So, you had mentioned when you hit that $25,000 stability level, you would mention you could get a job that pays less salary but has a bigger bonus potential, or you could go and work at a startup or things like that. Nice episode! Who Is Scott Trench Scott is an American perpetual student of personal finance, real estate investing, sales, business, and personal management. Well, thank you so much, Scott. 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. Accumulating a lifetime of wealth in a short period of time involves working harder and smarter than the average person, and Scott Trenchinvestor, entrepreneur, and CEO of BiggerPockets.comdemonstrates how to . Im not sure how long youve known Mindy Jensen, but I think ever since she got introduced to you, shes been like, Brandon, you have to get him on the show. This is whyI was already fairly frugalThis is why Im saving. Scott Trench: Yeah. After this, I think that your institutional investors and syndication investors are at the next highest risk. And. I was just working towards that financial freedom. They both live in Denver, Colorado. Cash obviously, but what else would apply as a real asset? At the moment, no information about his parents or siblings is available. Required fields are marked *. And so what Im trying to do with Set for Life and with some of the other things Im doing is try to help people put themselves into a position where theyre saving enough, where leaving a career track like that where they have very limited upside becomes the bigger risk than taking a chance on something that they believe to be a good opportunity. I picked stocks, and I tried to invest in stocks, and I lost money in 2013 and 2014 when everybody else was making money. This is it!. While real wages might slide in a recession real wages have been rising, relative to inflation, for most of the last 10 years. 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. He hosts a podcast called BiggerPockets Money.. - What else would be considered an asset in his model? And I wanted it as soon as possible. That's the topic of today's show, where we sit down with Scott Trench, author of Set for Life,to discuss some of the simple yet powerful, tactics people can use to increase their income, reduce their expenses, and lead a legendary life. And no one can go in and audit them and figure that out. And I think focusing on frugality at that stage absolutely is going to be the biggest impact you can have on your finances. We try to be a little bit more creative and adventurous with our investment and money management than maybe just passively investing in index funds. So, people always think that thats where they need to focus on their finances in order to achieve a high savings rate and rapidly accelerate toward financial dependence, but thats wrong. Mad Fientist: Yeah, absolutely. So hes stepped aside. Thanks for the podcast! It wasnt in the nicest area. Who cares if its underwater in terms of you owe more than its worth as long as its cash flowing? Thats not fast enough. Scott breaks down the journey to financial independence into three stages and explains what you need to focus on at each step (and why)! We, AOL, are part of the Yahoo family of brands. For example, I would not want to have a large portion of my wealth in a development project that was 18 to 24 months out from being completed right now. And my rents were $1150 from the other side and $550 for my side. Its just that the math doesnt work like that. So youre not going to be able to even last one month without your job if youre starting from scratch until eight months have passed and really six weeks timeframe by the end of the year. Scott Trench: Well, thank you for having me, Brandon. Its in my opinion as a saver who was able to accumulate a year of financial runway within a year, that was a risky career because I knew that I was not going to have any chance to live up to what I deemed my potential to be. She now has a net worth of $5 million, and her annual salary is estimated at $1 million. So, I think thats where our friendship kind of kicked off, a pretty similar mindset on life and finance and real estate in general. But youll need about $48,000 to finance your $4000 a month lifestyle. Mad Fientist: There was! Why Frugal Living Will Only Get You So Far. So thats how I managed to lose money investing in stocks I guess. . Mad Fientist: Hey, I hope you enjoyed that interview with Scott. I really appreciate it. The identity of Scotts wife is not known to the public. So the only criteria that I have that I think that you should really kind of strictly enforce is: Will this property make sense right now?, the day you buy it as an investment property if you dont live there. He married his beautiful wife with whom he resides in Denver, Colorado. What Is A 529 Plan and Where to Open One in Your State, How Much Should You Have In A 529 Plan By Age, How To Use A 529 Plan For Private Elementary And High School. By clicking Accept all you agree that Yahoo and our partners will process your personal information, and use technologies such as cookies, to display personalised ads and content, for ad and content measurement, audience insights, and product development. Calculate your FI date and graph your progress to FIRE for free in the Mad Fientist's FI Laboratory! 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. Mad Fientist: Thats very cool! So that would be cool to read that. The author, Scott Trench, has some very wise . You could try starting a blog or a podcast. Mad Fientist: Very cool! That's $1 MILLION. I wish that people knew that real estate investing is a double-edged sword. So, I always end all my interviews with one piece of advice youd give to somebody whos starting on the path of FI. She and her husband interviewed me in #26. So theyre not even recognizable by name, the companies? Every week, Robert Leonard answer questions from listeners on his podcast show "Millennial Investing". But theres also this whole realm of entrepreneurship. So what would yours be? Scott Trench: Sure! I was interested in that line of work, but I didnt want to be tied to it for 40 years. I invest in index funds. Scott Trench is the author of "Set for Life," CEO of BiggerPockets and co-host of the "BiggerPockets Money" podcast. Scott Trench is a perpetual student of personal finance, real estate investing, sales, business, and personal management. So, you might need $25,000 in total cash, liquidity, to finance your $2000 a month lifestyle. In 2021, he also released his book First-Time Home Buyer: The Complete Playbook to Avoiding Rookie Mistakes. But thats awesome. 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. But then we go into house hacking. BiggerPockets is a complete resource for anyone looking to succeed in the world of real estate investing. And I also have a quadplex now that I bought as a regular investment property. Shes good. Youre also not likely to get a big raise at your job at work within the next year. When Josh decided to step away to be with his family, Scott became CEO. I believe I currently was able to getI remodeled and got one of the units up to $925. Thats awesome. So you mentioned your first $25,000. But you model it out, and you just throw all of your excess cash into a big pile. Its kind of a funny phenomenon to me because when I was starting out on this journey, all I could think about was getting to a point where financial independence seemed like a realistic possibility. Scott Trench is CEO of BiggerPockets, co-host of the BiggerPockets Money Podcast, a real estate investor, and a real estate broker.He is also the best-selling author of Set for Life and First-Time Home Buyer, which have sold more than 140,000 copies combined.Through a solid understanding of wealth management, calculated risks, and a lot of hard work, he created financial freedom for himself as . Mad Fientist: Wow! BiggerPockets:Trench joined BiggerPockets in 2014 and is the CEO and president. They both live in Denver, Colorado. So, the goal of the show is to showcase these different perspectives on finance and enable people to think outside the box of Oh, real estate is the only way to go about this or even Index funds is the only way to go about investing or frugality is the only path to financial freedom.. For example, if I were single, I could rent out my spare bedroom in my house. Alright, man, thanks a lot. Building wealth is always possible, even while working full-time, earning a median income, and making up for a negative net worth. Turns out our guest today, Scott Trench, found a lower paying dream job at a startup. Buy, Rehab, Rent, Refinance, Repeat is the five-part BRRRR One of my favorites which will be coming out soon is with David Greene whos a real estate investor. Thats really important for investors, because the Feds dual mandate is to keep both inflation and unemployment low. I think that, sadly, those at the highest risk are middle-class American homeowners. And theres nothing wrong with this plan of index fund investing. He was born and raised in the United States by his parents. So, those are two approaches for investing. Scotts estimated net worth is $1.5 million. And then, I actually stumbled upon your podcast, the very first episode, and Mr. Money Mustache. And groceries are one of the things that a person thats interested in personal finance can go out and make a change in immediately. SNAP gives eligible low-income households extra food-purchasing assistance to supplement food budgets. I know a lot of people that would be happy with a raise of that level. Well, the reason is because Chinese companies all the timeI dont know about this one in particularlie about their financials. Joshua Dorkin, founder and CEO of BiggerPockets.com, joins me on the Financial Independence Podcast to talk real estate and entrepreneurship! So, thank you for that. Scott Trench is a perpetual student of personal finance, real estate investing, sales, business, and personal management. I know Ive had Chad Carson on the show, and weve talked about it in the 1500s. Denver, Boulder, Longmont (stop by and say hi to Pete), and Fort Collins are all full of excellent breweries. Click Manage settings for more information and to manage your choices. But on the other hand, if I wasnt saving, if I had no financial runway, it would be too risky to leave. Yeah, can you describe that again? So if youre following that, I was collecting $1700 in rent on $1550 mortgage. 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. She was right! Enjoyed the podcast. Scott Trench: But yeah, that interest in personal finance is kind of what spurred my ability to save and the accumulation of my first $20,000 to $25,000 for me. 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 lets dive in! You run out of money and you have to go and find similar paying work as your only option. So, that was your first $100,000. Also, you have nothing to invest, so you cant get a higher return on your invested dollars if you have nothing to invest. Or maybe you can just send them over, and Ill put them in the show notes in case people want to know more? Mad Fientist: Nice! And what caused her to come to me and say, Hey, you needed to talk to this guy? So yeah, I really enjoyed it. Your email address will not be published. So, for example, on a basic level, Mr. Money Mustache has an incredible intro because I believeand Mindy agreesthat the basis of personal finance, the foundation, is always in that frugality and having the mindset of the end goal of happiness and using money as a tool to live out that ideal lifestyle I guess. Over the weekend, Adams appeared to double down on the remarks on Twitter. So, alongside kind of dollar cost averaging with index funds, I try to dollar cost averageand by that, I mean consistently invest, so Im not buying at the top or the bottom of the marketin real estate. So one of the problems that a lot of people have I think when it comes to finance is theyre unable to take any risk whatsoever. I just mention I have the three properties. Youre welcome any time. Since joining BiggerPockets in 2014, Scott has authored the bestselling wealth-building book Set for Life and joined Mindy Jensen as co-host of the BiggerPockets Money Podcast. So I really like how you structured it. I think that this asset class and I broadly bucket large multifamily, NNN and other such real estate into this category is much more exposed to rising interest rates than people think, and there could well be some pain here. I am a massive fan of multiple streams of income, so have been pursuing side hustles for a while now. This is what I need to be doing and how I need to be moving forward with my life and with my finances. So the best place to find me is actually on Bigger Pockets. Mad Fientist: Yeah, this is a long time coming. In addition to his career, Scott is the author of Set for Life which was published in 2017. Its about a little over 10% of your savingsthat means you spend around $4000 a month. Two or three years ago, I actually [00:01:46] Bigger Pockets. I published that episode way back in May of 2012. Thats fantastic. And her annual salary is estimated at $ 1 million for investors, because Feds! 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