10 Money Rules That Let Me Quit My Job and Scale to $300 Million Through Apartments

The 10 Money Rules That Changed Everything

Let me share the 10 money rules that let me quit my job and scale to $300 million through apartments. 

Money Rule #1: Retirement is Stupid

The first money rule I learned is more of a mindset. The idea that I’m working 40 hours a week just so I can sit on my butt when I’m old and gray and not do anything is ridiculous. I know this because I experienced it firsthand during a 90-day paid sabbatical from my software job. 

After about the third week, I started feeling my brain slow down. I was sleeping 10 hours a day, and it scared me. I believe that humans are wired to be productive. Most humans are wired to be productive.

And the concept of waiting until I turn 65 to retire makes no sense either. By then, your health is often down the tubes, and you can't actually do the things you really want to do. Instead of working toward retirement, I decided to work toward financial freedom, which gives me more options about how to spend my time. I’ll be able to achieve it sooner and sustain it past 65.

Money Rule #2: I Can't Save My Way to Financial Freedom

Financial advisors talk about the 4% rule, meaning you can liquidate up to 4% of your equities and savings without running out of principal. But if you do the math, building $2.5 million in the stock market takes decades using traditional saving methods. 

Money Rule #3: Forget Single Family Houses

Whether you're flipping or building a rental portfolio, the numbers don't work for true scalability.

Most people can handle one flip at a time, which takes six months and might generate $25,000 to $50,000 per flip. That's maybe two flips per year for $100,000 total. But it's not passive because if you're not buying, fixing, and selling houses, you're not making money.

Money Rule #4: Focus on Cash Flow, Not Net Worth

You can't really live off net worth, especially if it's tied up in real estate, because you'd have to sell it. Really focus on the cash flow because that's what pays your bills and gives you freedom.

With a syndication – apartments, for example – you get paid multiple ways. You get paid at closing through an acquisition fee, which is 3% of the purchase price. On a $4 million building, that's $120,000 that you split with your partner. You also get ongoing cash flow from the building and asset management fees. You have all these sources of income coming from a syndication that you don't have with single-family houses.

Money Rule #5: Stop Trading Time for Money

This really hit me when I read Rich Dad Poor Dad. I was making six figures as a software product manager, but it occurred to me that if I stopped working, I'd stop earning money. I wasn't making hardly any passive income off my stocks and bonds.

If you want to stop working, you're going to stop getting paid – and that's not acceptable. The only way to break this cycle is through passive income that continues flowing whether you're working or not.

Money Rule #6: Build a Vision Bigger Than Just Money

Money is just a vehicle. If you have a goal of $10,000 in passive income, that's a very weak why. To get there, you're going to have to do a bunch of stuff, take risks, and face challenges. You'll get discouraged and have setbacks.

The way you address this is to develop a strong “why” by visualizing what financial freedom looks like for you. Do the perfect day exercise: If money were no object, where would you be? With whom would you be? What would you be doing? 

Write it down. That emotional connection to financial freedom is what's going to drive you through the tough times.

Money Rule #7: Get Your Rat Race Number

Financial freedom is also a number. What number do you need coming into your bank account each month to cover your living expenses? Not salary, but passive income? Income generated from assets that’s distributed to you each month. 

I'm talking about the minimal number that covers your basic living expenses – utilities, housing, food. The lower you can get that number, the faster you can get to financial freedom. If your rat race number is $5,000 per month instead of $15,000, you'll reach freedom much faster.

Money Rule #8: Use Other People's Money

Use other people’s money! So many investors try to save their own money and buy properties slowly, one at a time. You need to learn how to raise money so that you’re no longer limited by your own funds. The good news is it's not that hard to learn; people in our program are raising money within 30 days.

You don't even need to raise all the money yourself. You can partner with people who have access to capital. Natural capital raisers partner with deal finders all the time. But for goodness' sake, use other people's money when you're getting into real estate.

Money Rule #9: Pay Yourself First

Every entrepreneur pays himself last – after expenses, after employees, after everything else. You've got to reverse this. When money comes in, pay yourself first. This is your money. Then pay expenses and everything else.

Money Rule #10: Make the First Deal Happen Fast

The first deal changes everything. It's your launch pad to financial freedom. Do whatever it takes to close that first deal, even if it's the worst, smallest deal you'll ever do. It doesn't matter how much money your first deal makes.

When you close your first deal, the law of the first deal kicks in – you become a deal magnet and a money magnet. This is why getting your first deal done is so important for building momentum in your syndication business.