New Year! New You! How to Become A Private Money Lender

All right everybody new year new you I’m
gonna give you some financial tips today to set you off on the right foot for
2019 my name is April Crosley I’m a real estate investor in Berks County
Pennsylvania welcome to my youtube channel a lot of people ask me how did I
become a private money lender as you all know from watching all my videos cuz I
know they’re subscribed we flip houses and we own rental property and we’re
always buying more but we also do a little bit of private lending when I
tell people that they usually follow up with the question how did you become a
private money lender and how I did that was I got financially educated about
what to do with my money a lot of times people flip a house and they made twenty
or thirty or fifty thousand dollars profit and they take that profit and
they immediately go out and they blow that money on something and I didn’t
want to be like that so I actually went to a seminar to learn and read a book
about how to grow well like truly grow wealth and save and reinvest my money so
I’m gonna break down the short version of it for you today
okay so growing well one on one that’s what we’re gonna call it this is what
happens when you flip a house you’re gonna make a big chunk of profit 20,000
25,000 30,000 whatever the case may be I kind of skip the step in here because as
soon as you make that profit you have to take off the money to pay the tax man to
pay the tax man not really but you have to take money off to pay the tax man
okay and everyone’s gonna ask for a flip that’s capital gains how do you avoid
that there’s no way to avoid capital gains tax if you’re doing a short-term
flip so you’re taking twenty five thirty thirty five percent whatever they need
talk to your accountant the county take that off the top pay the
tax man after you pay the tax man when I first
started Musti and on state I had a lot of death okay I was in school for my
master’s degree I had school knows I had to pay off I had car loans all that debt
is bad debt and that’s the debt you want to get rid of first okay so the second
thing after you pay the tax man is pay off your debt pay off your school loans
pay off your car loans you want none of that crappy debt okay once you pay off
your debt you should start allocating your money to different buckets and if
you guys want to read a book on this it’s in the book secrets of the
millionaire mind by t4r Becker it’s a great book being like a little two-day
conference that you can go to I believe it’s free I think I might go pretty low
it’s very cheap like 99 dollars or something and this is actually where I
learned this bucket method and this is what led me to becoming a private money
lender and being able to flip by holes and save enough funds to lend out money
to other people which is the ultimate lazy way to invest in real estate is a
real estate project so to learn to grow wealth you’re going to pay off your debt
and then you’re going to divide your money as follows as fast as you can
because in the beginning when you’re working on paying off debt and you’re
making smaller amount sometimes it’s hard to allocate to all these buckets
but I take the profit I earn and I take 10% of that profit and I put it in
what’s called an FFA at the base stamps for financial freedom account
this means ten percent of my profit goes into this account and it can only be
as if I’m reinvesting it so it can only be used if I’m taking that money and
putting it down on a rental property or I’m taking that money and I’ll private
lending it to invest into something else or I’m taking that money and I’m
investing it in stocks whatever the case may be financial freedom account is not
to be touched for anything other than reinvesting this is how I became a
private letter over time I just kept building this financial freedom account
we also take 10% and we give it to charity in the beginning when I was
paying off my debt from school loans my car loans I could afford to give 10% to
charity couldn’t afford it so instead I would volunteer so if you can’t give the
charity of your time okay five percent goes to an education account even if you
don’t plan on going back to school as a real estate investor you have to
continually keep educating yourself so you’re staying up with the latest and
greatest information and technology in the market and so you can keep reaching
that next level of growing wealth even the wealthiest of people take money and
set it aside to educate themselves so five percent of my profit always goes
into my education account five percent goes into a play account this might
sound really dumb to some people you have basically two different types of
people people that spend a lot of money on clay and my play I mean going out to
eat going to the movies buying clothing for no reason
stuff like that and then you have other people who don’t play enough I’m in need
other people category okay I don’t really spend a lot of money on
things like going out to eat shopping going to the movies so I I satisfied
this 5% and it’s only to be touched to play and it base
Clee forces me to go do something that’s fun go have fun okay I love to work so I
work a lot so unfortunately I have to kind of force myself to get out and have
fun and then I put 5% into what I call LSA I honestly don’t remember what that
stands for a long a long term savings account is what it stands for we’ve been
doing this bucket method for years but that LSA is for like vacations if you
want to take a vacation like a big vacation you’re saving for a big
vacation or projects around the house like say you want to like paint your
house or put in a patio or something like that that’s what your LSA is for so
basically after you take your profit and you divide it up into these buckets
you’re living off of sixty to sixty-five percent of the income that you’re making
from your flips and that’s really hard for some people so if it’s hard for you
to live off 60 to 65% start by living off 75% and make it a goal to live off
70 now make it a goal to live off 65% but we live off sixty to sixty-five
percent of our income I live I mean this is how much money I have to pay my bills
my everyday bills so my mortgage my electric bill made my water bill
whatever else this is everyday bills have to be paid with sixty to sixty-five
percent of my income because the rest are divided into these buckets and this
gives me balance so that I can truly grow wealth I can be educated
I cannot balance between work and play in my life I’m giving and donating to
charity so it helps balance everything out so you’re not just spending money on
frivolous things and you’re holding yourself accountable for what your
budget is I hope this helps you guys in 2019 so that you can save money grow
some well hopefully one day to be a super lazy private money lender
so you’re not working so hard thank you for tuning in today make sure you click
like and subscribe to our channel you can also follow us on Instagram at April
Crosley you can follow us on Facebook at lazy girl real estate investing and you
can check out my website WWL REI calm

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