How To Be Successfully Unemployed and Master Passive Income in Real Estate

Hey, it's Mark Podolski, the land geek with your favorite niche real estate website, thelangeek.com and if you are excited about becoming successfully unemployed, my guest today is going to walk you through exactly how to get there. Dustin Heiner from MasterPassiveIncome.com and if you're not familiar with Dustin, he's the founder of Master Passive Income and Rubicon Real Estate Wealth Builders Conference. And successfully unemployed, he is a real estate investor who was able to make enough passive income from his business to quit his job job at the young age of only 37 years old. With his podcast, YouTube channel, books, courses and coaching, he now helps other people quit their job by investing in real estate rental properties to live the dream life. Dustin Heiner, welcome.

What's up, Mark? Good seeing you again, man. This is so terrific. And I love, I love the idea that real estate is a vehicle to get you what you want to do in life. Like my real estate is, allows me to not have to work. I own rental properties, 30 plus properties, apartment complexes and hotels. But that's what how I feed my family. And then I could go to the gym in the morning, hang out with the family, come on podcasts and talk to great people like you. So thank you so much for having me on the show, Mark.

No, Dustin, my pleasure. Thanks for, for taking the time. So let's just rewind the tape. And you're super young. I don't know what kind of job you're working, but what was it, what was the impetus to. Oh yeah, to have you go from employed to a real estate mogul to become successfully unemployed?

Well, let me tell I gotta walk you through this journey that I took because there was something that catapulted me, like it shoved me into real estate investing. So I didn't, I wasn't rich growing up. In fact, we were really poor. We lived in a two bedroom house, like it's like 900 square feet growing up. But I was taught, just like everybody's taught the same path. You go to school, you get good grades and you take those good grades and you go to hopefully a college or university and then you get in thousands and thousands of dollars into debt and you get a piece of paper called a degree and you go shop around to other companies to try to get a quote unquote career. Well, I'm doing that exact same thing. And at the same time I was entrepreneurial, started a few businesses, but nothing that was really taken off. But I'm going and I bought one rental Property. So I bought one rental property because I heard it'd be smart to do that. I was in California at the time, started investing in Ohio, but life started getting the way. So this is really what shoved me into it. So I'm working a, I call it a dead end job, a just over broke job. So you're living just over broke because your boss is not paying you enough of what you're worth. So I'm doing the exact same thing. But this is really the story that really shattered my life. So my wife and I are having kids. We have one, two, three, four kids. And then I'm working in a local county government, doing it in California and most stable, secure job you could ever think of working California. It and government, those aren't going away. And so I wanted to be invested, but life got in the way and I went on paternity to leave after my wife had our fourth child. That's where the dad stays home to the mom, changes poopy diapers and all that good stuff. Well, after two weeks I go back to work. And on a Friday at 3:30 in the afternoon, I get a call from my boss's boss's boss's secretary, like the top dog. And she says, dustin, would you please come to the office? I said sure. And then I hung up the phone. I thought why in the world they come in calling me to the office? This isn't normal. I've seen plenty of movies. Friday at 3:30 is not a good sign. Well, I started thinking about oh my goodness, I might be getting laid off. But I shook it off. I said that there's no way I work at the government for good goodness sake. Nobody gets fired or laid off the government. So I get up and I go to my boss's office. Now I start walking this hallway, this hallway isn't very long. In fact it's kind of short. But every single step that I took, it felt like the room got longer and longer and longer. And it felt like my feet became lead bricks because the weight of potentially losing my job started crushing me. Well, I get down the hallway and I turn the door, I started turn the corner, I see my boss's door, his door is closed. And I see his secretary there, super sweet, nice old lady. She says, dustin, would you please have a seat. And she's trying to sheepishly grinning at me, trying to console me with her eyes because she knows everything about what's going on. I know nothing. Well, as I'm sitting there, I start thinking about my life. I've been following this path that we're all taught. But if I lose my job right now, I started thinking, did I just lose my life? Like just waste my life doing this? And I thought, oh my goodness, we have four kids now. If I can't feed my family, does it make me a failure as a father, A failure as a, as a man trying to provide for his family? Well, as I'm sitting there, my hands get all clammy, my forehead gets all sweaty because of nerves. It's just crushing me. Well, the door to my boss's office opens up and out walks a coworker of mine with a piece of paper in her hands. Noticeably upset, noticed, noticeably distraught. Her world's been rocked while she passes by me and my boss says, dustin, would you please come in the office? So I get up and I walk into his office and I get laid off. And remember, this is the government. Nobody gets fired or laid off for the government. But I did. And this is the reason why I tell the story. So I take that layoff notice and I go back to my desk and I realize two things sitting there. Number one, I need to get another job. I need another way to be able to provide for my family. So I was blessed, praise the Lord, to find another job in the same county. Another department wasn't having an issue. So check. Got that. The second thing that I realized sitting there in that chair was that I need to make sure that this never ever happens to me again. I need to make sure that nobody has the ability to take away my ability to feed my family. So right then and there, I started becoming, I became an investor. Now it may so happen that 100% of my money come from my job that's now my part time job. I'm a full time investor. So I'll fast forward the story started. I bought property after property after property, each one making me $250 a month, $600 a month, $1,000 a month in passive income. Eventually I had 30 plus properties. And I thought, why am I working here? So the last part of the story, I went to my new boss, great boss and all. After I had enough properties, I said, boss, I'm laying you off. And we started laughing and it was as a joke. And he says, what are you gonna do? I said, I don't have to do anything. I own real estate that makes money for me without working. Last quick part of the story. I would walk to and from my job every day at mile and a half because I was. Is it downtown too Frugal to pay for parking. Well, the last time I walked home to my car, I felt like I was walking on clouds because I knew I would never, ever need a job again. And so everybody listening, what you need to realize is that you are worth so much more than anybody could ever pay you. And this is how you'll know if you, your boss is paying you just enough to keep you working without quitting, but not so much money. It takes money out of their pocket. What I did and what obviously what Mark has done is we found real estate as our tool to put our lives back in our hands, because I found it's more risky to work for somebody else than putting into my own hands and becoming a real estate investor. So I'll pause the story because you probably got plenty of questions.

You know, it doesn't. The story is so compelling and, and so beautifully told. And I love, I love the, the dramatic feeling of, you know, the lead shoes and the, the hallway becoming longer as you keep walking down. And, and so the way you told that, I think a lot of people have, can. Can really see themselves in your shoes. And you're right in, in every sense of the word of it. We, we really are taking a tremendous amount of risk when we work for someone else. And it's certainty versus uncertainty. A job gives you certainty. You're going to go in, they'll give you a playbook. You'll have certainty that if I do these things, I'm going to get paid. But then there's so much outside of my control that I can influence in this business, in this market, where the entrepreneur has to deal with uncertainty, they don't know what they can do every single day or what they should do every single day. They have to kind of figure it out, but then they can turn certain knobs and they get this, a certain amount of certainty that if they build and build and compound and do these things on a long enough timescale and everyone's going to get paid and they're going to be able to protect their four children or three children, two children, how many children you have, their family and be able to go to bed at night with the sense of, of security that their agency, their influence, their skills that they grew, provided, and no one can take that away from them. Am I. Am I saying that? Yeah, you're directly.

Yeah, you're 100% in the right direction. Exactly. What I realized was that when I'm working for somebody else and everybody. When you're working for somebody, you got to receive the idea that you are, you have a perceived risk free environment, like you're thinking, I just go to work and they pay me. Well, what. There's two things that come to mind. Number one, you're selling your time and number two, at any given point they can fire you because the saying is true. It's not if you lose your job or get fired, it's when, because it will happen. Well, this is what kicked me in the pants to get going. And then I realized, man, I'm selling my life each hour at a time to get a paycheck. You know, you get money for an hour that you spend there. Well, instead of that, I realized there's a thing called passive income. Instead of active. Active, you work one hour, you get paid for an hour. Passive means you work one time, you get, hopefully get paid over and over again. When I buy one rental property, that makes me three or four hundred or five hundred dollars a month or more, then that property works for me. So I get cash flow, I get passive income. And now I have 30 plus properties. In fact, I just bought three more in the last two or three weeks up Akron, Ohio. Each one's going to be making me $300 a month in passive income. What I did was I took one of my properties. I have a HELOC on it. This is just one of many strategies I teach my students, but I have a HELOC on the property, took that, bought three properties with them. Now I'm in the process of refinancing it, pulling those, the cash out of those properties and paying off my heloc. It's the idea that if you do it right, like I'll give you example, you build a business that has good inventory. My properties are our inventory. It's not a home that I would live in, but other people would gladly live in them. If I build a business, it doesn't matter where I get the money to buy it, how much it costs, because I don't pay my mortgage, I don't pay my taxes, I don't pay my insurance, I don't pay for repairs. Property managers, like I don't have to get a job to do that. My tenants pay for that. Because when I buy a property, I make sure all those expenses are accounted for before I buy it. And then I make sure that I could rent it for more than that. I'd suggest 300 or $400 more, which is Passive Inc. That's what I feed my family and cash flow. But you're 100% right. Like I perceived that I was risk free, working for somebody else. But now that I've done this, I quit my job when I was 37 years old, 2017 when I did it. And I realize now I am so much more risk free, meaning nobody can fire me. I have my properties that make me money. And Now I spent 40 plus hours of my life building other businesses, buying more real estate as opposed to selling my time to somebody else.

I know, I love it. And you know for sure you're speaking to the choir with, with me and our listeners. But I think the listeners are going to want to know a little bit more about the strategy that you, you took. Because there's all different strategies. I'm in land, you're in single family homes, there's syndications, there's mobile home parks, there's the brrr method. So walk us through your strategy to become successfully unemployed so that we can replicate it.

Yeah. So I'll tell you quickly what I did first in 2006 when I first started investing and I want you to quickly forget it because it was the wrong way. So I went to one of those late night infomercial things. They said, hey, we're coming to your town, going to have you a two hour free seminar. I went there. Then they said run to the back and go give us $1,000. I did, I run to the back, fast forward. I followed everything they told me and my property manager started stealing from me within six months. It was horrible because I didn't know what I was doing. And they just kind of, they just threw it at you. And I tried it, but then what I realized was that what they told me, where you find a property, run the numbers, make sure you're making a little bit of money in passive income, but you want appreciation. Remember this 2006 before the, the run up in the crash. And so you're going to get appreciation, which is what you love. And then you buy a house, spend thousand dollars to buy it, then spend thousand dollars to fix it up and then find a tenant and then hopefully find a property manager. Well, if you do that, I've had a lot of people come to me and say they've done that. Well, they say I try to find a property manager, somebody to manage it ongoing. And they say they would not manage it because they'll get shot there. Like, well, you no longer have an asset, you have a liability now. So what I've done and I figured this out, I invest in five different states now. I've coached my students, we invest all over the country, out of state, that we build a business first. When you talk like the secret sauce, if any, you want to know exactly? What I teach all my students is we don't just buy a property and say, that's our investment. Even though I call myself an investor, I'm a business owner. That's what it means. So here's the secret sauce. Imagine you're going to start a convenience store. You know, candy bars and soda machines and all that good stuff. Well, you would not sign a lease on a location, open the doors and set a box of candy bars in there on the ground. No, you wouldn't do that. You would go out of business in two seconds. But what you would do is you would build the business first. That's a Get the gondolas. Those are shelving units. All the candy bars go on, the countertops, cold storage, fountain machines, cash registers, employees, insurance, everything in the business before you buy any inventory. Then once you have the entire business built, then you buy the inventory and you put it into your business. Same exact thing with real estate investing. We find all the right people. Contractors, property managers, plumbers, roofers, wholesalers, inspectors, insurance agents. We find all these people and we build a business before we buy the property. And instead of calling a property manager, say, hey, property manager, will you manage that? The better question is property manager. You've already talked to them, you know them, you trust them. You say, I'm looking to buy this property, and they say, I won't manage it because I'll get shot there. Then you don't buy it. You don't waste the time and money. But what if they say, well, you ask them the question, how much will it rent for? What's the vacancy factor? You know, how much will it be vacant? Whether. What are the clientele like and will you manage it? They'll give you all great information. And if they say they'll manage it, you can still make money in passive income. Then you buy it because you had the experts, the people on the ground who literally live there. Like, Zillow is not expert. Redfin, truly, like, those are not experts. Who is the expert? The people living there on the ground. So if you boil everything down, Secret Sauce is first building a business, and then once you build the business, then you buy the inventory. The last quick little part about this is how I scale to become successfully unemployed. So I. I used to tell people I was retired. They're like, what? You're so young. Why are you retired? Like, oh, no, no, no. I'm Not, I don't just sit on my butt. I actually build business. I keep investing. But here's the secret sauce. To become successfully unemployed or financially independent. If you bought one property that makes you $250 a month, well, that is $3,000 a year without working. Now you bought 10 properties at $250 a month, that's $2,500 a month. Remember, this is the minimum. $250 is the minimum that we don't buy a house unless you can make that much. But that's $30,000 a year with 10 properties, 20 properties is $60,000 a year, $5,000 a month and this is the minimum. I have properties making 5, 6, 700, $800 a month in passive income or more. Because over time when you own the property, it's going to go up in value and go up in rents. And I will literally give these properties to my kids. I have five kids now, really blessed with five terrific kids. I will literally give these properties in generational wealth. And one quick last thing I'll say, even though it might sound a little hard to do all this sort of stuff, my 16 year old daughter, she's our oldest 16 years old. And my, my hope and is that every year all my kids are going to buy their first property. By the 16th, my 16 year old bought her first property. Now she, it does help that she has her me as her dad is going to coach her, walk her through that same thing. I take all my students and I help her with the financing and all that sort of stuff. But she has her own cash that she's using. But this is not hard. It's simple, it's not easy, but it's a simple process. You build a business, get the experts in there doing it right, you make sure that you're making cash flow. One quick last thing I'll say, just like if you're going to start a candy bar business, remember you buy a candy bar, you sell it for a dollar and you knew all day, every day you can sell it for a dollar. If you could buy it for 50 cents and sell it for a dollar, you'd make 50 cents. You'd think, man, how many can I get? But, but what if you didn't even have 50 cents? This is a great thing about real estate investing. Even if you didn't have that 50 cents, but it costs you 25 cents to borrow 50 cents where you're out of pocket 75 cents, then you would say I'd make 25 cents every single candy Bar sold. So you would think, how could I borrow more money? But you would not do this. You would not buy it for $2 if you could only sell it for a dollar. Same thing with real estate investing. We build a business that makes us money in cash flow every single month. You do not buy a business or buy a property unless it makes you money. And my suggestion is 2, 3, 4, $500 a month in passive income.

Yeah, I love the way that you explain that. And the secret sauce of building a business is, is so great because oftentimes, and I see it time and time again where people will actually build themselves another job and they think, oh, I'm going to build this passive income. And, and they go in and it's, it's just another job. And so when you get the infrastructure, right, and you think about it, how do I build this business? And that's in the way that you phrase it, generational wealth where your kids will inherit these assets. But really the assets are just the inventory of the business. And once you've built that machine again, that's where the passive income comes in. It's a one time set it would not forget it system, but a set IT system and then continuously improve on it. And that's where it gets kind of fun.

100%. And what I do is I give my property managers and everybody in the business systems procedures and processes that they must follow in order to run my business. I'll give you a quick example. So I hire property managers for all my, my properties and all my companies. The property managers, they're your quarterback. You got to make sure you hire a good one. And definitely I suggest interviewing many property managers so you find the best one that's going to take care of your property. The best. But what I do is also on top of having a property that's going to be making us money in hiring the right property manager, what you're going to be doing is making sure that they are, well basically they're your quarterback. They're going to make sure that you're making money. They're going to make sure that your property is protected. They're going to make sure that they're finding tenants. Like everything in the business is ran through by your property manager. And then on top of that, I'm also able to then scale my business because I'm not doing the work. I didn't want to build a job that I had to keep doing work in. In fact, I have a friend of mine, he's got 50 properties on his Own, but he manages all of them. He's like, I don't have time now. I feel like I have an active income. I'm like, yes, I know you got to get out of working for yourself or, you know, having a building a job for yourself. And he says, well, I'd have to spend $5,000 a year or, sorry, a month in property management. I'm like, you know, you're making $60,000 a month, $5,000. Like, come on, you're tripping over dollars to pick up pennies. What we do, though, is we build it first so that we can afford the other person making the or doing all the work for us, and then we give them systems of procedures and processes in place so that they can run the business the way we want to. Now, I probably work maybe 30 minutes a month on all my properties because I've built up the business, have already all the right people. That's the longest part. Like, when I coach, we coach hundreds of thousands of students just like you with land. The hardest part is building the business. But once you get past that, then it's literally clockwork. Like I said, I just bought three properties in the last three months or this last month, like from December to November. So because of that, now I built the business. It's so easy now to buy a property because people are bringing me deals now.

I love it. I love it. Well, what's the worst advice you see or hear given in your area of expertise?

It is investing for appreciation or speculating hoping that the value will go up. That is the absolute worst advice. Just like I said, if you're going to buy a Candy Bar for $2, you start a business if you'd only sell it for a dollar, why would you do that? You wouldn't. And just hoping that the value of that candy bar goes above the $2 that you. No, you wouldn't do that. And so that is the worst advice. And I'll tell you this way, too. I learned this firsthand. I started investing back in 2006, bought my first property in 2006. And as I was buying more properties, I saw the 2008 crash. And real estate crash was going really, really bad for everybody. I saw so many people who call themselves real estate investors crash and go bankrupt. Even Dave Ramsey went bankrupt. Like, that's. It's literally went horrible now. I didn't, though. I make money if the market goes up, if the market goes down, or if the market goes sideways. The reason why is because I don't invest for Appreciation. I don't buy a property unless from day one. My rent is more than my expenses, so I make money in cash flow. Now here's the great thing. When the crash happened, it's very sad that people lost their home. I made more money in rents. My rents went up because sadly with the crash, people who are buying homes lost their homes in a foreclosure, but they got to live somewhere and so the pool of demand went up. Supply relatively stayed the same. I bought more properties and so my rents went up. So no matter if the market goes up, down or sideways, I make money from the first day that I buy it, no matter what happens to the market. So worst advice is invest for appreciation. Don't do that. Invest for cash flow. Appreciation will absolutely come. And here's one quick suggestion. With that appreciation, I refinance the property, pull the cash out tax free, and then go buy another house. That makes me even more money.

I love it. I love it. Dustin, we could talk all day about these, your strategies, becoming successfully unemployed, but your mentorship has been phenomenal. But right at that point, now in the podcast, I'm going to ask you for one more pearl of wisdom. Your tip of the day. A website, a resource, a book, something else actionable for the art of passive income listeners to go improve their businesses, improve their lives. But before you do that, I have to give a shout out to our sponsor, which is flight school. Learn how the next 16 weeks can transform your life. Go up that mountain of land, investing safely, quickly and efficiently with our team of land investing experts. And I know you're thinking the tuition and it could cost you nothing guaranteed you to make that, make that money back 180 days or less. Just show us you did the work. Learn more. Go to the land. Com Forward slash training the language.com for slash training. Start building that passive income without any renters, rehabs, renovations or roads. Dustin Hider, what is your tip of the week?

The tip is being around the right people who have done it before. Just like you. Join your masterclass for land investing. That sounds fantastic. Where people can actually like when people come to me for coaching, they make more money than they could ever spend on my coaching. In fact, I charge relatively little because this is more fun for me. I enjoy it. So the tip is being around the right people. I give you another example. So my podcast, which you've been on, I have that and I interview other people and I get to know great investors like you. So if I have a question, I'm going to be like, hey Mark, you know, I have this investment. You want to invest with me? Like maybe you can partner on something. Like, you need to be around the right people that are also doing it. Like I bought a 355 unit apartment complex in Nashville, Tennessee right next to it. But I wasn't the one doing all the work. Meaning I didn't find the property and buy the property. I was brought on as a partner in it. But I have experts, those guys have done it before. So that's my tip is absolutely, you want to be around awesome people. One other thing is I created my conference, the Real Estate Wealth Builders conference. We have 500 plus people, 440 plus expert investors coming and speaking. It's not a sales pitch. It's literally let's get you around other people and connect you with other investors. So by far, I mean, I can't say this enough. You need to be around the right people, join somebody's membership, join Mark's Land Investing. Because what's going to happen is they're going to fast track you to success. Whereas my students, it took me nine years to become successful employed. It's taken my students four, three, four, five years because I've gone through all the problems. Help them to skip over those.

No, I know, I know. It's terrible and it's great, right? I, I feel like, you know, our clients are so spoiled we had to go up the hill both ways.

Right.

But, well, Dustin, this has been great. Thank you so much. Your tip is great. But my tip is really great because my tip of the week is Learn more about dustin heiner@masterpassiveincome.com masterpassiveincome.com I will have a link to his site. And if you're getting value, I have a free course.

Would you mind if I give that away to everybody?

No, it'd be amazing.

Awesome. Yeah. So my goal is to help 1 million people to invest in real estate. Just I love giving this out because it helps people to invest. So I'll show you how to find a property or find it, build a business anywhere in the country. How to scale your business so you can become successfully unemployed. If you text the word rental R E N T A L rental to 33777 rental. The 33777. I'll just literally give it to you for free. Or you go to masterpassiveincome.com forward/free course. All one word, free course, but also really, really quickly. I love talking with people. I'm an extrovert. More like it seems like you're, you're. We're cut from the same cloth. I love being around people and so I've been on Instagram and so you can find me on Instagram, send me a dm, you know, ask me questions and stuff like that. The Dustin Heiner. T H e Dustin Heiner. You'll find me on there. I just post everything about how I, how I share with other people to invest in real estate. But in the end, it's all about helping more people. So I really appreciate you having me on the show, Mark.

No, absolutely, Dustin. Thank you so much. We'll have links to all those special courses. That's so generous of you to. To offer that free course to listeners as well. And so listeners, you're getting value. Do me three little favors. Follow rate, review the podcast. Send a screenshot of that review. Support thelangit.com I'm going to send you for free a signed copy of Dirt Rich. But if you have Dirt Rich, where you have Dirt Rich too, Doesn't matter. Do it selfishly for yourself. We get better guests that way. Guys like Dustin look at our reviews and say, oh, okay, I'll spend that time educating that audience. So please do it. All right, Dustin, thank you again and let freedom ring. Thanks everybody. Thanks for listening to the Art of Passive Income podcast. Are you ready to learn how you can start building a passive income without renters, rehabs, renovations or rodents? Schedule a free consultation@thelandgeek.com forward slash training. Let's freedom Ring.