the offer you want to miss out on. Period.
Everybody knows that the world of real estate investing is all about other people's money (OPM). Anyone with a rich aunt or an endless supply of money can easily make money provided that they're smart enough to know the appreciation value of real estate (instead of blowing the money on dope and hookers...or some other such nonsense).
If you've been struggling with getting money for your deals and have been frustrated with the lack of resources due to the "dry spell" our economy has undergone in the past 7 to 8 years, here's your lucky break. (Finally!)
I have a short audio seminar about this phenomenal new Resource Directory athttp://www.monicamain.com/motherload_resource_directory/.
This deal ends very soon and once it's over...it's over!
This morning I took my daughter Brie to breakfast at a local restaurant that we often frequent. This was the second day in a row that I took her since she's officially out of school for the summer.
Yesterday morning and this morning I saw these 2 people in an old Pinto with 2 dogs. As with most people who feel they are in an uncomfortable situation, you tend to quickly skirt past people who are down on their luck, especially in a neighborhood like mine that is considered upper-middle class. That's what I found myself doing yesterday.
This morning was different...
They had this little puppy who we eventually learned was called Zippy. Brie wanted to pet the little pup and I let her. They had a much older dog called Blue, I think.
My heart went out to these people. Here they were in the parking lot wedged between a restaurant and a discount hotel/motel and this older couple (probably in their 60s) had everything they owned stuffed into this small beige beat up 70s car. With 2 dogs.
It's not my job or right to judge anyone and I don't. But these types of situations always make me ask myself..."What happened to these people that they ended up like this?"
I asked the man politely if I could offer him some money to help him out. I mentioned that I didn't want to be disrespectful but I wanted to offer him something. He said it would help get the dogs some food and he graciously accepted what I would offer.
I reached into my purse and counted out five $20 bills then handed the cash to my daughter so she could benefit from the joy of helping someone out. (This would be her second experience in 2 weeks giving money to someone who is less fortunate.) He thanked me and we went into the restaurant.
While we were sitting at the table, Brie started asking me questions about them. She asked about why we gave them money and I mentioned to them about how they didn't have a home. They were homeless and lived in their car.
This was the first time she was introduced to the word "homeless" and what it truly meant. And it made her sad. Her sadness touched my heart because she didn't understand why someone wouldn't have a home in a world (that she knows) as being abundant. It didn't quite register.
Both Brie and the homeless people are correct in the reality of their life.
Brie is correct in that life is abundant and has the ability to give everyone anything they want if they go for it.
The homeless couple are correct in that life is lacking because somehow along the way they chose that lifestyle or chose to believe that poverty is a reality.
During breakfast I pondered how someone like that could possible get out of that situation. What could you do if you're not given a break by anyone? How could you possibly shift out of that and into something better?
I thought of the possibilities.
Maybe collect cans for cash. Maybe get a post office box as an address. Maybe scrounge around Good Will to find some things you can sell on eBay. Maybe buy a cheap camera and use the computer with an Internet connection at a library to start a small eBay business.
At least that's what I would do.
Unfortunately, it's not just the mechanics of pulling out of their circumstance that's holding these people back. It's the heavy black cloud that looms over them day in and day out, blocking out any possibly hope they could ever have about their future.
Which is why they have 2 dogs. These dogs brighten each day for them and are critical for their survival. Those dogs give them the hope that they need each day.
As we left the restaurant, the man (who apparently didn't realize I gave him $100 before) was ridiculously grateful and said "thank you" over and over again. His wife (I presume) was actually sitting in view this time (since she was hidden in the driver's seat before) also profusely thanked us for the money and said something about being able to get her car registered. I quickly glanced at the tags of her license plate and saw that they expired at the end of this month...in a few days.
I looked at the woman. She looked somewhat glamorous and reminded me of Loni Anderson (if you remember who she was). If she was cleaned up and dressed up, she could easily walk a red carpet anytime anywhere.
What the hell happened to these people?
I told her "God bless" and I said that I hoped things got better for them very soon. She started wiping tears away and my heart dropped because I knew the truth...
This can happen to any of us.
Once upon a time these people were probably considered "normal" by society's standards and they hit a rough patch. And now they live in a car in a restaurant parking lot.
Again, none of us are immune to this possibility.
When you travel through LA (as I frequently do) and see a matted-haired homeless person pushing a shopping cart and wearing every bit of clothing they own on their back in 90+ degree weather...talking to themselves; what do you think?
Do you ignore them as a crazy person?
Or do you think..."What the f#@* went wrong?"
Do you think they came out of their mother's womb as a total whack job that talked to themselves and aspired to live on the streets of LA, talking to themselves?
No, my friend. Something snapped at some point in their adulthood. They couldn't handle the pressures of everyday living and their brain shut down in parts. Talking to themselves is a means of coping.
I am sometimes condemned by family members for giving money to strangers. Other people who think they "understand" why I do it think I do it as a form of tithing.
Both sets of people are wrong.
I do it because life has beat the sh** out of me many times and I understand the very real possibility that any one of us (including myself) can end up like those people.
I do it because I would want someone to help me, even a little bit, if I were in that situation.
I do it for "brownie points" because I hope the Universe will give me a "pass" and not shove me into a situation like that against my will.
And the main reason I do it because the only people who feel truly grateful for what I can give to them -- even if it's a few dollars -- are those who have been humbled by the severity of the worst that life can dish out.
The only time I ever feel a sincere blessing from anyone is when I can give to someone who is in need the most. And I need to feel their genuine blessing as much (if not more) than they need a few dollars.
Why?
Because when you're someone with money, everyone who contacts you (including and especially "friends" and family) wants money. And when they get it from you, they want more. And when they get more and you finally tell them to f#@* off after several years of the financial abuse, they immediately come to hate you and everything you are.
And it makes you feel sad because you are who you are after a time.
And that's where I'm at.
So...how does someone who is seemingly living a normal life spin out of control and end up living in a Pinto in a restaurant parking lot with 2 dogs when they should be retired, playing with grandchildren in the backyard, and watching Jeopardy every night?
The truth is this...
The mind/brain goes first. And when I say "go" I don't mean that they snapped or went crazy or anything like that. I mean that there was a slight shift in the thought process. Somewhere along the way they lost focus and maybe one or more things occurred in a short time frame that flushed their confidence down the drain where before they believed they could take care of themselves.
It happens a lot. Someone loses a good job. Then they lose their house. They find themselves living in Mom's basement. There are no job prospects. They take to drinking. Mom kicks them out.
Or there's a divorce. Or someone close dies.
Or some other such scenario.
Bottom line: something throws them off kilter and they lose confidence in themselves.
What am I getting to here?
It's simple.
Just as easily as you could be thrown off kilter, you can shift into a different direction to get what you want in life.
How?
It's so ridiculously simple that you'll probably discard it as being insignificant but here it is anyway.
1) Decide: you have to first decide that you're ready to go into a different direction in your life. To "decide" actually means "to cut off" other alternatives. It essentially means get off the fence and go in one direction with confidence while letting go of another possibility or reality. You also have to decide what that different direction will be (obviously).
2) Know-how/mechanics: once you decide which direction you want to go into, you need to get the proper know-how or mechanics (in order) that have to happen in order to achieve what you're doing. This includes education which needs to ultimately turn into a step-by-step action plan that you can follow in a specified order.
3) Action: do it. Period. Sitting on your ass thinking about it, talking about it, and dreaming about it will get you absolutely nowhere quick! My "smarties" or those of you who have high IQs, advanced degrees, or just think too much at 2am instead of sleeping end up thinking yourselves right out of success because you have trained your brains to weigh the "cons" against the "pros." And no action ever happens. So, do me a favor and "dumb yourself down" so you can take action and stop thinking about all the "what ifs" that will probably never happen.
I have to admit that in 2011 I started losing focus. When you find that you're losing focus, it usually means that something big is going on (positive or negative) or you're just done with how you're spending you life (i.e. sick of your job, business, etc.). In my case, I was getting a divorce then getting married all within about 90 days. (I know, probably not the best plan.)
No matter what I tried to do to snap my focus back, it continued to wane.
This is when I discovered that it was also time for a life change as well. Welcome to midlife crisis-ville.
In order to continue growing as a spiritual being, you sometimes have to shake things up a bit and venture out to do other things otherwise your soul starts to die.
Last year I was able to get my "groove" back with my new business.
I first started my new company to demonstrate how easy it was to set up a New Wealth Ninja business to become my own "case study" for my students.
Then this little "project" turned into a lucrative business venture.
I started to notice something weird happening...
My students knew about my new business (through my New Wealth Ninja trainings) and started to hit me up about how they could do it to.
And this is never a good sign when my students want me to talk about a completely unrelated business at a real estate investing seminar. Or maybe it is a good sign because I decided to have an Underground Secret Event solely on this Aggressive Income on Steroids and Speed method that I sort of stumbled in as a side project.
Little did I know that this side project would not only be incredibly profitable but it also saved me from careening off balance (where bad things could have happened to my financial and business future).
You'll not only discover a completely new and highly profitable business model that I've never fully explained or laid out but you'll also learn how to avoid the many pitfalls that I barely survived in this business. You'll also learn the multi-faceted realm of distribution of products from having a small home-based Internet business to having a major multi-million-dollar empire.
There's also going to be a very special guest speaker who can tell you about some incredibly profitable (and cheap) products including insider information on which of these types of products sell the most.
Ronnie will also be talking about his views of the business, the pitfalls he had to overcome, and how to quickly catapult yourself to success with some strategies that made all the difference.
Last night I found out that my Aunt Pam passed away at 65 years of age
due to a brain aneurism while she was getting a lung transplant. She
was a heavy smoker for the majority of her lifetime so...what can anyone
including myself actually say? If you abuse your body all your life,
you can't expect it to keep putting out in a positive way for you.
This made me think of my mom's death. It'll be 8 years in July since
she's been gone. Between alcoholism, heavy smoking, and drug abuse
here and there paired with the worst possible diet imaginable, here
again we have an instance of...what else can you expect? My mom died
at 52 of a brain tumor that housed the most aggressive form of cancer
imaginable.
I've taken a quick glance at the last couple of years in my life and
I'm realizing how many changes I've made for a couple of different
reasons:
1) Changes in the economy have altered the way I have to do business.
2) Personally I've determined that changes are required due to the
lack of desire for doing the same old things for the rest of my life.
The more people I've spoken to since about this time last year (mostly
women, I should add) I've been able to see that there is this same
"theme" that is running through most people's lives right now.
People want to do something different with their lives. A lot of
people (including myself) who kept "planning" on changing their diets
and implementing an exercise program finally are (like I have).
Those who lost their jobs or businesses are reinventing themselves...
and are much happier than they ever thought possible.
It also got me thinking about something else too...this one pestering
question that comes up time and time again:
What do we really need to be happy?
For the majority of my adult life, I've been extremely successful
financially. And 100% of that success has been derived from being
an entrepreneur of many different hats, as most entrepreneurs are.
What bothered me as I was delving into the "whys" and "what ifs" of
life was this...the more I got financially, the more I felt like I
had to get more of in order to be "safe and secure." And because I
didn't feel that feeling of "safety and security" that I thought I'd
feel being at certain stations in life (including where I'm at now),
I'd start to panic and really tumble off balance.
It got me thinking about the times when I didn't have anything and I
worried about how I'd pull off certain business and investing projects
I was working on.
Yet, somehow, it always worked out.
Looking back, those were actually the most peaceful and happiest
moments in my life. Certainly not because I worried about the outcome
but because there was nothing to lose.
Somehow when you accumulate a lot in your life and you have something
to lose, now you're worried about (1) maintaining what you have, (2)
getting more, and (3) possibly losing what you got.
Talk about making anyone a stress basket.
All of the above has thrown my health into a combination of stomach
ulcers, not eating enough (or well enough), and migraine headaches
while sucking out any possible energy I would normally have to do
basic day-to-day things. (At least I keep exercising though.)
I had a recent opportunity to participate in the building and managing
of a pretty large entrepreneurial project (and I won't tell you what
it is) that would have netted me somewhere in the ballpark of $20 to
$30 million after everything was said and done...in about 8 years from
now. This would have also included going back to my 65 to 80 hours
per week.
And this is where I declined.
Most of you already know that I have a daughter. She will be 5 next
month.
Most of you know that I just turned 39 last week.
And many of you are perhaps thinking that these are the 2 major reasons
why I turned down such a lucrative project.
Maybe. Maybe those are the reasons I turned it down.
After all, how often would I actually see my daughter working 80 hours
a week? I am 39 and I've "been there done that" with overworking for
many years and I don't quite have the desire to do that anymore.
(Youth gives us energy solely on motivation and enthusiasm...which I
don't have for certain things anymore.)
But for a $20 to $30 million payout in 8 years? What kind of mental
tardo would pass that up??
Me...that's who.
And it's because I've "been there done that" and I took a very close
look at what I really "needed" to exist happily on this planet.
Surprisingly, my monthly household bills don't exceed $10,000 a month.
On average, I make about 5 to 7 times that in any given month. In
some months, I make up to 14 times what I actually "need."
So, since it's pretty clear that I'm already making what I "need" by
amounts that dramatically exceed my $10,000 monthly requirement, what
the hell is $20 to $30 million parked in a bank account going to do
for me that will justify me giving up watching my daughter grow up?
I had a recent phone conversation with a student of mine. I'll just
use her initials as to not "out" her...Her name is L.D. She's an
incredibly independent woman and I admire her quite a bit for her
strength and character.
The problem with L.D.?
No problem at all except within herself.
Each time I talk to her, she has a very "heavy" energy about herself.
She's usually depressed and only wants to focus on what isn't working
in her life.
Okay, yes, she went through some major turbulent calamities in recent
months including a divorce. (Hey, I'm an expert on that one!) She
has a variety of different "issues" that she's been working through
most of her life.
And this is when I finally had to stop her before I went insane during
the phone call!
You can't move forward as long as you keep glaring into the rearview
mirror!! Past is past, baby. Nothing you can do about it.
In fact, Ronnie almost hit a box truck pulling out of a parking lot
yesterday that he was driving into because he was too busy focusing on
the police car that was riding up behind him.
You'll get hurt focusing on the past. It'll never do you a damn bit
of good either.
And this was L.D.'s problem. She was too busy not only focusing in on
the past but all of the worst things that happened...
Including...how she's in her 50s and isn't where she thinks she needs
to be financially. And how she's a few paychecks away from being on
the street.
Guess what L.D. (and everyone else out there)! I am too! We all are!
Just because I have a significant amount of assets squirreled away
doesn't mean that I am immune to a variety of different financial
storms that can come in and sweep it all away. This can vary from a
lawsuit to IRS issue to anything that may come up that I can't
possibly predict.
How many millionaires have woken up one day to realize that all their
assets were seized by the government due to the fact that we're really
all "guilty until proven innocent."
I once had $8,000 taken out of my bank account due to a clerical error
at Bank of America. There was a state tax lien on one of my accounts
because my business name closely matched another business that owed
the state of California.
What if it wasn't $8,000? What if it was $80,000 or $800,000? Or more?
I could have woken up and had all my assets frozen due to a clerical
error at the f#@&*** bank!!
And it took me 10 days to sort it all out. I would have been cashless
for all that time until the "guilty until proven innocent" system worked
in my favor.
One thing about L.D...she's a brilliant and highly regarded Registered
Nurse. She is literally the right hand woman to operating room doctors
that depend on her for her skills and talents.
She has been taking care of herself all of her adult life as a strong
and independent woman.
Yet she wouldn't see any of this (until I pounded some sense into her).
Instead she just wanted to keep focusing on what she didn't have going
on in her life. She went on and on about "what if I slip and fall and
can't work?" And I'm not in the same boat somehow??
It's just as ridiculous as a multi-millionaire who lives in San Diego
worrying daily about being kidnapped by a Mexican cartel and being
beaten for 3 days straight while his family comes up with a $5 million
ransom.
Who thinks like that?? Who worries about ridiculous negative nonsense
such as that??
Listen...absolutely none of us are at the stage in life that we expected.
None of us. Myself included.
Yet what I've learned and discovered is that I have perfectly balanced
my life to get what I need. I know that I'm talented and brilliant
enough with a strong enough skillset to start over (as I have multiple
times before) if everything is taken from me overnight. I am grateful
for these abilities and skills that I've developed to allow me to
take care of myself.
And you need to start being grateful for your abilities too.
Stop thinking about what you don't have. Stop worrying about things
that only have a 0.000000001% chance of ever happening in your life.
Start celebrating who you are, what you really want (is it really
$20 million in a bank account?), and all of the skills and talents
you have right now to get there!
(Sorry L.D. for "outing" you. You're an awesome woman. Start giving
yourself the credit you deserve!)
First things first, start identifying the negative thinking. (Hint:
it's usually about how much you're not making, how you hate your job,
how you've "failed" at doing certain things, etc.)
Now, start identifying and celebrating every skill you have. This
can be something as little as being able to whittle a whistle out of
a piece of wood. It can be your confidence. Your ability to talk to
people. Your ability to draw cartoon characters.
The more confidence you give yourself, the more action you'll take on
your action plan.
Now, the action plan...
I don't care how many self-help "attraction" books you read; you'll
never get anywhere with positive thinking until you actually physically
apply it somewhere in the world of economics.
Basic law, folks: sell a product or service and extract money from
people while offering something of value to others.
Anything that falls out of line with that simply won't work. (How
far have those lottery scratchers really gotten you in life?)
Here's what I've learned: It's very easy to quickly get past your
psychological shortcomings and negative thought patterns by developing
new thought patterns. You can only do that by moving in some type of
direction to change your life.
It's easy to sit around the campfire and talk about doing something
"someday" but "someday" never comes if you never pound out a short list
and start taking action!
Now is your time. Do something. Even if it's not something through
me, you need to really funnel your goals, desires, and dreams (starting
with what you really want in life), create a very short action plan
list (up to 10 simple items) and start working the list every day while
suspending any possible negative beliefs you have about the items or
the plan.
And there's your secret to getting anything you want.
The other day, Ronnie and I were talking through a "what if" scenario
about creating and distributing an alcoholic product.
Now, just to give you a spark of inspiration; I had a student who got
involved with my Distribution Profit System earlier this year. He took
interest in my example about how you can take an ordinary product like,
say, vodka, for instance. Then you can put a different "spin" on it
by maybe putting the vodka in skull-shaped bottles and sell them. This
is what one entrepreneur did and he became successful so I used it as
an example in my course materials.
This student of mine by the name of Nick was inspired by this to the
point where he did it. But instead of creating large vodka bottles
that would be sold in a grocery store, for example, he instead decided
to create different types of bottles for different liquors that were
small...like the ones you'd get on an airplane. Well, maybe a tad
bigger than those.
One was...yes, you guessed it: a skull. He has others. One is shaped
like a pistol. Another is shaped like an alien. I only remember those
three from the picture he emailed to me.
Nick sells these through distributors to convenience stores and gas
stations. And he sells them cheap.
The liquor, of course, is no top shelf alcohol. It's the lowest form
of well liquor you can possibly imagine.
And he reported that in the past few months since launching his product,
he's already grossed just over $150,000.
Not bad for an idea he ripped off from me (that I ripped off from
someone else) and basically filling bottles he bought in China with
sh***y well liquor.
My prediction for Nick, provided that he stays on this same track, is
that he'll be pulling in about $700,000 by the end of this year and
grossing over $2 million by the close of 2014.
Go Nick!
So, back to my conversation with Ronnie. He said that if he were to
churn out some type of alcoholic beverage, he'd completely turn his
back on any top shelf liquor. (This was before I told him the Nick
story.) Instead, he'd bottle up and sell the cheapest, most vile
and revolting alcohol he could get and call the product "Gut Rot."
I'm like..."Gut Rot"?!
He said, "Yeah, it's a catchy name. It'll be super cheap and it'll
sell really well in not-so-great neighborhoods. As long as people get
a buzz and it's cheap, they won't care about the name."
Even worse, I actually liked the entire idea and name of the product.
Why?
Because he had a point. As he said during the conversation, it's
a stupid marketing plan to create some expensive $300-per-bottle
liquor where you can only sell to high-end customers when you can
churn out a high volume selling hundreds of thousands of units to
low-end "party" stores, even if you're only making a buck or two
per unit.
Which would you rather have?
Your "clothing line" in every Walmart in America where you're "only"
making about a $1 per shirt or pair of pants that's sold?
Or your "clothing line" in a handful of mom-and-pop boutiques across
the country where you're making about $50 per shirt or pair of pants
that's sold? Except that you're only in about 25 mom-and-pop joints.
Oh, wait...Did I to mention that there are 4,663 Walmarts in the U.S.
and 10,857 Walmarts worldwide?
I'll opt for Walmart all day, folks! And yes, at "only" a buck a crack.
Okay, sure, there are higher end department stores like Macy's and
Nordstrom's but it's getting harder and harder to break through buyers
in these types of stores vs. getting into higher volume stores.
Plus, you actually have to create a higher cost product which is a pain
in the ass.
Instead, service our "get-stuff-cheap" highly consumable Walmart society
by going China, getting a pallet full of stuff, and distributing it here.
And it's just as easy as that, too.
Here are some facts:
1) No matter what, manufacturing is never coming back to the U.S. I
don't care what Obama or anyone else says. We can't make things cheap
enough with the cost of having a warehouse/plant, employees, health
care, insurance, and on and on and on...it's not affordable.
2) The Chinese have anything and everything you could ever want to
sell. What they don't have, they can make for you. And it's all cheap.
3) What the Chinese don't have is the ability to distribute here in
the United States.
And that's where you come in...and make millions in the process.
Now, of course, certain things you absolutely cannot get in China
such as consumables like herbal supplements or anything edible.
(You can still have the packaging manufactured there.)
But everything else? You can have made overseas, bring it over,
throw it into the distribution network, and rake in all the cash you
could ever want.
The other day I had this eye-opening phone consulting session with a
student on "what to do" with his real estate investing business/career.
It seems that there is a fashionable trend these days of my students
roping me into a 30-minute time-wasting phone consulting session just
to have me whip out a crystal ball and act like Dionne Warwick of the
Psychic Friends Network.
You see, nobody seems to know what they want to do with their lives and
yet I'm supposed to be the one to tell them.
And I can't do that.
How am I supposed to know which type of real estate investing you have
a liking for? I'm not you!
This is a big reason as to why I have different mentorship groups. This
allows you the opportunity to "try it out" without fully committing your
entire life to it. It allows you to get "real world experience" within
that type of investing to see if it suits you...or not.
And if it doesn't? Go with another group! It's that simple.
The other ongoing trend with my students is that I'm supposed to
"guarantee" their success somehow.
Well...there's a minor problem with that. How am I supposed to
"guarantee" that you'll become successful when there is a chance that
you'll be guided through the entire process (by me) and yet nothing
will be followed through on (by you)?
The only person's success that I can guarantee is my own. That's
because I know what I'm capable of -- not just with the education I've
acquired by being in the real estate investing trenches day in and
day out -- but because I get off my ass every day and actually follow
through with my goals and commitments to myself and other investors.
And if you're anything like me (self-motivated and a self-starter) then
you can guarantee your own success by (1) gaining the education needed,
and (2) following through until you succeed.
It's really no more complicated than that, folks.
There are a multitude of different types of income real estate methods.
Most of what I teach fall into the "passive" income category. However,
there are some aggressive forms such as SFR flipping. Since my last
SFR Mentorship Group started already, there are only groups that are
geared toward passive income.
I have my most successful signature group (Apartment Building Cash Flow)
starting next Wednesday. If you haven't had the opportunity to join this
group, I strongly suggest that you give yourself the gift of becoming a
real live apartment building real estate investor for 8 weeks. This
group is 100% online and you'll be put through the entire process of
exactly how to become an apartment building investor.
But only you can know if this is something you want. I can't tell you
if this is what you should be doing with your life.
I will tell you this: investing in multi-family residential properties
is the best type of investing there is, giving you the most lucrative
cash flows. And by taking this course, you'll be more educated than
many of the doctors, dentists, and lawyers that I consult with on a
weekly basis who are in a "help me" state of mind because they bought
property, didn't do the proper cash flow analysis before they bought,
and now they're consulting with me to figure out what to do.
("Sell that bitch and cut your losses" is usually my standard reply.)
Imagine being smarter than my doctors, dentists, and lawyers who
frequently consult with me because they got involved in real estate
investing half-assed and backwards.
You can do this but only if you believe it's up your alley. And I
can't be the one to tell you if it is or isn't. Only you know that.
There's this Asian guy down the road from my house. His name is Tom
and he owns a little donut shop called Stevenson Donuts. This place
has the best donuts and I swear the guy slips something else into the
coffee that's equivalent to speed.
As I sat there with my daughter one morning as she was chowing down
on her chocolate-covered donut, I was thinking about how profitable
the joint could possibly be. Yes, it's busy almost all the time.
But not "Starbucks" busy or anything remotely close to that.
Here again, we come into a situation where you need a calculator,
pen, and a piece of paper to realize just how "not" worthwhile that
type of business is.
You have to start off with the fixed costs. The overhead on even a
super small 800 square-foot shop is going to cost about $4 a square
foot in my neighborhood. That's $3,200 a month not including the ever-
so-famous "CAM" (common area maintenance) fees, which will run about
50 cents a square foot. So add another $400 a month to that.
The guys that own the place (Tom and Alex), work from 3am when they
get there to about 6pm when they close. It's only Tom and Alex. Once
in awhile, Tom's wife will fill in when one of the 2 dudes are cracking
at the seams and need a break before having a nervous breakdown.
So, no "employees" to speak of. That's good...well, not really. (Who
wants to work 16 hours a day?!)
Initial start-up costs were probably around $15,000 on the super low
side with used equipment including refrigerators, ovens, coffee makers,
etc. Between execution of the lease (first month, last month, and
security deposit matching a month's rent) and equipment, we're already
in $25,000 and we didn't even go shopping for the donut flour yet.
Now we go back into your average sale. Since I've sat in that little
donut shop on an average of 3 days per week before taking my daughter
to school for increments of about 7 to 10 minutes, I began to analyze
the sales going through there.
Yes, sales were a constant flow. You'd get the guy buying a cup of
coffee and that's all. You'd get somebody buying 3 dozen donuts for
a school class birthday party. You'd get everything in between...
usually averaging out to a donut and something to drink (milk, coffee,
juice, Red Bull...etc.)
Between the "bigger" orders (far and few between) and the "coffee only"
guys here and there, I figured their average sale is about $3.50.
Yes, a paltry freaking $3.50.
Mornings are their busiest. This means that there's the late morning
"lull." Then things pick up again around noon when somebody needs a
kick in the ass (i.e. coffee) to survive the rest of the day. Then
another lull. Then the school kids come by to get candy and sodas.
Since they have nothing else but donuts, there's nothing to sell to
really profit big from the lunch crowd and certainly nothing for the
dinner crowd.
I figured they average about 125 sales per day including during the
times (i.e. the summer months) when they have to take a beating on
sales due to school being out. This will give them around $440 in
sales per day or $13,200 per month.
They may make more, maybe up to $15,000 a month. But I really can't
see them grossing more than that.
Take away rent, supplies, insurance, and inventory, you have about
$10,000 left. Between Tom and Alex, they can split it, getting
$5,000 each.
For being slaves, basically.
I figure they each work about 70 to 75 hours a week and bring in
approximately $17 an hour for working drop-dead hours.
And we haven't even talked about getting their money back from their
initial $25,000 outlay yet.
Have I "boggled" your mind yet?
(That was the point!)
Here's a basic rule for you that you should tell yourself anytime you
are considering any entrepreneurial pursuit...
Rule #1: Retail Sucks!!
Well, there is Walmart, after all. But you don't want to be a Sam
Walton who, coincidentally on his deathbed said, "I blew it!"
Meaning, he failed because he was all about work and never about
spending time with his family.
Unfortunately, he didn't come to realize it until is was way too late.
But, screw Sam Walton. Because that's not going to be you.
You're not going to be another Tom and Alex donut shop operator either.
How?
Because you already understand the power of massive financial leverage
through distribution. It's like multi-level marketing except that
it's not sucky like multi-level marketing.
And if you don't know what multi-level marketing is, it's those super
lame "opportunities" where you sell product like Herbalife and Amway
to all your friends and family (until they move and change their
telephone numbers to avoid you) where you essentially "use" a large'
"network" of people to move product, and they you get a "commission"
from the sale of these products.
What sucks about this opportunity is that you're moving your product
through people who don't give a sh** about the product or being
entrepreneurs. They aren't serious business owners. They just want
to jump on some get-rich-quick bandwagon. Once they (quickly) realize
they're not getting rich fast, they jump off the bandwagon about as
fast as they jumped on in the first place.
Getting non-entrepreneurs and non-business owners to "move" product
is about as smart and efficient as laying your life on the line for a
group full of attendees at a Weight Watchers meeting to each lose
10 pounds in the next month and then actually stick with the program
for the next 10 years. Not gonna happen!
Instead, why sell somebody else's product through a Ponzi Scheme?
Using the 100% unmotivated deadbeat get-rich-quick crowd as your sole
means to success?
Pretty freakin' stupid success "plan," don't you think?
The wealthiest self-made millionaires are those who created a simple
product, duplicated it, injected it into the massive distribution
market which is composed of a sea of dedicated, serious, and successful
business people (and not fly-by-nights), and count the cash that starts
to roll in.
Today I got to waste approximately 50% of my day at the San Fernando
Courthouse in a mediation room with my ex-husband who, I'm now convinced,
is losing more and more brain cells each time the guy takes a breath.
(That may actually be true since he's a heavy smoker.)
Now you're probably wondering why, after being divorced for 2 1/2 years,
I'm stuck having to "mediate" anything.
It was a custody thing ordered by the judge. So there we sat, mediating
exactly nothing.
Did you ever have that moment of clarity when you can look at someone and
think to yourself..."Damn, dude, you really f***** up your entire life"?
I had that moment today.
It was either during or after my ex-husband's lengthy (and stupid)
explanation as to why he thought it was a "good idea" to have custody
of my daughter during work days when he can wake her up at 4:30am
when he leaves for work, drop her off at his ditzy mother's house,
and make it her responsibility to then take my daughter to school at
8am...completely bypassing my ability as her mother to fully take care
of her and get her to school on time without waking her up early and
shuffling her around in the wee hours of the morning.
And just about the time when the mediator stared at him with this
look of "why the hell would you want to do all that?"
I was thinking..."If only this idiot would choose to make things easier
for himself." (Sometimes you want to shake people and say, "Why the
hell are you so freakin' stupid?")
If you remember, I told you about how he was offered a house (and a
nice one at that) free and clear (mortgage-free) house in Michigan,
even on a lake if he wanted that too. He was offered extended support
payments and basically a worry-free life as long as he wanted to move.
And yet he chose not to go and instead concoct a variety of nonsense
hair-brain "versions" about how life could or should work, none of
which applies to anyone living in the real world.
Having dealt with more than a handful of people who seemingly and
maliciously are sabotaging their own life, it got me thinking about
everyone else who seem to have a decent logic-based head on their
shoulders.
People like you, for instance.
I already know some things about you. You are bright, sharp, and you
obviously want something different in your life. The life you have
right now isn't working. And you've been looking for something different
to do for some time now.
You just don't know how to get there yet.
Unlike my ex-husband who is living in some type of alternative reality,
far from having any sort of focus needed to get anywhere worthwhile,
you at least have a solid idea of where you want to go but you may not
know exactly how to get there.
And that's okay.
The hardest part, I've noticed, is figuring out where you want to go
and being focused enough to know exactly what you want.
If you haven't figured that out yet then you've got some work to do.
The other thing to understand is that you can't do something just for
the money. If you'll do anything just to make a lot of money then
become a porn star or drug dealer or something...if it's all about
just the money.
I have been working with students for years and have discovered that
only the ones that are passionate about real estate actually make it
in this business of real estate investing. Those who are doing it
just for the money never buy anything or end up getting involved in a
disaster of a deal that cause them to lose everything.
A lot has been happening on a universal level. To everyone. (So it's
not just you that's been soul searching.) People want to start living
on purpose doing something meaningful yet profitable. Life is a drag
if you're working on somebody else's dream while living an empty life
of endless alarm clock punching, traffic jams, office politics, fear of
the pink slip, boss bullsh** and everything else you may have come to
hate that's part of your everyday life, just know that it can change
whenever you're ready for it to change.
At the snap of your fingers, in fact.
For years I talked about how I wanted to get in shape. Yet I never
decided to make the change or commit to the process.
Until this past April, that is.
I decided...time to get on with the fitness program I've been chattering
about for years now. Time to make that roll-over annual year-to-year
same New Year's Resolution a reality.
I stopped freakin' talking about it and started doing it.
And believe it or not, right now I'm in near-top shape and I pulled it
off in less than 3 months.
So, I went from years and years of "talking" about it to instantly
"doing" something about it, thus giving me a near-instant result.
Another example...
I wrote the first act of my screenplay this past Saturday. That's
just over 25 pages of my script. And I did it by working on it most
of the day.
And this is after "talking" about it for years, making plans, making
excuses, telling myself it'll be too hard or that I'm out of practice.
Then I sat my ass down and did it. I muted the chatter and pounded
away at the screenplay...and put down a record number of pages because
I chose to shut the talking up and start getting down to action.
I think with all the external and internal chatter, we create obstacles
that simply aren't there. We create demons that don't exist. And we
incapacitate ourselves.
This is why my "stupid" students do well and my "smart" students are
miserable failures. The stupid ones are like fearless puppies. They
go out into the world, not considering the "dangers," and end up
quickly wading through the learning process to ultimately end up
successes.
My smart students (those with college degrees especially) overthink
the hell out of everything. They talk to others, talk to themselves,
and basically talk their way out of any good deal, plan, business, or
anything else that would enable them to move forward.
Which category do you fall into?
Time to sh** or get off the pot. And you decide if and when that will
be. You decide if you're going to do it or not.
We're running out of time on so many different levels. Yes, the
economy is recovering and you need to position yourself well right now
if you're going to gain the maximum profit benefit that these next
few years can offer to you.
But on a higher level, it seems that the universe is working at a faster
pace to "wrap things up" on some level (and I don't know what that is)
and there will probably be 2 types of people: the kings and the drones.
You're a trained drone. You're a slave for somebody else's dream.
Time to become the king (or queen) you deserve to be...and that requires
"breaking out" of your current life, thinking, and everything you
believe your entire life is about or made of.
I can't make you "decide" then "commit" to the process. Only you can
do that part.
What I can do is guide you to different opportunities and allow you to
determine which is most suitable for you.
And maybe it's nothing that I can offer you. Maybe you really want to
be a wrestling champ and...well, I can't help you out with that.
What I can help you out with are 2 different angles:
1) Passive income
2) Aggressive income
Passive income is best obtained through multi-family and commercial
real estate.
Aggressive income can be obtained a variety of different ways as I've
covered previously with my New Wealth Ninja stuff.
Now that I'm turning 39...I'm "older" and "wiser" now. It's really
pointless to stop kidding yourself with "plans" and "dreams" if you're
never going to get off your ass to start doing something about it.
