The Higher Earner vs. The Smart Investor: Who’s Better Off Financially? [A Case Study!]

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It’s not about how much you make. It’s about how much you keep.

If you’ve read my past posts, you know I’m an advocate of expanding one’s income through multiple income streams. You’ve probably even seen me battle with Scott Trench on the concept and value of frugality. Will avoiding your morning Starbucks run really make a noticeable impact?

Unfortunately, I have to give in a bit on the concept of frugality. You see, as I look for places to house hack around the DC-Metro market, I’ve come to realize I inherently understand that living frugally is a key part of the wealth building formula, no matter how much I hate to admit it.

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The Pareto Principle

Even though I’m giving in to the concept of frugality, I view it somewhat differently. I prefer to find ways to minimize my big ticket expenses rather than cutting back on the morning latte. I strive to follow the Pareto Principle, where 80% of my savings will come from 20% of my effort. By forcing myself to avoid my latte, I save maybe $20 a week or $80 a month—the effort is not worth the savings, to me at least.

On the other hand, I can dedicate 20% of my week to finding a great multifamily property that will reduce my monthly housing expenses. Do you know how much it costs to live in DC if you have a car (a 10-year-old beater car at that)?

You may not, so let’s break it down: $1,300 in rent, $150 in utilities, $150 in parking, for a total of $1,600 every single month. Oh, and I have a roommate, so the above is only my HALF of our total expenses. Compared to my city colleagues, I’m actually on the cheap side! Yikes.

If I’m able to find a multifamily where the other units can cover my mortgage, I can reduce my living expenses monthly by $1,600 or annually by $19,200. That’s relatively little effort, for massive savings and accounts for a big chunk of my annual expenses.

Taxes Are Likely Your Largest Annual Expense

I’m a CPA, so naturally I have to talk about taxes. Taxes are likely the largest expenditures any one of you incurs each year, aside from housing. Wealthy individuals understand this concept and constantly consult with tax advisors to minimize their tax burden. They view professional fees as an investment rather than an expense, and one that will provide returns in the form of drastically reduce their tax bills.

Ben Leybovich wrote a great article several weeks ago about personal “burn rates.” The burn rate is the rate at which an enterprise spends money. You’re not treating your personal finances like a business? Shame on you! Track your monthly income and expenses just like any business would and see how much you are cash flowing. If you aren’t doing that yet, it will be eye opening.

Anyway, taxes significantly add to the burn rate, and those people who break out of the low or middle classes and into prosperity truly understand how to minimize their tax liability. Those people take deliberate steps to reduce their taxable income, and do you know what step one is? Getting rid of the W-2 income. An example below illustrates my point.

Higher Earner vs. Smart Investor/Business Owner

I’m going to illustrate the differences between those who understand that a high paying job is not the best long-term wealth building route to take and those that do not.

Sarah’s Story

Sarah has done quite well. She’s in finance and only four years out of college. Her salary is an impressive $110,000, she lives in a city, and she is proud of how successful she is. She contributes 6% to her employer 401(k) and has a solid health plan. Her friends envy her lifestyle and success, yet they don’t see the whole picture. The problem is Sarah’s burn rate.

To be close to her job, Sarah rents an apartment in the city that costs $2,100 per month with utilities coming in at around $200 per month. Sarah spends annually $27,600, none of which is tax deductible. Additionally, because Sarah rents, she neither has property taxes nor mortgage interest.

Let’s look at the taxes: Sarah makes $110,000 and contributes $6,600 to her 401(k), which will reduce earned income to $103,400. Sarah has no other income sources and is phased out of deductions, so $103,400 is also her AGI. Sarah cannot itemize, mainly due to the fact she rents, so her standard deduction of $6,300 and personal exemption of $4,000 further reduces her AGI to $93,100, which is her taxable income. Her tax liability based on this income is $19,251.

Related: 5 Habits of the Wealthy That Helped Them Get Rich

Additionally, a commonly overlooked fact is that Sarah will also pay payroll taxes of 7.65% on her $110,000 salary, or $8,415. This brings her total tax liability to $27,666. Between taxes and rent/utilities alone, Sarah’s annual expenses are 50.2% or her annual salary, or $55,266. That’s a very high burn rate, and we haven’t even factored in basic living expenses, such as food!

Sarah is therefore left with $54,734, including her 401(k) contribution, to spend how she chooses.


Tom’s Story

Now let’s switch gears and look at Tom. Tom is also four years out of college and spent the first three working for corporate America. Tom works in the same city as Sarah. Tom found BiggerPockets early on in his career and decided that the key to wealth building and lifestyle design is that it’s not about how much you make; it’s about how much you keep.

So Tom purchased a property using his corporate W-2 to obtain financing. Because he decided to look around the city rather than in the city, Tom found a reasonably affordable 4-unit for $350,000 which he decided to owner-occupy. Tom put 3.5% down, and his monthly payment comes out to be about $2,300, which includes that pesky mortgage insurance.

Luckily for Tom, with the knowledge he gained from his time spent on BiggerPockets, he figured that each of the three units will rent for $900, and he was right. So Tom actually earns $400 per month for living in his property. He also has utilities, though his tenants pay for their share, so Tom only pays $200 per month, leaving him with a net $200 cash flow per month.

With the massive decrease in housing expenses, Tom was able to quit his corporate job and open up his dream business. He provides services to clients, and during the year, he nets $55,000. Great for the first year in business; poor compared to Sarah—right?

Not really. Tom understands taxes are painful and has sought out a good CPA. The CPA set him up with an S-Corporation, and Tom is able to pay himself a salary of $22,000. The remaining $33,000 is taken as a shareholder distribution, which is not subject to payroll tax. Tom, like Sarah, also contributes 6% of his salary to his 401(k)—although his CPA advised him he can contribute significantly more with employer contributions.

Let’s look at the taxes: Tom’s salary is $22,000, and he contributes $1,320 to his 401(k). His real estate income and expenses net out to $0 for tax purposes. He also has $33,000 of taxable income from his S-Corporation taken as a distribution. Tom’s AGI will be $53,680. Tom is able to itemize as he pays mortgage insurance and property taxes, which pushes him over the standard deduction threshold. His itemized deductions come out to $9,180, and his personal exemption is $4,000, reducing his AGI to $40,500, which is also his taxable income. His tax liability based on this income is $4,969.

Additionally, Tom must pay both the employer and employee halves of payroll taxes of 15.3% on his $22,000 salary, or $3,366. This brings his total tax liability to $8,335.

Remember, Tom’s net income for his multifamily property was $0 for tax purposes, but Tom actually cash flows $200 per month, which is essentially tax-free. How does this happen? Depreciation!

Taking into account Tom’s taxes and living expenses (or lack thereof), Tom’s annual expenses based on these facts alone is 26.9% or $5,935 ($8,335 – $2,400 of tax free rental income). This leaves Tom with $49,065 to spend as he chooses.

Please note that this example is purposefully not using like-kind variables. Life is full of variances and the two points I’m attempting to drive home are: (1) it’s not about how much you make and (2) thinking strategically about your finances can drastically change your entire life.


Who Has it Better?

Honestly, I don’t know. I don’t know how much Sarah works compared to Tom. I don’t know how much they enjoy their particular situations. But if I had to guess, I’d say Tom is better off for several reasons.

First, many of Tom’s everyday expenses can now be strategically written off as legitimate business expenses. This will provide Tom with savings that are unachievable to a W-2 employee such as Sarah.

Additionally, Tom runs his own business and is his own boss. There are pros and cons to this of course, but based this article that claims 52% of employees are unhappy at work, I think the odds of Tom being happier is higher than that of Sarah’s. As a business owner, Tom’s earnings potential are unlimited and can be tied directly to his efforts and implementation of business systems. Compare that to a W-2 employee whose earnings are tied to annual performance reviews and how well they can negotiate with HR.

Tom has also mitigated his risk of income loss by having multiple income streams. If Tom doesn’t get paid, he won’t be facing an eviction or even a foreclosure since his tenants are paying his mortgage. Sarah on the other hand will be in trouble if she is fired.

From a tax standpoint, you can clearly see who is better off. Tom can strategically implement tax plans to reduce his business income and payroll taxes—strategies which are unavailable to those who hold W-2 jobs.

The moral of the story here is clear: Business owners and real estate investors have a massive advantage over everyone else. This can be further substantiated by examining how the world’s wealthiest people earned their wealth (hint: it wasn’t from that W-2 job).

What Should You Do?

Evaluate where you are now and where you want to be.

Start with looking at your personal income statement and statement of net worth. If you’re not tracking these, then you should start today. Heck, shoot me an email and I’ll send you my templates.

Once you are tracking your expenses, you’ll notice that you spend more money in a few key areas over all others. For most of us, the top two will be living expenses and taxes. Your job is to figure out a strategy parallel to your goals to reduce your top expenses.

I understand that you may not be in a financial position to take down a multifamily property. My challenge to you would be to do whatever it takes to get to such a position. If it’s simply impossible, consider picking up a single family home and renting out the rooms—same idea, but just sharing the same space.

I also understand that many of you have families and owner occupying a multifamily is not an option. Can you make the bonus room above the garage rentable? Do you have a detached guest house on your property that you don’t need? Can you downsize and use the excess cash to pick up a couple of rental properties? Get creative here.

Related: The Pain-Free, Proven Way to Achieve a 200% ROI, Build $1.5M in Wealth & Earn $300 Per Hour

I hate paying taxes, which is ironically why I love the specialization so much. Anything I can do to legally reduce my tax liability I want to take full advantage of. It has become clear to me through helping clients and extensive readings/research that business owners and real estate investors are not held hostage to the tax code, rather the tax code is their friend.

So my next challenge to you is: figure out how to get out of the corporate world and into business for yourself. This can be a real business or just managing your rentals. Of course, this is easier said than done.

To mitigate the financial risk, build a side business while you maintain full-time employment. You don’t have to quit your job tomorrow; you can be smart and strategic about the timing of jumping into a side business full-time. If that means waiting 3, 5, even 10 years, that’s okay.

Everyone should try to generate side income. You have unique skills that others don’t. Figure out a way to monetize them. From purely a tax standpoint, working for someone else is simply too costly. You may love your job, which is great. But that song Jennifer Lopez wrote: “Love Don’t Cost a Thing” is a huge lie—at least that’s what my parents tell me.

We’re republishing this article to help out our newer readers.

What do YOU think: Is frugality worth it? Can you get ahead financially with a W2 income?

Leave your thoughts below!

About Author

Brandon Hall

Brandon Hall is a CPA and owner of The Real Estate CPA. Brandon assists investors with Tax Strategy through customized planning and Virtual Workshops. Brandon is an active real estate investor and a Principal at Naked Capital, a capital group investing in large multi-family projects and manufactured housing. Brandon's Big 4 and personal investing experiences allow him to provide unique advice to each of his clients.


  1. Brian Karlow

    Great article Brandon! I love how you emphasize running your personal finance like a business. I’d love to share your mentioned expense tracking sheet with many of my friends who have not yet implemented this practice. Could you please email copies of these forms….I’d really love to pay forward in hopes that these could possibly even help out one person. Keep up the awesome articles!

  2. Michael Boyer

    Neat illustration here ..And for further holiday reading on this theme, a few similar ideas can be seen in the classic (but now dated) Millionaire Next Door and some of the data those authors gleaned on persistent accumulators of wealth in America (often thrifty, playing good defense, often business owners, as opposed to high W2 earners or spenders, and lots of financial planning, which of course includes tax planning). I can’t stress enough how important understanding tax implications of decisions are for financial planning and financial success (think, e.g., of Berkshire Hathaway and their dividend policy, driven partly because they produce greater returns by plowing the money back into their enterprises, but also the double taxation is a large driving factor, as you will see in the many in depth books on his philosophy, see Snowball book etc…). Rich Dad, of course, also has some ideas on the limits of W2 earnings versus business ownership for the popular audience, but with less depth on the precise tax implications. Keep up the good work!

  3. Articles like this that suggest a high income isn\’t \”all that and a bag of tricks\” miss the mark IMHO. It\’s far easier to save a huge percentage of your salary, and that huge percentage is more money, when you have a high income. Sure, taxes suck, but your marginal tax rate is never 100%.

    I could invest far more money when I was making $50K instead of $20K, when I was making $120K instead of $50K, when I was making $300K instead of $120K, etc etc etc. If you\’re making $800K, and saving $300K per year, you can buy a nice rental house for cash every year.

    High earners become wealthy by converting their earned income into passive income ASAP. But the high earned income is the foundation. 80% of my first million was brute force savings. That percentage will go down for the 2nd, 3rd, 4th million etc, but the fact remains that a high income is an excellent tool for any investor.

    • Brandon Hall

      I agree with everything you are saying and my previous articles and thoughts fully support this view. This article simply shows us that it’s not all about how much you earn – savings is an important part of the wealth formula.

      From my experience in dealing with high net worth clients, they spend more as their incomes increase. So it is very much about how much you keep, not necessarily about how much you make.

      Keep in mind that, if you are indeed the White Coat Investor, you run a successful blog and generate substantial business income. The same scalability is not available to W2 earners. I wanted to show it in a different light, mainly that you don’t need a high paying W2 job to be successful.

      Keep up the good work by the way, your blog is great!

  4. Vania Castillo

    Thank you for the article, Brandon!

    As stated in the book “Secrets of the Millionaire Mind” by T.H. Eker, Wealth has four pillar:
    1- Income: Critical, but only a part of the entire equation. You can earn wads of money, but if you don’t keep it, you will never create wealth.
    2- Savings: Imperative. Many people’s blueprint is wired to spend.
    3-Investments: Needs no explanation
    4-Simplification : The “dark horse” because few people recognize its importance in creating wealth. Simplification is consciously creating a life style in which one needs less money to live on. By decreasing one’s cost of living, one increases savings and amount of funds avaialble for investing.

    Keep up the good work, Brandon!!

  5. margaret smith on

    Hey Brandon-
    This is comprehensive enough to be really useful. I am already doing the Model 2, but… I would love to have those templates too! Where do we find you?

  6. Brandon this an excellent article, knowledgeable and so clearly written. Even a caveman can understand it. It also helps a person to put building blocks together for a solid plan. Would you please send me your templates, as well?

  7. Scott Trench

    Brandon – I think that this is a great article here. I think that I completely agree with your points on the business owner vs W2.

    I also totally agree with your points on value creation vs frugality. I think that frugality is really critically important only at the outset of business building and in laying a financial foundation. Then, “frugality” is open to interpretation, so long as your income far exceeds your expense. It’s my belief that Tom only gets the chance to house-hack, start his business, and THEN leave Sarah in the dust from an income perspective because he saved up the $20K from his W-2 in the first place. With that initial savings, a property to help him live for free, and probably a lifeline of another $10-$20K, Tom was able to go ahead and try to build that company that now lets him shield his earnings from the IRS, and begin to scale.

  8. Mayank S.

    Great Article Brandon. One of Ben Leybovich article was also surrounding this issue of W2 vs entrepreneur that opened my eyes. It is very well written and reinforced in me again why it is critical to have side income through REI while holding on to full time employment.

  9. Rick C.

    Hey Brandon – Another excellent and thoughtful article! Keep them coming!

    In the Tom example, you mentioned that his CPA set him up with an S-Corporation for his “dream business”, allowing him to take $33k as a shareholder distribution that is not subject to payroll tax. Do you ever recommend an S-Corp for the holdings of small full time real estate investors?

  10. Gerardo Dominguez

    @BRANDON HALL Unfortunately, any time I hear anything related to tax planning I instinctively become a deer in headlights lol So thanks for making this very informative but easy to follow. You did a great job illustrating the importance, and impact, of good tax planning. I’ll be taking you up on your offer for templates shortly. Thanks!

  11. Peter Dunne

    Super helpful Brandon. While every individual situation has it’s own wrinkles, your articles have a way of shifting our mindsets to new ways of thinking and organizing our decision making. Thanks for writing and keep it up.

  12. Asem AbuAwad

    Good Stuff Brandon. I am at the situation where I want to figure out how I can leave my corporate job and be my own boss. This might take a while but I gotta start some where 🙂

    The problem that many people face is the idea of leaving your comfort zone and start playing the investment game thinking about the “What IFs” in each stage along the road.


  13. Ronald Lopez

    Great article Brandon! Personally, it is very reassuring to read something that I have always believed to be true. I love the part about looking at your personal finances as a business. I still have a lot to learn about the tax planning, but thanks to articles like this I am making progress! Thanks for the great read and I’ll be reaching out to you for the templates. Thanks!

  14. Javier Marchena

    You lost me at the beginning of you scenario. Why would Sara rent at $2,100 a month, instead of buying? and buying a four-plex, living in one and renting the other 3? She got the income to back it up?
    We are talking about “The Higher Earner vs. The Smart Investor” or a “The Dumb Higher Earner vs. The Smart Investor”? You can get higher salary and be smart on your investments.

    • Brandon Hall

      Javier – It’s quite common to rent at $2,100, even $4k per month, in large cities (I speak from experience knowing what people pay here in DC). The reason is that home prices are unaffordable and renting provides luxuries and amenities (and location preferences) that a home may not.

      I’m not really understanding your part about the income for the “buy a fourplex, live in one and rent out three”. If you read my article, you’ll clearly see what I’m talking about.

      The point was to demonstrate that you don’t have to be earning $100k+ to invest in real estate and be financially free.

      • Fabio Secaira

        Excellent article Brandon! Being from the same area as you, I know plenty of people that fall in the first camp. This city (and the surrounding areas) is full of high income earning professionals that are focused on building their careers, not in being business owners and/or investors. It’s not as much that they are “dumb high earners”, as it is that most people don’t think like entrepreneurs. Most of us are taught early on to get good grades, so we can get into a good school, so we can get a good job (with benefits!). It’s a very small minority that ever ventures out into the scary world of entrepreneurship.

        Thanks again for the article, great perspective. I’m sending you an email shortly.

  15. Lora H.

    Great article, Brandon . . . . thanks for taking the time to write this up and share!

    I have a couple questions on your article that I didn’t follow. I’ll also post this as a comment to the article in case you’d like to reply there so others can read it. I used to do my own taxes and understand what you mean by AGI, etc. I stopped when I tried to do depreciation on my own – boy, did I goof that up.

    Tom’s example:
    Here I follow pretty well through tax liability number of $4,969. I don’t understand the payroll taxes of 15.3% realizing I don’t know much about S corps. I understand he doesn’t pay payroll tax on the 33k. I don’t understand the net income = $0 based on depreciation (I failed that class as mentioned above, lol). You mention Tom’s annual expenses is 26.9% or $5,935 ($8335 – $2,400 of tax free rental income); now figured out the 2400 = 12 * 200/mo cash flow. Guess I need a touch of “hand holding” through some of this.

    And I’d love the template(s)! Thanks. [email protected].

  16. Brandon, good article.

    Based on my own experience over the past 30 years, one makes more money with a Job IF (and it’s a BIG if) (a) you have a well paid skill, (b) you’re able to capitalize on lucky breaks and (c) nothing bad happens.

    a) you aren’t going to do well as a cashier or laborer. Period. Pretty obvious. But, if you have an engineering degree, law degree, CPA, etc, you can trade that into a well paying job (over $100K). I have a number of friends that started out of college the same time I did (I have an Aeronautical Engineering degree) and there is no doubt I have more book smarts than they do. But, some of them have gone on to make literally millions in corporations. Which leads to:

    b) you will get lucky breaks but you have to recognize them and capitalize on them. The inverse is true as well. While at Boeing I almost got sent to Harvard Law on a full ride, but the deal was cancelled. It was then that I realized I would have more lucky opportunities if I was on my own than within a corporation.
    What I’m getting at is we tend to compare ourselves to the successful ones in corporations. However, for every one of those, there are thousands that didn’t get that early promotion, leading to the big fat upper management paycheck.

    c) Bad stuff happens. I was a Flight Test Engineer and used to joke about wearing a parachute to work (sitting in an ejection seat isn’t exactly wearing a parachute but you get the point). What I found out is that with a job, you have very little control over situations WHEN (not if) bad stuff happens. Plant closings, layoffs, mergers, etc. If you have your own business MORE bad stuff WILL happen. Get that through your head. If you can’t handle laying awake at 3am wondering how you’re going to make payroll or make that bank note payment, then get a job an live in blissful ignorance of the dangers that surround you. They are still there but somehow W-2 folks delude themselves into a false sense of security.
    However, with your own business, you have more control over how to react to those situations. You can’t reverse a plant closing but you can win back a client, find a new tenant, etc.

    Which leads me to why I like real estate. It’s one of the few businesses where the rules are very strictly defined, therefore your risk is limited. You can insure for most losses and can define what your worst case scenario will be. If a tenant doesn’t pay, then you can have them evicted. Sure you lost rent revenue but you can repair the unit and find another tenant. I’ve had a very large IT company steal my patent, take my customers and then sue me in anticipation of my patent infringement and breach of contract suits. They had more lawyers than I had employees. How do you think had the upper hand? (side story – I actually won that one but it was sheer luck on my part and HUGE brass [email protected]). It was right after that episode that I got into real estate investing.

    Just had a unit burn down right next to my property. Tenant was displaced. My total loss will be about $1000-$2000 due to careful planning BEFORE bad stuff happened.

    In closing, if you can’t take the risk, don’t want to work longer hours than your W-2 friends, want instant gratification and the status of a title, go the job route.

    If you want to be that quiet person who drives an older car/truck and puts up with people telling you “I always wanted to start my own business”, you are able to deal with obvious risk and can wait 10 years for the bigger payoff than the average of your friends, then running your own business is for you.

  17. Junior Mac

    “Evaluate where you are now and where you want to be.”

    In each one of our “stories” the math works differently. This article does a good job of highlighting that message. You do not need $100k salary to invest in real estate.

  18. Marco G.

    Great article, I’ve read it a few times. But this time I realized there’s no mention of corporate taxes on the $33k left over after the $22k salary draw (or did I miss it?). How does that impact the analysis?

  19. Kevin Longeuay


    Great article Brandon. I’m a fan of nitty gritty details and you laid them out very well. I’m going to reach out to you for some of your expense templates. I keep track of our monthly expenses but never factored in taxes, of which I pay a LOT of since I don’t have any write offs at the moment.


  20. Eric Schultz

    I’m a little late to the discussion on this article, but it’s great even several months later! Well done Brandon!

    I would point out that if Sarah is contributing 6% of her $110,000 salary to an employer 401K and it is matched 100% by the employer, than Sarah is accumulating 401k contributions at a rate 10x greater / faster than Tom per year. This is a considerable amount over time and 50% of it is “free” just by being employeed. As long as Sarah becomes vested (after 5 or 6 years of employment is probably typical) than she keeps and controls 100% (pre-tax). Sarah could then potentially transfer 401K funds to a self-directed IRA for investing in rental properties.

    Sarah probably has an advantage for conventionally financing rental properties as she has a W-2 with a steady track record of income.

    Unless business proceeds substantially increase for Tom, and assuming he can systematize his business for allocating more of his time elsewhere, Sarah may have the advantage in building semi-passive / passive income through real estate investing. Tom can always find time for the “no or low money down approach”…but Sarah can too. So who has more of an advantage???

    It’s just a matter of preference and too many variables to count…

    Thought-provoking article!

  21. Thomas Hickey

    I don’t post here as often as I should. This article is my exact life story, right down to the fact that my name is Tom haha! I was at a crossroads after college, continue down the all consuming and profitable road of marketing but risky or focus on investing. I chose a safer role with the local DPW for my day job and focus on investing in my spare time. The alternative was getting an MBA and putting myself more in debt.

  22. Nancy Bachety

    Nice article again Brandon!
    It’s late in the game posting here but could Sarah or Tom (or anyone for that matter) have it both ways? Meaning, can you work at a $100K W-2 job for say 40 hours a week AND work a business that runs as an S corp or LLC too? Now you have the potential to earn and save through the W-2 while gaining some tax-saving benefits of running an S-corp/LLC?
    I know this is what many working RE Investors work hard at doing.

  23. Steven Wertheim

    Great article Brandon! I am also a CPA with a Big 4 background and seem to have a lot of the same opinions as you do. I’ve been reading your articles for a while now and it has helped motivate me to start a blog to help young professionals and millennials recently out of college! Thanks for the great posts!

  24. Mike Allen

    Wow! On tracking your personal expense as a business: My late father retired as an internal CPA for a national firm. The “jargons” of accounting was a norm in my life when him and I talked about things. I remember starting to keep “accounting books” when I was still receiving an allowance from him at age 14.

    I asked him how can I keep track of my money? He said “get one of those yearly agenda booklets and split every day-page in half. On one half write down all the money you made, and on the other half write down all the money you spent. At the end of every day tally your totals and subtract what you spent from what you earned. Write your negative numbers in red ink and your positive numbers in black. Next time you receive your allowance, tally all the day sums that fall between allowance periods. Try to make your expenses less than your income and you’ll be just fine”. I still have those “agenda books” today. They are over 30 years old. And it’s an amazing nostalgia to look at the numbers and see how much candy or taking a ride cost back then.

    I’m beyond indebted to my dad for all the successes that this self-discipline brought to my life. May God rest his soul.

  25. Yaron Horsky

    Loved your post.

    What you see It’s unbelievable once you do the math (that is why I love math and numbers so much 🙂 )
    People feeling high and safe with big time salary, other people sees them as “successful” people who made it.
    But, if you sit, run the numbers, a 40-50K annual salary smart investor can kick 100K+ salary income high earner ass in the long run.

    Loved the simplified examples and article!

  26. Andrew Syrios

    I’ve heard of lots of high earning doctors and lawyers living paycheck to paycheck. And we all know what happens to many professional athletes and movie stars when the checks start coming in. Making money and keeping it (and growing it) are two very different things.

  27. Steve B.

    Great comparison of reality, I wish I knew this when I was a lot younger. They should definitely do a better job teaching kids in school. I am trying to learn and teach my 4 boys at the same time. Thanks for posting.

  28. Jonny R.

    Great article! Thanks Brandon. Side note for other readers eager to be a Tom ($350k 4plex) and not a Sarah ($2.1k rent): you will have a hard time finding a 4plex at Tom’s price if you’re paying Sarah’s amount of rent.

  29. Michael Purcell

    I really liked this article and would love to have your templates.
    I live in DC, too, and living here is not cheap.
    I am a Real Estate Agent with Keller Williams Capital Properties and I am little stunned how many agents have no rental properties.
    I just sold my Town House in Virginia and I am in the process of educating myself on Multi-family properties. I am a BP Plus member.
    Thanks again,
    Michael Purcell

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