WEBVTT
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Welcome to Paging Financial Freedom, a podcast about doctors and spouses and the journey to financial freedom through real estate and taxes.
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I'm Dr.
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Daniel Chen, a surgeon and real estate investor.
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You might know me on social media as the Storrentia Doctor or the founder of Surge Real Estate.
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And I'm Lila Kaplan, former Wall Street professional, certified financial planner, and the person on a mission to retire my orthopedic surgeon husband in the next five years.
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I specialize in apartment investing, helping doctors and their families build true financial freedom beyond their W-2 income.
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If you're interested in achieving tax-efficient financial freedom through real estate, you're in the right place.
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Let's get started.
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Hello and welcome back to Paging Financial Freedom.
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Today I'm really excited to be joined by Param Balandan Dapani.
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She's the physician founder behind Generational Wealth MD, and her platform focuses on helping physicians think more intentionally about real estate investing, passive income, financial independence, and building wealth in a way that fits their goals, constraints, and risk tolerance.
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So we're really excited to talk to her about her path in medicine, what led her to build Generational Wealth MD, and what physicians and spouses should understand before chasing financial freedom outside of that traditional sort of doctor career path.
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Welcome, Param.
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Welcome, welcome.
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Thank you, Danielle.
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Thank you, Laila.
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All right.
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So why don't we just uh start a little bit from uh the beginning, if you don't mind.
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Uh so a little bit about who are you, where are you from, and what drew you into medicine?
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Well, what drew me into medicine?
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Very interesting question.
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Because I think when I was born, my dad decided that I would become a physician.
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I think uh, you know, uh those of us with Asian backgrounds can relate to that.
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And so, but uh in hindsight, I'm I'm uh I'm very glad he chose that path for me.
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I think um I would have fumbled my way into medicine at some point, but I, you know, um I had a very straight path because that was what I was destined to become.
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Um and uh but I enjoyed my training, loved medicine.
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Uh, worked as a full-time radiologist for about 10 years.
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Uh, but um, you know, after um after completing my training.
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Um and uh yeah, so I guess uh I always knew that I'd become a physician.
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And I think you eventually ended up in California, right?
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That's that's where you were for quite a long time.
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Yes.
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So I trained on the uh on the East Coast, and then we moved to California because we are a physician household, both radiologists.
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And so I think it's um uh it come boils down to where I can find two jobs that we both were comfortable with, and we had a great opportunity in Central Valley, California.
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I moved there, and uh, I know you're from um Southern California also, Daniel, and it's it's a great place to to grow a family.
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And um, I'm from Southern India.
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I like the warm weather, so the weather was perfect.
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I don't think I would have lasted in New York any longer.
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Yeah, I I know that for a while we overlapped because I I think I was in LA and you were over the mountains, sort of in the central California area.
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Um and it was it was an amazing place to raise a family.
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But I've since moved, by the way.
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I live in uh Tennessee now uh for the last four years.
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So I I think uh, you know, it we've we've moved along from there.
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Uh do you still maintain a home base there or do you kind of travel around?
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I do, I do.
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This has been uh an well interesting last few years and definitely not something I thought about when I was thinking about financial freedom.
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I think when I initially worked towards financial freedom and building income streams out of outside of medicine, it was from the perspective of security.
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I wanted to have that buffer, you know, um uh a net.
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But um a lot has happened over the last few years.
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Um uh we have uh had both sets of parents really um had medical challenges, healthcare issues, they needed care.
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And um, because we were financially free, my husband and I were both able to um move back to India.
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We've spent um quite some time in India now uh with the kids.
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The kids are being homeschooled.
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And I I think it's just been a blessing.
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We just had the freedom to do what we want, and it's almost a byproduct of uh what we I built um our financial freedom for.
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But uh it's been uh it it truly I I'm very grateful for where we are and for the ability to do what we're doing now.
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Param, so let's unpack that a little bit.
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Um when you were a physician, what brought you to the real estate realm?
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Um why not something else?
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Okay, great question.
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Um, so I mean, uh just my background, you know, the community, the uh the place where I'm from.
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Um I think there's this traditional belief that you always invest in real estate and gold, right?
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And in hindsight, now that I think about it, it's because those are inflation-controlled assets, right?
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So that's a saying, that's a saying that's been there for generations.
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And I think what it did is that my parents have were also financially free in their 40s, and they it was primarily through real estate.
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And so um, I don't think I necessarily carried that information over uh when I moved to uh when I migrated to America, but it did break down barriers, right?
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So there wasn't like a huge barrier to investing in real estate for me, just because I've seen so many success stories.
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I think it's harder for other people um when they haven't seen that, right?
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So that's the background.
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And then when I moved to um when I was training in New York right after fellowship, uh my first job, uh my colleague, I taught him to read breast MRI and he taught me to invest in um dividend aristocrats uh in the stock market.
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And then he also was a third-generation real estate investor who had never seen his properties.
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He lived in um New York and his properties were in Tennessee, which is where ironically, that's where you're from, right?
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Uh where you live now, um Daniel.
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And um, you know, he just said, I, you know, whatever happens at work, I just, you know, I get a paycheck, I get uh, you know, mailbox money, and I just laugh all the way to the bank.
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And he was like, Perh, I'm gonna introduce you to my teams.
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You should do this.
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And that's how things got started.
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It wasn't, um, it wasn't because of knowledge that was directly passed to me from my parents, but I think it definitely broke down a lot of barriers.
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And I had this opportunity, it's almost like piggybacking onto somebody else's team and their knowledge.
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Uh, and I'm really grateful for that because that's how I bought my first property.
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And and again, a lot of people may resonate with this.
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It was three years from when he told me to invest in real estate and he introduced me to his teams to when I started investing.
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And that's because I had a spouse who was hesitant um to invest in real estate because of his background, because of his experiences growing up.
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And uh, and then eventually one day I was like, you know what, this is diversification within the family.
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I'll invest in real estate, and you be the non-real estate investor.
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And I just, you know, got my first property and um, and from there, and I I would say the first seven years I invested in real estate, I was super passive, very hands-off, just bought a long-term rental.
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Every time I went on maternity leave, I got a long-term rental, right?
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And so there's all a four-year gap um between those properties.
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Um, but um 2020, um, right, right during the pandemic, 2019, 2020, we had um both of us are radiologists work for the same company.
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There was a merger at work, and we both um, you know, weren't given partnership track and we decided to um, you know, um uh to not join that practice.
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And um that was a really rough transition because both of us lost our jobs uh around the same time.
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My daughter was under a year old.
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We just bought the doctor home in California.
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You know, it was a it was a rough transition.
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It took us a year to get back uh on our feet, and then the pandemic hit, and it was again, uh, I had a you know compressed work schedule, kids were home, no, no childcare.
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Yeah, it was it was rough.
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And so that's when I really started looking at um financial freedom and understanding my numbers.
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And I realized it would take me 17 years to get to financial freedom through the stock market, and I could do it in a couple of years with real estate.
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So I started scaling.
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Um, I did short-term rentals, used all the tax strategies that Daniel and uh Lila, I'm sure you guys talk about on your podcast, and especially with you, Lila, being a real estate professional.
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Um and that really accelerated my path.
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Like I said, it was for security, right?
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That's why I got into scaling real estate.
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A year within within a year and a half of when I made that decision to really start accelerating my portfolio, like we hit financial freedom.
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And so that's how things got started.
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And then I built a community and we've taken um, yeah.
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So a lot has happened since then, but that was how it got started.
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So was your first couple of properties single family, multifamily?
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Where did you start?
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My first couple of properties, yeah.
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Um, so when I started again, I was uh an out of state investor.
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Uh my first few properties were in Houston, Texas.
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Um, and since then we've bought apartments there, right?
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And we syndicate properties and we have investors there.
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I visited Houston quite a few times to uh visit the properties, but I haven't set eyes on my single family homes there to date, right?
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So I've been very hands-off.
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I haven't met my property managers there, but I invested as an out-of-state investor.
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Um, and so that was all my personal portfolio is mostly single-family homes and townhomes, um, and then a few apartment complexes, uh, but uh it's predominantly single-family homes.
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So that timeline to financial freedom was really compressed and honestly pretty rapid.
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Uh, do you think that's typical or is that kind of something special about um Param?
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Uh, what is what is a typical kind of path to financial freedom look like for most families, would you say, physician families?
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Yeah, that's a great question, Daniel.
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And so I think it can look very different depending on the strategies you use, right?
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So like I mentioned, the first few properties I purchased and I was very passive in um, you know, um, I just buy something that I could rent and uh and you know, it was just mailbox money.
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But when I started accelerating my path, uh, I think that make and I would say that there are three buckets, right?
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Most people, I would say, fall into one of three buckets.
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Uh, but then when I accelerated, I actually started getting active in those strategies.
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I started using tax strategies, um, I started rehabbing properties, right?
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Um, and so I started recycling the same pot of money over and over again.
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And so what I like to say is I think people fall into three buckets typically.
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Um, and there is the passive investor.
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That's people who really value their time.
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They have capital, they want to invest in real estate, but they want to be very, very hands-off.
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That could be people who invest in long-term rentals or people invest in syndications passively, right?
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Like that's uh that's what a lot of people in your community do also.
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Because you're pretty passive, you still get the benefit of tax-sufficient income that comes from real estate, and it's still significantly higher in the long term over what you'd make in the stock market.
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Um, but uh, you know, you don't necessarily uh tap into active tax strategies that allow you to shelter your uh clinical income or W-2 income from taxes.
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And the opposite end of the spectrum, I have what I call the um the entrepreneur, right?
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And so this is someone who invests in, say, short-term rentals or is a syndicator, uh, uh like uh you, Danielle, someone who is a general partner in apartment deals.
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And so it's almost like having a business, right?
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So you're on the active side, um, but you get the benefit of having significantly higher returns and tapping into, you know, more advanced tax strategies where you're now getting tax savings that you can use to shelter your W-2 or 1099 or clinical income from taxes, right?
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And so um you're putting in a little more time and effort over there, but you're getting rewarded for that.
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And, you know, and time and effort, again, it's it depends on systems.
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We have a lot of people who do that who probably spend two to three hours a week on their portfolio.
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So there are ways to really uh become efficient over there, but your returns are significantly higher and you're starting to tap into some of those advanced tax strategies.
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And I'd say in the middle, you have people who I call the hustlers.
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These are people who maybe do midterm rentals or do the burst strategy where you rehab some properties and you know you're definitely a little more hands-on than the passive investor and you get higher returns, but you may not be able to qualify as a real estate professional, right?
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And and tap into those um those strategies.
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So there's a spectrum.
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And I think the first question I ask people when I talk to them, and I'm sure you do, Daniel, is like, where do you see yourself on this spectrum, right?
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And so there's not one answer for everyone.
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If you're on the passive path, it can take you 10 to 15 years to get to financial freedom.
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But once you start getting really active, and you know, it could be for a short duration.
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Um, I was pretty active for a year and a half and I did rehabs without a general contractor.
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I invested in short-term rentals, and so I hit financial freedom in say 18 months.
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And then you could always, you know, it's all very fluid.
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And that now my entire portfolio is very passive.
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Like they're they're all converted into long-term rentals.
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Property managers manage them, I spend less than a month a week on them, right?
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And so it depends on where you are on that spectrum.
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Your timeline's going to differ depending on that.
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But again, like I said, it's very fluid.
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And uh you don't necessarily have to think you're boxed into one of those strategies.
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Got it.
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Okay.
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So I think a lot of our audience will hear the term financial freedom and sort of automatically assume that that means quitting medicine and and leaving medicine.
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But was that where was that?
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Um, how was that progression for you?
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Like as soon as you hit financial freedom, was it, you know, no more radiology, or was it kind of a more sort of slow progression for you?
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Yeah.
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Was there a goal or a threshold that you were looking to achieve?
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Yeah.
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I mean, so like this is geoarbitrage, right?
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So Daniel's in uh when when he we he was in California, you were closer to LA and I was in Central Valley, California.
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So what I needed um to be financially free was uh$10,000 uh post-tax, right?
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When I hit that number, I was like, okay, I could do whatever I want to.
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And I went down um honestly, like uh my intention wasn't to quit medicine completely.
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I liked what I was doing.
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It was just that my kids were still home.
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Um, you know, they were being homeschooled, and um, because of you know the post-pandemic years, we just we chose to keep them home.
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And so I was working a day a week in medicine.
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Uh, but then, you know, generational wealth MD grew.
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We now have 20,000 doctors, and then the coaching um uh portion grew.
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And I I loved doing that, the impact we over have over there.
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And then, you know, 85% of our community wanted to be passive investors.
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So we built GW Capital, which was the passive syndication part.
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And I think there came a point where I was like, something has to give.
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And, you know, I I think Lila and and Daniel, you understand this when you're a parent, you're a full-time parent, right?
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It doesn't matter what else happens.
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And so um, medicine was what I had to, and it was a very hard decision.
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It was like a, you know, huge identity crisis because I think we identify ourselves as physicians so strongly.
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So it wasn't an easy choice, but at that time, I felt like that was the best choice for my family.
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But I also maintain that, you know, financial freedom, like I said, initially was mostly for security.
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And so I think all of us need to practice medicine because we get to and we want to, not because we have to, not because we need to bring the paycheck in.
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So I think the goal is to just get you to the point where if you have any transitions in your life, right?
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I I think most of us are in cruise control mode.
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We can work another 20 years, that's great.
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But if you start get into crisis mode for any reason, I just want us to have options.
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And and, you know, honestly, our family, we got into crisis mode uh a year ago.
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I lost my dad three months ago.
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And because of uh of where we were financially, we were able to relocate back home to India.
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And I don't think that was an option that would have been available to us if we didn't have financial freedom.
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And so, um, so I think it it's absolutely necessary, and then you get to do whatever you want to do, and it's gonna look different for many of us.
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I just hope we just have many more satisfied physicians who aren't burnt up who are practicing medicine and they have the ability to negotiate and do what they want and practice how they want to.
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Parem, earlier you talked about getting into real estate, and I think you mentioned that your husband wasn't completely gun-ho about it.
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He sounds like he's a little bit more risk averse.
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What conversation needed to happen between you and him in order for you to move forward?
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Or maybe you didn't and you just did your own thing because that's kind of what I do.
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I just make my husband sign on the dotted line every time I want to buy another building.
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Oh, oh yes, and so everyone has a different dynamic, right?
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So good for you.
00:16:30.159 --> 00:16:34.159
Um, I think for me, and you know, what you said makes complete sense like that, right?
00:16:34.240 --> 00:16:41.519
So when people identify as risk-averse, it highlights a key concept because a lot of people look at real estate and they think it's risky, right?
00:16:41.679 --> 00:16:51.600
And honestly, for me at that point, um, not shifting things seemed more risky because I couldn't do that, do what we were doing for another 20 years without having options, right?
00:16:51.759 --> 00:16:54.399
And uh honestly, real estate is risky.
00:16:54.559 --> 00:16:58.720
Uh, and uh, and and you know, all three of us have been doing it for a while.
00:16:58.799 --> 00:17:04.799
And there are bumps along the way, but the truth is there is a way to do it where you can reduce risk significantly.
00:17:04.960 --> 00:17:14.400
A lot of that has to do with diversification, really understanding your numbers, um, buying properties with a buffer there, um, right, and then really taking on conservative debt.
00:17:14.480 --> 00:17:17.279
And I can go on and on and on, but there is a way to do it.
00:17:17.440 --> 00:17:19.039
There, there's a right way to do it.
00:17:19.119 --> 00:17:21.680
Um, and there's a way to introduce diversification in there.
00:17:21.759 --> 00:17:23.759
So you're lowering your risk significantly.
00:17:23.839 --> 00:17:29.680
And that's a big part, I think, of what people need uh need to learn before they start investing in real estate, right?
00:17:29.759 --> 00:17:38.319
Um, and uh, and like I said, um, he uh, you know, um, I didn't really have those barriers to investing in real estate because I've seen success stories.
00:17:38.480 --> 00:17:44.160
So what happened with us is was that um I eventually decided to, well, like I said, it was diversification looking at the family.
00:17:44.240 --> 00:17:48.000
I said, you know, um, you be the bond investor, I'll invest in real estate.
00:17:48.240 --> 00:17:51.759
And and because end of the day, the family reaps the benefits, right?
00:17:51.920 --> 00:18:00.000
And so I'd say six years into my journey, he looked at the numbers, he saw we were um, I think we were getting close to financial freedom at that point.
00:18:00.079 --> 00:18:02.480
And he was like, wow, this makes, this makes a lot of sense.
00:18:02.559 --> 00:18:08.559
And so now he's investing, he invests um in uh passively in our syndication opportunities that we have in GW.
00:18:08.720 --> 00:18:09.839
And so he's converted.
00:18:10.160 --> 00:18:10.400
Yeah.
00:18:10.559 --> 00:18:12.880
So so let's go a little deeper on that.
00:18:13.039 --> 00:18:15.279
Um, you said not taking risks.
00:18:15.359 --> 00:18:25.039
And I just find, you know, in speaking with doctors, you know, a lot of them don't take on real estate because it's a risk, and obviously it's a lot of time spent as well.
00:18:25.200 --> 00:18:29.279
And you said, you know, there's ways of alleviating those risks.
00:18:29.440 --> 00:18:38.720
Can you just give some real life examples so that our audience can understand what those hedges or um, you know, possibilities are?
00:18:39.200 --> 00:18:46.559
Yeah, so I think there, and so if I were to give examples, I think I'll start off with examples and then without getting too theoretical, right?
00:18:46.799 --> 00:18:55.359
Um, and so we have students, and so I would say the last two years, the real estate market had we've had high interest rates, uncertainty in the economy.
00:18:55.519 --> 00:19:01.920
And so we've had, I mean, I think for most people, that would probably they would call that one of the riskiest times to be investing in real estate.
00:19:02.160 --> 00:19:05.920
And we still have students in our community who've invested in real estate.
00:19:06.079 --> 00:19:14.000
They've increased their gross revenue from their portfolio to a million dollars, uh, you know, and uh, you know, half of that can be cash flow.
00:19:14.240 --> 00:19:22.480
We've had students who've sheltered close to a million dollars of income from taxes, and that's, you know, that's a guarantee, that's a guarantee, no matter what part of the market cycle you're in.
00:19:22.640 --> 00:19:35.680
Um, and people do this while they're in spending with the right systems in place, they spend two or three hours a week on a portfolio that generates twice as much as they do in clinical medicine, where they possibly have to pay zero dollars in taxes, right?
00:19:35.759 --> 00:19:37.200
And so there is a way to do it.
00:19:37.359 --> 00:19:42.160
And if I were to break it down, um now I'm getting to the like the theoretical part, right?
00:19:42.400 --> 00:19:45.119
I think the risk is exists in in three stages, right?
00:19:45.279 --> 00:19:46.640
You have to buy the right property.
00:19:46.720 --> 00:19:52.400
Um, I think with real estate, it's really important to have a longer-term strategy that itself lowers risk.
00:19:52.640 --> 00:19:58.720
You need to buy properties with the right basis because buying it right, you know, is is so crucial.
00:19:58.799 --> 00:20:04.960
Um, you can't just um buy because, you know, it's the next, it's like the shiny object syndrome, someone else is doing it.
00:20:05.200 --> 00:20:08.880
If you catch it at the wrong time part of the market cycle, then we all suffer, right?
00:20:09.039 --> 00:20:12.400
So buying right is a is a is a big uh important part, the right markets.
00:20:12.480 --> 00:20:18.720
And so like Daniel shifted from a um a tenant-friendly market to a landlord-friendly market, right?
00:20:18.880 --> 00:20:23.359
And so whenever I listen to where people are from, I was like, okay, great, that's a great market for you to be investing in.
00:20:23.440 --> 00:20:26.400
So knowing your market, understanding that, all of that is really important.
00:20:26.480 --> 00:20:28.240
So buying right is the first piece.
00:20:28.480 --> 00:20:32.400
The second piece is um having the ability to hold on to the asset.
00:20:32.559 --> 00:20:37.279
And so all of us have seen in the last few years, we've seen a lot of projects suffer.
00:20:37.440 --> 00:20:44.000
Um, and a big part of that is um when you aren't able to hold on to the asset because you have the wrong kind of debt on the property, right?
00:20:44.079 --> 00:20:55.200
So debt is really critical, which, you know, the the flip side to that is if you're buying a long-term rental or a short-term rental with 30 year debt over there, now that debt is very, very conservative, right?
00:20:55.279 --> 00:20:56.480
So it's very forgiving.
00:20:56.720 --> 00:21:00.799
And so, but when you're investing in apartments, the debt piece can be can be huge, right?
00:21:00.960 --> 00:21:03.200
Having adequate cash reserves, that can be huge.
00:21:03.279 --> 00:21:07.119
And so that's that's a piece about having the ability to hold on to the asset.
00:21:07.279 --> 00:21:08.079
That's the second part.
00:21:08.240 --> 00:21:13.039
And then the third part um is always controlling the things that you can control.
00:21:13.359 --> 00:21:24.480
And that's where I think um, especially if you look at syndications um and uh general partners, the last few years, the operators who thrived are those who are able to control expenses, right?
00:21:24.559 --> 00:21:31.039
When you're in a market where you can't manage rents, where you can't manage occupancy, um, there are still a lot of things that you can control.
00:21:31.279 --> 00:21:43.680
Value add, uh, when you're able to go in and um increase the value of a property rapidly by increasing its income, um, um, by doing a rehab, you know, that's a way where you control, you control the returns, right?
00:21:43.839 --> 00:21:44.960
That's not market driven.
00:21:45.119 --> 00:21:47.200
Now, it hasn't been the best environment to do it.
00:21:47.359 --> 00:21:51.119
The last two years, operational uh expense control has been a huge part of it.
00:21:51.279 --> 00:21:53.839
A lot of what we've been doing is creative value add, right?
00:21:53.920 --> 00:21:59.599
We go in, we partner with the Houston Housing Authority on some of our projects, reduce property taxes 80%.
00:22:00.319 --> 00:22:00.720
90%.
00:22:01.039 --> 00:22:03.039
That's something that we have control over.
00:22:03.440 --> 00:22:03.680
Right.
00:22:03.839 --> 00:22:08.400
Our students invest in short-term rentals or they have real estate professional status.
00:22:08.559 --> 00:22:11.759
In any market cycle, you're able to tap into those tax savings, right?
00:22:11.839 --> 00:22:13.119
That's market independent.
00:22:13.279 --> 00:22:16.319
So there are a lot of ways where you can control those variables.
00:22:16.720 --> 00:22:18.559
Your strategy is one part of that.
00:22:19.119 --> 00:22:22.480
Creative financing, creative value add, right?
00:22:22.559 --> 00:22:31.599
So a lot of different ways, and I can go on and on, but there are those three pieces I think that are critical to risk management, buying right, having the ability to hold on to an asset.
00:22:31.759 --> 00:22:43.279
And then the third piece is controlling the variables that you do have control over because the returns from real estate are multifold and market pricing is one piece of it, but you have all those other levers that you can't pull.
00:22:43.519 --> 00:22:43.680
Yeah.
00:22:43.759 --> 00:22:46.480
So that those are really incredible tips there.
00:22:46.640 --> 00:22:54.720
And you know, as a you have a very unique perspective in that you're in multiple asset classes, your students are in multiple asset classes.
00:22:54.880 --> 00:23:05.440
Um, could you speak a little bit more about the investors who were investing even passively in syndications around the time when interest rates started going up?
00:23:05.599 --> 00:23:08.480
And all of a sudden those deals stopped cash flowing.
00:23:08.640 --> 00:23:13.599
Um obviously you don't have a crystal ball, but where do you think we are sort of in that cycle?
00:23:13.759 --> 00:23:20.480
And are you seeing opportunity now from those deals that are kind of falling apart from that time period?
00:23:20.799 --> 00:23:21.359
Yeah, yeah.
00:23:21.440 --> 00:23:24.960
And so that's a that's a very important discussion to have, right, Daniel?
00:23:25.039 --> 00:23:29.759
Um, because many of us have been burnt by assets that we acquired in 22 and 23.
00:23:29.920 --> 00:23:33.039
March 2022 was the top of this current market cycle.
00:23:33.200 --> 00:23:38.559
Since then, asset values have dropped, um, interest rates have gone up, and um cash flow has dwindled, right?
00:23:38.640 --> 00:23:40.960
Just because of that high interest rate in my mind.
00:23:41.039 --> 00:23:47.279
And uh, you know, we've struggled with a few of our deals that we acquired in 22 and 23, like most syndicators.
00:23:47.440 --> 00:24:17.039
Um, and um yeah, I think uh it's you know, it's this, this, this, the psychology piece, interestingly, is that when we're at the top of the market cycle, that's when people are very, very enthusiastic about investing in real estate because they've seen um, you know, they've seen those price hikes, they've seen the inflation correlated increase in rents, increase in prices, the the the mass L ROI that people um, you know, that exited deals in 2019, 2020, and 2021 had.
00:24:17.200 --> 00:24:22.559
And everyone's super excited about investing in real estate, but that's where the risk is the highest.
00:24:22.799 --> 00:24:31.759
And when we're where where we are where we are now, which is at the bottom of the market cycle, trending back upwards, this is where investor sentiment is at its lowest.
00:24:31.920 --> 00:24:37.359
Um, and uh, and you know, people want to stay away from real estate because they've been burned.
00:24:37.680 --> 00:24:43.440
But uh, you know, the seasoned real estate investor knows that this is also part of diversification, right?
00:24:43.599 --> 00:24:45.920
You have temporal diversification also.
00:24:46.160 --> 00:24:56.799
Um, and um, for you to lower risk in real estate, you know, you need geographic diversification, you need asset class diversification, um, but you also need to diversify temporally and you keep investing.
00:24:56.880 --> 00:25:01.759
It's almost like the dollar cost of investing, um averaging that you do in the stock market, right?
00:25:02.000 --> 00:25:06.559
This is the time where you have the most opportunity, although it's things seem the bleakest.
00:25:06.640 --> 00:25:09.759
Um, and we're getting deals at a great basis, right?
00:25:09.920 --> 00:25:18.400
We are still um seeing um different niches like manufactured housing, self-storage, industrial, um, where the numbers are really making a lot of sense.
00:25:18.480 --> 00:25:23.759
Um, but it's also the time where investors are, it's you know, um investor sentiment is at its worst.
00:25:23.920 --> 00:25:36.240
And the the the the challenge with investing, and I think that the trick is to be that investor who's able to zoom out, um, see, see things for what they are, keep emotions out of it, and then invest in it based on the numbers.
00:25:36.400 --> 00:25:41.680
And and I think this is um this is our 08, 09, um, you know, for for our generation.
00:25:41.759 --> 00:25:43.599
And I think we have a lot of opportunity.
00:25:43.759 --> 00:25:44.799
We're seeing a lot of deals.
00:25:45.039 --> 00:25:46.559
We're getting a great basis.
00:25:46.960 --> 00:25:56.319
So getting towards the end here, you know, for physicians today, obviously physicians, average work week is 50 hours a week, 60 hours a week.
00:25:56.640 --> 00:26:03.440
What would you say a good starting point is to get acquainted with the even the concept of investing or real estate investing?
00:26:03.519 --> 00:26:04.880
What's a good way to start?
00:26:05.200 --> 00:26:12.960
Um, yeah, so I think, like I said, you know, uh originally there are three buckets and there are the three ways to get started um investing in real estate.
00:26:13.039 --> 00:26:15.839
And I think that's the first question most people should answer.
00:26:16.079 --> 00:26:24.799
If they are considering being passive in real estate, then I think a great way to get started is investing in syndications, but doing their own due diligence is also critical.
00:26:24.960 --> 00:26:27.680
Um, and so there are lots of resources um for that.
00:26:27.759 --> 00:26:34.319
Um the um, I think it's what is the passive um investor handbook, uh, um, The Hands Off Investor.
00:26:34.400 --> 00:26:37.039
The Hands Off Investor by Brian Burke is a great book.
00:26:37.200 --> 00:26:42.400
Um, we have a due diligence worksheet uh at gwcapital.com slash guide.
00:26:42.559 --> 00:26:43.839
I'm sure you have resources.
00:26:44.000 --> 00:26:48.799
So really listening to podcasts, educating yourselves, even as a passive investor, is critical.
00:26:49.039 --> 00:26:55.839
And then there are those who start off and um they say, well, taxes are a big pain point, so I want to start off with a short-term rental.
00:26:56.000 --> 00:27:03.359
And I think uh if that's something you're considering, and you've done this, Daniel, um, and I don't know if you have, Lila, but um, you know, we've invested in short-term rentals.
00:27:03.440 --> 00:27:07.920
And and that's something where the risk profile is much higher, but the as are the returns.
00:27:08.079 --> 00:27:10.000
So their education becomes critical.
00:27:10.160 --> 00:27:21.759
So being part of a community where you have people who've done this, walk the path before, who are able to guide you in terms of underwriting the right markets, making sure you don't make mistakes is super critical because you could easily lose money.
00:27:21.839 --> 00:27:27.759
Um, you know, if you're investing in the wrong market and working the wrong property and you don't know how to optimize your listing.
00:27:27.920 --> 00:27:31.839
Um, especially post-pandemic, not everyone does well in in that space.
00:27:31.920 --> 00:27:36.799
And so you really need to know what you're doing, both from acquiring the right property and then managing it henceforth.
00:27:36.960 --> 00:27:37.920
So there are two stages.
00:27:38.000 --> 00:27:40.000
And so really education becomes critical.
00:27:40.079 --> 00:27:45.119
Um and surrounding yourself with a community of people doing that, I think, uh is is super important.
00:27:45.440 --> 00:27:52.240
So I think you don't have to go just one way, but uh if you are investing in long-term rentals, there's obviously lower risk.
00:27:52.400 --> 00:27:59.200
And, you know, um syndications educate yourself there, there is there's the element of higher risk because of the debt profile over there.
00:27:59.359 --> 00:28:09.839
Short-term rentals also it's it's really important to um to really educate yourself and surround yourself with community and um you know spaces where education is is being highlighted.
00:28:10.160 --> 00:28:12.799
Yeah, I think um I I love that.
00:28:13.039 --> 00:28:20.400
And I so believe that real estate, there's just so many ways to dissect, you know, the business.
00:28:20.640 --> 00:28:22.720
There's not one way of doing it.
00:28:22.799 --> 00:28:26.640
Um, and there's so many creative ways of doing it nowadays.
00:28:26.880 --> 00:28:34.720
Um, even with technology, AI, it's it's been helping us to, you know, run our business, scale our business as well.
00:28:34.960 --> 00:28:38.079
And honestly, for me, short-term rental is kind of fun.
00:28:38.160 --> 00:28:44.880
You know, right now I think is a better market to get into short-term rental because everyone is trying to sell cheaply.
00:28:45.039 --> 00:28:50.000
I know uh Daniel has other opinions about short-term rentals right now.
00:28:50.240 --> 00:28:51.119
I'm getting out.
00:28:51.519 --> 00:28:52.160
Yeah.
00:28:52.480 --> 00:28:54.960
But, you know, and that's another episode.
00:28:55.119 --> 00:28:56.720
Stay tuned, everyone.
00:28:56.960 --> 00:28:59.440
Um, but you know, there's just so many ways.
00:28:59.519 --> 00:29:07.599
But what would you tell the physicians who want financial freedom, but it's too afraid to make that for the costly mistake?
00:29:08.000 --> 00:29:08.319
Yeah.
00:29:08.480 --> 00:29:12.720
So uh, you know, my opinion is that diversification is key, right?
00:29:12.799 --> 00:29:20.240
And I think most people should have about um at least 25 to 30 percent invested in alternative assets like real estate.
00:29:20.319 --> 00:29:26.240
And if you don't, if you're not doing that, you know, um, then um that it I feel that that's more risk to your portfolio.
00:29:26.319 --> 00:29:31.519
You know, you want to be non-correlated assets, you know, it's uh it I agree with what Ray Dalio says over there.
00:29:31.680 --> 00:29:36.000
And so um I think it's important to have a portion allocated to real estate.
00:29:36.079 --> 00:29:41.359
But like I said again, um, you know, risk uh mitigation is super critical, which is why we do that.
00:29:41.440 --> 00:29:43.680
That's what that's what um all of us do, right?
00:29:43.839 --> 00:29:49.440
Educating um and um helping to break those barriers down is critical, but also doing it the right way.
00:29:49.519 --> 00:29:57.440
Um we host events um to support people who are getting started in investing um and uh just just educating yourself is key.
00:29:57.680 --> 00:30:01.519
But um I think not investing in real estate is the actual risk.
00:30:01.599 --> 00:30:03.200
And and there's a percentage, right?
00:30:03.279 --> 00:30:14.079
It's not like throw all your money into real estate, but um diversification um you know, you know, I think uh is is is very important to have a resolution portfolio.
00:30:14.480 --> 00:30:15.440
Such great points.
00:30:15.599 --> 00:30:19.839
So let's uh just move now to just a few kind of rapid fire questions.
00:30:20.000 --> 00:30:28.079
So just sort of off the top of your head, but are there kind of a top two or three markets that you're really excited to invest in these days?
00:30:28.240 --> 00:30:28.960
What would you say?
00:30:29.200 --> 00:30:34.480
Um yeah, and so again, that differs for short-term rentals, long-term rentals, and multifamily, obviously.
00:30:34.720 --> 00:30:44.240
But um I'm still, and I know the Sun Belt has taken a beating these last few years from a rent growth perspective and occupancy, just because there's been a lot of um supply.
00:30:44.400 --> 00:30:46.640
But I'm still very bullish about the Sunbelt.
00:30:46.720 --> 00:30:48.880
It's very um, you know, landlord-friendly.
00:30:48.960 --> 00:30:51.759
Um, there's a lot of migration, the demographics are strong.
00:30:51.920 --> 00:31:05.519
And so for long-term rentals and for multifamily, I'm still bullish um as far as uh the Sunbelt goes, which is um, you know, Texas, um Tennessee, Georgia, Arizona, um, and Florida, um, and and even the Carolinas.
00:31:05.759 --> 00:31:13.920
And then for short-term rentals, it's obviously a completely different uh ballgame because I would say they're the market, you have your traditional vacation rental markets, you have metro markets.
00:31:14.000 --> 00:31:22.640
And so um the markets we like for traditional um rental, uh, you know, short-term rentals is the smoke case market, um, the Florida uh markets.
00:31:22.720 --> 00:31:24.559
Uh our students do really, really well there.
00:31:24.640 --> 00:31:26.079
A lot of them are scaling over there.
00:31:26.160 --> 00:31:38.960
And then I also say metro markets because I think for those investing in short-term rentals where you're really not sure if it's your cup of tea, you know, invest in a place where you could easily convert that to a long-term rental or where the numbers make sense for a long-term rental.
00:31:39.200 --> 00:31:41.599
A lot of our students do that, and they do that in Houston.
00:31:41.680 --> 00:31:45.119
They do that in um Phoenix, Arizona, uh, Tampa, Orlando.
00:31:45.200 --> 00:31:53.359
So I'd say when I say short-term rentals, my brain automatically goes to are you, you know, you are you bullish on it and do you want to be defensive when you're investing in short-term rentals.
00:31:53.440 --> 00:31:56.960
So I'd say I stood listen to two markets, but uh, but that's my take.
00:31:57.359 --> 00:31:59.519
Cap rate or cash on cash?
00:32:00.480 --> 00:32:02.160
Which one are you chasing?
00:32:02.480 --> 00:32:05.440
You know, um, we're chasing cash on cash.
00:32:05.599 --> 00:32:07.039
I feel like that's a huge buffer.
00:32:07.200 --> 00:32:15.599
I think most of the deals we've gotten into, even in this market, we've had at least five to seven percent cash flow day one, and that is before the business plan is executed.
00:32:15.680 --> 00:32:19.039
And that's what I looked for because that indicates a healthy DSC art.
00:32:19.279 --> 00:32:21.039
Um, it indicates a good buffer.
00:32:21.200 --> 00:32:23.680
And uh I think we're that's what we've been bullish on.
00:32:24.000 --> 00:32:24.319
All right.
00:32:24.480 --> 00:32:30.240
And is there anything sort of in your history where you felt like you got a really good piece of advice from a mentor?
00:32:30.319 --> 00:32:35.599
Or for example, maybe that first uh physician who has really got you into real estate investing.
00:32:35.759 --> 00:32:40.480
Do you remember any anecdotes or specific pieces of advice that you would want to pass on to our audience?
00:32:40.799 --> 00:32:41.359
Oh, okay.
00:32:41.519 --> 00:32:46.880
What stands out for me has been the fact that he always said, I'm just laughing all the way to the bank.
00:32:46.960 --> 00:32:48.160
You know, just stuck in my head.
00:32:48.240 --> 00:32:50.559
I was like, there must be something to this.
00:32:50.720 --> 00:33:00.880
Um, you know, and uh I think um I think when done right, it can it can be a huge boost to your um to your cash reserves, to your cash flow.
00:33:00.960 --> 00:33:03.680
And so yeah, that's that's probably the one thing that stuck with me.
00:33:04.000 --> 00:33:04.480
I love that.
00:33:04.559 --> 00:33:06.000
Laughing all the way to the bank.
00:33:06.160 --> 00:33:06.640
All right.
00:33:06.880 --> 00:33:10.240
Well, but um, this has been such a great interview.
00:33:10.400 --> 00:33:10.960
Thank you so much.
00:33:11.119 --> 00:33:13.920
Um I'm really glad we had a chance to finally chat like this.
00:33:14.079 --> 00:33:21.039
Uh if people want to learn more about your platform, um, I know there's a kind of a couple of varieties and ways to do that.
00:33:21.200 --> 00:33:24.559
What would you say the best way to learn more about you and your platform is?
00:33:24.880 --> 00:33:28.319
Yeah, so um, you know, I I think education has been key for us.
00:33:28.400 --> 00:33:30.079
And so we have two platforms, like you said.
00:33:30.160 --> 00:33:38.880
If you're thinking about it, you know, overall of real estate education, thinking about actively investing in real estate, then generationalwealthmd.com is the place to go.
00:33:38.960 --> 00:33:50.880
And we host um the 10x event um twice a year, where I really deep dive into all of what we've been talking about, right strategy, how do you make things work in this market, long-term rentals, short-term rentals, multifamily, everything.
00:33:50.960 --> 00:33:52.880
It's it's an amazing event, tons of content.
00:33:53.039 --> 00:33:59.519
And then for those who are thinking about investing passively and really learning to do it the right way, GW Capital is our site.
00:33:59.599 --> 00:34:06.480
And like I said, we have a free guide over there where you can, you know, you have your own due diligence checklist, you figure out how to do this right before you jump in.
00:34:06.559 --> 00:34:09.760
And that's gwcapital.com/slash guide and lowercase.
00:34:09.920 --> 00:34:15.280
I think those are the both of those sites have great resources for people looking to just get started.
00:34:15.440 --> 00:34:17.360
Um, and uh yeah, yeah.
00:34:17.440 --> 00:34:22.159
And so I'm very passionate about supporting people who are considering it and breaking down those barriers.
00:34:22.480 --> 00:34:22.880
All right.
00:34:22.960 --> 00:34:26.719
Well, thank you so much again for your time today, and hope to talk to you again soon.
00:34:26.960 --> 00:34:27.840
Thank you, Param.
00:34:28.079 --> 00:34:28.559
Thank you, guys.
00:34:28.639 --> 00:34:29.760
This has been so much fun.
00:34:30.079 --> 00:34:40.559
Thanks for tuning in to Paging Financial Freedom, where we help doctors and spouses like you take control of your finances, invest smarter, and build a life by design.
00:34:41.039 --> 00:34:48.800
If you enjoyed today's episode, don't forget to subscribe, leave us a five star review, and share this with someone who needs to hear it.
00:34:49.119 --> 00:34:53.360
And remember, financial freedom isn't just a dream, it's a decision.
00:34:53.519 --> 00:34:55.679
So let's get there together.
00:00:01.439 --> 00:00:08.880
Welcome to Paging Financial Freedom, a podcast about doctors and spouses and the journey to financial freedom through real estate and taxes.
00:00:09.199 --> 00:00:09.599
I'm Dr.
00:00:09.679 --> 00:00:12.320
Daniel Chen, a surgeon and real estate investor.
00:00:12.480 --> 00:00:17.440
You might know me on social media as the Storrentia Doctor or the founder of Surge Real Estate.
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And I'm Lila Kaplan, former Wall Street professional, certified financial planner, and the person on a mission to retire my orthopedic surgeon husband in the next five years.
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I specialize in apartment investing, helping doctors and their families build true financial freedom beyond their W-2 income.
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If you're interested in achieving tax-efficient financial freedom through real estate, you're in the right place.
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Let's get started.
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Hello and welcome back to Paging Financial Freedom.
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Today I'm really excited to be joined by Param Balandan Dapani.
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She's the physician founder behind Generational Wealth MD, and her platform focuses on helping physicians think more intentionally about real estate investing, passive income, financial independence, and building wealth in a way that fits their goals, constraints, and risk tolerance.
00:01:10.480 --> 00:01:25.439
So we're really excited to talk to her about her path in medicine, what led her to build Generational Wealth MD, and what physicians and spouses should understand before chasing financial freedom outside of that traditional sort of doctor career path.
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Welcome, Param.
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Welcome, welcome.
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Thank you, Danielle.
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Thank you, Laila.
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All right.
00:01:32.400 --> 00:01:38.000
So why don't we just uh start a little bit from uh the beginning, if you don't mind.
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Uh so a little bit about who are you, where are you from, and what drew you into medicine?
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Well, what drew me into medicine?
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Very interesting question.
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Because I think when I was born, my dad decided that I would become a physician.
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I think uh, you know, uh those of us with Asian backgrounds can relate to that.
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And so, but uh in hindsight, I'm I'm uh I'm very glad he chose that path for me.
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I think um I would have fumbled my way into medicine at some point, but I, you know, um I had a very straight path because that was what I was destined to become.
00:02:09.120 --> 00:02:12.159
Um and uh but I enjoyed my training, loved medicine.
00:02:12.240 --> 00:02:15.759
Uh, worked as a full-time radiologist for about 10 years.
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Uh, but um, you know, after um after completing my training.
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Um and uh yeah, so I guess uh I always knew that I'd become a physician.
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And I think you eventually ended up in California, right?
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That's that's where you were for quite a long time.
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Yes.
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So I trained on the uh on the East Coast, and then we moved to California because we are a physician household, both radiologists.
00:02:39.280 --> 00:02:47.599
And so I think it's um uh it come boils down to where I can find two jobs that we both were comfortable with, and we had a great opportunity in Central Valley, California.
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I moved there, and uh, I know you're from um Southern California also, Daniel, and it's it's a great place to to grow a family.
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And um, I'm from Southern India.
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I like the warm weather, so the weather was perfect.
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I don't think I would have lasted in New York any longer.
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Yeah, I I know that for a while we overlapped because I I think I was in LA and you were over the mountains, sort of in the central California area.
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Um and it was it was an amazing place to raise a family.
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But I've since moved, by the way.
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I live in uh Tennessee now uh for the last four years.
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So I I think uh, you know, it we've we've moved along from there.
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Uh do you still maintain a home base there or do you kind of travel around?
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I do, I do.
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This has been uh an well interesting last few years and definitely not something I thought about when I was thinking about financial freedom.
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I think when I initially worked towards financial freedom and building income streams out of outside of medicine, it was from the perspective of security.
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I wanted to have that buffer, you know, um uh a net.
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But um a lot has happened over the last few years.
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Um uh we have uh had both sets of parents really um had medical challenges, healthcare issues, they needed care.
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And um, because we were financially free, my husband and I were both able to um move back to India.
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We've spent um quite some time in India now uh with the kids.
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The kids are being homeschooled.
00:04:08.400 --> 00:04:10.000
And I I think it's just been a blessing.
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We just had the freedom to do what we want, and it's almost a byproduct of uh what we I built um our financial freedom for.
00:04:18.079 --> 00:04:24.720
But uh it's been uh it it truly I I'm very grateful for where we are and for the ability to do what we're doing now.
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Param, so let's unpack that a little bit.
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Um when you were a physician, what brought you to the real estate realm?
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Um why not something else?
00:04:36.959 --> 00:04:38.319
Okay, great question.
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Um, so I mean, uh just my background, you know, the community, the uh the place where I'm from.
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Um I think there's this traditional belief that you always invest in real estate and gold, right?
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And in hindsight, now that I think about it, it's because those are inflation-controlled assets, right?
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So that's a saying, that's a saying that's been there for generations.
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And I think what it did is that my parents have were also financially free in their 40s, and they it was primarily through real estate.
00:05:04.800 --> 00:05:13.600
And so um, I don't think I necessarily carried that information over uh when I moved to uh when I migrated to America, but it did break down barriers, right?
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So there wasn't like a huge barrier to investing in real estate for me, just because I've seen so many success stories.
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I think it's harder for other people um when they haven't seen that, right?
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So that's the background.
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And then when I moved to um when I was training in New York right after fellowship, uh my first job, uh my colleague, I taught him to read breast MRI and he taught me to invest in um dividend aristocrats uh in the stock market.
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And then he also was a third-generation real estate investor who had never seen his properties.
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He lived in um New York and his properties were in Tennessee, which is where ironically, that's where you're from, right?
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Uh where you live now, um Daniel.
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And um, you know, he just said, I, you know, whatever happens at work, I just, you know, I get a paycheck, I get uh, you know, mailbox money, and I just laugh all the way to the bank.
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And he was like, Perh, I'm gonna introduce you to my teams.
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You should do this.
00:06:03.920 --> 00:06:05.519
And that's how things got started.
00:06:05.600 --> 00:06:11.759
It wasn't, um, it wasn't because of knowledge that was directly passed to me from my parents, but I think it definitely broke down a lot of barriers.
00:06:11.920 --> 00:06:17.439
And I had this opportunity, it's almost like piggybacking onto somebody else's team and their knowledge.
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Uh, and I'm really grateful for that because that's how I bought my first property.
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And and again, a lot of people may resonate with this.
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It was three years from when he told me to invest in real estate and he introduced me to his teams to when I started investing.
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And that's because I had a spouse who was hesitant um to invest in real estate because of his background, because of his experiences growing up.
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And uh, and then eventually one day I was like, you know what, this is diversification within the family.
00:06:43.439 --> 00:06:47.120
I'll invest in real estate, and you be the non-real estate investor.
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And I just, you know, got my first property and um, and from there, and I I would say the first seven years I invested in real estate, I was super passive, very hands-off, just bought a long-term rental.
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Every time I went on maternity leave, I got a long-term rental, right?
00:07:00.720 --> 00:07:04.160
And so there's all a four-year gap um between those properties.
00:07:04.399 --> 00:07:14.079
Um, but um 2020, um, right, right during the pandemic, 2019, 2020, we had um both of us are radiologists work for the same company.
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There was a merger at work, and we both um, you know, weren't given partnership track and we decided to um, you know, um uh to not join that practice.
00:07:23.199 --> 00:07:27.759
And um that was a really rough transition because both of us lost our jobs uh around the same time.
00:07:27.920 --> 00:07:29.600
My daughter was under a year old.
00:07:29.680 --> 00:07:31.920
We just bought the doctor home in California.
00:07:32.160 --> 00:07:33.759
You know, it was a it was a rough transition.
00:07:33.839 --> 00:07:43.839
It took us a year to get back uh on our feet, and then the pandemic hit, and it was again, uh, I had a you know compressed work schedule, kids were home, no, no childcare.
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Yeah, it was it was rough.
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And so that's when I really started looking at um financial freedom and understanding my numbers.
00:07:50.399 --> 00:07:57.439
And I realized it would take me 17 years to get to financial freedom through the stock market, and I could do it in a couple of years with real estate.
00:07:57.600 --> 00:07:58.720
So I started scaling.
00:07:58.800 --> 00:08:08.160
Um, I did short-term rentals, used all the tax strategies that Daniel and uh Lila, I'm sure you guys talk about on your podcast, and especially with you, Lila, being a real estate professional.
00:08:08.240 --> 00:08:10.399
Um and that really accelerated my path.
00:08:10.720 --> 00:08:12.319
Like I said, it was for security, right?
00:08:12.399 --> 00:08:14.560
That's why I got into scaling real estate.
00:08:14.800 --> 00:08:22.160
A year within within a year and a half of when I made that decision to really start accelerating my portfolio, like we hit financial freedom.
00:08:22.240 --> 00:08:24.240
And so that's how things got started.
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And then I built a community and we've taken um, yeah.
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So a lot has happened since then, but that was how it got started.
00:08:31.920 --> 00:08:36.879
So was your first couple of properties single family, multifamily?
00:08:37.919 --> 00:08:39.039
Where did you start?
00:08:39.360 --> 00:08:41.519
My first couple of properties, yeah.
00:08:41.679 --> 00:08:45.679
Um, so when I started again, I was uh an out of state investor.
00:08:45.840 --> 00:08:49.120
Uh my first few properties were in Houston, Texas.
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Um, and since then we've bought apartments there, right?
00:08:51.919 --> 00:08:54.639
And we syndicate properties and we have investors there.
00:08:54.799 --> 00:09:02.080
I visited Houston quite a few times to uh visit the properties, but I haven't set eyes on my single family homes there to date, right?
00:09:02.159 --> 00:09:03.519
So I've been very hands-off.
00:09:03.679 --> 00:09:07.919
I haven't met my property managers there, but I invested as an out-of-state investor.
00:09:08.000 --> 00:09:18.480
Um, and so that was all my personal portfolio is mostly single-family homes and townhomes, um, and then a few apartment complexes, uh, but uh it's predominantly single-family homes.
00:09:18.960 --> 00:09:24.639
So that timeline to financial freedom was really compressed and honestly pretty rapid.
00:09:24.720 --> 00:09:30.480
Uh, do you think that's typical or is that kind of something special about um Param?
00:09:30.879 --> 00:09:37.200
Uh, what is what is a typical kind of path to financial freedom look like for most families, would you say, physician families?
00:09:37.440 --> 00:09:39.120
Yeah, that's a great question, Daniel.
00:09:39.279 --> 00:09:43.840
And so I think it can look very different depending on the strategies you use, right?
00:09:43.919 --> 00:09:54.480
So like I mentioned, the first few properties I purchased and I was very passive in um, you know, um, I just buy something that I could rent and uh and you know, it was just mailbox money.
00:09:54.720 --> 00:10:00.000
But when I started accelerating my path, uh, I think that make and I would say that there are three buckets, right?
00:10:00.080 --> 00:10:02.559
Most people, I would say, fall into one of three buckets.
00:10:02.639 --> 00:10:06.480
Uh, but then when I accelerated, I actually started getting active in those strategies.
00:10:06.639 --> 00:10:10.559
I started using tax strategies, um, I started rehabbing properties, right?
00:10:10.639 --> 00:10:13.759
Um, and so I started recycling the same pot of money over and over again.
00:10:13.840 --> 00:10:17.919
And so what I like to say is I think people fall into three buckets typically.
00:10:18.000 --> 00:10:20.320
Um, and there is the passive investor.
00:10:20.480 --> 00:10:23.279
That's people who really value their time.
00:10:23.440 --> 00:10:27.039
They have capital, they want to invest in real estate, but they want to be very, very hands-off.
00:10:27.200 --> 00:10:32.159
That could be people who invest in long-term rentals or people invest in syndications passively, right?
00:10:32.240 --> 00:10:34.960
Like that's uh that's what a lot of people in your community do also.
00:10:35.200 --> 00:10:45.519
Because you're pretty passive, you still get the benefit of tax-sufficient income that comes from real estate, and it's still significantly higher in the long term over what you'd make in the stock market.
00:10:45.919 --> 00:10:55.600
Um, but uh, you know, you don't necessarily uh tap into active tax strategies that allow you to shelter your uh clinical income or W-2 income from taxes.
00:10:55.759 --> 00:11:01.120
And the opposite end of the spectrum, I have what I call the um the entrepreneur, right?
00:11:01.200 --> 00:11:11.120
And so this is someone who invests in, say, short-term rentals or is a syndicator, uh, uh like uh you, Danielle, someone who is a general partner in apartment deals.
00:11:11.200 --> 00:11:13.519
And so it's almost like having a business, right?
00:11:13.600 --> 00:11:29.120
So you're on the active side, um, but you get the benefit of having significantly higher returns and tapping into, you know, more advanced tax strategies where you're now getting tax savings that you can use to shelter your W-2 or 1099 or clinical income from taxes, right?
00:11:29.200 --> 00:11:33.919
And so um you're putting in a little more time and effort over there, but you're getting rewarded for that.
00:11:34.080 --> 00:11:37.279
And, you know, and time and effort, again, it's it depends on systems.
00:11:37.440 --> 00:11:41.279
We have a lot of people who do that who probably spend two to three hours a week on their portfolio.
00:11:41.440 --> 00:11:50.159
So there are ways to really uh become efficient over there, but your returns are significantly higher and you're starting to tap into some of those advanced tax strategies.
00:11:50.320 --> 00:11:54.320
And I'd say in the middle, you have people who I call the hustlers.
00:11:54.480 --> 00:12:09.440
These are people who maybe do midterm rentals or do the burst strategy where you rehab some properties and you know you're definitely a little more hands-on than the passive investor and you get higher returns, but you may not be able to qualify as a real estate professional, right?
00:12:09.519 --> 00:12:11.600
And and tap into those um those strategies.
00:12:11.759 --> 00:12:12.879
So there's a spectrum.
00:12:13.120 --> 00:12:20.000
And I think the first question I ask people when I talk to them, and I'm sure you do, Daniel, is like, where do you see yourself on this spectrum, right?
00:12:20.080 --> 00:12:22.320
And so there's not one answer for everyone.
00:12:22.480 --> 00:12:26.960
If you're on the passive path, it can take you 10 to 15 years to get to financial freedom.
00:12:27.120 --> 00:12:31.279
But once you start getting really active, and you know, it could be for a short duration.
00:12:31.440 --> 00:12:36.320
Um, I was pretty active for a year and a half and I did rehabs without a general contractor.
00:12:36.480 --> 00:12:40.960
I invested in short-term rentals, and so I hit financial freedom in say 18 months.
00:12:41.120 --> 00:12:44.080
And then you could always, you know, it's all very fluid.
00:12:44.240 --> 00:12:46.559
And that now my entire portfolio is very passive.
00:12:46.639 --> 00:12:48.799
Like they're they're all converted into long-term rentals.
00:12:49.200 --> 00:12:52.320
Property managers manage them, I spend less than a month a week on them, right?
00:12:52.399 --> 00:12:55.120
And so it depends on where you are on that spectrum.
00:12:55.440 --> 00:12:58.080
Your timeline's going to differ depending on that.
00:12:58.240 --> 00:13:00.320
But again, like I said, it's very fluid.
00:13:00.559 --> 00:13:04.960
And uh you don't necessarily have to think you're boxed into one of those strategies.
00:13:05.360 --> 00:13:05.840
Got it.
00:13:06.000 --> 00:13:06.320
Okay.
00:13:06.639 --> 00:13:16.000
So I think a lot of our audience will hear the term financial freedom and sort of automatically assume that that means quitting medicine and and leaving medicine.
00:13:16.080 --> 00:13:17.759
But was that where was that?
00:13:17.840 --> 00:13:20.000
Um, how was that progression for you?
00:13:20.159 --> 00:13:27.279
Like as soon as you hit financial freedom, was it, you know, no more radiology, or was it kind of a more sort of slow progression for you?
00:13:27.600 --> 00:13:27.759
Yeah.
00:13:27.840 --> 00:13:32.000
Was there a goal or a threshold that you were looking to achieve?
00:13:32.320 --> 00:13:32.639
Yeah.
00:13:32.799 --> 00:13:35.200
I mean, so like this is geoarbitrage, right?
00:13:35.279 --> 00:13:41.759
So Daniel's in uh when when he we he was in California, you were closer to LA and I was in Central Valley, California.
00:13:41.919 --> 00:13:47.759
So what I needed um to be financially free was uh$10,000 uh post-tax, right?
00:13:47.840 --> 00:13:50.799
When I hit that number, I was like, okay, I could do whatever I want to.
00:13:50.960 --> 00:13:55.440
And I went down um honestly, like uh my intention wasn't to quit medicine completely.
00:13:55.519 --> 00:13:56.720
I liked what I was doing.
00:13:56.960 --> 00:13:58.799
It was just that my kids were still home.
00:13:58.879 --> 00:14:04.399
Um, you know, they were being homeschooled, and um, because of you know the post-pandemic years, we just we chose to keep them home.
00:14:04.559 --> 00:14:07.440
And so I was working a day a week in medicine.
00:14:07.519 --> 00:14:10.159
Uh, but then, you know, generational wealth MD grew.
00:14:10.240 --> 00:14:14.639
We now have 20,000 doctors, and then the coaching um uh portion grew.
00:14:14.720 --> 00:14:17.519
And I I loved doing that, the impact we over have over there.
00:14:17.600 --> 00:14:21.519
And then, you know, 85% of our community wanted to be passive investors.
00:14:21.600 --> 00:14:24.879
So we built GW Capital, which was the passive syndication part.
00:14:25.039 --> 00:14:27.919
And I think there came a point where I was like, something has to give.
00:14:28.080 --> 00:14:33.279
And, you know, I I think Lila and and Daniel, you understand this when you're a parent, you're a full-time parent, right?
00:14:33.360 --> 00:14:34.799
It doesn't matter what else happens.
00:14:34.879 --> 00:14:38.879
And so um, medicine was what I had to, and it was a very hard decision.
00:14:38.960 --> 00:14:44.399
It was like a, you know, huge identity crisis because I think we identify ourselves as physicians so strongly.
00:14:44.480 --> 00:14:49.440
So it wasn't an easy choice, but at that time, I felt like that was the best choice for my family.
00:14:49.679 --> 00:14:56.080
But I also maintain that, you know, financial freedom, like I said, initially was mostly for security.
00:14:56.240 --> 00:15:04.000
And so I think all of us need to practice medicine because we get to and we want to, not because we have to, not because we need to bring the paycheck in.
00:15:04.159 --> 00:15:09.759
So I think the goal is to just get you to the point where if you have any transitions in your life, right?
00:15:09.919 --> 00:15:11.840
I I think most of us are in cruise control mode.
00:15:12.000 --> 00:15:14.080
We can work another 20 years, that's great.
00:15:14.240 --> 00:15:18.399
But if you start get into crisis mode for any reason, I just want us to have options.
00:15:18.480 --> 00:15:22.799
And and, you know, honestly, our family, we got into crisis mode uh a year ago.
00:15:23.039 --> 00:15:24.879
I lost my dad three months ago.
00:15:25.120 --> 00:15:31.279
And because of uh of where we were financially, we were able to relocate back home to India.
00:15:31.440 --> 00:15:36.559
And I don't think that was an option that would have been available to us if we didn't have financial freedom.
00:15:36.720 --> 00:15:44.080
And so, um, so I think it it's absolutely necessary, and then you get to do whatever you want to do, and it's gonna look different for many of us.
00:15:44.159 --> 00:15:54.399
I just hope we just have many more satisfied physicians who aren't burnt up who are practicing medicine and they have the ability to negotiate and do what they want and practice how they want to.
00:15:54.960 --> 00:16:03.279
Parem, earlier you talked about getting into real estate, and I think you mentioned that your husband wasn't completely gun-ho about it.
00:16:03.519 --> 00:16:06.720
He sounds like he's a little bit more risk averse.
00:16:07.039 --> 00:16:14.000
What conversation needed to happen between you and him in order for you to move forward?
00:16:14.159 --> 00:16:17.759
Or maybe you didn't and you just did your own thing because that's kind of what I do.
00:16:17.919 --> 00:16:22.799
I just make my husband sign on the dotted line every time I want to buy another building.
00:16:25.360 --> 00:16:28.960
Oh, oh yes, and so everyone has a different dynamic, right?
00:16:29.039 --> 00:16:30.000
So good for you.
00:16:30.159 --> 00:16:34.159
Um, I think for me, and you know, what you said makes complete sense like that, right?
00:16:34.240 --> 00:16:41.519
So when people identify as risk-averse, it highlights a key concept because a lot of people look at real estate and they think it's risky, right?
00:16:41.679 --> 00:16:51.600
And honestly, for me at that point, um, not shifting things seemed more risky because I couldn't do that, do what we were doing for another 20 years without having options, right?
00:16:51.759 --> 00:16:54.399
And uh honestly, real estate is risky.
00:16:54.559 --> 00:16:58.720
Uh, and uh, and and you know, all three of us have been doing it for a while.
00:16:58.799 --> 00:17:04.799
And there are bumps along the way, but the truth is there is a way to do it where you can reduce risk significantly.
00:17:04.960 --> 00:17:14.400
A lot of that has to do with diversification, really understanding your numbers, um, buying properties with a buffer there, um, right, and then really taking on conservative debt.
00:17:14.480 --> 00:17:17.279
And I can go on and on and on, but there is a way to do it.
00:17:17.440 --> 00:17:19.039
There, there's a right way to do it.
00:17:19.119 --> 00:17:21.680
Um, and there's a way to introduce diversification in there.
00:17:21.759 --> 00:17:23.759
So you're lowering your risk significantly.
00:17:23.839 --> 00:17:29.680
And that's a big part, I think, of what people need uh need to learn before they start investing in real estate, right?
00:17:29.759 --> 00:17:38.319
Um, and uh, and like I said, um, he uh, you know, um, I didn't really have those barriers to investing in real estate because I've seen success stories.
00:17:38.480 --> 00:17:44.160
So what happened with us is was that um I eventually decided to, well, like I said, it was diversification looking at the family.
00:17:44.240 --> 00:17:48.000
I said, you know, um, you be the bond investor, I'll invest in real estate.
00:17:48.240 --> 00:17:51.759
And and because end of the day, the family reaps the benefits, right?
00:17:51.920 --> 00:18:00.000
And so I'd say six years into my journey, he looked at the numbers, he saw we were um, I think we were getting close to financial freedom at that point.
00:18:00.079 --> 00:18:02.480
And he was like, wow, this makes, this makes a lot of sense.
00:18:02.559 --> 00:18:08.559
And so now he's investing, he invests um in uh passively in our syndication opportunities that we have in GW.
00:18:08.720 --> 00:18:09.839
And so he's converted.
00:18:10.160 --> 00:18:10.400
Yeah.
00:18:10.559 --> 00:18:12.880
So so let's go a little deeper on that.
00:18:13.039 --> 00:18:15.279
Um, you said not taking risks.
00:18:15.359 --> 00:18:25.039
And I just find, you know, in speaking with doctors, you know, a lot of them don't take on real estate because it's a risk, and obviously it's a lot of time spent as well.
00:18:25.200 --> 00:18:29.279
And you said, you know, there's ways of alleviating those risks.
00:18:29.440 --> 00:18:38.720
Can you just give some real life examples so that our audience can understand what those hedges or um, you know, possibilities are?
00:18:39.200 --> 00:18:46.559
Yeah, so I think there, and so if I were to give examples, I think I'll start off with examples and then without getting too theoretical, right?
00:18:46.799 --> 00:18:55.359
Um, and so we have students, and so I would say the last two years, the real estate market had we've had high interest rates, uncertainty in the economy.
00:18:55.519 --> 00:19:01.920
And so we've had, I mean, I think for most people, that would probably they would call that one of the riskiest times to be investing in real estate.
00:19:02.160 --> 00:19:05.920
And we still have students in our community who've invested in real estate.
00:19:06.079 --> 00:19:14.000
They've increased their gross revenue from their portfolio to a million dollars, uh, you know, and uh, you know, half of that can be cash flow.
00:19:14.240 --> 00:19:22.480
We've had students who've sheltered close to a million dollars of income from taxes, and that's, you know, that's a guarantee, that's a guarantee, no matter what part of the market cycle you're in.
00:19:22.640 --> 00:19:35.680
Um, and people do this while they're in spending with the right systems in place, they spend two or three hours a week on a portfolio that generates twice as much as they do in clinical medicine, where they possibly have to pay zero dollars in taxes, right?
00:19:35.759 --> 00:19:37.200
And so there is a way to do it.
00:19:37.359 --> 00:19:42.160
And if I were to break it down, um now I'm getting to the like the theoretical part, right?
00:19:42.400 --> 00:19:45.119
I think the risk is exists in in three stages, right?
00:19:45.279 --> 00:19:46.640
You have to buy the right property.
00:19:46.720 --> 00:19:52.400
Um, I think with real estate, it's really important to have a longer-term strategy that itself lowers risk.
00:19:52.640 --> 00:19:58.720
You need to buy properties with the right basis because buying it right, you know, is is so crucial.
00:19:58.799 --> 00:20:04.960
Um, you can't just um buy because, you know, it's the next, it's like the shiny object syndrome, someone else is doing it.
00:20:05.200 --> 00:20:08.880
If you catch it at the wrong time part of the market cycle, then we all suffer, right?
00:20:09.039 --> 00:20:12.400
So buying right is a is a is a big uh important part, the right markets.
00:20:12.480 --> 00:20:18.720
And so like Daniel shifted from a um a tenant-friendly market to a landlord-friendly market, right?
00:20:18.880 --> 00:20:23.359
And so whenever I listen to where people are from, I was like, okay, great, that's a great market for you to be investing in.
00:20:23.440 --> 00:20:26.400
So knowing your market, understanding that, all of that is really important.
00:20:26.480 --> 00:20:28.240
So buying right is the first piece.
00:20:28.480 --> 00:20:32.400
The second piece is um having the ability to hold on to the asset.
00:20:32.559 --> 00:20:37.279
And so all of us have seen in the last few years, we've seen a lot of projects suffer.
00:20:37.440 --> 00:20:44.000
Um, and a big part of that is um when you aren't able to hold on to the asset because you have the wrong kind of debt on the property, right?
00:20:44.079 --> 00:20:55.200
So debt is really critical, which, you know, the the flip side to that is if you're buying a long-term rental or a short-term rental with 30 year debt over there, now that debt is very, very conservative, right?
00:20:55.279 --> 00:20:56.480
So it's very forgiving.
00:20:56.720 --> 00:21:00.799
And so, but when you're investing in apartments, the debt piece can be can be huge, right?
00:21:00.960 --> 00:21:03.200
Having adequate cash reserves, that can be huge.
00:21:03.279 --> 00:21:07.119
And so that's that's a piece about having the ability to hold on to the asset.
00:21:07.279 --> 00:21:08.079
That's the second part.
00:21:08.240 --> 00:21:13.039
And then the third part um is always controlling the things that you can control.
00:21:13.359 --> 00:21:24.480
And that's where I think um, especially if you look at syndications um and uh general partners, the last few years, the operators who thrived are those who are able to control expenses, right?
00:21:24.559 --> 00:21:31.039
When you're in a market where you can't manage rents, where you can't manage occupancy, um, there are still a lot of things that you can control.
00:21:31.279 --> 00:21:43.680
Value add, uh, when you're able to go in and um increase the value of a property rapidly by increasing its income, um, um, by doing a rehab, you know, that's a way where you control, you control the returns, right?
00:21:43.839 --> 00:21:44.960
That's not market driven.
00:21:45.119 --> 00:21:47.200
Now, it hasn't been the best environment to do it.
00:21:47.359 --> 00:21:51.119
The last two years, operational uh expense control has been a huge part of it.
00:21:51.279 --> 00:21:53.839
A lot of what we've been doing is creative value add, right?
00:21:53.920 --> 00:21:59.599
We go in, we partner with the Houston Housing Authority on some of our projects, reduce property taxes 80%.
00:22:00.319 --> 00:22:00.720
90%.
00:22:01.039 --> 00:22:03.039
That's something that we have control over.
00:22:03.440 --> 00:22:03.680
Right.
00:22:03.839 --> 00:22:08.400
Our students invest in short-term rentals or they have real estate professional status.
00:22:08.559 --> 00:22:11.759
In any market cycle, you're able to tap into those tax savings, right?
00:22:11.839 --> 00:22:13.119
That's market independent.
00:22:13.279 --> 00:22:16.319
So there are a lot of ways where you can control those variables.
00:22:16.720 --> 00:22:18.559
Your strategy is one part of that.
00:22:19.119 --> 00:22:22.480
Creative financing, creative value add, right?
00:22:22.559 --> 00:22:31.599
So a lot of different ways, and I can go on and on, but there are those three pieces I think that are critical to risk management, buying right, having the ability to hold on to an asset.
00:22:31.759 --> 00:22:43.279
And then the third piece is controlling the variables that you do have control over because the returns from real estate are multifold and market pricing is one piece of it, but you have all those other levers that you can't pull.
00:22:43.519 --> 00:22:43.680
Yeah.
00:22:43.759 --> 00:22:46.480
So that those are really incredible tips there.
00:22:46.640 --> 00:22:54.720
And you know, as a you have a very unique perspective in that you're in multiple asset classes, your students are in multiple asset classes.
00:22:54.880 --> 00:23:05.440
Um, could you speak a little bit more about the investors who were investing even passively in syndications around the time when interest rates started going up?
00:23:05.599 --> 00:23:08.480
And all of a sudden those deals stopped cash flowing.
00:23:08.640 --> 00:23:13.599
Um obviously you don't have a crystal ball, but where do you think we are sort of in that cycle?
00:23:13.759 --> 00:23:20.480
And are you seeing opportunity now from those deals that are kind of falling apart from that time period?
00:23:20.799 --> 00:23:21.359
Yeah, yeah.
00:23:21.440 --> 00:23:24.960
And so that's a that's a very important discussion to have, right, Daniel?
00:23:25.039 --> 00:23:29.759
Um, because many of us have been burnt by assets that we acquired in 22 and 23.
00:23:29.920 --> 00:23:33.039
March 2022 was the top of this current market cycle.
00:23:33.200 --> 00:23:38.559
Since then, asset values have dropped, um, interest rates have gone up, and um cash flow has dwindled, right?
00:23:38.640 --> 00:23:40.960
Just because of that high interest rate in my mind.
00:23:41.039 --> 00:23:47.279
And uh, you know, we've struggled with a few of our deals that we acquired in 22 and 23, like most syndicators.
00:23:47.440 --> 00:24:17.039
Um, and um yeah, I think uh it's you know, it's this, this, this, the psychology piece, interestingly, is that when we're at the top of the market cycle, that's when people are very, very enthusiastic about investing in real estate because they've seen um, you know, they've seen those price hikes, they've seen the inflation correlated increase in rents, increase in prices, the the the mass L ROI that people um, you know, that exited deals in 2019, 2020, and 2021 had.
00:24:17.200 --> 00:24:22.559
And everyone's super excited about investing in real estate, but that's where the risk is the highest.
00:24:22.799 --> 00:24:31.759
And when we're where where we are where we are now, which is at the bottom of the market cycle, trending back upwards, this is where investor sentiment is at its lowest.
00:24:31.920 --> 00:24:37.359
Um, and uh, and you know, people want to stay away from real estate because they've been burned.
00:24:37.680 --> 00:24:43.440
But uh, you know, the seasoned real estate investor knows that this is also part of diversification, right?
00:24:43.599 --> 00:24:45.920
You have temporal diversification also.
00:24:46.160 --> 00:24:56.799
Um, and um, for you to lower risk in real estate, you know, you need geographic diversification, you need asset class diversification, um, but you also need to diversify temporally and you keep investing.
00:24:56.880 --> 00:25:01.759
It's almost like the dollar cost of investing, um averaging that you do in the stock market, right?
00:25:02.000 --> 00:25:06.559
This is the time where you have the most opportunity, although it's things seem the bleakest.
00:25:06.640 --> 00:25:09.759
Um, and we're getting deals at a great basis, right?
00:25:09.920 --> 00:25:18.400
We are still um seeing um different niches like manufactured housing, self-storage, industrial, um, where the numbers are really making a lot of sense.
00:25:18.480 --> 00:25:23.759
Um, but it's also the time where investors are, it's you know, um investor sentiment is at its worst.
00:25:23.920 --> 00:25:36.240
And the the the the challenge with investing, and I think that the trick is to be that investor who's able to zoom out, um, see, see things for what they are, keep emotions out of it, and then invest in it based on the numbers.
00:25:36.400 --> 00:25:41.680
And and I think this is um this is our 08, 09, um, you know, for for our generation.
00:25:41.759 --> 00:25:43.599
And I think we have a lot of opportunity.
00:25:43.759 --> 00:25:44.799
We're seeing a lot of deals.
00:25:45.039 --> 00:25:46.559
We're getting a great basis.
00:25:46.960 --> 00:25:56.319
So getting towards the end here, you know, for physicians today, obviously physicians, average work week is 50 hours a week, 60 hours a week.
00:25:56.640 --> 00:26:03.440
What would you say a good starting point is to get acquainted with the even the concept of investing or real estate investing?
00:26:03.519 --> 00:26:04.880
What's a good way to start?
00:26:05.200 --> 00:26:12.960
Um, yeah, so I think, like I said, you know, uh originally there are three buckets and there are the three ways to get started um investing in real estate.
00:26:13.039 --> 00:26:15.839
And I think that's the first question most people should answer.
00:26:16.079 --> 00:26:24.799
If they are considering being passive in real estate, then I think a great way to get started is investing in syndications, but doing their own due diligence is also critical.
00:26:24.960 --> 00:26:27.680
Um, and so there are lots of resources um for that.
00:26:27.759 --> 00:26:34.319
Um the um, I think it's what is the passive um investor handbook, uh, um, The Hands Off Investor.
00:26:34.400 --> 00:26:37.039
The Hands Off Investor by Brian Burke is a great book.
00:26:37.200 --> 00:26:42.400
Um, we have a due diligence worksheet uh at gwcapital.com slash guide.
00:26:42.559 --> 00:26:43.839
I'm sure you have resources.
00:26:44.000 --> 00:26:48.799
So really listening to podcasts, educating yourselves, even as a passive investor, is critical.
00:26:49.039 --> 00:26:55.839
And then there are those who start off and um they say, well, taxes are a big pain point, so I want to start off with a short-term rental.
00:26:56.000 --> 00:27:03.359
And I think uh if that's something you're considering, and you've done this, Daniel, um, and I don't know if you have, Lila, but um, you know, we've invested in short-term rentals.
00:27:03.440 --> 00:27:07.920
And and that's something where the risk profile is much higher, but the as are the returns.
00:27:08.079 --> 00:27:10.000
So their education becomes critical.
00:27:10.160 --> 00:27:21.759
So being part of a community where you have people who've done this, walk the path before, who are able to guide you in terms of underwriting the right markets, making sure you don't make mistakes is super critical because you could easily lose money.
00:27:21.839 --> 00:27:27.759
Um, you know, if you're investing in the wrong market and working the wrong property and you don't know how to optimize your listing.
00:27:27.920 --> 00:27:31.839
Um, especially post-pandemic, not everyone does well in in that space.
00:27:31.920 --> 00:27:36.799
And so you really need to know what you're doing, both from acquiring the right property and then managing it henceforth.
00:27:36.960 --> 00:27:37.920
So there are two stages.
00:27:38.000 --> 00:27:40.000
And so really education becomes critical.
00:27:40.079 --> 00:27:45.119
Um and surrounding yourself with a community of people doing that, I think, uh is is super important.
00:27:45.440 --> 00:27:52.240
So I think you don't have to go just one way, but uh if you are investing in long-term rentals, there's obviously lower risk.
00:27:52.400 --> 00:27:59.200
And, you know, um syndications educate yourself there, there is there's the element of higher risk because of the debt profile over there.
00:27:59.359 --> 00:28:09.839
Short-term rentals also it's it's really important to um to really educate yourself and surround yourself with community and um you know spaces where education is is being highlighted.
00:28:10.160 --> 00:28:12.799
Yeah, I think um I I love that.
00:28:13.039 --> 00:28:20.400
And I so believe that real estate, there's just so many ways to dissect, you know, the business.
00:28:20.640 --> 00:28:22.720
There's not one way of doing it.
00:28:22.799 --> 00:28:26.640
Um, and there's so many creative ways of doing it nowadays.
00:28:26.880 --> 00:28:34.720
Um, even with technology, AI, it's it's been helping us to, you know, run our business, scale our business as well.
00:28:34.960 --> 00:28:38.079
And honestly, for me, short-term rental is kind of fun.
00:28:38.160 --> 00:28:44.880
You know, right now I think is a better market to get into short-term rental because everyone is trying to sell cheaply.
00:28:45.039 --> 00:28:50.000
I know uh Daniel has other opinions about short-term rentals right now.
00:28:50.240 --> 00:28:51.119
I'm getting out.
00:28:51.519 --> 00:28:52.160
Yeah.
00:28:52.480 --> 00:28:54.960
But, you know, and that's another episode.
00:28:55.119 --> 00:28:56.720
Stay tuned, everyone.
00:28:56.960 --> 00:28:59.440
Um, but you know, there's just so many ways.
00:28:59.519 --> 00:29:07.599
But what would you tell the physicians who want financial freedom, but it's too afraid to make that for the costly mistake?
00:29:08.000 --> 00:29:08.319
Yeah.
00:29:08.480 --> 00:29:12.720
So uh, you know, my opinion is that diversification is key, right?
00:29:12.799 --> 00:29:20.240
And I think most people should have about um at least 25 to 30 percent invested in alternative assets like real estate.
00:29:20.319 --> 00:29:26.240
And if you don't, if you're not doing that, you know, um, then um that it I feel that that's more risk to your portfolio.
00:29:26.319 --> 00:29:31.519
You know, you want to be non-correlated assets, you know, it's uh it I agree with what Ray Dalio says over there.
00:29:31.680 --> 00:29:36.000
And so um I think it's important to have a portion allocated to real estate.
00:29:36.079 --> 00:29:41.359
But like I said again, um, you know, risk uh mitigation is super critical, which is why we do that.
00:29:41.440 --> 00:29:43.680
That's what that's what um all of us do, right?
00:29:43.839 --> 00:29:49.440
Educating um and um helping to break those barriers down is critical, but also doing it the right way.
00:29:49.519 --> 00:29:57.440
Um we host events um to support people who are getting started in investing um and uh just just educating yourself is key.
00:29:57.680 --> 00:30:01.519
But um I think not investing in real estate is the actual risk.
00:30:01.599 --> 00:30:03.200
And and there's a percentage, right?
00:30:03.279 --> 00:30:14.079
It's not like throw all your money into real estate, but um diversification um you know, you know, I think uh is is is very important to have a resolution portfolio.
00:30:14.480 --> 00:30:15.440
Such great points.
00:30:15.599 --> 00:30:19.839
So let's uh just move now to just a few kind of rapid fire questions.
00:30:20.000 --> 00:30:28.079
So just sort of off the top of your head, but are there kind of a top two or three markets that you're really excited to invest in these days?
00:30:28.240 --> 00:30:28.960
What would you say?
00:30:29.200 --> 00:30:34.480
Um yeah, and so again, that differs for short-term rentals, long-term rentals, and multifamily, obviously.
00:30:34.720 --> 00:30:44.240
But um I'm still, and I know the Sun Belt has taken a beating these last few years from a rent growth perspective and occupancy, just because there's been a lot of um supply.
00:30:44.400 --> 00:30:46.640
But I'm still very bullish about the Sunbelt.
00:30:46.720 --> 00:30:48.880
It's very um, you know, landlord-friendly.
00:30:48.960 --> 00:30:51.759
Um, there's a lot of migration, the demographics are strong.
00:30:51.920 --> 00:31:05.519
And so for long-term rentals and for multifamily, I'm still bullish um as far as uh the Sunbelt goes, which is um, you know, Texas, um Tennessee, Georgia, Arizona, um, and Florida, um, and and even the Carolinas.
00:31:05.759 --> 00:31:13.920
And then for short-term rentals, it's obviously a completely different uh ballgame because I would say they're the market, you have your traditional vacation rental markets, you have metro markets.
00:31:14.000 --> 00:31:22.640
And so um the markets we like for traditional um rental, uh, you know, short-term rentals is the smoke case market, um, the Florida uh markets.
00:31:22.720 --> 00:31:24.559
Uh our students do really, really well there.
00:31:24.640 --> 00:31:26.079
A lot of them are scaling over there.
00:31:26.160 --> 00:31:38.960
And then I also say metro markets because I think for those investing in short-term rentals where you're really not sure if it's your cup of tea, you know, invest in a place where you could easily convert that to a long-term rental or where the numbers make sense for a long-term rental.
00:31:39.200 --> 00:31:41.599
A lot of our students do that, and they do that in Houston.
00:31:41.680 --> 00:31:45.119
They do that in um Phoenix, Arizona, uh, Tampa, Orlando.
00:31:45.200 --> 00:31:53.359
So I'd say when I say short-term rentals, my brain automatically goes to are you, you know, you are you bullish on it and do you want to be defensive when you're investing in short-term rentals.
00:31:53.440 --> 00:31:56.960
So I'd say I stood listen to two markets, but uh, but that's my take.
00:31:57.359 --> 00:31:59.519
Cap rate or cash on cash?
00:32:00.480 --> 00:32:02.160
Which one are you chasing?
00:32:02.480 --> 00:32:05.440
You know, um, we're chasing cash on cash.
00:32:05.599 --> 00:32:07.039
I feel like that's a huge buffer.
00:32:07.200 --> 00:32:15.599
I think most of the deals we've gotten into, even in this market, we've had at least five to seven percent cash flow day one, and that is before the business plan is executed.
00:32:15.680 --> 00:32:19.039
And that's what I looked for because that indicates a healthy DSC art.
00:32:19.279 --> 00:32:21.039
Um, it indicates a good buffer.
00:32:21.200 --> 00:32:23.680
And uh I think we're that's what we've been bullish on.
00:32:24.000 --> 00:32:24.319
All right.
00:32:24.480 --> 00:32:30.240
And is there anything sort of in your history where you felt like you got a really good piece of advice from a mentor?
00:32:30.319 --> 00:32:35.599
Or for example, maybe that first uh physician who has really got you into real estate investing.
00:32:35.759 --> 00:32:40.480
Do you remember any anecdotes or specific pieces of advice that you would want to pass on to our audience?
00:32:40.799 --> 00:32:41.359
Oh, okay.
00:32:41.519 --> 00:32:46.880
What stands out for me has been the fact that he always said, I'm just laughing all the way to the bank.
00:32:46.960 --> 00:32:48.160
You know, just stuck in my head.
00:32:48.240 --> 00:32:50.559
I was like, there must be something to this.
00:32:50.720 --> 00:33:00.880
Um, you know, and uh I think um I think when done right, it can it can be a huge boost to your um to your cash reserves, to your cash flow.
00:33:00.960 --> 00:33:03.680
And so yeah, that's that's probably the one thing that stuck with me.
00:33:04.000 --> 00:33:04.480
I love that.
00:33:04.559 --> 00:33:06.000
Laughing all the way to the bank.
00:33:06.160 --> 00:33:06.640
All right.
00:33:06.880 --> 00:33:10.240
Well, but um, this has been such a great interview.
00:33:10.400 --> 00:33:10.960
Thank you so much.
00:33:11.119 --> 00:33:13.920
Um I'm really glad we had a chance to finally chat like this.
00:33:14.079 --> 00:33:21.039
Uh if people want to learn more about your platform, um, I know there's a kind of a couple of varieties and ways to do that.
00:33:21.200 --> 00:33:24.559
What would you say the best way to learn more about you and your platform is?
00:33:24.880 --> 00:33:28.319
Yeah, so um, you know, I I think education has been key for us.
00:33:28.400 --> 00:33:30.079
And so we have two platforms, like you said.
00:33:30.160 --> 00:33:38.880
If you're thinking about it, you know, overall of real estate education, thinking about actively investing in real estate, then generationalwealthmd.com is the place to go.
00:33:38.960 --> 00:33:50.880
And we host um the 10x event um twice a year, where I really deep dive into all of what we've been talking about, right strategy, how do you make things work in this market, long-term rentals, short-term rentals, multifamily, everything.
00:33:50.960 --> 00:33:52.880
It's it's an amazing event, tons of content.
00:33:53.039 --> 00:33:59.519
And then for those who are thinking about investing passively and really learning to do it the right way, GW Capital is our site.
00:33:59.599 --> 00:34:06.480
And like I said, we have a free guide over there where you can, you know, you have your own due diligence checklist, you figure out how to do this right before you jump in.
00:34:06.559 --> 00:34:09.760
And that's gwcapital.com/slash guide and lowercase.
00:34:09.920 --> 00:34:15.280
I think those are the both of those sites have great resources for people looking to just get started.
00:34:15.440 --> 00:34:17.360
Um, and uh yeah, yeah.
00:34:17.440 --> 00:34:22.159
And so I'm very passionate about supporting people who are considering it and breaking down those barriers.
00:34:22.480 --> 00:34:22.880
All right.
00:34:22.960 --> 00:34:26.719
Well, thank you so much again for your time today, and hope to talk to you again soon.
00:34:26.960 --> 00:34:27.840
Thank you, Param.
00:34:28.079 --> 00:34:28.559
Thank you, guys.
00:34:28.639 --> 00:34:29.760
This has been so much fun.
00:34:30.079 --> 00:34:40.559
Thanks for tuning in to Paging Financial Freedom, where we help doctors and spouses like you take control of your finances, invest smarter, and build a life by design.
00:34:41.039 --> 00:34:48.800
If you enjoyed today's episode, don't forget to subscribe, leave us a five star review, and share this with someone who needs to hear it.
00:34:49.119 --> 00:34:53.360
And remember, financial freedom isn't just a dream, it's a decision.
00:34:53.519 --> 00:34:55.679
So let's get there together.
