Do you really need to get out of the Rat Race to be successful?

27 Replies

I am sure most of us read the "Rich Dad Poor Dad" at least one time before starting our REI journey. I eve know few who read it more than 3 times. It may be the bible to make you think differently about your job and provoking someone to start Real Estate investing. That's all well and good.

But these days while I am talking to new investors who keep repeating the same thing, " I am want to get out of my job".  I feel the book is out dated long time ago when someone can do their regular job sitting at Starbucks and even multitask juggling between work and investments. 

What I am trying to get at is, "One really don't have to get out of their day job to make your investment to work".  

I know some might not agree but that where my debate about, "Is RE business or Investment?"

If you are thinking about doing it has business, then surely you need to lose your day job and concentrate fully on the real estate path. But if you really want to build your passive income for retirement or kids education, that's not business. Business means you need to work on it to make money whereas Investment is other way. You need to make the money work for you. Many who preach or coach about real estate are full timers and it might make sense for them. But someone who is making $100k a year, do you really think it's good idea to leave their job for the purpose of RE Investment. Even if you plan to do few flips a year, will it make sense to lose it? Think about it!!

If you ask me, I wouldn't do it. Why would you lose a big chuck of money which you can easily make with skill set acquired going to good school.  I know someone will say, you gotta to take risk and chances to get big. Come on guys, I have tried it myself to be business owner by owning a famous healthy bakery but couldn't able to make it work. During this time 3-4 years,  I never lost my job and it actually helped me to get out again and start fresh in my different path. There is no harm in trying out but you should never lose your job if brings your good income and build Social security and healthcare benefits for you.

At this internet age, you can work from home and do multitasking, you shouldn't be losing your job for new venture. Keep your job and build your net worth for the future. I know some might have to work 12 hours a day or 40 hours a week, but still you can make it happen by doing few hours of extra work every day on your Real Estate investing. 

If you call me contrarian, I would say, I am just trying to think differently at this time of age and don't get stuck in the old concept  :-)

Vijaianand Thirnageswaram

I love my career. It is something that I am very passionate about and took me years of hard work to achieve. I am paid a decent income and with benefits it would take a lot of money to replace it. I don't want to leave my career to invest full-time.

Keeping that in mind, real estate is still a business for me that produces significant cash flow.

Exactly my point @Anthony Gayden . I want to share my experience and make a point but coming from others also helps to reinstate strongly. Thanks! 

I agree. Not only do you not have to leave your job, you probably shouldn't leave your job until your "passive" income surpasses your job income - and that assumes your job covers all your bills, ancillary costs like health insurance, and leaves you money to save. 

I built my business at nights, weekends, and vacation time before it got big enough to leave the job. And I didn't, because I have a career that I like.

The "rat race" is the easiest way to earn money to invest aside from maybe being a drug dealer.

Getting out is not a "need" it is a want. Needs and wants are entirely different.

The problem is that most people view work as something more than trading time for money. It is all about attitude. A job is not intended to be enjoyed, it's work.

Reality is that most jobs allow a individual to think about, plan for and even act on investing while working. Many jobs allow you to use only a small portion of your brain to perform your job allowing plenty of space to manage your investments in your head while working. 

Enjoying your work is very low on the scale of priorities in the real world. You trade a small portion of your time for the money to do what you really want in life. 

Those wishing to give up a easy, lucrative source of income need to take a serious look at and maybe adjust their attitude.

The rat race, which is for most a casual stroll, is the low hanging fruit on a money tree.

@Vijaianand Thirnageswaram

I feel the same way. I would not leave my job because, A. I like my job, and B. to replace my income it would take 5 time what I own now. I will use my job to continue to fund and build my RE portfolio.

So, at this point in my life it does not make sense for a career change and loss of wage because my goal is to retire at 55+. When I do retire, I will go into the full asset managing mode.

I was blessed to find a job I enjoy doing so I don't see it as a rat-race.

@Thomas S. @Dave Chapa   Thanks for keep reinforcing the new fact. 

It will surely helps the newbies to think differently. That's my idea. I keep telling my mentees, don't just listen to all these gurus and coaches out there. You gotta filter through and process according to your situation. You first need to decide, whether you want to make money or make the money work for you. Simply to put, You want to be in RE Business or RE Investment. That will show the direction.  Stop saying, I want to retire soon and get out rat race and replace with passive income. 

I see a lot of threads on BP that say something along the lines of “I want to be a real estate investor because I hate my job.” I think most of these people have deeper issues going on than simply a job they don’t like. For some reason my generation has got it in their heads that what you do for a living is supposed to be an extension of who you are. It has to be THE one thing that defines you as a person. In my parent’s and grandparent’s day a career was a way to make a living, and to make enough money to pursue passions outside of work. I don’t feel discontent with my job because I see it for what it is. It is a tool, a tool to make money. The money I need to pursue my passions. It is one piece of the puzzle, it’s not the end all be all. I work for an airline so I get great benefits and I fly for free. When I’m 52 I can retire and my family and retain the benefits for life. My dream has always been to have passive income so I could spent my life traveling with my family. So my job is an integral part of the plan. If people saw their careers for what they really are, a tool to make money, there would be a lot less mid-life crisis’ going on. One time I was riding the train and I sat next to this older Irish gentleman. We starting talking and the topic of cultural differences came up. He said “You Americans live to work, we Irish work to live” that always stuck with me.

@Vijaianand Thirnageswaram great post! I wish everyone would read this. RDPD, a book I've read 8 or 9 times actually doesn't specifically encourage quitting your job to invest in real estate. If one looks deeper I think the real lesson is an income stream (job or any business. For Kiyosaki it was/is an education company) to funnel more cash into income producing assets.

One either needs to be in the business of real estate or as an investor; focus on other income streams that can build the income producing asset, acquisition war chest.

A mantra I always followed while working was is part of my life, life is not part of my work.

Separation keeps it all in perspective.

Certainly don't have to. Matter of fact, if we all did, nothing would get done out there!

I left as a choice. I don't like traffic and commuting. It took me so long to arrange coverage for when I took time off, it was only worth it far out and in large chunks. I wasn't able to run simple errands or putz around the house and yard during the week, leaving me with weekends catching up- only to start over again Mon.

Not everybody's rat race experience is like mine. I miss the friendships forged there and the benefits of being in the cubicle trenches of a corporation, but overall it wasn't rewarding enough to offset my above issues. 

Freedom to me is my most valued basic need. For others it's power (self-worth & achievement), fun or love and belonging. FI and doing your own thing is way too lonely for L&B folks.

@Vijaianand Thirnageswaram in my experience owning rental properties is that it is a part time business. We self manage, so maybe that is why I feel that way. I work full time and do real estate on the side. The strategy works for me, but if I wanted to scale my business, I would need to quit my job.

Whenever I see posts about, "should I quit my job", my advice is always the same. Get your real estate side hustle producing before you quit your day job. If you can't do a couple deals in your spare time, you probably lack the hustle to do it full time.

Still, I am not sure I fully agree with you. There is only so much attention you can give real estate part time. If you hate your job and real estate is your passion, then pursuing it full time will yield better overall results. 

I guess my ultimate goal. With both real estate and my day job is to retire.

I'm not one of those that hates their job. All things considered, I've got a pretty good job. But, I wouldn't say I love my job. It doesn't fulfill any of my needs(outside of money.) It is just what I do to earn a living. 

And I believe most people fall into this boat. Some genuinely loathe their job, and some(probably a smaller percent) love their job. Most of us are in the middle. 

With all of that in mine, I earn money to eventually become financially independent and no longer HAVE to work. Keeping my day job while working on RE seems to be the best way to become financially independent. At that point I'll be free to pursue anything I like and spend ALL of my time as I choose, not just the hours I'm not working.

That is the goal.

@Thomas Shaw I think I’m the same as you. I’m right in the middle. I’ll probably reach the point where I don’t need to work by 40. But I will give my job more years because I want to grow my business as big as I can.

Frankly my opinion is that thinking you have to keep your job is the the 'old concept' that people get stuck with. This idea of getting out of the rat race is the new idea. Prior to this most people thought of buying a few houses here and there as investments such that when they retire at 65 they would have a little something extra on top of their pension/social security. So staying with your job as you invest is not a new idea at all, it's the original idea.

While I don't propose people to quit their job just to invest, I think it's important to let people know it is a viable option if that is what you're looking to do. There are definitely down sides to both. 

Originally posted by @Dave Chapa :

@Vijaianand Thirnageswaram

I feel the same way. I would not leave my job because, A. I like my job, and B. to replace my income it would take 5 time what I own now. I will use my job to continue to fund and build my RE portfolio.

So, at this point in my life it does not make sense for a career change and loss of wage because my goal is to retire at 55+. When I do retire, I will go into the full asset managing mode.

I was blessed to find a job I enjoy doing so I don't see it as a rat-race.

I hear ya, Dave, and I've been in the same boat and have a few posts on BP to the effect of "You all seem to assume everyone hates their job - why can't you imagine people who actually like what they do?"  

In my case, I like my job as much today as I did 3, 5, or 10 years ago.  While that's stayed consistent, my interest in real estate (B&H and urban re-development, specifically), hasn't.  If you get to the point where real estate (or anything else) is *more* interesting than the day job, and you can't do both really really well, you've got a choice to make.  10 years ago, I didn't have that financial choice to give up my job, nor did I seek it.  But, things have a way of changing over the years ... and now I've chosen to give up that job.

My point is only that leaving one's job doesn't necessarily happen because you don't like it anymore ... it can also happen because you grow to like something else more.

The answer to the title question is obviously "No, you can be very successful by keeping your job and investing in RE."

I read a statistic once that a significant percentage of Americans are unhappy with their jobs. There are many reasons, but lack of autonomy, lack of career growth, commuting and office environments are all factors. Also, employers have phased out pensions and more jobs are "gigs," hourly contract or freelance work without health insurance or full benefits. Many people are just not happy with what they're doing for a career. At some point, it's normal to get burned out and want to do something else. For some of those people, real estate is the promised land of riches and passive income. Maybe some of them have a passion for real estate, but it sounds like many are just running away from their jobs.

When it comes to burnout, it's funny to see 20-something's who are already tired of working and just want to retire and sail around the world.

Personally I like investing in RE, but I decided I don't want to be a landlord, a flipper, or do anything RE-related that resembles a job.

I think about switching careers sometimes, but it would probably be something unrelated to real estate, unless it let me combine RE with things I enjoy (such as writing, programming).

Definitely don't want to lose that primary income stream, which enables RE investing in the first place, but if I could reach FI early and "retire" to become a full-time investor, that would be awesome.

I still have my career as commercial real estate and love it. Having said that I have been free from the regular rat race for a very long time.

It is liberating to know you can work if you like to but not because you HAVE TO. That tends to make people happier as the pressure is off and they can decide what type of clients to take and when.

@Vijaianand Thirnageswaram Not everyone thinks like that. Could be just the sheep. Some people just don't get it. It's not about the money. It's about the game. :) 

@Vijaianand Thirnageswaram I completely agree with you.  If I didn't go down the dastardly "go to school and get a good job" route, I could not have invested in real estate like I have today while still in my 20s.  Nor could I have developed a decent side hustle income doing taxes while keeping the W-2 job.  Nor could I have quit my job to start my CPA business, working from the comfort of my home (or wherever I have my laptop and an Internet connection).

I don't say this to brag, but to point out that early on in life the most important thing you can do to someday have the life you want to have is to 1) gain skills and 2) make and invest as much money as you can.  And like it or not, the quickest, most surefire way for most people to 1) gain skills and 2) make and invest as much as money as they can is to pursue the Kiyosakian antithesis of "going to school and getting a good job."

That being said, while I'm clearly not the biggest Kiyosaki fan myself, I have listened to enough people far more successful than I am who took life-changing risks as a result of reading his material and are in a much better place today than they would have been had they spent the next 30 years in a cubicle and contributing to their retirement plans.

For others, of course, Kiyosaki's message led to a path of ruin. With no savings, plan, or viable product or service, they quit their jobs, thinking by doing that they would magically figure it all out and get out of the "rat race," only to find out that they had no idea what they were doing.

I personally think the best route is a middle ground.  Get your bachelor's, get your master's if your field requires it to progress, and kick butt at what you do in order to maximize both your active income while educating yourself on passive income sources, like real estate, so that you can invest in it wisely. It's a lot easier to set yourself up to fund your passive income sources making $200,000 a year, albeit at a slavish cubicle job, than making $20,000 a year at McDonald's or—worse—making $0 a year at no job. But hey, at least you escaped the rat race!

Just my two cents.

Great post @Vijaianand Thirnageswaram!  My wife tells everyone that I work TWO full-time jobs.  I am a 22-year veteran of the fast paced management consulting world.  I make a very good salary but between travel, long commutes, 12-hr days at the office, and frankly work that just doesn't stimulate me anymore....I will start my night job around 9pm and never complain. Maybe I am cutting against the grain on this post.  I don't think I am running from something....but toward something I enjoy much more.

I always tell people that I am not looking to retire.  I just want to do something I am really passionate about.  I do not regret my years in business/consulting.  It helped me gain skills in finance, negotiation, people management, and project management.  But in my early 20's I started off in the construction field.  Loved it but convinced myself I needed a career change to earn more money.  It was a good move.  But now I see those two worlds blending into the perfect match.  Real estate is something I love to do and something I have the right skills for.  It's not really investing...I love building my business.

I am torn though.  The W2 funds my endeavors and gives me street cred.  Lenders really appreciate that W2 income as well.  I also think that it helps me develop efficiencies.  I have processes and systems "because I am busy as hell".  I am forced to be efficient with my time.  So the hope is that when I eventually walk away from the W2 I will be able to scale and grow much faster.

But the real reason I keep my day job is because if I didn't have a 1.5hr commute (one way) to work every day how else would I be able to listen to all those great BP podcasts!!!  :-)

What would make me happy is not having to work. Having passive income in order to spend more time with my wife and kids once they hit high school would be optimal. That would be success to me. Having to answer to someone at work just isn't for me. But thats just me. Another individual may feel other wise.

Hence I think this is more of an open ended question that is not so black or white. 

Imagine a job candidate who, when asked about why they wanted the job, talked about the reasons they hate their current job? That person wouldn't be a successful candidate for the position and shouldn't need to be able to step towards something...and give an employer a reason to hire you. 

I believe its the same with any form of entrepreneurship, real estate included. Hate a day job or love a day job...thats just step one; do real estate because you are drawn to it and your skill sets and temperament are a good fit with your chosen niche. Then you are off to the races you want to run.

When I read a variation on the "hate my job and I want passive income" I always what? Now tell me the story of what you want to DO and how you want to do it. Money is received in return for perceived value, what value are you offering in real estate?

And the phrase "passive income" probably does more damage than any other to people entering the profession. Its only passive if you spend a lot of time and thought on it :)

You don't have to get out of it.  Some people like what they do for a living and also invest in real estate.  The reason it gains a lot of attention is because most people don't like what they do and want a way out.  You can make it in either scenario.

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