S5 E05 | Mo Money No Problems

I have five reasons why this is a must listen episode. Those five reasons I'm giving you five emerging markets here in the United States that haven't exploded yet, that could make you very, very profitable in real estate. So tune in.

You just told me something kind of crazy. You told me that there is a strategy for Americans to be able to tax free, build wealth and become millionaires in less than 10 years. Say it ain't so.

Give me that strategy. What?

Yeah, tell the people what they should know.

Thank you for making episode five. First and foremost, we like to slide in absolute genius in episodes. Usually between toilets and turn termites like we like to. Yeah, we like to put in there. We want to make sure that you're hunting for it because this is free after all. And we want all of our listeners to hit that subscribe button. Give us a quick five star review. Share with some friends. This episode, particularly you want to share with your friends because it's going to be very, very easy. And what we're going to do is we're going to walk you through it. Now, Britney knows all about this. She's, she's really testing me to make sure that I know you know, because she knows. So here, here goes. This is called.

Primary residences for sale.

Oh, okay.

Primary residence. What is a primary residence? So if you're listening to this and you live in the United States of America, greatest country on earth with the greatest problems.

If you live in a primary residence, AKA you bought it, it's yours. You put down the down payment, 3%, 5%, 10%, 20%. Whatever you put down, you're in this house.

If you sell that house for a more amount than you bought it for a mo money. Mo money, mo problems, you got a profit.

Not in this case.

You buy a house for 100,000, you sell it for 150,000, you have a net profit of $50,000.

That $50,000 is 100% tax free if you are single or married. If you are single. Ladies and gentlemen, this is an IRS tax code. Please listen in very closely. If you are single, you have a tax free gain on your house of one quarter of a million dollars. That's $250,000 of tax free gains. And if you're married, it's half a.

Million, half a mil.

So I'm going to walk through a strategy of someone that you know very closely. We have a lady who's single, grinding that keyboard, getting after it, making money, loving life. She bought a house a while ago, it was worth $200,000 now while she's working, getting after it, she's renovating the house a little bit, updating the kitchen, putting new flooring in, new paint, fixing the outside, increasing the value of the house. Right? Putting in new decks. You know about those decks.

Strong deck game.

Strong.

Super important.

So she's putting in money in this $200,000 house. Now, right now, this house is worth very, very close to $650,000.

Oh, snap.

In the interim of this house becoming worth more money because she bought it five or six or seven years ago and her getting married, she could now sell this property she owes. Remember, she bought it for 200,000, it's worth 650. She only owes $50,000 on it. So riddle me this. If she sells it for 650 and she owes 50 after tax tag and title and all the fees, let's just happenstance say that she walks away with a cool $500,000 since she is married. That $500,000 is tax free, ladies and gentlemen. Tax free. Half a million dollars in your bank account.

Now, it's great to make money on all these houses. The reason we're stuck on the tax free is you just have more to play the game with. You have more to invest with. You can sell it before two years, you can do that. Appreciation is wonderful. But when you don't have to pay taxes on it, you have more to play with.

That's such a big, I mean $500,000. Because the average American, we looked at this stat recently, we had someone come into our G Force community. They did a live presentation and I believe the number was 66. So 66 people out of one at the age of 65 will retire with approximately $130,000 in their retirement account.

Seems high.

Well, yeah, if you're seven. Right, for sure.

But 100, it's actually higher than I would expect is my point.

For sure. Yeah, but that's 66%. Now, 130,000. If you're retiring at the age of 65, how long does that last? Right, right. So it is a bigger number. But that 130,000 means that you're going to be working, you're not going to be able to retire for, I mean, the rest of your life. Or if you're $30,000 annual expenses, that money is gone in five to seven years. Toast. Goodbye. Thanks for playing. That means that people are terrified of retiring, they're terrified of not having enough money, and so they're continually working for the rest of their lives. But here we have a Strategy in the US where you could buy a house, fix up a little bit, spend a little bit of time getting into a good city, buying a good region. Buying a good region and get a half a million dollars of tax free money. Now, could you, Britney, I actually have a question for you. Could you take that $500,000 and then go buy another house with it? Let's say the house cost, I don't know, $700,000. You put $500,000, you only have to pay a mortgage on $200,000. And then you really attack that mortgage aggressively. And then, oh, I don't know, four years later, you take another half a million dollars out, also tax free, on something called a home equity line of credit, which you can get from a bank and you never pay taxes on a loan. So then you have a house and you have $500,000 of liquid that you still didn't have to pay taxes for.

That's how you become a millionaire.

Hold on, though, hold on. Because then, then, Britney, is it possible that someone could take that $500,000, which cost them 7% a year, and could they, oh, I don't know, give it to a real estate investor who would guarantee them 10% return a year on that $500,000 plus all kinds of perks, bonuses, cookies and goodies. And they have a 3% spread annually for free. Am I doing the math right?

For free.

And they don't pay taxes on the 500,000.

They don't.

I'm trying to figure out, why isn't everyone doing this? Why isn't everyone doing this?

Brittany, I think that a lot of people don't take the time to get a financial education, okay? They spend hours and days and weeks studying tests and impressing teachers and learning history and how, you know, photosynthesis works. But it's important that if you're gonna learn how to have a skill to get a job, to make money, you also learn what to do with the money. And this was like the most basic thing that I was blown away with when I first started getting financial education. I'm like, why are they not teaching us this? Why are they not talking to us about this? And I think that will change in our lifetime because it's just stupid that it's not.

And because we're doing it and because.

We will make sure this happens, we will make sure it's really important. Why? Why block people from ever getting ahead? We just saw this weekend at our GeForce meetup the national debt and how it's climbing and Unemployment, all these really scary numbers, and the interest that we're paying on the debt to service this national debt. And it was really amazing how irresponsible our government is being in. The most abundant nation in the world is really being propped up in a really irresponsible way, which makes it scary. And so the only way I believe we can get ahead of this is to empower the people to know how to continue to create value for the world and start and grow these businesses. And it does take time, energy, focus, money, resources, influence to be able to do that. And really good government leadership, which we will need to talk about this a little later.

We need good government leadership.

Somebody's got to do it. Somebody's got to care. Somebody's got to be brave enough to deal with the haters, haters, the betrayers, all the fun, joyful things that come with being in the spotlight.

So much joy. So much joy.

It's scary.

It is scary. But what is also scary, Brit, you're absolutely correct, is this is obtainable for so many people. And it's a building block. It's a process. It's something that could take time. The reason I said 10 years is because that's. That's probably maximum.

Well, I wanted to add one thing on how to get there faster.

Yeah, please do.

So you talked about this woman that we met this weekend who's been doing this work on her house. But what if you're not handy? What if you don't have extra cash to be able to buy and fix things up, or you've got three kids or whatever, you don't want to be doing work on your house. Another way that you can be creating this delta of appreciation is to buy in the path of progress. I'm like, write that down. Everybody listening to this. Buy in the path of progress. You always want to be buying something that you can do what's called a value add to, so you can make the property better by being there by changing some horrible paint color or adding a deck. Something would be nice to be able to add value that way. But if the area is trending up in an area that was known as being a rough spot or didn't have a lot of amenities there, and now the amenities are coming. If you can be in the path of progress, not already buy in the progress. It has to be the path of progress not already done, then you're going to get those double prizes. I've got houses that I bought for 39,000 that I sold for 139,000 that the people seven years later could now sell for a freaking million dollars. That's an insane jump.

Hashtag Nashville.

It's an insane jump.

Yeah.

And that is, again, an extreme market. But. But I don't actually have a buyer that I can think of right now that's ever bought one of my houses that hasn't made at least $100,000 holding onto it. And so all of the properties I invest in are in the path of progress. My buyers are blessed because they're in the path of progress. And so it's just one of the ways that you can do really well without having to be a rehabber or handy or spending your extra money on fixing stuff up.

Can I give you five cities that I think are on the path of progress right now?

Oh, I'd love to hear your opinion on this, but I want to just tell you real quick that I would call this strategy, okay. That you are talking about the MO Money, no problems.

Strategy. The MO Money, no problem.

No money, no problems.

It's important.

Yes. I love that.

So tell me your path of progress.

Yeah. I want to give you five cities that are not boiling hot under the sun, lunar fires like Nashville is.

Okay.

So the ones that might be off the beaten path that people might not totally have thought of before. And then I would like you to tell me if you think that these are good cities or not.

Okay.

Is that fair? Yeah. Okay. Number one, Sioux Falls, South Dakota.

Number two, Jacksonville, Florida.

Okay.

Number three, Oklahoma City. Number four, Cincinnati, Ohio. And number five, Lexington, Kentucky. Man, what do you think? How'd I do?

I agree with a few of those.

Hey, a few's good.

I agree with a few.

Okay, I'll take a few.

And I wanna hear your logic on why. So it's really important to not just listen to headlines. And by the time the headlines make it, you're probably too late, people. So you always wanna be on the cutting edge of breaking through and buying all your stuff before the headlines hit. So tell me, why do you believe in Sooth Falls, South Dakota?

All right, so here's a fun one. Now, all these cities I just mentioned, I have been to.

That's important.

That is important.

That's important.

Okay? Now, when did I go to Sioux Falls, South Dakota? Any guess? Brit Turner. I actually have no idea on that RV trip. So in order to get to a small little place called Mount Rushmore, you.

Got to go gallivanting around the world with your family.

You got a Galvant. And South Dakota is one of those places we gallivanted into. And we went through Des Moines, Iowa, which is pretty nice also. So we went up to Des Moines and we hit Sioux Falls. And then you cut across and you drive across South Dakota. Now, I thought, like, you thought and you thought. I thought. If you're listening, that I thought this too. It's freezing in South Dakota.

Yeah. Sounds cold.

Well, North Dakota is colder.

Yes. I've heard rumor on the street.

No one ever goes to North Dakota for. For sure, but South Dakota.

We're not dissing you. We still love you. We still love you if we're number one.

Yes. Thank you. I actually have a really good friend, Aaron, who's from.

I have some good friends. They're good people, great people. They gotta be good people because they're stuck inside together.

We say that with love.

It's always so cool.

Yes.

South Dakota is very, very green, luscious and beautiful. Yeah. Between May and early October, it's like Iceland. Yeah. Very, very. Kind of very similar to Iceland. Now, here's the thing. You have a humongous territory, a very, very fertile grounds in South Dakota. So when they're planting things in the spring, they have a humongous, humongous agricultural piece. But you have also loads of national parks and state parks in South Dakota, specifically the Badlands. Now, the Badlands is all the way to the left, but Sioux Falls is a very, very quick flight and a decently close drive. Des Moines, but a little city that a lot of people are trying to get out of called Chicago, which is about eight miles, eight hours away from a drive. So there's a lot of people leaving Chicago that are blowing up Sioux Falls because also acreage is out there somewhere between 2 to 10,000 an acre.

Oh, snap.

Oh, snap. So it's pretty cheap.

Yeah.

So there's a lot of great land opportunities out there, and it's beautiful.

So he is referencing my mentor Paulie's number one current investment strategy.

Really?

So you can take this theory and apply it to almost any space. And he says, invest in the submarkets of the hot markets. So those submarkets, they're a safer bet because they're more affordable the first time home buyers can be living there, you get more for the money. And you never want to be the number one most expensive thing in an area because that luxury market is too finicky to be a solid investment.

Right.

You can invest in those hot markets, but again, it's riskier. So if you want a solid investment strategy, invest in the sub markets next to the hot markets. I love that.

Thank you.

Why did you pick number two on your list?

What was number two?

When I say I didn't write it down.

Well, we got Sioux Falls. We have Cincinnati in Jacksonville. So let's say Cincinnati. So Cincinnati, it's north enough where you have a lot of seasons, but it's not Cleveland. Cleveland is cold, right? Cleveland, Ohio is chilly.

People are moving on from the cold a little bit.

People are starting to move away from the cold. So the people who are leaving Sioux Falls, South Dakota, and they don't want to go to Chicago, they're also going to Cincinnati. Now Cincinnati is also about 5 ish hours away from Chicago. Now, again, I sorry, Chicago, but your city kind of sucks.

You got to clean it up.

You got to clean it up. Clean it up.

Got to have some kind of rules.

A lot of people are leaving Chicago.

We're not hating.

I'm just stating facts.

Clean it up.

So you have Cincinnati is not very far away. You have Cleveland. That's relatively close. You're also semi close to Louisville. Did I say that right? Louisville.

It's got to be with that country twang or it ain't right.

Louisville. So it's right. Right north of there. And fun fact, it's right on a river and it's beautiful. I don't know if you spend any time in Cincinnati, but it's really, really pretty. It's a gorgeous, it's a gorgeous city around the river. They have gorgeous bridges, they have a lot of nice architecture. It's been around for a while. Very, very nice art pieces. Yeah. And. Correct. And there's a lot of jobs are moving into Ohio. Nationwide is in Columbus. They're expanding and so they're putting a lot of sub branches.

Back to your roots.

Back to my roots, dog. I just, I just invest in what I know. Which, which brings me to Jacksonville. Right. Jacksonville usually avoids really, well, all natural disasters. So the, the places that get hit by hurricane are generally, you know, Orlando and south and then all the way on the, the border. What's that? You have west. East. Yeah. So you have the west coast of Florida, right. With the Gulf of Mexico, you have hurricanes that come up in there. Panama City, Pensacola, that's going to get hit by hurricanes every now and then in tropical storms. But Jacksonville is generally pretty safe, right. From a hurricane standpoint. So that way, number two, huge sprawling city where you have Georgia, you have Florida. You have a lot of people that are leaving from, guess where? Atlanta.

Right.

A lot of people. Because the crime rate's a little too high in Atlanta. So they're traveling south but they clean it up. Atlanta, but they don't want to live in Georgia. So they're going to go to Jacksonville because there's an ocean there. So Jacksonville is beautiful. It's pretty, it's sprawling, very, very nice, so on and so forth. Oklahoma City Most of the reason that Oklahoma City is blowing up is because there's a lot of smaller pockets like Boise, Idaho and other places, Vegas. They're just getting a lot of that California traffic. Right. People are leaving California in droves, droves.

I mean, no one's going to go to California.

No one is going to California in the right mind. Okay. I'll tell you that. So that's one of those pockets that got really, really picked up. And the again, per square foot to build there. It's extremely flat in Oklahoma City. So there's not, there's not a lot of expense. Expense. It's very, very easy to build. And so the price per square foot of a building in Oklahoma city is like sub 100.

Interesting.

Yeah.

Interesting, interesting choices.

Yeah.

When you are looking at investing, start considering these things. What is the build cost, the market? People are leaving in droves to, to do that. What are people interested in? And always ask yourself the difference between a trend and a movement. You want to invest on movements, not trends. And so what will sustain people wanting to live here? What will people not put up with? What seems like a fad, what's just based on the market going up and down and interest rates. Just ask these questions before you spend big money and we are going to talk about next level strategies on investing in the next episode. Stay tuned for more Broke to woke.

My favorite word, I mean like top five of all time is abundance. And if you ever want to hang out with Brittany and myself and hear and be a part of my keynote presentation for the year, the thing I spend the most amount of time, energy and effort on and the event that will shift your entire being the fastest, the quickest and the most. It's at the Abundance Summit at the Aerial bvi. We want you there. We need you there. Hop over to BroketOak.com to check out when the next Elevate Abundance Summit is going to be. Can't wait to have you there in person. Sam.