In today’s episode, Theo brings up the topic of what is important in life? He starts to question what does financial freedom really mean to you? He shares a popular blog post where a nurse interviewed her patients who were close to their end of life and asked them each the question “what did they regret?”. This episode will help open up your mind to discover what it really means to be financially free?
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To listen to other Syndication School series about the “How To’s” of apartment syndications and to download your FREE document, visit SyndicationSchool.com. Thank you for listening and I will talk to you tomorrow.
TRANSCRIPTION
Theo Hicks: Hello, Best Ever listeners, and welcome to another episode of the Syndication School series, a free resource focused on the how-to’s of apartment syndication. As always, I am your host, Theo Hicks.
Each week we air two podcast episodes that focus on a specific aspect of the apartment syndication investment strategy. For a lot of these episodes we offer a free resource to you. These are free PDF how-to guides, PowerPoint presentation templates, Excel calculator templates, some sort of resource to help you along your apartment syndication journey.
All of these free resources from previous Syndication School episodes, as well as the actual episodes, are available at SyndicationSchool.com.
In this episode I wanted to review a blog post that was written by someone on the Ashcroft team about the top two regrets of dying, and how to buy more time. We might have briefly touched on what I’m going to talk about today in a Follow Along Friday actually, probably about a year ago… Those of you who are newer, this will be new, and those who are long-time listeners – this will be a refresher… But it was back when Joe was talking about how he was starting to volunteer at a hospice care.
In his blog post, Travis focuses on a blog post that was written by a nurse, all the way back in 2009. This nurse worked in a terminally ill care unit, with people who are living out their final days in life, so kind of like hospice care… And this nurse decided to ask her patients about their top regrets in life. She first published her results as a blog post, and it was so popular that she later wrote a book on the topic. If you wanna check that out, the woman’s name is Bronnie Ware.
Now, the top two regrets that people had on their deathbeds was 1) I never pursued my dreams and aspirations, and 2) I worked too much and never made time for my family. So the way that Travis was positioning this blog post was that people spend a lot of time focusing on getting a nice car, new clothes, or a really nice house, or a vacation home, which is obviously pretty awesome to have, but he categorized all of these things as “stuff.” And while stuff is nice, we only need a certain amount of stuff… And having stuff is different than having freedom. So he was saying that there’s a choice between having more and more things or having more and more freedom.
There’s a pretty cool quote in here from Susan Fussell. which is “You can have anything you want, but not everything you want.” So you can’t have both. You can really have freedom, or you can have more and more stuff. If you actually sit down to think about it and you focus your awareness on it, would you rather have more and more things, or would you rather have your own life? Because ultimately, having freedom comes down to being able to live your life and spend time on things that you love, and focus less on things that you don’t like doing, just so you can buy more things.
So the reason why he wrote this blog post was because — it was geared towards passive investors, so I definitely wanna talk about that in a second, but… Looking at those two regrets, 1) I never pursued my dreams and aspirations, and 2) I worked too much and never made time for my family – number two is probably a better selling point for passive investing… And number one as well, “I never pursued my dreams and aspirations”, but that also applies to apartment syndicators as well.
This blog post, when you read it — it’s positioned and speaking to passive investors, but the same regret could apply to an apartment syndicator. You work a regular 9 to 5 job your entire life, you retire when you’re 70, you live off of your 401K, and you have a pretty comfortable life… But even if that’s the case, on your deathbed did you wish you would have bought in real estate? Do you wish you would have bought more real estate? Do you wish you would have decided to take the chance and raise money and buy larger deals? Whatever your real estate aspirations are, do you want to be on your death bed and regret not taking that leap into trying to (in this case) raise money for apartment deals? Obviously, it can be anything, but this is Syndication School, and a lot of people who are just starting out aspire to raise money, so that’s why we’re here, to help you learn how to do that. Obviously, if you’re listening to this, you’re already on the track to not have that regret.
But the second regret, which is “I worked too much and never made time for my family” – that’s something that you want to use when you are talking to people who might potentially invest in your deals. Because obviously, you can tell them “Hey, you can get 8% preferred return, or 7% preferred return, and you can make a 2x equity multiple”, and you can tell them of all the money that they’re gonna make from the deal, which might convince some people, but a stronger, more powerful story is to try to touch on this second regret.
Obviously, don’t go to them and say “Do you want to be on your deathbed and regret that you worked too much and never made time for your family? Well, if you passively-invest, you’ll be able to make money without having to work, and be able to do that.” I guess you could position it that way, but the whole point is to focus on the dollars that they can make by passively-investing, but also focus on what those dollars will do for their life.
So the moral of this story from Bronnie Ware and these two regrets is that passive income is not about money or obtaining more stuff, it’s about having freedom and the ability to spend your time on the things you love, and focus less of your time on the things you dislike doing.
So the first step – and again, this is your trying to position this to your passive investors, or at least understanding this, so that when you’re talking to your passive investors, you can position it in a way that gets this story across… But the first step towards any journey to financial freedom, as you well know, is having more income than expenses… But it’s not just any type of income, it’s actually passive income. So you wanna have more passive income than the expenses that you’re paying out. So that means you have more money coming in each month than your expenses; that money that’s coming in is coming in without you having to exchange your time or effort for it. So that’s the actual true definition of financial freedom. It’s having passive income that’s equal to or greater than your living expenses.
Now, when you put it like that – this is kind of a simple formula; it seems straightforward, but most people aren’t passively-investing in real estate. Most people aren’t involved in real estate in general, so what’s the reason why people are deciding to purse what Travis calls “stuff”, or pursue income that you have to get in exchange for time and effort, as opposed to passive income and choosing freedom over stuff. He believes it has to do with the fact that there’s not a lot of education on the topic of time freedom, which is what’s achieved through building passive income streams… Or as an apartment syndicator, doing these apartment syndications and building up a large enough team, so that you’re only working on your business for a few hours per week.
So I thought that was interesting, the whole concept of time freedom. Most people focus on financial freedom, but when you actually drill down into it, it’s actually time freedom. And I know when I first started working for Joe on his website, he had a big About Me section, which was about that time freedom. And the whole entire idea is that he believes that people are inherently good, so if people had more time, then they would be able to do more good. So by creating the syndication business and allowing people to passively invest in his deals, so they’re able to make more money without having to exchange their time and effort, they can have more time freedom to spend on doing more good for the world.
And the same applies, again, to the Syndication School, teaching people how to do syndications… Because that’s also gonna get people in the long-term more time freedom as well.
Next in the blog post he goes over some example numbers of “Hey, if you invest $200,000 at 10% passive income, you’ll get $20,000/year”, which is great, but obviously, you wanna have more passive income than your living expenses, so you should be figuring out “Okay, here are my expenses; they’re 100k/year.” Typical apartment syndications result in 10% — again, I’m just making these numbers up just for simplicity. So if I wanna make 100k from a 10% return on an apartment syndication, I need to invest one million dollars to make that 100k/year in passive income.
Now, this doesn’t mean — and this is something that’s important too, that maybe don’t maybe think about or don’t really talk about… There’s not just “Either work full-time, or you’re completely taking in passive income.” Because if you go back to those two regrets, it’s “I never pursued my dreams and aspirations” or “I worked too much and never made time for my family.” Obviously, some of your passive investors may want to eventually do nothing but make money through passive investing, but not every single person is going to have the same outcome for passive investing. Some of them may want to — rather than working for someone else, they wanna do their own thing, and having this passive income will allow them to not have any income coming in from a W-2 job for 6 to 12 months.
So figuring out exactly what it is your passive investors want from passive investing is important. Ultimately, they’re likely gonna be tied to those two regrets… Either “I’m working too much and can’t spend enough time with my family or doing things that I personally want to do” or “I never pursued my career dreams/aspirations.”
My point there is don’t just assume that every single person you talk to just wants to make $100,000/year and just do nothing. Most people that are high net worth are going to want to do other things at the same time, so maybe it means that they have 50% more free time, and then they work part-time. So rather than working 100 hours per week, they’re working 50 hours per week; or rather than 50, 25. Or rather than 20, 10. And then obviously, for some people the amount could be for retirement, and then just kind of doing whatever they want to and sitting on a beach.
Overall, when you’re thinking about how to position your conversation with passive investors, you’re gonna wanna keep those two regrets in mind, and you’re gonna also wanna understand the difference between having stuff and acquiring more things, as opposed to the time freedom. And also, understanding that whenever people are talking about financial freedom, what they’re actually talking about is time freedom. So having money coming in so that they’re not spending 20, 40, 60, 80 hours per week doing something they don’t necessarily like. Instead, they can spend that time either doing whatever, hanging out, chilling, or they can do that pursuing some other dream or aspiration that they have, so that they’re not like the patients that Bronnie Ware was meeting, that were full of regrets about not pursuing their dreams and aspirations, and working too much and never having time to see their family.
So that concludes this episode. Obviously, the entire purpose of this episode was for you as an apartment syndicator to think about what’s going on in a potential passive investor’s mind, but you also wanna apply this to yourself, too. I kind of talked about that in the beginning, “Why do you wanna do apartment syndications? Does it fall into one of these two categories of?” Do you wanna pursue a dream or aspiration, or you don’t wanna work a lot? Obviously, if you don’t wanna work a lot, then apartment syndications could eventually get to that point, but you’re gonna have to put in a lot of effort upfront in order to build up a large enough portfolio and team… So more than likely, it’s something that is a dream and aspiration of yours – to build your own company, to work for yourself, things along those lines.
So that concludes this episode. Thanks to Travis for writing this blog post. I thought it was very inspiring, and also very enlightening as well, and a very interesting take on the concept of financial freedom and acquiring things, versus acquiring more time.
I recommend reading his blog post. It’s called “The top two regrets of the dying. How to buy more time.” If you just go to the blog page on JoeFairless.com, it’s one of the top blog posts right now. If you’re listening to this way in the future, if you just search “Top two regrets of the dying” on the website joefairless.com, it will be one of the search results.
Until next time, make sure you check out some of the other Syndication School episodes that we have about the how-to’s of apartment syndication. Check out some of those free documents as well; those are all available at SyndicationSchool.com.
Thank you for listening, and I will talk to you tomorrow.
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