In this podcast episode, Steve and Kevin discuss the often misunderstood concept of cash flow in real estate investing. While cash flow is widely seen as the ultimate goal for many investors, the hosts argue that its importance is overstated—especially in the early stages of investing. They emphasize that focusing solely on cash flow can distract from long-term wealth-building strategies. Steve shares examples of how appreciation, tenant contributions, and tax advantages can create significant financial gains over time, even without immediate cash flow or favorable interest rates.

The episode also touches on the importance of understanding when and how cash flow becomes relevant, framing it as a long-term outcome rather than an immediate necessity. They explain how interest rates, while often viewed as a barrier, can actually unlock opportunities for growth, such as tax-free income through cash-out refinancing. Kevin uses examples of real estate appreciation over time to show how properties can double in value, even in the absence of significant cash flow or optimal interest rates.

The episode aims to shift the mindset of real estate investors, encouraging them to look beyond short-term cash flow and focus on the larger financial picture, including property appreciation, tenant-paid equity, and tax-free income.

0:00 Life Lately

5:08 Cash Flow

11:46 Why it is irrelevant

20:50 Focusing In

In this podcast episode, Steve and Kevin discuss the significance of time in real estate investing. Steve shares a personal experience where they purchased a building despite rising interest rates, focusing on the long-term benefits over short-term market fluctuations. They emphasize that time is a powerful wealth creator when paired with real estate, highlighting how patient investors who stick to their plans often achieve substantial financial success. Kevin supports this idea with personal anecdotes, including how his own home’s value significantly increased over time and his son’s property investment that yielded strong returns after eight years. The discussion reinforces the idea that real estate investments, combined with time and a clear plan, can lead to significant financial growth despite economic challenges.

0:00 Intro

3:29 Purchasing Despite Rising Interest Rates

8:40 Time

15:46 After 8 Years

23:05 Plan

The discussion revolves around the concept that a mortgage is not just a debt but an essential investment tool, particularly in real estate. Kevin and Steve explore how mortgages are often seen negatively due to societal norms and historical perspectives, like the notion that debt is inherently bad. They argue, however, that a mortgage, when viewed as a financial instrument, can be a powerful lever for wealth creation.

Steve emphasizes that many people see mortgages as liabilities because they are technically debt instruments on a balance sheet. However, he suggests reframing this perception by recognizing that mortgages, especially 30-year fixed ones attached to single-family homes, offer unique opportunities for individual investors. These loans allow for leverage, enabling investors to use less of their own resources while maximizing potential gains through real estate appreciation.

Kevin introduces the idea of comparing a mortgage to a musical instrument, where the real estate is the musician. Just as an instrument needs a skilled musician to create beautiful music, a mortgage needs the right property and market conditions to unlock its full potential. The wrong property can make the mortgage a liability, but the right one can turn it into a significant asset.

They also discuss the idea that the limitations placed on the number of mortgages an individual can have (typically ten) might be a way to keep the most valuable financial instruments scarce. This scarcity is likened to a limited deal at Costco, where the value is so high that it's restricted. They note that while banks and the government use leverage to increase their wealth, the average person often overlooks the opportunity to do the same with a mortgage.

The conversation touches on how inflation impacts the value of mortgages, where fixed-rate mortgages allow investors to benefit from rising rents and property values while their mortgage payments remain constant. This creates an inverse relationship where the debt decreases as the property's value and income potential increase.

Ultimately, the discussion highlights the importance of understanding the rules of the financial game and how to use tools like mortgages to participate actively in wealth creation, rather than being passive observers.

Chapters

0:00 Intro

3:20 Is the mortgage or property the investment?

13:50 Utilizing a financial instrument

19:14 Micro-Winning the game

28:35 Hey, Siri...

31:51 Ice cream

In this episode of the "Replace Your Income" podcast, Kevin and Steve discuss their return after a long hiatus and the successful weekend event they recently hosted. The event marked the relaunch of their real estate intensives, which they used to conduct regularly, helping participants immerse themselves in income replacement strategies and real estate investment. They emphasized the importance of community, noting how gathering with like-minded individuals helps reinvigorate goals and commitment to action.

They also announced that these events will be held quarterly moving forward. During the event, they introduced various strategies, including cost segregation, bonus depreciation, and other tax benefits that can significantly enhance investment outcomes. Kevin shared a personal story about his son being excited to see his name in their newly released book, "Micro Wins to Millions," which they distributed at the event.

The discussion then shifted to current market conditions, where Steve highlighted the potential risks of waiting for lower interest rates before investing in real estate. He argued that while lower rates might come, waiting could mean missing out on the opportunity to buy properties at lower prices. They both emphasized the importance of taking action now, given the unique market dynamics where demand is high and property values are likely to rise as interest rates fall.

Overall, the podcast conveyed a sense of urgency for investors to engage with the market now and the benefits of participating in their upcoming events to stay connected and motivated.

0:00 - Event Recap

5:25 - Book Buzz

18:39 - Intro to Mid-Term Rentals

27:51 - DFY Family

31:51 - Watch Your Inboxes!

The podcast episode delves into Jesse Kelly's remarkable journey, tracing his path from a construction background to political activism and media success. Jesse shares anecdotes from his upbringing in Ohio, where he was raised in a family entrenched in construction work. Despite initially pursuing a conventional college path, Jesse's lackluster academic performance led him to embark on a different trajectory. He candidly admits to being a "terrible student," especially once he discovered the distractions of high school life.

Feeling a sense of maturity and a desire to serve his country, Jesse made the impulsive decision to join the Marines, inspired by his love for military literature. His abrupt enlistment surprised his family and friends, but Jesse was resolute in his choice. Following his service in the Marines, including deployment to Iraq, Jesse returned to his family's construction business. However, his thirst for new challenges eventually led him to Arizona, where he immersed himself in talk radio while working construction jobs.

Driven by his burgeoning interest in politics, Jesse made another impulsive decision to run for Congress in Arizona, despite having no prior political experience. Although he ultimately lost the election, Jesse's foray into politics laid the groundwork for his future endeavors. Subsequent moves to Washington, D.C., and eventually to Texas, where he found success in media, showcased Jesse's resilience and adaptability.

Throughout his journey, Jesse emphasizes the importance of taking risks and embracing opportunities, even when they seem daunting or unconventional. He recalls the sage advice of his mentor, Michael Berry, who instilled in him the mindset that "you never know who's listening." Jesse's willingness to seize the moment and pour his energy into every endeavor ultimately paid off, leading to unexpected opportunities in radio and television.

The episode also explores Jesse's philosophy of consistency and urgency in pursuing one's goals. Despite facing setbacks and financial hardships along the way, Jesse's unwavering commitment to his principles and his willingness to put in the hard work positioned him to capitalize on unexpected opportunities. As the hosts reflect on Jesse's journey, they admire his authenticity and resilience, recognizing him as a role model for staying true to oneself and making a meaningful impact in any endeavor.

00:00 Intro

3:05 Jesse's Background

14:58 You Never Know Who's Listening

18:35 Meaning

20:58 Wrap Up

Curtis Ray lives in Arizona native, is married with 5 Children, a Collegiate Wrestler at ASU, an Amazon Best Selling Author- “Everyone Ends Up Poor”, an Inventor of MPI, and a Business Owner.

In this episode of Replace Your Income, you'll get to understand Curtis' background, his inventions, and the power of secure compound interest.

00:00 Intro

2:00 Growing Up

7:00 The Big Three

11:30 Premium Financing

23:51 Everyone Ends Up Poor

36:10 Learn More