Frustrated with Bigger Pocket Posts

Frustrated with Bigger Pocket Posts

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

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

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Josh C.Pro Member
Property Manager · Indianapolis, IN · Member since 2010 · 1k+ posts · 1k+ votes
11y
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.
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  • Morris, IL · Member since 2014 · 36 posts · 9 votes
    11y

    I just wanted to thank everyone for commenting on this post and for the lively discussion. Many of you have shared your personal stories with me both here and in private messages. I really appreciate you taking the time to engage with me, even when you didn't agree with what I said. I look forward to more discussions on this site. 

  • Investor · Riverside, CA · Member since 2011 · 2k+ posts · 3k+ votes
    11y
    Originally posted by @Andrew Hawkins:

    I'm a millennial (25). I look around at people in my age group (say 25-30), and most of them don't have it together. They spend tons on living the life they were accustomed to when they lived with their parents (who were mid career and earning a lot more). They are in debt. They don't know how to save. Many of them will jump on any bandwagon to earn as much money so they can keep spending.

    This isn't exclusive to your generation. This has been going on since the Jone's moved into the cave down the path. They showed up with that fancy foot mobile, the woolly mammoth vacuum cleaner and that woodpecker record player. From then on, consumer debt has ruined more lives than crack. 

    Those who learn about money and understand what it can do for you are the ones that escape this trap. Those who don't struggle with personal debt into their 30's, 40's, 50's, 60's, etc. I see articles in the news all the time about poor blue collar Bob who worked at the factory for 30 years and now it closed. What's he going to do? Like Jimmy Napier said, "Hope you've been doing something more with your free time than going home and watching soap operas."

  • Investor · Miami, FL · Member since 2012 · 79 posts · 19 votes
    11y
    Originally posted by @Katie Douglas:

    @Brittaney Woods

    Maybe so. I wrote this in a moment of frustration and maybe I just need to toughen up and hustle more. But I am still in the skill building phase and my point is that when I have looked to BP for resources, sometimes the advice given oversimplifies the amount of time/money/skills are needed to get started. All of those things are important to note and posters  should note what assistance they had. I will continue to read BP to help shore up my skills so that I can start investing when my family is ready to get started. 

    Every time I feel frustrated I only blame myself. My husband and I have both had so many large lump sums of money in our possession over the last few years that we just blew on stupidity....even after knowing we should invest. If you are in a position where you are getting loans...use that money to invest.

    We have to learn from mistakes. I know times are rough but most of us run into lump sums sometimes ( tax returns, loans, etc ) and the first thing we want to do is pay a bill or buy things that we have been putting off that we THINK we need.

    If you need capital start mentioning your investment plans to your close friends and family. The private money I'm using now came from my mom and I would have never imagined she would be willing to help me.  Just believe in what you are doing and other people will believe in you too. You will be surprised to see how many people are willing to help you.

  • Investor · Suwanee, GA · Member since 2014 · 579 posts · 347 votes
    11y

    @Katie Douglas

    You could collect all the stories in here and put together an anthology called, "Pulling Oneself By One's Bootstrap - A Story of US Real Estate Investors" and sell it. The passive income could help you finance your first investment ^^ 

    I had some challenges for my first investment - I'm an expat living in Korea and I wanted to invest in the US.

    I'm curious - you said you read for years before posting. 

    Was there a reason you didn't participate?

    From all the research you did, you seem like a very intelligent woman capable of making and defending a position. 

    Was part of your reason not wanting to look foolish by asking 'silly questions'?

    If so, I can relate. I'm not great at networking and not great at asking for help. It took me a while to 'dive in' and post and ask too.

    But I've found that those two activities let me to form some really strong partnerships.

    Those partnerships led to my first investment and a world of other potential opportunities in Real Estate.

    Having a regular conversations with more experienced investors is probably key to making steady progress as a newbie. Try volunteering to work for free on a project. If you don't have a skill that you think a real estate investor would need, try this tactic - go to Udemy and take a specialized course on website design, etc. Then you can offer to give them some advice on their website. Or better yet, write up a free report for them and send it to them. Or a blogging course and offer to write free blog content. I'm sure your research skills will come in handy.

    I had to take a very indirect path into real estate investing because I'm so far away. And after my first investment, I didn't have any capital to spend. 

    I ended up helping to organize a meetup out here in Korea. I became a connector. I got to talk to @Joshua D., @Brandon Turner & other great BP investors as we invited them on virtually. I posted regularly here on BP about my progress and that led to more contacts. I started a blog and a website. And because networking can be a number's game, the more people I met, the more I found people I could connect with and deliver value to. 

    Now, I'm in a position to raise capital for deals when I'm ready. 

    People say real estate is about location location location. True.. but to get access to those deals, it's all about your network network network.

    Don't just network up. Network with those at your level and form masterminds or have progress meetings. And also network down. After all those years of reading, you probably can offer great advice for those just getting started - articles to read, books that help, etc.

    Buying a house or MF or a condo is not the only way to get involved in Real Estate. I read another post where the blogger said he got involved with local community planning activities to give back to the community and find out where the next developments were going to be. Great way to learn about real estate.

    The bottom line - Real Estate is all about solving problems. If you look for problems that need solving, you'll find opportunities.. because as you point out - there are a lot of problems out there ^^

    Anyways, BP sometimes does Newbie podcasts. Those are great for learning the step by step process of doing things. And then every now then there will be a Grant Cardone interview. And those are all about energizing people and getting people to dream big. I think both are great content, although I think BP in general has been more grounded in the practical. Maybe that's changed lately? I"m not sure.. I've been busy working with the networks I met through BP to check in as often as I used to LOL..

    I Love BP. I know you do too and are just addressing some of the 'myths' that people put out there. But here's hoping that some of my suggestions help with other myths - that you need to buy something to get in the game. There's lots of way in the game for problem solvers ^^ Feel free to reach out anytime!

  • Investor · Norfolk, VA · Member since 2014 · 125 posts · 19 votes
    10y

    Some people say I can't because .... others say how can I.  Which one do you want to be?

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