My Name is Tom Sylvester and I work a full-time job.<\/p>\n
(Hi Tom!)<\/p>\n
I say that I work a full-time job because I believe that it is important for people to understand that you can be a real estate investor and work a full-time job.<\/p>\n
(Boo! \u00a0We want to quit our jobs<\/a>\u00a0and get in the fast lane with real estate investing so we can make lots of money while sitting on a beach!)<\/p>\n Hear me out. \u00a0I want to make lots of money and sit on a beach too!<\/p>\n —<\/p>\n For many, one of the allures of becoming a real estate investor is the prospect of being able to leave your job. \u00a0Most people work a job, not because they want to, but because they need to support themselves and their family. \u00a0It is awesome to see people who get into real who are able to leave their job and become successful in real estate investing, but the grass is not always greener on the other side<\/em>. \u00a0While there are benefits to leaving your job, there are also a lot of benefits to have a job.<\/p>\n I plan to eventually get to a point where I do not need to work a day job and can instead live the lifestyle that I want from my investments, but in the meantime I will enjoy the benefits of working a job while investing.<\/p>\n Description:<\/strong> Most people understand that to get a loan from a bank<\/a>, they want to see that you have enough income to be able to make the payments. \u00a0When you are a real estate investor, banks are one of your potential sources of funds. \u00a0Most banks will finance 80% of your investments, but only if you can show income and have a credit score<\/em> that gives them confidence in your ability to repay the loan. \u00a0Before the housing crash, it was much easier to get a loan without a 1099 or W2 job. \u00a0Since it is now much more difficult, having that 1099\/W2 to show the bank will make getting loans much easier.<\/p>\n How I Benefit: <\/strong>Outside of my first deal (which I bought so cheap the bank said they could give me a mortgage that small),\u00a0I have not have any issues getting loans from banks. \u00a0I show them my W2 along with my credit score and am able to get financed. \u00a0This has included multiple mortgages for real estate as well as a business loan to start my wine\/liquor store.<\/p>\n Outside of banks, I also do a fair amount of work with private investors. \u00a0Being able to show them that I have a job to support myself in addition to my investments provides them more confidence investing with me.<\/p>\n Description:<\/strong>\u00a0When you have a job, you have a steady paycheck in addition to your real estate investments<\/em>. \u00a0This means that you can make investing decisions that make sense, instead of making them because you are dependent on the income. \u00a0This could mean not jumping on every deal and instead picking the cream of the crop.<\/strong><\/p>\n How I Benefit:<\/strong> I don’t have to worry about how I will buy groceries for my family each week from my real estate investing. \u00a0I know that my job provides enough to support my family, as well as extra to save and invest. \u00a0This also allows me to invest at my pace and explore different options (such as starting a retail non-real estate business).<\/p>\n Description:<\/strong>\u00a0There are many skills that can be learned at a job. \u00a0Some of these skills may be soft skills, such as listening, communication, teamwork, problem solving, creative thinking and confidence. \u00a0Some will be hard skills, like how to operate a computer, market effectively, fix a car or whatever other skills come with your job.<\/p>\n How I Benefit:<\/strong>\u00a0I learn a ton at my job! \u00a0I started out developing software (coming out of college with a degree in computer science), so I learned new technologies and how they worked together. \u00a0This helps me in the technological aspects of my business, such as developing my website and integrating data from various sources together.<\/p>\n I then moved on to project leadership, where I learned how to work with a variety of people and manage multiple aspects of a project that included technology. \u00a0I also learned a lot about how to handle different problems as they occur.<\/p>\n In my current job, I am using lean concepts to design processes and workflows for people to follow when working on projects. \u00a0This helps me understand how to develop and design lean workflows for my real estate business so that I can step away and hire someone else to follow them.<\/p>\n Finally, the company that I work for provides services to businesses, so I learn a lot about other businesses and the services that we offer them, which in turn help me implement them in my businesses.<\/p>\n Description:\u00a0<\/strong>Many organizations will provide training to employees. \u00a0This could be things as small as how to use computer software all the way up to paying for college classes.<\/p>\n How I Benefit:<\/strong>\u00a0Not only was I able to attend several technical trainings as a software developer, I was also able to get my entire Masters degree paid for by my employer<\/em>. \u00a0My Masters was in Management and I was able to take courses in the following topics:<\/p>\n -Organizational Development and Change These topics are all important aspects of running a business. \u00a0I was able to educate myself on various aspects of a business at no cost to me. \u00a0In addition to the learning, having my Masters provides more credibility when talking to banks and lenders.<\/p>\n Description:\u00a0<\/strong>We all have the best intentions when getting into real estate investing, but as any experienced investor can tell you, we all make mistakes. \u00a0We pay too much for a property, we over improve the property, \u00a0we rent to the wrong tenant, we wait too long to evict<\/a>\u00a0and so on. \u00a0Having another source of income outside of your real estate investing makes these mistakes less have impact.<\/p>\n How I Benefit:<\/strong>\u00a0I haven’t really paid too much for a property, but I have spent too much on renovations. \u00a0My basic strategy for buy and hold investing it to purchase run down properties with cash for a discount, renovate them to rent and refinance to pull my cash out. \u00a0In some cases (especially early on), I spent too much on the renovations because I incorrectly calculated the ARV. \u00a0So when I went to refinance to pull my cash out, the refi did not cover the purchase + renovation costs. \u00a0It if did not have cash coming in from a job, I would have had to pay quite a bit of interest on the portion of cash that was not included in the refi.<\/p>\n There have also been cases where I lost several months worth of rent by not evicting a tenant soon enough<\/a> or had a large expense related to a property. \u00a0Finally, I can use the profits from real estate to grow the business faster, since I am not relying on them to support myself and my family.<\/p>\n Description:\u00a0<\/strong>Books such as The E-Myth and The 4-Hour Workweek describe a business as a collection of processes (or systems). \u00a0\u00a0These processes, when executed, enable the business to deliver a service or product to the customer. \u00a0Instead of the traditional thinking that the owner of a business needs to be involved daily and work a lot of hours, these books recommend creating these processes and outsourcing someone else to actually perform the tasks.<\/p>\n By working a full-time job, a person does not have the time to work the job and then handle all of the aspects of their real estate investing businesses. \u00a0This forces the individual to create systems and pay others to perform them.<\/p>\n How I Benefit:<\/strong>\u00a0I have a full-time job and a family, so I need to limit the amount of time that I spend on my personal businesses, otherwise it will cut into my family time or it will cut into my job. \u00a0So for every aspect of my business, I am forced to define the processes and outsource them.<\/p>\n When we had our daughter, this allowed my wife to stay home and raise her. \u00a0She is now the office manager for our businesses and makes the same income that she did while working, but she works less, has a flexible schedule and can spend lots of time with our daughter. \u00a0When I am not working, I can spend time with my family, instead of trying to catch up on all of my work from my businesses.<\/p>\n Description:\u00a0<\/strong>Companies often offer perks to their employees, such as stock options or retirement matching plans.<\/p>\n How I Benefit:\u00a0<\/strong>One of my funding strategies for properties is to borrow from my 401k retirement account through my employer. \u00a0I’m allowed to borrow up to $50,000 from my 401k for a few percent of interest. \u00a0My employer matches some of my contributions. \u00a0So I am getting additional funds in my 401k, which not only helps me with my real estate investing, but also helps in having more money available in my 401k to allow it to grow.<\/p>\n Description: <\/strong>Health insurance is a confusing and costly expense, especially for those who own their own business. \u00a0By working for an employer, health insurance will most likely cost less as employer insurance rates are often cheaper since they receive economies of scale by offering plans to their employees.<\/p>\n \u00a0How I Benefit:\u00a0<\/strong>I don’t have to spend extra time or expenses on researching the best insurance for myself or my family. \u00a0I am able to take advantage of my employer’s plan and it automatically gets deducted from my paycheck.<\/p>\n Most people that I speak with and articles that I read discuss focusing on quitting your job asap so that one can invest in real estate full-time. \u00a0That is definitely one path of many, but there are many benefits to having a job, especially early on in your investing.<\/p>\n Have you quit your job to invest in real estate full-time? \u00a0Or are you currently investing in real estate while still working for someone else? \u00a0Let’s hear your thoughts. My Name is Tom Sylvester and I work a full-time job. (Hi Tom!) I say that I work a full-time job because I believe that it is important for people […]<\/p>\n","protected":false},"author":1302,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[20],"tags":[],"class_list":["post-49410","post","type-post","status-publish","format-standard","hentry","category-personal-development"],"acf":[],"comment_count":0,"_links":{"self":[{"href":"https:\/\/www.biggerpockets.com\/blog\/wp-json\/wp\/v2\/posts\/49410","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.biggerpockets.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.biggerpockets.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.biggerpockets.com\/blog\/wp-json\/wp\/v2\/users\/1302"}],"replies":[{"embeddable":true,"href":"https:\/\/www.biggerpockets.com\/blog\/wp-json\/wp\/v2\/comments?post=49410"}],"version-history":[{"count":0,"href":"https:\/\/www.biggerpockets.com\/blog\/wp-json\/wp\/v2\/posts\/49410\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.biggerpockets.com\/blog\/wp-json\/wp\/v2\/media?parent=49410"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.biggerpockets.com\/blog\/wp-json\/wp\/v2\/categories?post=49410"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.biggerpockets.com\/blog\/wp-json\/wp\/v2\/tags?post=49410"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}Benefits of a Job<\/h2>\n
1. Easier Access to Funds<\/h3>\n
2. Money to Live On<\/h3>\n
3. Learning<\/h3>\n
4. Free\/Reduced Education<\/h3>\n
\n-Quality & Performance Management
\n-Financial Management
\n-Ethics and the Practice of Management
\nand Management
\n-Business Research Methods
\n-Management Behavior and Team Dynamics
\n-Advanced Strategic Management
\n-Marketing Management
\nSystems Management
\n-Project Management
\n-Executive Lectures\/Networking
\n-Lean Six Sigma<\/p>\n5. Provides a Buffer<\/h3>\n
6. Forces Creation of Systems<\/h3>\n
7. Free Money<\/h3>\n
8. Health Insurance Plans<\/h3>\n
Conclusion<\/h2>\n
\nPhoto Credit: Acciones Urbanas \/ Left Hand Rotation<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"