Frustrated with Bigger Pocket Posts

Jedd Braunwarth

Investor · Waconia, MN · Member since 2014 · 238 posts · 104 votes

11y

@Katie Douglas I agree with every point you make. However, I believe these are just obstacles. There are obstacles in every aspect of life, industry or decision, as you know. If you want to do something there are many more opportunities than there are obstacles, you just need to find them. I am similar to you in that I am now 30 years old. I wasn't happy with how much I was making in my job, so I made some changes and now make triple what I used to. Still, I have obstacles with money to get started in certain things., probably always will! I have a professional job, married with a combined student loan debt of $100k and a 9 month old. I pay double my required monthly student loan payments to pay off faster. I own two duplexes, a small commercial, completed and sold my first flip and am set to close on a 6-unit and looking for the next flip. Networking is the biggest thing that has helped me overcome every obstacle. It made me more money, taught me real estate, found partnerships, friendships, etc.

My post is not trying to say that I've made it by any stretch but more that I have found the same obstacles as you've stated but put a plan together to get around them and live the life I want. You can do it too, I gaurantee it!

4 Reply

Matthew Paul

Severna Park, MD · Member since 2013 · 7k+ posts · 7k+ votes

11y

I have heard what Katie said by many of the people in their 20's and 30's . They have complained abut all their student debt , and how getting a job in their field doesnt pay well , and the cost of housing . BUT , they are driving an expensive car , dressing rather well , going out on the weekends and they talk of how they are going on a cruise .

The Problem isnt how much they make , its how much they spend , and what they spend it on .

8 Reply

Ingrid J.

Investor · Tromsø, Norway (Europe) · Member since 2015 · 431 posts · 194 votes

11y

Thank you for the post. It is true that there are many personal and economic factors which play in when it comes to personal finance. Net worth, family status and employment all affect our daily lives and economic goals.

None the less, one of the reasons why BiggerPockets has become so popular is because such factors aren't swept under the rug. People you hear about in the success stories here are prime examples of ordinary people who have been faced with similar challanges, and who have taken a different road to achieve a better life for themselves. Which road you yourself will take is up to you. There are many ways to achieve a better life for oneself, just as many as there are members on this site.

Steven G.

Investor · Walden, NY · Member since 2015 · 49 posts · 43 votes

11y

Originally posted by @Josh C.:

You quoted lots of averages. The average person does not make good financial decisions. Credit card debt and buying crap they can't afford are the top of the list. Your bit about new cars is ridiculous. I've always paid cash for cars and when I didn't have very much cash I didn't have very much car. When they broke down I got on YouTube and learned to get them running. I'm in my 20's still with a only bachelor degree and have managed to purchase plenty of real estate. My income is probably a little higher than the average but not by lots. On the other hand my wife doesn't work and I have three children so I'm pretty sure that negates my income. You just have to want it. You'll never run out of reasons why not to do something and statics are good at saying why things won't ever pan out. You simply need to stop being lazy and dumb. Sorry to be harsh, but it is really that simple. Cut your lifestyle you think you are entitled to and get a second job and save money like crazy. I moved my family out of a nice 5 bedroom house in the burbs to a big renovation project duplex in the city because I wanted to aggressively grow my portfolio. It takes a long time. Our clothes and cars weren't as nice as our friends, but hopefully our decisions will pay off. Yours can to if you commit to them.

You hit the nail on the head. Our generation feels entitled to drive a BMW and live in a $300k home when they leave college. Having things that you have not earned is expensive and ultimately slows the road to success. Most of us who make it on our own make sacrifices that others are simply not willing to make.

5 Reply

Mark Nolan

Professional · Carlsbad, CA · Member since 2012 · 12k+ posts · 1k+ votes

11y

@Katie Douglas

This site should be viewed as one of the tools in your toolbox.

OP

Morris, IL · Member since 2014 · 36 posts · 9 votes

11y

@Account Closed

I think you misunderstand me. My husband and I are highly motivated and we are working on our personal finances so that we are in a position to have several investment properties in the coming years, but we are also mobile professionals on an upward trajectory in our careers. Motivation is not the issue. What I was trying to say is that in order to accomplish the things that people are saying in the posts relies on certain assumptions about the readers. You went to a prestigious university, were in the military, and had a 401k that had enough money in it to cash it out by 26- you are an outlier. You are definitely an inspiration, but please don't pretend that every other 20 something getting started in real estate is like you. Also, most people are married by 30 and smarter more educated people are more likely to be the ones to be married- and they are richer for it. We earn above the median income for the US. The point is that there are many issues that young people face that are realistic barriers and the articles should point it out or list out the assumptions they have about the lives of their readers. It doesn't mean the advice is bad it just means it is not exactly actionable for many people and can come across as gimmicky.

OP

Morris, IL · Member since 2014 · 36 posts · 9 votes

11y

@Jedd Braunwarth

Thank you for sharing your story. These real life examples are way more interesting to me because they reflect how most people actually live and how they can still accomplish their goals.

OP

Morris, IL · Member since 2014 · 36 posts · 9 votes

11y

@Mark Nolan

Bigger Pockets has provided invaluable resources and I have learned so much by reading the posts. I will be forever grateful for those who take the time to share their stories with others.

Jordan Williamson

Rental Property Investor · Cape Coral, FL · Member since 2012 · 427 posts · 186 votes

11y

I agree that it is not easy, and that young adults need to focus on fundamentals first but I feel a lot of your post is excuses for why it can't be done instead of asking how it CAN be done. It is all true for average people. I don't know about you, but goal isn't to be average. I plan to set goals, change my habits and pursue personal development to assure to break from average. I believe that America is a land of opportunity and that if we are willing to put in the time, effort and personal development to achieve our goals, anyone can make it happen.

For what it is worth, I am not successful yet, but I'm 27 and own two duplexes and looking to purchase another. I saved money on one income, paid off my student loans, worked full time while getting my MBA, have a 5 year old son and another one on the way. It CAN be done, and the second you let yourself think otherwise is the moment it becomes impossible.

3 Reply

OP

Morris, IL · Member since 2014 · 36 posts · 9 votes

11y

@Josh C.

We have low household expenses and are budgeting just fine for regular expenses. We do not live a lavish lifestyle and we make more than the average household (average is 50k). But we have a lot of debt from school and some debt from a small wedding and living and real estate costs are very expensive! I think the key to your comment is "be smart" and "it takes time." Unfortunately, (and this is the crux of my original post) is that I agree with you and the posts on this site frequently don't address those things. More people should talk about the fact that it is hard to invest, but ultimately there are a myriad of ways in which it pays off more than anything else you can do for your family. Those articles I bet would be more interesting but should be accompanied with more details about how much things actually costs and how long it took to do them. Or they should focus on hacks that people use like specific skills that you need or how to access people who can help you.

OP

Morris, IL · Member since 2014 · 36 posts · 9 votes

11y

@Jordan Williamson

Thank you for sharing your story. I wish it was people like you who were writing these posts because I think they would be more realistic instead of some of the over simplistic and motivational posts I've been reading.

Podcast Guest on Show #47

OP

Morris, IL · Member since 2014 · 36 posts · 9 votes

11y

@Steven G.

I think it would be interesting if you went into more detail about how people change their lifestyles to accomplish their goals. My husband and I follow Mr. Money Mustache and are not strangers to different lifestyle choices. Our expenses are low compared to the typical household. However, I don't think many people are blowing their money the way you imply- they simply have large expenses because the cost of everything is going up.

1 Reply

Joel OwensBusiness Member

Moderator

Real Estate Broker · Canton, GA · Member since 2010 · 15k+ posts · 11k+ votes

11y

I am going to stay away from politics.

All I will say is that the system is set up to FAIL people. You are never going to get anywhere going to college to make 30k a year and incurring 60k of federal college debt that can't be removed in bankruptcy.

You get a house, have a family, need a car to drive around, paying student loans. Then your income barely keeps up with inflation and you have to cut to the bone to save anything.

As soon as the car is paid off it breaks down and you get a new one again. It's a continual process for many to stay poor the rest of their lives and depend on the government to take care of them with social security and Medicare in the golden years.

Not everyone is a superstar and that's okay.

The reality is making 100 a month per door on an investment isn't going to make you rich. If you build up over 30 years and say had 1 million that 1 million might be worth 600k by then. I don't know about everyone else but I want to enjoy today within reason and not be miserable saving money because tomorrow is not promised to anyone.

Equity growth is where you make your money with properties. Cash flow is just the cherry on top.

Example take 10 properties you buy at the right time in the market. You get 100 per door net monthly after all expenses. So off of 10 properties you get 1,000 a month or 12,000 a year times 5 years is 60,000 ( I am leaving out rental increases etc.).

In that same time the properties you bought for 50k are now worth 90k in the market. You now have 400,000 in equity growth from the properties in 5 years versus 60,000 of cash flow.

It's a balance between enjoying today yet planning for the needs of the future.

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12 Reply

Joe Bertolino

Investor · El Dorado Hills, CA · Member since 2012 · 1k+ posts · 1k+ votes

11y

The reality is that most "successful" investors are not in their mid 20's. Those that are typically have access to the BoM (Bank of Mom), have no school debt and have a safety net if they fail. What you can do rather than make excuses or complain is put yourself into a position to invest as soon as you can. That involves sacrifice. That involves risk. That involves living somewhere you want may not want to live or working hard for an extra year rather than going to grad school. If you don't have rich parents or some other windfall, you have to do it the hard way.

5 Reply

OP

Morris, IL · Member since 2014 · 36 posts · 9 votes

11y

@Joe Bertolino

Thank you for your post, I think this is the kind of advice more people should give and it would be more interesting to hear from people who were still able to do it the hard way.

Bill Gulley

Investor, Entrepreneur, Educator · Springfield, MO · Member since 2009 · 21k+ posts · 12k+ votes

11y

Originally posted by @Katie Douglas:

Hello, I'm a newbie and this is my first post on Bigger Pockets although I have lurked here for several years. While I have been able to find invaluable information on this site, I find many of the posts (especially in the newsletters) to be frustrating because they sound a bit like internet marketing/motivational speak with little realistic or actionable advice although they are supposedly targeted towards young professionals. They tend to underestimate costs/skills needed/and timelines that many people have.

For example, my husband and I are a young professional couple in our mid-twenties. Many of the articles directed at our age group fail to address the following:

- many young people out of college do not have high incomes (median net compensation for individuals in 2013 is about $28k per year) http://www.ssa.gov/oact/cola/central.html; http://time.com/money/3829776/heres-what-the-avera...

- record high student loan debt (average amount of debt for individuals is $26,500 for 2011 graduates) http://www.nytimes.com/2012/10/18/education/report...

- most people are married and/or have children by age 30 (http://www.huffingtonpost.com/2013/11/22/marriage-... http://www.cdc.gov/nchs/data/databriefs/db19.htm; http://www.cdc.gov/nchs/fastats/births.htm; http://www.infoplease.com/spot/momcensus1.html)

- The median American household owes $3,300 of consumer debt (http://www.nerdwallet.com/blog/credit-card-data/av...)

- if you do have a professional job you will probably have to purchase a professional wardrobe (in our case we needed new clothes that were appropriate for cold winters)

- you will probably have to move to where jobs/graduate programs are (moving costs plus potential increase in the COL; see note on buying winter wardrobe)

- increasing rents (http://www.deptofnumbers.com/rent/us/)

-record high prices for cars (http://www.usatoday.com/story/money/cars/2013/09/0...) average price is $31k for new car and slightly used cars are only a few thousand dollars less); most households in the US need at least one car and if you were lucky enough to have one in high school it is probably starting to get old and have expensive maintenance issues by the time you are a young professional.

-record number of people in graduate school (http://www.census.gov/hhes/socdemo/education/data/...) poverty level pay and long hours that discourage people from working a second job during this time

- housing is expensive (down payment plus transaction costs- why do so many posts fail to go into detail about these? My husband and I wanted to purchase the condo we are renting- at a modest price- but the transaction costs doubled the cost of purchasing and we would have only saved $180 per month over the cost of renting. We decided it was better to pay down debt and move to a better location in a couple of years.)

- house hacking; there are not likely very many multi-family units in many towns and if there are they are probably expensive and in undesirable/dangerous parts of town

I am not trying to discredit the usefulness of this site or of investing in real estate. But many of the posts I have read come down to: either the OP majored in a related field in college and worked with other professionals shortly thereafter, had a much higher than average income starting out of college, or had their parents pay for college/weddings/ first mortgages, or the OP is not really young and is already a professional who is looking back at what they wish they did when they were younger (when they had no networks or money).

I think more accurate advice for 20 somethings would be:

- work on increasing your knowledge and income (try to find and fill your skill deficits so that you can be useful to others in the industry and make money; here is something that might be useful: http://www.slate.com/articles/podcasts/negotiation...)

- work on your people and organizational skills

- get your personal finances in shape

- set a realistic time frame for investing (it might take several years to be ready)

- work on getting your SO on board

- build a network of colleagues that you can call on later

- don't buy stupid motivational business books to learn, buy books that focus on specific skills and that have case studies

OR

- have access to specialized knowledge. a large amount of capital, and a professional network, already

- have access to people with those things

Many people go through seismic changes in their lives during their twenties that are not accounted for in these posts. The over simplistic messages I think overshadow the usefulness of the posts. Young professionals don’t need 30 posts with click bait titles to motivate them to become involved, they need to build specific skills and work on their personal finances instead.

Very good observations. There is a reason I don't blog or listen to pod casts or webinars.

The more knowledge you have, the more it complicates your life in many ways, you understand different alternatives, see a topic in more depth and breadth than the unknowing, but it certainly pays off! If you have been lurking that long, then you know I have a great BS Meter, so I just don't go there with some hair brained idea unless I really need to.

We can only speak to RE matters too, I'm not advising anyone what profession to go into or when to have babies, or determine soccer practice schedules, or tell someone they need at least $20,000 to get into real estate. If I did, I'd be wrong!

Need to understand that most young adults here don't come out of college as you did. I think too, what you're speaking of is maturity and simply being business savvy enough to understand the difference between hype, exaggerations, fluff, puffing and reality. The lack of experience is guaranteed for those starting out, ambition and hard work are necessary, but they can't replace knowledge or common sense.

I like seeing the desire, even the ambition of making money, even big money, but that has to be balanced with your skills, abilities, maturity and willingness to learn and that means the ability to spot the fraudsters, gurus and predators who might be ready to "help you". I give free advice as to how to develop your own BS Meter.

There are no set strategies that fit everyone's needs, you need to balance other jobs, family, relationships, assumed duties to a priority and work in aspects that fit your needs.

While we have highly educated young people here, my advice is still the same. learn real estate before trying to deal in real estate. And I mean formally, not strategies or ploys or systems or the quick buck ventures. Being dispirit and greedy at the same time is dangerous in real estate for newbies. Best of luck :)

OP

Morris, IL · Member since 2014 · 36 posts · 9 votes

11y

@Bill Gulley

Thank you for your comment and the encouragement :)

Ally H.

Property Manager · SF Bay Area, CA · Member since 2014 · 46 posts · 16 votes

11y

Hi @Katie Douglas, I'm another 20-something who by your perspective, is something of an 'outlier' like @Account Closed (though only 1 property so far and I'm relatively early in my military career). After paying off 6 figures of student loan debt and being a single-income family until very recently, my husband and I are currently growing our careers, maxing our retirement accounts, and saving for tangible goals like an investment property and taking care of our families. However, I don't think of ourselves as outliers. Perhaps in the 'typical population', the number of 20-somethings who are drowning in a sea of debt without the skills to save themselves is overwhelming, but you have found yourself in the BP community, where there are many people, including those in their 20s (and even younger!), that are killing it on whatever spectrum of success you care to use.

Since you wanted more details on how people are changing their lifestyles and accomplishing their goals, we'll share some of our choices. When we moved to Oahu (high cost of living), we decided to pay a premium to live close to my work and save commuting costs/time. Since groceries are expensive here, we eat less meat and we learned how to cook with whatever's on sale or in season at the farmer's market. We enjoy inexpensive hobbies on our limited time off (beaches, gardening, home movies, BBQs with friends, etc.), so no cable, gym membership, etc. In summary, we maintain a simple, but happy and fulfilled life on this expensive island of paradise.

From my perspective, the majority of the points that you pointed out are CHOICES. The fact that we have the opportunity to make those choices in this country is an amazing opportunity that not many in the world can claim to have. You can choose to go to college. You can choose to go into debt to go to said college. You can choose to marry and who to marry. You can choose to have children. You can choose to go into consumer debt. You can choose to buy a (new) car. You can choose where you live.

The abundant choices YOU have all have their own financial consequences, and you have awesome resources like Mr. MMM and BP as tools to help you make the choices that will set you and your family up for financial success. Instead of wasting time and energy on comparing yourself to the 'typical household', I encourage you to concentrate on making moves that will help you progress to where you want to be in X number of years. Best of luck and hope to read about your success story soon!

3 Reply

OP

Morris, IL · Member since 2014 · 36 posts · 9 votes

11y

@Account Closed

Thank you for your posts. Please don't think I am angry about what you wrote - I did not take it personally. I think stories like yours are interesting because they are not the average and it would be more interesting if you outlined the steps you took so that you could meet your goals. I simply wrote this post because although I have found great information on this site, at some points there aren't enough specific details about how people accomplished something to make them helpful.

Podcast Guest on Show #79

M Marie M.

Rental Property Investor · Washington, DC · Member since 2015 · 278 posts · 156 votes

11y

Originally posted by @Katie Douglas:

@Steven G.

I think it would be interesting if you went into more detail about how people change their lifestyles to accomplish their goals. My husband and I follow Mr. Money Mustache and are not strangers to different lifestyle choices. Our expenses are low compared to the typical household. However, I don't think many people are blowing their money the way you imply- they simply have large expenses because the cost of everything is going up.

So your husband and you have downsized to one clown car? I read MMM too, he's got great advice and is spot on regarding cars. Think if you could match his yearly spending of $27K for 3 people, imagine how far your $50K in earnings can go.

There are two skills you may need to develop that would help in RE and personal finances, creativity and taking a hard look at your numbers. Yes, your expenses are low compared to the average indebted American who spends too much on crap, but what are they compared to the bada** version of yourself? The one who, like MMM, hardly ever eats out, monitors utility usage and spends money on things that make money. Have you tracked your monthly spending to see where you are spending and seeing where you need to cut back to get financially lean and mean? Then there is creativity, thinking out of the box. Find something where you provide value.

1 Reply

Michele FischerPro Member

Rental Property Investor · Seattle, WA · Member since 2013 · 2k+ posts · 1k+ votes

11y

Katie,

This was a very thought provoking post, thanks for putting it out there. I tend to shy away form the more controversial topics, because harmony is one of my strong skills, which translates to minimizing conflict. So I normally concentrate on welcoming people in my state and posting specifics about low income landlording, just reading these other forums.

I'll admit that lately there have been so many podcasts and posts about people being really aggressive and really successful in real estate, and I feel like I fall short. We are content with where we currently are, but I feel pressure to move faster, do more, show more results based on some of the info and people on the site.

We started investing much later, in our 40's, when we were starting to see free time again after getting the kids through their youngest years. We are not replacing anyone's income, but we are growing net worth and we are shopping and spending money on the investments rather than personal items we don't really need. And growing experience for the future, because we still have a lot of years left and I feel there is more real estate to purchase in our future.

Learn what you can, use the site for what you can, and move at your own pace.

3 Reply

OP

Morris, IL · Member since 2014 · 36 posts · 9 votes

11y

@Ally H.

Thank you for your post- I find it very interesting. The reason I mention averages for households is because even if you have made smart decisions, chances are at least one of those costs I mentioned affect you and I think people need skills in personal finance to be strategic and deal with them. Congratulations on paying off a 6 figure student loan on one income! (No sarcasm, I really mean it.) I'm sure if you wrote a post about how you did that while living in a HCOL area it would pique the interest of many readers on this site.

You are right about making choices and how people should be strategic about them so that they can invest. How young adults manage this is the most interesting aspect to me. But I think if you are already doing those things the answer then is simply that you need time to build it up so that you can take on the risks that come with investing. And if you do this, you are likely not a young 20 something by that point or you took some unusual steps that most people don't- which would warrant an interesting post.