Direction Mr. Whitney? - Posted by Henry Kagoda

Posted by Stu Silver on March 13, 2001 at 19:34:44:

Hey Mark,

How are you? Fine I hope.

I would have given different advice to my son if he was still in his first year of college, or just starting, and he diliked it. But after 3 years?

The wisdom I tried to impart to him was to complete the things you commit to and not give up (we’ve all heard the advice Abraham Lincoln gave on the value of persistance versus genius and talent).

On balance, I think I did the right thing - but it was not a clear cut decision.

Thanks for the input.

Stu Silver

Direction Mr. Whitney? - Posted by Henry Kagoda

Posted by Henry Kagoda on March 12, 2001 at 21:52:09:

Hello Mr. Whitney,
I am a full time college student and am working 20 hours a week. I have passion and I have aspirations. I have been given the opportunity to attend school totally free, room and board,anywhere. I have baught your course and others and know a marginal amount about REI. I also landed a job as a Jr. Loan Officer at a mortgage bank near my school. I want to start investing in REI but have limited funds and time. I am torn because I want to dedicate 100% to school 100% to work and 100% to business opportunities. I am not interested in becoming the richest man in the world. I just want my future family to have the things that make life a little more enjoyable at times. I am not self pitying or timid, I just want to hear from someone who may have had the same struggles I am hving right now. I am Ninteen, Hungry and Impatient!I will succeed. I know because God wants the best for me and I want the best for me. I would appticiate any words of wisdom that you would have to offer. Please Respond, If you can. =)
Thanx alot
Henry Kagoda (Future Millionaire)

Re: Direction Mr. Whitney? - Posted by Terry Heilman

Posted by Terry Heilman on March 13, 2001 at 10:56:03:

Henry,

I was in a similar position a few years back that you are currently in. I attended business school and majored in real estate. I also worked for an investor and developer part time. Like you, I wanted to commit 100% to school, 100% to work, 100% to investing and 100% to my wife and daughter. I burnt out, my grades went down and I did not get any deals done.

The jobs that I did were trivial and didn’t support my dreams and goals. Which was to graduate and become an investor.

As outlined in the previous post a rooming house is an excellent strategy. Since it would get you into an investment that does not take up as much time as work and could replace your work freeing up time for you to spend on school and possibly make other investments.

Time is on your side, enjoy the college experience while you are there.

Terry

Re: Direction Mr. Whitney? - Posted by Stu Silver, Trainer

Posted by Stu Silver, Trainer on March 13, 2001 at 08:09:51:

Henry,

I know you asked for Russ’s words of wisdom, and Russ will probably answer, but … you struck a chord in me, as a father, as a millionaire, and as trainer (in that order).

You already show great drive - you are a full time student and working 20 hours too - good for you! You go! And working in the mortgage field is great experience for investing - financing is critical to real estate investment.

Second, chill out a little :slight_smile: You can not give more than 100%! And already, between school and working, and trying to start a real estate investing carreer, I’ll bet you are close to being maxed out. Enjoy being young and full of energy.

When my son was in his third year of college, I asked him what he wanted to do - he could come into our successful real estate business and became an investor, an auctioneer, a land developer, a builder - whatever he wanted.

He said, “Dad, I love working on computers, and I want to have my own computer business.” In other words, he wanted to start from scratch (like you), rather than have his father help him, and he wanted to do what he loved.

It made me happy, and a little sad. I was happy that he had the drive to succeed, and I knew he would survive and prosper when his loving father would no longer be around for him (we don’t live forever).

I was sad because I thought that the work of my lifetime would eventually be sold off, and converted into only money. Note the word “only”.

I had to beg my son to stay in school and get his diploma. The business he created was more fun, more vibrant, more creative, more challenging than anything his college professors were teaching him. It took him two and half years to finish his last year in college.

Russ and I came to real estate from totally opposite ends of the spectrum - Russ lost both of his parents and had to quit school in the 9th grade and fend for himself.

Me, I went to college, got a degree in Physics, and then did what I was best trained to do - drive taxicab in New York City. I handed out resumes while I drove cab, and finally, one day, a partner at a presitigious Wall Street Firm gave me a job as a computer coding clerk - which required the I.Q. of a carrot. I could program in 4 computer languages, did so well on the Programmer’s Aptiture Test that I was accused of cheating, and there I was, entering data into the computer like a robot - and thankful for the job because my ass didn’t hurt from driving cab 12-14 hours a day, six days a week.

In other words, the educational system failed me. Russ never had a chance to to be failed - he was handed a heavy load at a young age and he learned how to survive.

In many ways, Russ and I were both lucky. We had jobs we hated so much that we had to find a better way. And after finding a better way, Russ wanted to share that knowledge that he gained through hard work, pain, blood, and stubborn persistance. Russ and I have had many talks about why he keeps on working - he has enough money now. Russ wants to create an educational system that trains people how make money, prosper, and take care of themselves and their loved ones.

Now, here’s my advice. Find something you love to do, first. Study every aspect of Real Estate and choose something you like, then try it.

You will not do it perfectly at first, so allow yourself mistakes. But if you love doing it, and persist, you will become wealthy.

And keep feeding your mind, first with good real estate training, and secondly, with positive motivational things.

Hope the above helps you, son :wink:

Good luck and God Bless,

Stu Silver, CCIM
Head Trainer at Russ Whitney’s Millionaire U
Licensed Real Estate Broker, Appraiser, Auctioneer, Mortgage Broker
And
Friend and admirer of Russ Whitney

Re: Direction Mr. Whitney? - Posted by Russ Whitney

Posted by Russ Whitney on March 13, 2001 at 07:30:07:

Henry,

Trying to put 100% into school, Real Estate and into Business Opportunities would stretch even the hardest working of us.

Here are some suggestions. First of all, because you are in school and have an interest in Real Estate,there is a natural dove-tail cash flow technique…

How about looking to buy either a rooming house or a multi-bedroom house where you can rent out rooms to fellow students,and live there yourself,so you can manage it?

If your parents are off-setting your living expenses, this might be a less expensive way out for them and actually something you could offer up to them as a profit incentive for helping you.

Ie: Have them put up the down payment money to buy the property. You manage it, do all of the cleaning up and maintenance,and split the cash flow profits with them 50/50.

Also, once you move on from college, either sell it and split the sale profits 50/50 or buy Mom and Dad out, giving them a nice little profit…

  1. Look for a cosmetically distressed property. One that is in need of paint and clean up that can be bought a bit below market value.

  2. With the ingredients above, you have increased your chances to find a seller financed property. This would be most preferable, as you will not have to qualify for a loan and can close it quickly.

  3. Example of return. House has 4 bedrooms and a back porch, enclosed.

a. Buy for 85,000 (depends on where you live, obviously)

b. $5,000 down - Owner to hold a an 80,000 mortgage at 8%. Payment apprx., 650.00 - 700.00. Clsoe, but not exact.

c. Fix the porch up into a room. Get used (but decent) furniture for the other 4 bedrooms. Rent them out for 75.00 per week (depends on where you live, again). Could also divide the dining room into 2 for two more rooms,if there is a kitchen and a living room for gathering. This could significantly increase your cash flow from the numbers I show below.

d. Rents - 5 rooms at 75.00 per week = $375.00 /weekly
e. 375 4.3 weeks per month = $1,612.00 / mo.
f. Less mortgage of 650.00 = 962.00 / mo
g. less variable expenses (tax, ins, w&s Vac, etc, , apprx., - 400.00 per month.

Leaves you a net cash flow after all expenses of $562.00 per month!!! ( not counting possiblity of tw more rooms by splitting dining room, if applicable

This would be one way to start… And depending on where you live the number can get much more exciting than this.

Read the book, Be My Guest, written by Conrad Hilton. This is exactly how Conrad started,and built one dusty rooming house into the Hilton Hotel chain,as did Harry Helmsley, among others…

Hope this helps.

Russ Whitney

Re: Direction Mr. Whitney? - Posted by Mark (SDCA)

Posted by Mark (SDCA) on March 13, 2001 at 10:28:37:

Why didn’t you follow your own advice with your son?
Your advice to Henry was: “Find something you love to do, first.”

But on the other hand you wrote: “I had to beg my son to stay in school and get his diploma. The business he created was more fun, more vibrant, more creative, more challenging than anything his college professors were teaching him. It took him two and half years to finish his last year in college.”

He obviously did NOT love being in school and it seems like it was not necessary for him. (Don’t get me wrong. I am a big proponent of education and have 2 college degrees myself but I am “wise”?? enough to know that it is not necessary for everyone.)

Here are some examples of people who have succeeded reasonably well without a college degree.

Kobe Bryant
Bill Gates
Russ Whitney

Hmmmmm…

Mark

Re: Direction Mr. Whitney? - Posted by Markk (SDCA)

Posted by Markk (SDCA) on March 13, 2001 at 10:40:59:

If I have one beef with your book, this is it. You REALLY gloss over the management aspects of a rooming house. Renting rooms on a weekly basis will be a management nightmare (collecting rent, move ins/move outs). If someone is already 100% committed to school and business opportunities, where are they going to find the time to manage a rooming house?
I love real estate but there are much better choices than a rooming house.
As for Hilton Hotels… You may notice that they have a manager on duty 24/7 for exactly this reason. If the rooming house throws off enough cash to pay for a 24/7 manager then I stand corrected…

Cheers,

Mark