Thats true for the average and the median American, but not popular to point out. And Im looking forward to checking out the rest. I think that the two things that come into play there are going to be entrepreneurship, asset creation, and then investing. Scott Trenchis the epitome of the "grind until you shine" real estate investor. Scott Trench: Yeah. Rising interest rates are likely to impact cap rates on properties, which will compress values and limit exit and/or refinance options. Mad Fientist: Yeah, you mentioned in the book, youre like, Turn your biggest expense into an income-producing asset, and I think thats really powerful to think of it that way. I started my investing adventure as a pimple-faced 22 year old when I bought my first house/investment with $22k and that has laid the foundation of my FIRE journey in my 40s. Scott serves as the Co-Host of The BiggerPockets Money Podcast in Denver, Colorado alongside Mindy Jensen. Instead, I think that we will simply see real wages fall relative to inflation. House hacking for life!! They both live in Denver, Colorado. But as long as I can find a property that cash flows in a sense where I basically have a very, very good odds at having long-term $500 to $800 a month plus in cashflow on a $50,000 to $100,000it may not be the best cash in cash return, but I do believe that I can see some solid appreciation over a 30-year holding period in Denver. Online Loan Companies To Borrow From Home. And I think that goes right along with what I just said before, its about increasing your odds of success, but understanding that some things are out of your control alongside that. Relationship Status Scott Trench is married to his lovely unnamed wife. Find out more about how we use your information in our privacy policy and cookie policy. This is whyI was already fairly frugalThis is why Im saving. On the flip side, wealth inequality skyrocketed as asset prices inflated with low interest rates. Advertiser Disclosure: Many of the offers appearing on this site are from advertisers from which this website receives compensation for being listed here. So, for example, a house hack the way I look at it through my lens was I bought a duplex for $240,000 here in Denver in about late 2014. And in a good market, thats not so important. So it gets harder to save, and you need way more the more your average monthly spending increases. Mad Fientist: Wow! Scott Trench: And particularly in terms of appreciation and real estate and stock markets. So, do you think you stumbled upon it shortly after it was published or was this something that happened a little bit later. Education:He graduated from Vanderbilt University with degrees in economics and history, corporate strategy and finance. Going back in time to the 1970s and 1980s, weve seen that the Fed is willing to push interest rates as high as they need to go to fight their first enemy inflation and that they are willing to conduct brutal monetary policy that affects jobs to do that. Last, I think that your small mom-and-pop investors are likely to be affected. He has some family things that are going on. Alright, man, thanks a lot. So, I think thats really important. Earning an $8000 raise after a year is great. So, I think theres a couple schools of thought. Mad Fientist: And thats why I love these three distinct phases so much. We've cultivated everything you need to get started, from long-term investing principles to increasing your overall net worth in big ways, with this list of the 20 best finance audiobooks from our catalog. And if people want to find you, wheres best to find you online, just go to Bigger Pockets? More luck is involved in rapidly going from $25,000 to $100,000 than there is from going from zero to $25,000. It has really motivated my fiance and I to take the next steps towards financial freedom. Its written for a median income earner that is starting with little to no assets but wants financial freedom. He is also a real estate investor, an executive at a large online corporation, salesman, real estate broker, and author. When interest rates fall and real estate assets are scarce, asset values soar. At the time that were recording this, Im finding it very difficult to find properties. But one of the things I loved most about it was how you broke it down to three phases. And thats when I found your show, some time in that timeframe. . Thanks for the podcast! But its very exciting, and its like the perfect world for me because I just love Bigger Pockets. Mad Fientist: Wow! Scott Trench: So, after the other expenses that went into maintaining the property and fixing some things up myself, I was probably breaking even or maybe paying a little bit out of pocket to live on a monthly basis. In this show, he talks with successful entrepreneurs, . Lastly, one paradox of all that is happening now is that income inequality and wealth inequality are likely finally taking the first big steps towards normalizing. But that was not going to get me expediently towards my goal of a several hundred thousand to a million dollar net worth and several thousand dollars a month in passive cashflow. The amount of savings I had, less my car loan payment, plus the value of my car. And I knew very clearly that around the 18-month mark, give or take a few months depending on my performance, I was going to get a promotion to financial analyst 2. And Im also looking forward to exploring some of the strategies that he used personally to get to the stage that hes at today like house hacking and real estate investing. Well, my goal was financial freedom. Set For Life: Dominate Life, Money, and The American Dream. So, I always end all my interviews with one piece of advice youd give to somebody whos starting on the path of FI. People doubling their income in a corporate type situation, its not heard of. I find social media very overwhelming. So thats what I did! I just mention I have the three properties. Thanks for taking the time to read this post and thanks Scott for writing such a good book. The thing I liked most about the book was that he broke the journey to financial independence down into three distinct stages, each with their own focus. But within three months of starting my career, my introduction to the real world, I became very interested again in the concept of personal finance. For example, if I were single, I could rent out my spare bedroom in my house. Even starting with zero savings, you can go from a five-figure income to six figures, from an active job to passive income, then finally to the ultimate goal . Have you bought any other property since then? Mad Fientist: Right! But its funny because I hear these people, theyre like, Oh, Im very well into FI. Scott Trench: Yeah, Im 27. When Josh decided to step away to be with his family, Scott became CEO. So, my major mistakes are going to be things like I bought a brand new Toyota Corolla in 2014, kind of before I really wrapped my head around the whole personal finance thing. Scott started acquiring more properties as he worked with Josh and later became such a crucial part of the BiggerPockets family, he was promoted to president. So hopefully, it will happen. BiggerPockets is a complete resource for anyone looking to succeed in the world of real estate investing. And it contains all of the answers Ive received since I started this podcast back in 2012. The more money these institutions raise, the more soaring property values they can scoop up, and the more carried interest the deal sponsors make. And no one can go in and audit them and figure that out. Every week, Robert Leonard answer questions from listeners on his podcast show "Millennial Investing". Hes this young guy thats doing all these crazy things. So youre in your mid-twenties, right? Mad Fientist: Thats cool! These offers do not represent all available deposit, investment, loan or credit products. Mad Fientist: Very cool! But do have any other questions about the. So, if you spend $40,000 per year, if thats your target goal, and you have $1 million in index funds or wealth in general in your portfolio, youre likely to sustain that in perpetuity. When I started on the road to financial dependence, thankfully, I was already in stage three. And Im going to hopefully get it out of the library as soon as I can because that sounds really good. Theres a lot more factors. So, I think that from a big picture standpoint, I was able to think about it in a pretty rational way and have the odds in my favor for success. Scott Trench: Yeah, I rarely do this, but I just read a book that Im raving about lately called Thinking in Bets by Annie Duke. This is why I studied finance in general, in college and with the start of my career. Required fields are marked *. So, if I kind of maintain my system of dollar cost averaging through real estate, I believe that Ill have a good result at the end. Are they easier to manage initially? Mad Fientist: Wow! Scotts wifes identity is unknown to the general public. So, I definitely have some higher financial goals than kind of like lean FI for me and maybe like one significant other. Scott Trench: Oh, Ive love it! I think that a lot of people dismiss the actions of the Federal Reserve right now. So theres a ton of great stuff there. So, the goal is to go from a year of financial runwaywhich is a very modest goal that you can grind out over maybe a year to eighteen months depending on where youre starting from, what your income is, and where your expenses are, to a goal that has a lot less certainty. Bigger Pockets Money podcast did a show about this recently. Scott was born in September 1990, in the United States. And yeah, back in my poker-watching days, I remember Annie Duke very well. And yeah, youre 27 and youve done a ton of crazy, amazing stuff so far. I was like, Oh, Im a smarter guy than the market. This company in China is a Chinese fruit juice company. Over the weekend, Adams appeared to double down on the remarks on Twitter. $305 at Sezane. I bought a house in Edinburgh and Ill definitely be able to do house hack in the short feature with the prices in this city. No, heres what I was thinking. Theres so many different ways to make money that dont cost anything but your time, and maybe a few hundred to a few thousand dollars to try out. Some of it is obviously also luck. Greg Palkot is known for his work on Shepard Smith Reporting, America's Newsr, Who is Kin Shriner? Im going to bet on that and go with that. And thats the correct decision to make in that game. Who Is Scott Trench Scott is an American perpetual student of personal finance, real estate investing, sales, business, and personal management. And I still have a little bit to go to completely pay it off. Its putting money in your pocket every month. Ive been recording this podcast since 2012 and at the end of every interview, I always ask, Whats one piece of advice youd give to someone pursuing financial independence?. The couple frequently shares photos of themselves on social media. I was just curious if anyone has calculated there Real Net Worth as he describes it in the book. And their market cap is $50 million. Yeah, can you describe that again? Theyre unable to take advantage of opportunity. And I definitely recommend everyone to check it out. And theyre just like, I dont know what Im going to do after I retire. The money is not the fear anymore. Who Should Read Set For Life: Dominate Life, Money, and The American Dream? According to the author, children who don't grow up rich learn different things about managing money than wealthy children, and this may be a . I moved out a couple of years later. So, I think that youre absolutely right to have a passion project, whether its personal finance-related stuff or a podcast or a blog or a project or a business in something else that you just want to work on with your free time. Scott Trench: Sure! So, I mentioned your podcast briefly, but I definitely want you to talk about it because your co-host is one of the people that has been on my show probably more than anyone else. And I also have a quadplex now that I bought as a regular investment property. Scott Trench attended Vanderbilt University after high school, where he earned a Bachelor of Arts in Economics and History in 2013. Also getting some buy to lets in Glasgow, all with the funds from the limited company I run as a software consultant. You have no ability to even attempt to put yourself to put some money on that or take the shot on that new career or whatever. He was episode #23. So hes stepped aside. Scott Trench is a perpetual student of personal finance, real estate investing, sales, business, and personal management. Im on a lot of social media, but I dont ever check them. He's the VP of Operations at BiggerPockets and loving life. I think a 50% percent savings rate kind ofget to a median income, and then get to a 50% savings rate. Trench joined BiggerPockets in 2014 and is the CEO and president. Scott breaks down the journey to financial independence into three stages and explains what you need to focus on at each step (and why)! You made the right choice. Its hard to see how unemployment can increase right now in a meaningful sense when the minimum wage is this low. He was born and raised in the United States by his parents. Buy, Rehab, Rent, Refinance, Repeat is the five-part BRRRR Scott Trench: You know, she hasnt wrapped yet. There needs to be more FI conversation for those with children. Scott Trench Mar 21, 2017Mar 16, 20218 min read In this article I just talked to a lender that prequalified me for over $1 million in financing. Im very excited to be here. Scott Trench: So, I got interested in real estate as a byproduct of being interested in financial independence in the first place. Yet, it is also a dangerous game where, as investors, we play with big numbers and assume legal, operational and financial risks. Now, once you achieve a high savings rate and accumulate maybe six months to a year or more of this financial runway, options begin to present themselves in your life, things like you can go and take a job that pays you $40,000 instead of $50,000, but offers you a chance at a big bonus at the end of the year, or you can go work for free for an entrepreneur that you really admire and go learn a valuable skill set, or you can just take that $25,000 and invest or house hack the way I did. So, itll take me a year or two to get to that point because I dont want to kick any tenants out or anything or raise the rent too quickly on them. Funded by the U.S. Department of Agriculture and administered at the state level, SNAP benefits 11 Companies That Will Help You Pay Off Student Loan Debt. Scott Trench: Yes. Scott Trench: I live in another duplex doing the same thing. So you were my gym companion for a good week or two. Yeah, Ill put a link to the first episode in the show notes. buying two houses per month using BRRRR. And thanks to Mindy for putting this together. Personal Finance Forum Real Net Worth (Scott Trench model) Steve Schneider Investor Sherwood Park, Alberta Posted May 24 2017, 09:08 Hi everyone, I just finished up @Scott Trench book Set For Life. I put down $12,000. It's free. Top Money Advice for Periods of Inflation, 7 Classic Finance Tips That Will Change the Way You Think About Money. But we dont talk about his real estate investing, we talk about his personal financial journey where he started as a waiter and found ways to make way more money than all the other waiters at the restaurant, how he saved all that money, how he was able to house hack, how he was able to parlay into his career as a police officer, how he was able to save and accumulate tremendous amounts of wealth while most of the people, most of his peersand this is in San Francisco. But you can next week go to the grocery store, plan out your meals, and save a few hundred bucks on your eating billand eat healthier and bring that advantage into your life. I interviewed her and her husband in episode #14. Its really reassuring to hear Scotts story as it sounds so similar to my plans at the moment. Scott Trench was born in the United States in September 1990. And again, yes, youre buying in such a way that it will make a smart cashflowing asset for you once you move on and move out of that property. I could continue living in that property happily forever, I could sell it at a gain alongside all the other homeowners in the area, or I could rent it out. Although his salary was less than $50,000, Trench took on an aggressive saving strategy and had enough to put a down payment on a $240,000 duplex in just a year's time. Nice episode! even while working full-time, earning a median income, and making up for a negative net worth. 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