Insider Secrets Podcast Episode #30

 Guest: Mark Seither & Josh Saunders

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Guest Bio:

MARK SEITHER:

Partner and Wealth Manager at Kingsview Partners. He is a business owner. He talks about taxes, pilots, and aviation careers.

JOSH SAUNDERS:

Professional Pilots (Southwest, United, Delta, UPS, FedEx, American Atlas) have a very unique retirement situation that is a blessing and a curse. Lots of W-2 income and great 401(k) matching but very few tax options. A great retirement plan both during accumulation and spending down can help stretch that 401(k) and help ensure those years of hard work pay off. It just takes a little planning and strategy.

TRANSCRIPT

Mike: [00:00:00] Hey, good afternoon. It’s Mike your host of Insider Secrets brought to you by My Core Intentions. Glad that everybody’s here this afternoon. Let me ask you, have you been thinking about your real estate intentions there affect your personal intention? What’s your why and why does that matter to you in your life, in your business?

You know what MCI we invest in our clients. Through educational platforms and teaching you how to create short-term cashflow and long-term wealth, empowering you to create sound real estate investing and property management principles while living a balanced quality lifestyle, develop that a strong foundation of practical principles.

If you’re looking for some direction, my core intentions would love to help you with. Exactly by guiding you and helping you discover your why and designing that balanced life. I have to give a shameless plug right now for my newly released book, exit plan, but go to the website today, get a copy for yourself because it’s going [00:01:00] to cover a lot of that.

And it’s going to cover those principles and how we balance our life and what we look for as far as investors. But I’m excited today about our show and our guests. I only have one, but I have to bring two on. And these guys have become a couple of good friends, mark C there, and Josh Sounders with Kings view wealth management.

And let me just tell you, Hey guys, why don’t you say hi real quick, first? Before I introduced.

Mark: Hey everyone. Mark, mark. And I got to correct you. It’s pronounced either. I’m not faulting you for it because it’s it’s spelled incorrectly. It’s actually my fault. It’s an old German spelling. So it’s either, but glad to be on the show.

Josh: awesome to be here. Good. Thanks for being here. And I apologize about that. Geez. Yeah,

Mark: everyone. Everyone gets it wrong. Yeah, no fault on you.

Josh: Oh, I think Josh muted himself. Perfect. Perfect. Yeah. Best way to. Mike, the funny thing about his name is even when I asked Siri [00:02:00] to call him, she Siri calls him marks either.

So don’t go, that’s funny. That’s how, you got it, right? Yeah. It’s really filed that. Siri knows a lot more than me.

Yeah, no, we’re excited to be here and talk about real estate investing and how that plays out into a great financial plan. It really does. If we think it’s a really important core of any good financial investment strategy.

Mike: Good. Let me give just a brief intro and you guys, and then I’m going to give you guys the the floor.

Mark grew up in a home gaining experience as an extensive, with an entrepreneurial extent. With an extensive, our entrepreneurial background through his family business, which was in the lumber and sawmill business. He completed a bachelor of arts education degree in economics at San Diego state university, and began working as a financial advisor, right after that, as mark honed his skills as an advisor and planner, he looked for a platform that would better [00:03:00] serve his desire to work with clients needing advanced plans.

When Mark’s not working, you can find him hanging out with his wife, hiking, the local trails, and searching for new eateries and breweries around his area, making frequent trips up to lake Tahoe. Mark. That sounds like a lot of fun. You’re going to have to come out sometime and hang out with you

Josh: guys.

Mark: Yeah I should update that cause we, w with kiddo number two, come in two months ago.

I don’t know if I’m going to be doing much hiking here in the short-term future.

Mike: It might take a little

Josh: stress off too.

Mike: And then Josh is passive passionate about helping business owners minimize their exposure to lawsuits and credit attack. He served as a risk and financial management for his clients, personal and business affairs. He’s worked with one of the top assurance firms in California, learning that the value of adding different tax and risk management strategy.

To his client’s estate and financial [00:04:00] world. He’s got a bachelor’s of science degree from the United States merchant Marine academy, and a master’s in business administration from Texas a and M. Josh is a closet tech nerd. I love that. I’ve been waiting to say that all week he serves on the board of directors of the sky mountain Christian camp and volunteers at his local church, coaches, soccer and basketball.

Hey guys, we’re. I’m really glad that you’re here. And I know that my listeners are going to gain a lot from your knowledge and your experience. One thing I want us to remember is that, this show is titled insider secrets and what I want to do and we tend to do is we take professionals like yourself and we really hone down and make the skills manageable.

Not only for the new infant. But for the seasoned professional, who’s going to get the most benefit out of what you’re teaching and what you’re talking about. So what I’d like you to do is mark, you want to start and just start with a little bit of background about yourself and [00:05:00] how you got involved in real estate and your passion or.

Mark: Yeah. And so I guess to go back to just my original beginning of having a family who worked in the lumber industry and my dad did specialty lumber work and log work Really what sparked my interest in just seeing how things worked. Financially as my dad did something that most people, I don’t think have the kahunas to do, which is he moved from Minnesota back to the small town of Alta, California, and he bought a piece of land.

He took a chain saw and started cutting trees off the land and bought a saw mill and milled the trees into lumber. And we built a house from scratch. But Lehman brothers did own a note on the house and when they went out, so did we, right? Like we got the, we were one of those people who got that notice on the door Hey guys, leave, and it was a dream home, beautiful home.

And it just, that’s a, an emotional rollercoaster, so that [00:06:00] really got me thinking like, man I wonder how things actually work. I wonder how, and that kinda led me to Yeah, the financial planning world and then where, Josh and I honed in on the real estate side of things is, you’re looking at all these people who built wealth.

And so few of them did it on wall street. So few of them were like, you know how I got to the top. I picked an investment portfolio. And we really started honing in on there’s, there’s tax Reggie here, right? There’s tax leverage, there’s leveraging, there’s cashflow, there’s all these things that we can do.

And we started looking at ways that we could even pull money and move money from the investments to, to maximize the benefit of both the investment and the real estate world. And that’s really what had us headed into the direction of, we sound like the world’s worst investment advisors when we’re telling clients like, oh, it’s a really good investment and get it out of my book of business and go get into real estate, pay me less.

What are you doing? Yeah. So that’s really uh, and Josh and I have known each other forever. So [00:07:00] quite literally since the day I was born. That’s a little bit more background of how I got to where I am and naturally how Josh and I have just always worked.

Josh: Yeah, that’s interesting.

Mike: And the one thing that really stands out for me about what you said, and there was a couple of things, but the one thing was Lehman brothers, right?

I was at lunch with a buddy of mine who actually, he was the CFO of my company at the time. And we were watching the TV screen and all these people walking out of Lehman with boxes of all their stuff. And we hear that they’re done. And I looked up from across the table and I said, We’re screwed aren’t we?

Yeah.

Josh: It’s like flowing through. It

Mike: was just, straight. True. Yeah, the world is becoming an interesting place. Hey, Josh, before you tell us about your background, what I’d like you to do is describe in one word your real estate investing strategy. Simple. Oh.

Josh: Nice and one word. Yeah.

Mike: That takes [00:08:00] the complexity out of the whole deal,

Josh: right?

Yeah. I, I I’ll give a shameless plug. We interviewed lane Cal OCA on our civil, passive cashflow. Who’s actually at the summit and spoke great presentation. And he we, we tell our clients like, what we do is not rocket science, this is not like you don’t need some special equation or a PhD or, three decades of experience to go out.

Buy things at the right price, manage it. We’ll learn along the way, right? You’re going to make some mistakes, take some lumps, find good mentors, right? Like you Mike find good mentors, find good people that want to share information and just do and follow what they do. And the thing that I think a lot of people forget, you need to learn to give back, and that doesn’t necessarily need to be monetary rise, which is great too, but find people that want to do it. You want to do it and show them how. Whole people along with you. And, I don’t know how many times we’ve seen clients or people that, somebody, they helped. Some, they knew gives them the call.

I’m like, Hey, I have this, my buddy, my neighbor is getting ready to sell his piece of property. He doesn’t want to list it. Would you be interested in buying it? You get to pick it up at, 10, 12, 15% below, market. Cause the guy just wants to get rid of it. But if you [00:09:00] hadn’t given back and done and built those relationships over time, you didn’t ever gotten that phone call.

So I just think, simple as it really is simple. It’s not that complicated. It just takes some work and a little bit of know-how and a little bit of a shoe leather or elbow grease, so to

Mike: speak. Yeah. Yeah. Yeah. So your backstory, how’d you how’d you get involved

Josh: in this world?

Yeah I flew airplanes for the Navy for a decade and did that, and I always knew I wanted to go into entrepreneurship. Me and two buddies. So in 2008, we had this great idea that we should start a hedge fund. Let’s do that. So me and two buddies started a long-short equity hedge fund and launch it on January 1st, 2009.

Yeah. The best time ever to launch a hedge fund, man, we’re geniuses, smartest guys in the room. And so obviously, you know how that went down, we kept it open for about almost three years and shut that down and give our investors money back. It just wasn’t, we weren’t able, we’re never gonna be able to raise equity.

And I went to work in the commodity futures business selling commodity and futures, and that industry really changed. And I really just started talking with clients and I was like, what really, what clients need is a full service plan. Cause most people are always, picking one thing or, I’m doing this or I got this [00:10:00] great idea, but they never see things through for T through to fruition.

And I’m like, w we really need to teach people how to get from point a to point B, run the marathon. It’s a long way. And, really make help them make good decisions. And so that’s really, I have the heart of a teacher. I know mark does too. And that’s what we love to do with our clients is we’re this they’re help helping teach them how to make good decisions.

And I know that’s what you do to Mike for your.

Mike: Yeah. Education is really important, right? Absolutely. We can take in a lot of education and the education itself. Isn’t powerful unless you execute on it. Sure. Absolutely. That’s the other piece of the execution piece. Hey, let me ask, how does Kings view wealth fit into the multifamily space?

And, I don’t know who wants to tackle that, or you guys want to tag team on it or whatever, but how do you guys fit into the multifamily space and what exactly do you guys do?

Josh: Yeah. We’ll take that from I’ll and I’m sure mark I’ll dovetail on this, but we really look at real estate, as an asset class. And we’re, I [00:11:00] wouldn’t say we’re agnostic, but everybody has a specialty. We have clients that love mobile home parks. They have, they love single family or they love multifamily. Some, we have some commercial. I know that’s a little out of, not in favor at the moment in the current environment.

But we look at that as a tool, right? So it’s another bucket of money and it really what real estate does is they create cashflow, which is beautiful, but it’s also as a great, he used the word tax shelter, but it’s very tax efficient. And so if we can learn how to move money through our assets and work with great CPAs we think that just becomes this almost a force multiplier, right?

It’s like putting your financial plan on steroids to really get clients to really want to be. And then it also creates distribution buckets and all kinds of stuff. We can talk at nausea, all this stuff, but we really think it’s very efficient on a multifamily front and real estate in general.

For Ana financial.

Mark: Yeah. And there’s also going to be, cause as much as we encourage and educate people around getting into real estate, most people have some sort of actual stocks and bonds investments [00:12:00] in their life at some capacity, right? Whether it’s a 401k or an IRA from another job and getting people to also really understand, the the risk component where it’s like, Hey, you’re taking your risk in the real estate.

And, If you want to be heavy in real estate. We’ve run into clients who, they have things basically maxed out risk-wise on the real estate side and they also haven’t maxed out risk wise on the investment side. When they tell us that their strategy is I can’t wait for the market to goes down and I’m going to go buy more real estate.

That’s where we get to have the education of Hey, we have to balance this out. At some point we can’t be, we can’t be risky on both ends. So let’s get, we really try and get people away from thinking about rate of return, because I just think that’s a silly thing to chase and look after and start thinking.

Setting up opportunities setting up like, okay, we’re not going to win the rate of return game over here, but we are going to win the real estate game at some point. And then if we can also time this out to distributions or rough conversions, now we win the tax game and I’d way rather win real estate.

And I way rather wind tax than win a taxable rate of return. And so [00:13:00] that’s how we come in and just say, here’s what your world looks like. And this is how, from a risk standpoint, we think this is more advantageous to be, how it should be. So if you’re setting up

Mike: somebody’s portfolio today are you do you have an allocation amount that you say, Hey, you should be in this much real estate and you should be in this much stocks and bonds?

Josh: No, w we don’t. And the reason we don’t is because it depends on how much, stocks and bonds are easy. I use the word easy is because it’s pretty easy to buy a portfolio, at Schwab or fidelity or wherever. Brokerage house with choices and let it sit there. If we have a client who is very active and they’re like, Hey, I want to build this.

And I’m really trying to grow. We think the real estate place is a really good place to do that. If it’s somebody who’s just, I’m in that distribution mode or I’m going to maybe start, either passing stuff off to my children or we’re going to start to, basically live off some of that stuff or just live off the cash flows.

I’m not in growth mode. Maybe we’re shifting a little bit more than the stock and bond portfolio, just because it is a little easier and it’s really client specific and client

Mark: dependent as well as, this’ll probably be come back into [00:14:00] the fold possibly after tomorrow, who knows.

But we’re recording at an interesting time.

Josh: We’re trying not to date this.

Mark: Yeah, but another aspect we look at when it comes to just the financial planning is if you’re successfully building real estate, you may have an estate tax problem. And so how do we set up the pieces to where we can do some charitable planning that kicks back another stream of income or, donate shares of stock

Josh: versus,

Mark: Cash, and there’s some tax advantages there. So that’s another area where it’s like, if we’re successful and we beef this up and if they start bringing that a state tax down to a lower threshold, those are things that, you’re probably not going to get just talking to someone about stocks and bonds.

Josh: And it’s also mark Margaret dependent, Mick. And you’ll agree with this as, markets fluctuate and things go up and down. And if I have several clients right now that we’re sitting around on a little more cash in the investment. If we get a pullback, we have the real estate market’s gone crazy as of right now.

But if we get any sort of pull back right in the real estate market, we’re [00:15:00] going to be an absolute net buyer. So that real estate portfolio will actually substantially increase depending on what’s going on. And that’s just we don’t know the future. We can’t predict things, but that’s, we’re always on the lookout for that, we’re always looking for opportunities. And how do we flex and optimize this to what’s. Yeah,

Mike: you guys just, you’ve said some really good things, just like you can’t predict the future and too many investors, I think sit back and say, oh, I’m gonna wait for a good marketer. I’m going to wait for a bad market.

You know that you I’ve made money in good markets, bad mark. Democratic president Republican presidents. I know you guys were waiting for that one. Yeah, absolutely. So it doesn’t matter right here. I want to just back up for a minute, cause you talked about, you alluded to the commercial space, right?

And I know a guy right now that he is, he’s got this concept for a grocery store. So he’s out buying these. I’m going to just call them, broke down shopping centers, these retail places that are [00:16:00] like 90% vacant. And he’s got this designed for a grocery store. He’s going to go in and put a new grocery store in as the anchor in these shopping centers.

And he’s bought a wheelbarrow full of groceries about retail centers that are just like, they’re on Ivy for sure. Yeah. And it makes me wonder sometimes do people see things that we don’t see or are people just. Ignorant and not doing the right thing, and I think that sometimes people see things that we don’t see, and that’s why it’s really important in our lives.

They have guys like you that can coach and train people in their financial arena to, to help them. Hey, did you think about this or did you look at this? If you had an, have you had an investor recently? I say recently, in the last eight months, because of the way COVID, [00:17:00] who’s gotten panicky or wanted to do something different that, any good stories like that

Josh: hard.

Mark, can you take that one out? You got a couple

Mark: of guys. I had a one particular person where, phone was ringing off the hook and they were super heavy in real estate. They had about, No, I’d say eight to 9 million in real estate and, small family all multi-family and they had a, a portfolio of roughly two or I guess 3 million.

And yeah when COVID hit we had everything scaled back. We had everything scaled back and everything was very conservative and I had let them know cause they wanted to be aggressive. I was like, I’m not sure what’s going to happen, but at some point, cause we had done the risk assessment and they had basically alluded to the fact that any downward momentum made them nervous.

And sure enough, COVID hits and they’re panicking and they’re like, oh we gotta sell things. We gotta move things all to cash. And we just have, we had the conversation of look at your cashflow. The cashflow from your real estate is still paying all you need and more.

The account then bounce back [00:18:00] plus some, and then we got to go back to them and say Hey, if that made you nervous, then it’s it could be a little too aggressive anyway. And if they’re also thinking about buying more real estate, I was like, maybe it’s time to move some, even though you’re conservative, maybe it is time to, again, we’ve we didn’t react heavily.

We didn’t sell and move everything to cash, everything, bounce back. You’re now on the plus side again. But now let’s go ahead. Let’s go ahead and take, think it was about $700,000. Moved over to a cash holding. And they’re like, yeah we really do feel like cause they wanted to get into commercial and they’re like, we think commercial is going to be a good buy here in the next, year.

And so we got to do that. We didn’t panic, sell everything while it was down, cause again, if you make that reaction of panicking and sell while everything’s down, you’re very likely to also panic that you just missed out on a bunch of growth. And by when everything’s. And that is doing the one thing that everyone knows not to do, which is sell low and buy high.

Josh: Yeah. So can

Mike: you turn the market though? Really [00:19:00] realistically can really time to market.

Josh: And so I always tell clients that’s a fallacy, that nobody ever sold the S and P 500 or bought the SUV a five voted on March 9th, 2009 at the all time low and sold. When was it about. February of this year at all time highs.

That was not a real person. That would happen to be one lucky guy that made a trade and one lucky person that made a trade. And so that’s, tiny in the market as a fallacy. I think you can definitely spot trends and there’s definitely things that you see going on. But, you don’t time the market, you stay, you get invested, you stay invested, you make prudent decisions, you make long-term goals and follow them and then pivot if you need to.

Mark: And I, I would say that, I think two people make money on wall street. It’s either lucky people are patient people, right? You can be patient with the market. You can’t time the market, but you can set up, you can set up the right buckets to where you can be patient and just know oh yeah, I wish that I wasn’t in that investment.

I’m not panicked cause it’s not, it’s not everything I am in that in that one particular

Josh: fund. Yeah. I

Mike: think the key word there that you and you guys are bolts that at a couple [00:20:00] of times as panicked, as soon as people start panicking it’s over and then sometimes it is no rational conversation you can have with anybody.

Know which I think if people just relax and sit back and get. Realistic and think it through, really look at what could happen or what might happen. Think it through to the end, they might make different choices and different decisions.

Josh: Yeah. I think the rational man theory says that the rational person theory, we keep having a growing population.

So everybody needs a place. So you’re going to keep growing and you’re going to, so real estate is always going to continue to grow and go up now will go up forever while I have dips and ups and downs. Absolutely. It will. Over the longterm, if you buy it right and do it right and manage it well, you’re going to make your goal.

You’re going to, I can’t, I won’t talk in absolutes, but you’re going to be okay at the end of the day. So

Mike: what pitfalls should it investor look for today in today’s market? If we can’t time the market, what should an investor keep his eyes open for for a pitfall that might either be a good [00:21:00] opportunity to come in the market or his timing to get out of the market.

Josh: Go ahead, mark. I’m kidding. No, I think, as far as a particular stock and bond, I don’t think there something, everything’s I would say price to perfection, maybe the last couple of days, not withstanding something. But I do think there’s going to be lots of opportunities coming going forward in the affordable housing sector.

As. Whatever happens with the current COVID situation and all of that, we’re going to, whether we’re going to go into a depression or a little recession or a dip, whatever you want to call it, that people are still gonna need a place to live and affordable housing.

I think the kind of the, a lot of the market in the world has shifted, right? There’s two, there’s either the wealthy, that didn’t really lose their job. They’re working from home, working from apple, Google. They’re still making their 150 200 grand a year, but you have a lot of the lower people in, especially in the surface.

That last that last jobs, but they still need places to live at affordable costs. And so those small multifamily units are gonna, they’re going to continue to be very viable now, [00:22:00] as Mike playing in that arena has its own nuances and issues. So you you just gotta be, know what you’re getting yourself into a good again, hire a good coach.

I think money spent on yourself learning and hiring people like you to coach you through these situations and. I’ll use the word old dog. And I only use that out of respect because you’ve been through so much and seen it right. And get the advice from smart people be like, oh yeah, I saw something similar to this.

And in the early nineties, I’ve seen this. Yep. Here’s what I would do. It’s not going to be the same, but it’s going to be pretty close and, do this and then, talk again in three to four years and you’ll probably be pretty happy about it. Yeah, absolutely.

Mark: And I think from a personal standpoint, if it’s a good time for a person to jump in or not, I think really it almost.

It does matter on the opportunities, but it also matters on the do you have a CPA and a planner and an attorney that are all on the same page? Because I know we’ve had scenarios where, the asset protection attorney said, Hey, we want to get more into real estate. And we had positioned things like, Hey, we think it’d be advantageous if we did this, but then the CPA.

You shouldn’t do that [00:23:00] unless it’s structured this way, which then the asset protection attorney said that doesn’t work for asset protection purposes. So we all had to talk amongst ourselves and find the good plan that was right for that person. Because that’s another thing is you almost don’t want to just go off a whim because you may then hear back from your CPA, then it’s just oh, that just totally screwed up this over here or.

Or what have you, so that’s where you want to make sure you don’t just have good counsel, but you have good advisors working with you who are all on the same page.

Josh: Yeah. One of the things I

Mike: teach a lot about is team building and networking, right? And if you have an investor, who’s building a team and he’s got a financial planner and has got an accountant, he’s got an attorney.

Those people need to be able to come together to, for situations like that. I think that’s a great example that you just gave of that because, if you can’t, if they can’t work together, And when the time, not that they’re always going to work together, but if they can’t work together, when the time is required, there could be challenges as a result of that.

Josh: Yep. And the biggest mistake, I we’ve seen this with clients and [00:24:00] the biggest mistake we see is a client goes out and does a transaction and they didn’t consult anybody. Which it could have been a good transaction, but if the CPA is Hey, if we were to actually push that out one month after the 1st of January, we could have asked this.

We could’ve pushed a tax bill off for 17 months, or we could have done X, Y, and Z and, or, maybe we could have pulled some depreciation forward because you had a big win this year and another, and you’re you’re fitting that puzzle piece together all the time and just ask for help.

Or we might just art or the answer might be, Hey, just do the transaction. Good job. Good. Find and go forward, but just ask those. Yes. It’s a big deal. Absolutely. It’s huge. Yeah. Yeah. And, Mike, I will say, and you probably get this, when you run coaching and you understand is sometimes don’t be penny wise and dollar foolish.

Don’t, I don’t, I didn’t want to, I didn’t want to spend the $300 and my CPA charges me 300 bucks every time I call him for advice. Now we can have a conversation. Do you have a good CPR or not with that conversation? That’s all there part but don’t, don’t be like, oh, I didn’t want to ask for tax advice because I [00:25:00] didn’t want to spend the 300 bucks.

What if the CPA could have saved, 25 or 30 grand, I just structuring a deal a little differently or in a better way. Don’t mean to do it yourself or figure it all, just ask for help and and don’t make those big mistakes. And that’s what we’re, that’s what we try and really avoid.

Mike: Yeah. Even way back when I was selling residential real estate, the client who the. Who was really worried about the quarter percent or the half percent luggage race who was really going to be a challenge, right? Yeah. The whole thing, because when you worry about that little detail, quarter percent is to be $8 a month.

You know what I mean? Is it really in the big picture of

Josh: spend the 300. Yeah. Or you are, or if you want it, he was going to save his quarter percent, but he’s going to pay twice as much in fees, but he got fixated on that quarter percent. You’re like you’re missing the, yeah, no. And speaking of the taxi example, we just had a client, they’re doing the development up in Northern Idaho and they’re the ground movers that are, we’re doing all the dirt [00:26:00] work.

They asked to not be paid until January 15th and next. Because they had their, having such a great year. They’re like, Hey, if we can push income into 2021, we’ll do that. And so that was just another example of, being like, yes, take that deal all day long. Of course, they’re happy, you’re happy and they’re already, so in the meantime, they were actually able to sell three more lots, basically on a free loan. Almost a half a million dollars for the dirt movers. Cause they’re like, man, we were going to take such a big tax hit this year. We got to move this income into 2021. And but those are, but obviously that dirt mover the construction company was taking some good advice from their CPA and be like, Hey, ask your client.

If they can pay us in 2021, that’d be way better. We could push it out. So those are having those smart conversations to say. Good problems to have, right. Especially in a pandemic year. I know you’re absolutely. Yeah. It takes

Mike: the heat off when you say, oh, I can’t pay you until

Josh: January of next year.

Yeah. Yeah. Again, that’s just good planning. And that’s just good thinking things through and not having that penny-wise [00:27:00] dollar foolish mindset and kind of that scarcity mindset of Let’s push this out and make a good choice. Cause then I get, think of if that CPA saved that construction company, 10% on that 400 grand that’s a $40,000 plus hit

Mike: You have to look at the win-win, it’s all about a win-win situation. So obviously the dirt mover is getting some reward for not taking the money this year because their tax bill or something already this year is going to be offset or. Kill him. So how, in a situation like that, maybe he needs to buy some real estate or do a passive investment and put some money away and do some asset allocation or asset planning that’s going to benefit him somewhere.

There’s always the flip side of that. Hey, you know what, I know a couple of guys that might be able to help you with that problem.

Josh: Yes. So yeah.

Mike: What what do you see as a biggest pitfall today in the marketplace where we’re at, here we are the end of 20, 20, right? Fourth quarter, the world’s kind of in a crazy place the last [00:28:00] several months, when we thought that we were.

Things we’re going to be shut down for two weeks. It’s been eight months and it’s just, it’s nuts. So what do you see as the biggest pitfalls or challenges for the real estate investor today?

Mark: I would say, we’ve run into some people who have still done really well, even during a pandemic.

And it usually comes from a mindset of I’m going to find a way I’m going to do it, and everyone has their struggles and obviously not everyone can actually do it, but I think that, what was that? The harder I work, the luckier I get that, that quote, or, there are some people who they see it, what needs to be done and it’s discouraging and there are some people that see what needs to be done.

And they’re like, okay if I wait a year, I’m going to be one year older and it’s still going to be sitting there. And so just the biggest pitfall is not actually. Starting the work and starting to stash money aside and finding ways to maybe make other supplemental income to start funding that first real estate investment property.

We it was one of the things that lane Kobocha said on our [00:29:00] podcast when we asked Sam, cause it is one of those things where we’re just like, what, what you do is simple. You have it all online. People can go online and go check it out and do it themselves. Like why aren’t more people doing it.

And he’s most people just can’t access. No, they come up with an excuse as to why it can’t be them. And so they never start.

Josh: Yeah. The other one Mike says, I think there’s a lot of fear in the world right now. And I would say maybe not even for, that’d be for good measure. There’s, it’s been a crazy year, 2020, like to just strike that off the old calendar for a lot of people, we’re coming into an election season and we’ve had COVID and all this, riots and all that kind of.

I still think that after election day or whenever it is the sun’s going to rise again, I not shocking. The sun’s gonna rise January 1st is going to show up, the world still gonna move forward. And so I think some people that, I will say stand in the face of danger, but I don’t really don’t think it’s that dangerous, but if you’ll stand up and look for those opportunities and keep pushing it forward I think you’re going to be just fine.

So if you can ratchet that fear factor back, a couple of notches. The prudent be smart, maybe not go crazy. I wouldn’t [00:30:00] head down to the casino and put on black, this week, but just start stuff and keep it moving forward. I think you’re going to be very happy with what you did in 2021

Mark: and, last or just a tailor on that too.

Let’s see. So many people get distracted in their strategy cause they’re like, Hey, this is a new shiny thing. I’m going to chase this and now I want to chase this. And now I want to sh and there’s always, they’re always being pitched like a different opportunity and finding what you’re comfortable with.

And this kind of goes back to what Josh was saying earlier, where it’s like, Hey, do something, take your lumps, learn from it, grow, move forward. When you take your lumps, that should be, how can I hone in what I’m currently doing? Not let me run the opposite direction and do something completely different.

Cause you see that too, where people are like I would never do that again. It’s but you already learned how to do it the worst way now do it the second, like that, now do it a little bit better. And you know what to look for. So consistency is definitely something that I think holds people

Josh: back.

So Mike, let me ask you this question. It’ll tell you what we’re talking about is what do you tell your clients that you’re coaching the first time they have to evict somebody.

Mike: The [00:31:00] first time they have to evict somebody to, I teach them the process and tell them to go execute and

Josh: do it. Exactly.

And then the first time it sucks, for the client. They’re like, oh, I’ve never done this before. It’s a new process. And my now the fifth or the 20th time they’ve done it. You’re just like we just go do the process. And I worked through it and I’ve, I budgeted for it. And I put it into my business plan and we just make it happen and keep moving forward.

It’s not the end of the world. And that’s that scarcity mindset that people need to get away from of it’s just, it’s part of the, as part of the world we live in and you just keep moving forward.

Mike: It’s a lot about the fear. And you said that. If people, I think people get, they get nervous.

Scared and they just, they lock up and they can’t report quick story. When I was selling residential real estate, 75% was with investors. My business was investor based business and on Saturdays I would have a bus tour and I’d put eight or 12 investors on a bus and we’d go look at two new construction properties.

Two properties that, just needed a little cosmetic stuff, but the last two [00:32:00] properties we’d always go look at were good foreclosures. Really beat up, run down mold. They can board it up and we would walk in and these people would just say, I can’t do. I, and now you’ve got to push them over that edge, to say, yes, you can. And it’s just fear and it’s the fear of the unknown until you get that first. Then it, then your whole life changes.

Josh: Yeah. Then after that, you start to see that mold is a goldmine, or a rotten Flores. That’s where 30 grand right there. Love us bestest today.

That’s right. Yeah. That’s a story for another day too.

Mike: So what do you think investors should look for today coming into the market? As a new investor

Mark: coming in as a new investor. I’m kinda going off of one of the podcasts that we just did where again, it was lane Kobocha and he was talking about people who were starting to get, trying to get started. And he was [00:33:00] saying your profit margins on class a, Don’t look for a place that you would want to live.

He focuses more on the, the B class and he’s try and find a place that has. Roughly 1% wrench to value ratio, right? Just as a way of first initially looking at it, he’s you’ve got much lower capital that you need to put up forward to get into the property.

And so it’s, it’s easier to buy $120,000 home than it is to buy the $400,000 home. And, you’re probably going to get. A thousand bucks or, 1200 on the, the $120,000 home, you might get 1800 on the more expensive place. So if you’re just starting, that’s I take his advice, right?

Like I think he’s a smart guy. And as someone who hasn’t started building the real estate portfolio, that they can start, let Virginia, that’s a good place to at least start looking.

Josh: Yeah. And, for really, it’s just getting over that fear and just doing it. And you’re not going to get rich off your first deal every once in a while you, that person, they have that one buddy that gets lucky and he [00:34:00] makes a whole bunch of money on his first one.

But you’re looking at that slow build, right? I always jokingly call it the 10 year overnight success. It just takes a long time to do things. And, especially if you’re building that long game, real estate portfolio, most likely you’re not going to be incredibly wealthy in three years.

And you’re probably not, Yeah, but in 10, 12, 14 years, 20 years, you’re going to look back and be like, wow, I made some really good decisions and they’re paying off big time right now. Hence long-term right. Absolutely

Mike: ask you guys. Where’s Kings view management vision for the next 3, 5, 10 years.

Where do you guys see yourself as a company fitting into the marketplace and grow where your growth is going to.

Josh: Yeah, and we really want people to see that there’s, you don’t have to be a binary investor, right? You don’t have to be all real estate, not to be all stock market.

There’s a lot of ways for you to make money out there. You need to be diversified, but in a way that’s taxing. So that you can actually grow those assets because everything moves and goes up and down. And if you can find a way to do that and then hire a good [00:35:00] team. We are. So me and mark are passionate about working with a good CPA and a good attorney.

I know that’s a basically attorney is like a four-letter terrible curse word, but find a good attorney that, that you can work with. Find a good CPA of the. Because there, the advice they give is going to pay off in spades down the road. So that’s where we’re moving our business to have it, what we would call a virtual family office or a, basically a small family office for the common person.

Mike: Yeah. And I think that there’s a niche in the marketplace where that cause you’re not talking about the totally high net worth individual. You’re talking about the average. Yeah. Yeah.

Josh: Those people making the hunter a hundred to $400,000 a year, maybe even a little less, but they want to build that portfolio.

They want to work hard. They have kids and families and they coach soccer and, they do all their things and they just want to, they want to be able to retire at some point and we really think. But the cashflow that real estate, the opportunities that has, it’s just, it’s something you can’t, you really shouldn’t pass up.

You shouldn’t overlook it. And

Mark: because of a COVID and everything’s shutting down, everyone’s a zoom master. Now [00:36:00] everyone works virtually. We tell people, Hey, there’s no, I don’t care if you’re in New York or Chicago or Seattle,

Josh: I don’t care

Mark: where you are. I should still be able to talk to your CPA and he should be a master zone by now.

So let’s get us sinked up. We’ll have a discussion. We’ll talk about what you’re doing. And I don’t see any reason why we can’t do that forever

Josh: moving forward. So

Mike: if we would have only known in March that we should have went and bought some zoom

Josh: staff.

Mark: Yeah, no. There. There was someone else who had actually had the ticker symbol, Z O M and their stocks skyrocketed, but they are not zoom.

They’re like, don’t tell anyone. Don’t tell anyone.

Mike: So guys, this show is called insider secrets and we’re here every Tuesday. And what we want to do is we want to try and give some really good in-depth drill down insiders. So before we start to close out here this afternoon, what do you, w what would you [00:37:00] say is one good chip that you could give the real estate investor?

Mark: W first I’ll clarify that it’s insider secrets and not insider trading because we are facing,

Josh: these are secrets.

Mark: They’re not it’s our trading, but I would say one really good thing to start looking at is a Roth conversion and spend down strategy. So you’re probably going to have a 401k.

You’re probably gonna have an IRA and some investible assets. You can, if you are able to be successful in real estate, you can really start getting those out of those investments at very low tax brackets. And so I would say on top of the real estate development start reading about.

Tax efficient retirement. How do I drive my, my, not my passive income, but my ordinary income tax bracket down to zero. If we can do that, then we can really do some sexy stuff financially. [00:38:00]

Josh: Great. Yeah, I’m going to go with accelerated depreciation. If you know your, especially when you start getting to that either, the multifamily or commercial might your specialty.

That is just a huge under utilized area that most people don’t take advantage of. And there is lots of opportunities to get either a cost stake study done, or depending on the assets and accelerated depreciation. And maybe don’t take it this year. You look at a year when you’re going to have a higher passive incomes or something like that.

Again, get with your CPA because they’ll help you with this. But really use that as a great tool. Because if you can save yourself 20, 30, $50,000 in taxes. That is a big. Yeah, and I

think

Mike: I could think we could do one whole show just on a accelerated depreciation and depreciation, because when have you ever known the government to give you.

And there

Josh: you have it right. Is depreciation and make him, I can dump hell dump. Tell him just a little bit. The problem is most CPAs. I call them tax repairs because they’re really not a CPA. If they just file your taxes for you, a tax planner and a good CPA will do that [00:39:00] planning. They should know that stuff and they should be bringing that to you.

They should be telling you, Hey, you own this real estate. Yeah, we need to look at doing this. We need to look at doing, accelerated depreciation or can we do a cost SEG study and they should be bringing that to you. You shouldn’t have to tell your CPA to at least bring that to the table.

You really shouldn’t interesting.

Mike: You guys on a lighter side, let’s let’s just, I know that you’re in two separate locations, mark you’re in California and Josh here, you’re down in Mississippi. Here’s what I want to know where you’re located right now. What’s the best tourist attraction.

Where are you in?

Mark: The most common one is a Tahoe, right? Everyone loves lake Tahoe and hiking, castles and peak and some of the stuff around there. I would say if you talk to some of the more locals they’ll. Give you the the end on a few. Off the beaten path attractions.

So I know up where Josh and I live, there’s something called smarts crossing, and it is where Mr. Smart’s back in the Western expansion actually built a [00:40:00] bridge for covered wagons going over this canyon it’s gone, but the 26 foot cliff into water is still there. You can find a few more, if you go searching online you can definitely find some off the beaten path of locations too.

You can

Josh: have. And Mike mark being mys. I know you wanted to mention a couple of breweries because these are huge beer aficionados, so right where he is right by where we live. There’s some great breweries. So yeah. Yeah. If you get, if you could go to

Mark: needy or Moonraker crooked lane all great places

Josh: here in Auburn.

Yeah. So I’m actually down here in Gulf port where me and my family are getting up tomorrow morning driving to go spend three days in Norway. So I will be tomorrow night, if all goes well, I’m going to have my own personal doesn’t set of wasters at Acme oyster house on bourbon street. And then we’re going to follow that up with some chicory coffee and some vignettes at cafe Dumont.

That is a I for sure must do in new Orleans.

Mike: Absolutely. Yeah. That’s great because my next question was favorite restaurants. So you just

Josh: hammered that. So that [00:41:00] was good.

Mike: If our listeners want to get a hold of you, they want any more information or planning strategies, how do they get in touch with you?

Josh: Yeah

Mark: you can check out our podcast. So our website is a wealth preservation podcast.com. You’re going to have the full lineup of entrepreneurs, their stories. We actually have some of the tax tax strategies episodes up there as well. And then all of our info is there. So you can reach out you can also follow us on LinkedIn, Twitter, Facebook, all of the good stuff, all the social needs.

And then, our email address, mine is my first initial last name. So M cipher@kingsview.com. And it’s going to be the same structure for a Josh’s email as well, but definitely go check out the podcast and there’s a couple real estate specific and tax specific episodes.

Mike: I appreciate you guys being here. Thanks for taking time out of your day to meet and to carry some good information to my investors and the listeners on this podcast. And you guys [00:42:00] remember Kingsview wealth. You can find them on the. I want to thank you for being here. If you guys want to say goodbye real

Josh: quick.

Yeah. Have a good one. Thanks for having us on. Thanks so much. We appreciate your next Tuesday

Mike: again. So have a great afternoon and the rest of

Josh: your day, everybody. Thank you. Perfect.