How to take off the golden handcuffs (high paying w2) and go full time investor

Question

Hey everyone,

I've been investing in real estate for 12 years now. Along the way, I've built a solid portfolio, made some good money, and learned a tremendous amount. What I still love most is the art of finding great deals, negotiating favorable terms, and stabilizing assets to create long-term value.

To date, I've bought and sold more than 80 doors, representing over $15 million in real estate transactions. My current portfolio consists of 30 units valued at roughly $9 million, where I hold either 100% or 50% ownership depending on the asset. All my assets are between 50-75% DCR. I have recycled 100% of my cash flow, sales, and refinances since day one 12 years ago!

Here's my dilemma: I also work full-time as a medical device sales rep. The compensation is hard to walk away from, around $250K per year, plus a company car, gas, and other perks. The problem is that I'm no longer passionate about that business like I once was. I love helping patients and talking with my surgeons. But the business has changed.

What I am passionate about is real estate. My goal is to own and operate a portfolio that provides at least $40,000 per month in net cash flow. I am around $15k now. Deep down, I believe I can get there much faster if I go all-in and focus exclusively on real estate.

My last four deals have been home runs: a 10-unit, a 6-unit, and two oceanfront STR triplexes. The returns have been incredible and have only reinforced my belief that this is where I want to spend my time and energy.

Has anyone here made the leap from a high-paying W-2 job that felt like golden handcuffs? If so, what finally gave you the confidence to leave, and what did you wish you had known beforehand?

I'd love to hear your experiences and advice.

Shiloh Lundahl · Answer

@Richard Forton I know a lot of people make the jump from high paying W2 to contact work. That way they can have more flexibility but they still have a money making skill that they can use to create money when they need to. For example, as a therapist I went from meeting with 25 to 30 clients a week to meeting with 10 to 15 clients a week scheduled on the days that I wished to meet with clients. This gave me greater  flexibility to do more real estate deals but also doesn't cut off my more dependable income stream completely. Do you think transitioning from W2 to 1099 would work for you?

Dan H. · Answer

I had a good paying engineering job that approached $300k total compensation and quit and they offered just over $50k more ($350k total compensation) but I was done.  Like you my passion for my w2 had waned.

I had enough investments that my return on investments virtually every year exceeded my w2 compensation.   Granted w2 was guaranteed, investment return less guaranteed.

You know how long it took me to turn down the $350k offer?  I was offered it Friday afternoon and asked for a week to decide.   It was technically a great job (consulting architect to add starlink to a military aircraft - not sure why star link over muos, if I had accepted the job that would have been the first thing I investigated).   I turned down the job offer first thing on Monday.   I did appreciate getting the offer; it is nice to feel wanted.

Without a w2, I have been able to start to organize my non w2 life.  It has allowed me to manage my investments better than I could when working a w2.

Walking away from a well compensated w2 was the correct choice for me.  I enjoy the freedom.  I mentor young adults in RE and other financial areas.   I enjoy that, but I need to find a way to work less and do more recreational activities and travel.

Only you can decide when you should “retire”, but I have zero regrets.  Remember we all have a limited time; you decide how you can best use that limited time.

Good luck

Shawntae Harrison · Answer

I would suggest getting a real estate assistant to leverage your time, so you can keep your job until your fully ready to make that leap. With doing so you can achieve your cash flow goal a lot faster.

Chris Seveney · Answer

Richard

I was in your shoes about five years ago. How a nice cushy corner office making great coin, and had a great and growing real estate portfolio. I ended up saving a good amount of money that allowed me to replace atleast 1 year of my income and I then left my w2 job to do real estate full time. I was in a position  where the income i had was replacing my existing income so there was less risk there on my end and the money set aside was just in case.

The key is to not leave to early and make sure you can sustain / live off the income coming in or have a very nice nest egg to cover the delta. I know a good amount of people who left w2 to go to real estate full time and did it too early and ended up having to go back to a w2.

I will say if you can focus on real estate full time then yes it can grow much faster when not tied down to the w2.

Ryan Spath · Answer

This type of salary and security will be tough to replace in a short amount of time. Are you able to get your RE license and scale back what you do at your w2? Do the re on the weekends, get VA's use automation where you can etc. this will do a cuple things, it will give you access to the MLS and you will be able to help folks with something you have first hand experience with and are passionate about. I must admit though, that cushy 250k would be a tough one to move away from.....good luck!

Matthew Tregoning · Answer

I would not leave a $250,000 income because the portfolio is exciting. I would leave when the job is no longer required to protect the family. Set a cash reserve target, a minimum trailing twelve month portfolio income, and a replacement plan for benefits before choosing a date. Financial freedom is control, not just quitting.

Jules Aton · Answer

It is hard to walk away from a high salary especially when considering the value of benefits, 401k match and PTO. The sales lunches and dinners probably aren't too shabby either. ;) Are you able to reasonably reach your FI number with investing at the level you are now? Keeping in mind that recent years both in RE and the stock market made us all look like geniuses. Also consider your age, I'm guessing you are on the younger end but for those of us 50+ the wear and tear starts showing and I know more than a few who died before taking time to enjoy the fruits of their labor due to chasing after another 5mil before retiring.

Garrett Keith · Answer

Personal expenses are a big factor in when you should quit. If you can get closer to that $20,000-$21,000/month range, essentially replacing your current earned income and without a noticed lifestyle change. That does mean working with a lot less cash flow to acquire new deals, but you are good at making good deals and you love doing it, so I am sure that even with less cash you can find deals that cash flow.

Minimize personal expenses as much as you can without losing quality of life, I think people often over-cut on spending and burn out. There might even be a world where you go part-time, cut back on hours and pay but keep some benefits and earned income. That frees up more time for real estate and takes some of the sting out of not being passionate about the job anymore. Definitely something worth at least exploring even if it might be a stretch.

That said, life is short. If this job is making you miserable, quitting and doing something you love is the right call even if it slows down your progress toward that $40,000/month. Money is great, but it's not what life is about. Enjoy it.

No matter what you are in a great position. Good luck. Keep us updated.

How to take off the golden handcuffs (high paying w2) and go full time investor

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