Take advantage of these FREE multifamily real estate tips by successful Real Estate Investor Rob Rowsell. Learn from Rob how to wisely invest your wealth in multi-family rental apartments. Eventually, you can turn those profits into passive residual income. Subscribe on Youtube and soak up Rob’s Words of Wisdom!
Successful Multifamily Real Estate Investor Rob Rowsell explains two examples of the Wealth Buckets model. Let Rob teach you about the Wealth Operating System method of long term investing. When you invest wisely, then you will find long term financial security once your active earning years are done!
How The Wealth Operating System WorksIn this clip from our ATL Inner Circle Community Meeting, Rob describes that there are many potential money buckets you could use. Specifically, Rob focuses on using two different wealth buckets in this clip. One bucket specifically operates to save up an emergency fund. The other bucket is a Wealth Operating System, which is designed for your long term financial stability.
When employing the Security Bucket Model, you base it on a two part formula. First, you calculate your vitality number. This number is based on typically based on ten months worth of your monthly expenses. You reach your comfort zone when you save up this number. Your mind should be at some ease knowing you have enough cash put away in case a major crisis occurs keeping you from earning active income.
Next, Rob explains the Wealth Operating System, which is also called your Core Fund. This bucket exists as the base of your financial freedom. If you are younger, filling this bucket with potentially risky investments might be okay. When you are an older investor, you may not have much runway left to accrue interest on your money. Therefore, more conservative investments are in order. The first order of business to achieve freedom in your golden years? Invest in projects that will generate horizontal income that adds up to 1.3 to 1.5 times your vitality number. That formula equals financial freedom!
When you decide your own personal vitality and freedom numbers, factor in everything! This means transportation costs for trips, meals, taxes, and personal grooming. Only then can you get an accurate personal P&L on paper to work with.
Do you own your own multifamily rental properties? If not, do you plan to do so one day? Then you should consider joining our online discussion group, the ATL Inner Circle Community! Each month, investing pro Rob Rowsell will teach you what you must do in order to build wealth in the real estate business. It’s not quite as easy as it looks! Property taxes, liens, and legal fees can all be hard to navigate, so having a successful guide in your corner like Rob is a must! Sign up today!
Successful Multifamily Real Estate Investor Rob Rowsell is here to explain the answer to a burning question. How can YOU can cut tax drag that is sapping the returns from your investment portfolio. Do you want to invest your money wisely? Then you need to take the time to reduce your tax expenses. That is a key component in any multifamily real estate investment strategy. Watch, learn, and then apply this knowledge. Then, you’ll start saving on your precious investment taxes!
Cut Tax Drag On Your Investments Safely And LegallyRob starts out by explaining that there are a few major expenses that we all want to avoid as investors. Tax drag is way up there on top of that list. There are just four key ways that our favorite multifamily magnate Rob Rowsell recommends for all investors to cut tax drag:
First of all, you must make sure that you will always pay yourself tax efficiently on payday. Do you earn a W2 income working for a business that you own? Then your CPA will tell you that you must pay yourself a typical salary range for that position. However, you will want to pay yourself based on the low end of that salary range. That way, you will pay much less in both your income and your payroll taxes. If you are a smart business owner, then you should be able to afford to live on that smaller salary amount.
This practice of paying one’s self tax efficiently is a key component of tax rate arbitrage. The concept of tax rate arbitrage means you use different types tax rates within your business in order to lower your overall tax bill.
Finally, you will need to make sure that you will plan your exit before you go in. This means that you will decide the proper legal entity for your business, such as an LLC, S-Corp, or C-Corp. None of these corporate entity designations are wrong in and of themselves. You must decide which one is the right choice for your specific industry and your intended pursuits.
Without a shadow of a doubt, savvy tax planning is the lowest risk way for you to immediately boost your investment returns. Rob repeats this important mantra often: saving on your taxes will create another income stream! Rob has saved well over $250,000 in a single year, all because of his CPA’s savvy tax planning strategies.
Most of the time, you will want to put your long term capital growth investments in your taxable accounts. Your ordinary income cash flow investments, on the other hand, should all go in your tax advantaged accounts. A Roth IRA account is one example of such a tax advantaged account.
Last of all, in order to invest tax efficiently, you should leverage your unrealized gains so that they will compound tax free. Your unrealized gains might include the value of your property increasing after you purchase it. Perhaps you bought a business and then you increased the income that it is generating. You are not taxed on that business income. That way, you could take out some low interest loans from your lender against those numbers. You could use that money in order to scale your business, so you can realize even greater success!
Rob’s third principle to cut tax drag is that you should pay your expenses with your pre-tax dollars. What does that mean for all of us investors? Make sure that you will push all of your legitimate business expenses into your business. When you do that, then you will earn your business an automatic discount. Unlike your employees who are paid and then taxed, an LLC business owner can pay their expenses before they are taxed on their earned income.
Finally, you will need to plan what the tax impact will be of each and every potential investment that you intend on making. Once you reach Rob Rowsell’s high level of real estate investment savvy, you might just know by June what you will pay in taxes at the end of the year! That is one of the many advantages of regularly consulting with an experienced, hard nosed CPA on your investment plans. Just make sure that you meet with your CPA in order to plan your tax strategies regularly. Keep them in the loop as early in your planning process as possible. When your CPA knows all the machinations of your plans, they can stop you from making costly mistakes. Many plans can change when you are drawing up investment strategies. Whenever your plans take a left turn, call your accountant immediately, so you can make the necessary adjustments.
Do you own your own multifamily rental properties? If not, do you plan to do so one day? Then you need to consider joining our online discussion group, the ATL Inner Circle Community! Each month, Rob Rowsell will teach you what you must do in order to build your wealth in the multifamily real estate business. It’s not as easy as it looks from the outside! Property taxes, liens, and costly legal fees can all be hard to navigate, so having a successful guide in your corner like Rob is a must! So sign up today!
Successful Real Estate Investor Rob Rowsell explains money literacy terms in common language that investing beginners can understand. Master these financial concepts and terms as a step one in your wealth journey! No money making glossary is complete without this terminology to guide the way.
Rob starts strong out of the gate with one of the foundational money literacy terms. When you subtract everything you owe from everything you own, you arrive at your Net Worth. In other words, your assets minus your liabilities equal your Net Worth.
Next, Rob explains the three different categories of income. Active Income means money that you are actively earning. If you work at a W-2 job or earn 1099 income, then all of that money qualifies as Active Income. Passive Income is money that you accrue without working a regular job. Some examples include Capital Gains from the sale of assets and the appreciation of the assets you own. Finally, Passive Residual Income (aka Horizontal Income) includes stock dividends, rent collected from tenants, royalties, and more. You may have taken one step to set up this “mailbox money”, and you enjoy earnings it brings you regularly without additional effort.
To truly succeed at the wealth game, you need to know your Vitality Factor. This is your true cost of living before you pay taxes and donate to charity. The Vitality Factor formula consists of adding your personal expenses to your deductible business expenses. This number is a key factor in planning for retirement.
Your Horizontal Income Score is the best measure of your ability over time to convert your Net Worth to Horizontal Income (Passive Residual Income). When you divide your Horizontal Income by your Net Worth, you get the Horizontal Income Score. For example, if your Horizontal Income is $100,000 annually, and your Net Worth is $1 Million, your score is 10. Rob estimates that the average number is around 3.5.
Most people subscribe to the Nest Egg Theory of investing. Summed up, the theory says that “Freedom is a number”. Typically, it’s the number of dollars in the bag of money saved in a 401k retirement savings account. The flaw in the theory? It is likely we will outlive the bag of money! Then, we may have to go back to work in order to pay our bills and maintain our lifestyle. If you truly want to keep working, great. If you have to work in order to survive in your golden years, not so great.
Finally, the Financial Freedom Formula is the most important of all formulas we’ll discuss on this list of money literacy terms. When you divide your Horizontal Income by your Vitality Factor, you get this number. If you arrive at 1.3 or greater (including taxes), then congratulations – you are financially free!
Your Blended Tax Rate means the average rate at which you are taxed on all of your income sources. Tax Drag means the wealth draining resistance taxes make on your investments and earnings. Cut this number as much as you can legally in order to avoid losing out on future compound earnings!
Rob offers a FREE, comprehensive glossary of money literacy terms! Just sign up below and he’ll send it directly to your inbox.
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Do you own multifamily properties? If not, do you aspire to one day? Then you should consider joining our online discussion group, the ATL Inner Circle Community! Each month, Rob Rowsell will teach you what you must do in order to build wealth in the real estate business. It’s not as easy as it looks! Property taxes, liens, and legal fees can all be hard to navigate, so having a successful guide in your corner like Rob is a must! Sign up today!
Nobody can be successful on their own in the real estate business. That is why you must choose your Multifamily Property Investment Team wisely! Watch and read on as Rob Rowsell outlines the key players you need on your side when you invest in a multifamily property.
Multifamily Property Investment Team discussing real estate deal
They say that “no man is an island”. That phrase definitely applies in the real estate investment industry. If you’re going to wade through the mountains of paperwork and make wise decisions about your potential rental property deals, you will need a multifamily property investment team made up of two super powered units, the Core Power Team and your Vendor Power Team.
Rob explains your Core Power Team as your “inner circle”. This team consists of your General Partners, Sponsors, and a Mentor. These teammates will guide you and do most of the heavy lifting. Just make sure that you have a “push pull” buyout clause in your agreements, so everyone has an out if necessary. Sometimes business partners grow apart, or develop different needs. Get everything in writing, so it stays just business, and doesn’t get personal.
Your Vendor Power Team for your real estate deal consists of commercial real estate brokers, a property manager, attorneys, a mortgage broker, and general council. Finally, you need to recruit the right investors to be your Limited Partners. When you choose wisely and trust your partners, you will go far in the rental property investment game!
Do you invest in multifamily properties? If not, do you aspire to one day? Then you should consider joining our online discussion group, the ATL Inner Circle Community! Each month, Rob Rowsell will teach you what you must do in order to build wealth in the real estate business. It’s not as easy as it looks! Property taxes, liens, and legal fees can all be hard to navigate, so having a successful guide in your corner like Rob is a must! Sign up today!
Let’s say that you are in the process of putting together a real estate deal, but all of your funding has not come through yet? Can you get capital extensions in writing for your property investment deals? When sellers write Real Estate deals, contracts often allow for deadline extensions, so that buyers can round up more investors. Rob explained the process of asking for capital extensions to one of his callers on one of his monthly Inner Circle Group Zoom Call.
How To Write Capital Extensions In Your Real Estate Investment DealsOn the call, our friend David remarked at how amazing it was that Rob and Claudia could do their due diligence in such a short span of time. Closing real estate deals is a very complex process, after all. He asked Rob to walk through the process from fundraising to close. What happens if the buyer can’t raise enough funds in time? Do sellers typically accept capital extensions in buyer contracts, and how many are the standard number that buyers can receive?
Rob explained that he asks for up to two free 30-day extensions when he begins the real estate buying process. This is a bold ask, but if you don’t ask, you’ll never know! He rarely gets it, but sometimes he can negotiate one free 30 day extension and an additional 15-day reprieve if needed.
Often with capital extensions, a penalty fee will apply. If you pay that fee, though, you have enough invested that the seller knows you are serious. You will raise the funds and deliver them in a timely fashion. In the unlikely event the deal falls through, as a general partner, your investors are safe from losses.
Do you own multi-family properties? If not, do you aspire to one day? Then you should consider joining our online discussion group, the ATL Inner Circle Community! Each month, Rob Rowsell will teach you what you must do in order to build wealth in the real estate business. It’s not as easy as it looks! Property taxes, liens, and legal fees can all be hard to navigate, so having a successful guide in your corner like Rob is a must! Sign up today!
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