Latest / Between Two Chairs - Demystifying Commercial Real Estate / Tax Strategies and Retirement Planning for Real Estate Agents: Interview with Chris Sierra CPA

Transcript

Tax Strategies and Retirement Planning for Real Estate Agents: Interview with Chris Sierra CPA · Between Two Chairs - Demystifying Commercial Real Estate

0:00
Welcome to Between Two Chairs, Demystifying Commercial
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Real Estate, the podcast that brings you the
0:06
latest insights and trends on the South Florida
0:09
commercial real estate market with your hosts,
0:12
Fernando Arencivia Jr. and Jennifer Wolman. In
0:16
each episode, we dive into the world of commercial
0:18
real estate and break down complex concepts to
0:21
make them accessible for everyone. Whether you're
0:24
a real estate professional, a curious investor,
0:28
or just interested in the South Florida market
0:30
in general, Between Two Chairs is the podcast
0:32
for you. So pull up a chair and join us. Welcome,
0:48
everybody, to another episode of Between Two
0:51
Chairs. My name is Fernando Arecibia Jr. And
0:53
with me, as always, is the very financial financial
0:56
financially financially financially financially
0:59
literate Jennifer woman. I thought I was going
1:03
to get stuck in the word literate and then the
1:05
financially didn't didn't come out. But it just
1:08
I think it's very, very suitable for today's
1:11
special guest and for our episode. So, Jennifer,
1:15
without further ado. Would you please introduce
1:17
our special guest? Sure. I'm super excited today.
1:20
We have Chris Sierra, CPA, joining us. And whether
1:24
you are a beginning real estate broker thinking
1:29
about real estate brokerage or an old timer thinking
1:33
about retirement, I can guarantee you that Chris
1:36
is going to give you a ton of information on
1:39
how to best set up your business so that you
1:44
can retire. You can build a business and sell
1:47
your business, or you can invest in what you
1:49
know, which is real estate. So thank you so much,
1:53
Chris, for joining us. We really appreciate having
1:56
you here. I've learned so much from your conversations
1:59
with the group at Avanti Way and all of the help
2:03
that you've given our brokers. So thank you,
2:06
thank you so much for being here. Thank you for
2:08
having me. It's a pleasure and a privilege. I
2:10
will say when I saw between two chairs, I said,
2:13
As long as I don't inadvertently end up on between
2:16
two ferns to get made fun of, I'm good to go.
2:24
A pleasure. I mean, if you guys want to poke
2:26
fun, I am game for it. So I have my son's Legos
2:30
here. Have at it. So before we get started on
2:38
things that you've seen and that you recommend,
2:40
why don't you give us some of your background,
2:42
where you grew up, where you're from, what you
2:44
like to do when you're not diving into numbers.
2:48
Sure. People sometimes ask me, how long have
2:51
you been in real estate? And my response is typically
2:54
the womb. My parents have been in real estate
2:56
their entire lives. My mom used to work for,
2:59
and I'm going to date myself, Barnett Bank. I
3:03
remember going to her office at Barnett Bank
3:05
on Flagler right off the expressway before it
3:08
was now Bank of America. That's always flooded
3:10
apparently. And I was born, not there, but. You
3:16
know, that was the era that I was born into.
3:19
My parents have been in real estate pretty much.
3:21
My dad has been real country wide. I don't know
3:23
if you remember that name. Yeah, for sure. My
3:25
dad worked for country wide for many years and
3:29
I have grown up around real estate. I've done
3:32
flips with my parents in the past. I've been
3:35
working with Avanti Way now since, gosh, 2014,
3:41
2015. And I'm born and raised here in Miami.
3:45
Beautiful family. I like to think so. Wife and
3:48
two kids, nine and 11, Andy and Sophia. And when
3:51
I'm not doing accounting, I'm either volunteering
3:55
at a church. I oversee the kids ministry there,
3:58
which is a ton of fun. Or you'll find me at the
4:02
gym or you'll find me. You can see my bike. You'll
4:04
find me on the road trying to hit 25, 30 miles
4:07
an hour and not kill myself. So. That's me in
4:12
a nutshell, been a CPA now since 2013. I've been
4:16
in accounting since 2009. And a lot of my business
4:20
has been built off of real estate, not necessarily
4:24
real estate I own, but advising clients in the
4:27
real estate arena. So again, a joy to be here.
4:30
And I've seen plenty of crazy things in the real
4:34
estate world, plenty of crazy ideas. I've been
4:38
in meetings where I'm like, that's not gonna
4:40
work. I've been in meetings where, wow, why didn't
4:44
I think of that? And all in real estate. And
4:47
I've been in meetings, the best ones I'm in are
4:49
with Enrique, because Enrique is like, I don't
4:52
know, man. I think he sleeps and dreams about
4:56
real estate things and tax strategies. He'll
5:00
call me at 10 o 'clock at night, hey, bro, what
5:02
do you think of this? I'm like, dude, it's 10,
5:04
man. I'm not thinking. Well, I am NOT your that's
5:07
the problem. I don't think at this So well, thanks
5:12
so much for that intro. I love it because you
5:15
know, you're a CPA. So I think, oh, conservative,
5:18
but you're obviously a risk taker because anybody
5:21
who rides their bike at any speed in Miami Dade
5:25
County is definitely a big risk taker. It's more
5:28
dangerous riding a bike here than it is in New
5:30
York. So that's great. Yeah. Yeah. Haven't been
5:33
hit yet. I have a bright orange helmet. My wife's
5:36
like, that is a ridiculous sum. And I'm like,
5:38
that is so that no one hits me. So yeah. Again,
5:42
fun to be here. So, I mean, as far as real estate
5:45
goes, I think, and this is like a general issue
5:49
that I see, just generally in real estate, a
5:51
lot of people are very short -sighted and people
5:55
typically miss the fact that when you're investing
5:57
in real estate, when you're doing anything in
5:59
real estate, you can never play the short game.
6:01
Though you're in golf, your short game has to
6:03
be exceptional. in real estate, your short game,
6:06
sometimes it has to be good, but you really need
6:08
to think long term. And that's not just in real
6:11
estate investing in it. I also think, because
6:13
you alluded to it earlier, realtors, real estate
6:16
professionals or brokers that are in the realm,
6:19
they're always thinking about the next deal,
6:22
but retirement is a part of life. And so both
6:27
as an investor and as a professional in the realm,
6:31
I think that long -term outlook is often overlooked.
6:36
And that is because people are only thinking
6:38
about that next commission, that next deal, maintaining
6:42
the current pipeline. And when I say future,
6:44
I'm not saying line up deals from here for the
6:47
next three years. When I say future, I mean,
6:49
line it up so one day you're not dependent on
6:51
the next deal, right? And I think that people
6:54
miss that because they focus so much on the thing
6:57
that's right in front of them because they can
6:58
touch, feel, and see it. I mean, that happens
7:00
in anything, right? You go to the gym, you work
7:02
out, but then you see that beautiful piece of
7:05
Hershey pie sitting in front of you, and you're
7:07
not thinking about what you'll look like a year
7:09
from now. You're thinking about how good that
7:11
thing's gonna taste. And the same is true in
7:13
real estate. A lot of times people see a deal
7:15
and they think about how much they can make on
7:17
a flip, and they don't realize that if it cash
7:20
flows well enough long -term plus appreciation
7:23
and value, that's really... where the bang for
7:27
the buck is and people miss out and they leave
7:29
early. Same thing with stocks. People, oh, they
7:32
freak when everything drops, let's sell. No,
7:34
let's buy when everything's low because now dollar
7:38
costs average. So just in general, that short
7:40
versus long -term outlook I think is a humongous.
7:44
There's a disparity between where people spend
7:46
most of their time. They think so much short
7:49
-term and they miss out. In real estate, you
7:52
ask anybody that's in real estate, the winners
7:54
are the ones that stuck around. for a long time
7:56
and set themselves up for the future. So I love
8:01
that a couple of things. The fact that you have
8:04
a real estate background, anyone who's listened
8:06
to this podcast long enough knows that the biggest
8:09
mistakes that I made were I had CPAs that were
8:13
amazing CPAs, but they knew nothing about real
8:15
estate. So we weren't speaking the same language
8:18
and I missed a lot of opportunities and did a
8:21
lot of things kind of the wrong way, which is
8:23
why we're bringing you Chris today. Another thing
8:27
is that we got a call from a really good friend
8:29
of ours, Gus Fonte, who had attended a friend's
8:33
retirement. This person was... extremely advanced
8:37
in age and basically had to continue working,
8:41
which if you want to continue working until you're
8:43
99, great. But if you don't, then you need to
8:47
have something set up. And I think the fact that
8:50
Chris is so tuned in to not only real estate,
8:55
but our local markets, the tax laws, the tax
8:58
loopholes, et cetera, et cetera, that he's going
9:02
to bring us invaluable information. So there
9:05
are There's a couple of different ways that somebody
9:07
in the real estate business can retire. You can
9:11
build your business and sell your business. Can
9:13
you talk to us a little bit about that? And then
9:16
also the investing and other things that you
9:19
have seen and learned as other strategies for
9:23
people to be able to retire and have a nest egg,
9:26
or if they don't want to retire, to be able to
9:29
build a legacy that they can either sell or pass
9:32
on to the next generation. So I love that little
9:35
story you shared. There's a gentleman that I
9:38
know, he's a realtor and he also works at a bank
9:41
and he's 87. And every time I speak with him,
9:44
I'm like, you're crazy. He's like, well, I mean,
9:48
what else am I gonna do? I don't wanna not move,
9:51
right? And I get it, but to have that freedom
9:55
to be able to give back or to travel or whatever
10:00
it is, I think is... It's vital. And now, and
10:04
now I'm blanking out. I'm like, wait, the question.
10:08
I just went on a little rabbit hole. Can you
10:11
repeat the question because. This mind isn't
10:14
what it used to be. That's okay. I chase squirrels
10:17
all the time. So it was basically how, you know,
10:21
the different ways that a broker can set up retirement
10:23
either by building a book of business and selling
10:26
their business or investing in real estate or
10:29
both. So generally speaking, if you're a broker
10:31
and you're trying to build up a business to one
10:33
day sell, one of the biggest things you can do
10:35
to set yourself up for success is not make the
10:38
business so dependent on you. That is one of
10:42
first off from a valuation perspective any business
10:45
that you're gonna sell and this is standard valuation
10:47
But this is not even just real estate. This is
10:49
generally speaking and I'm learning this myself
10:52
as a CPA who is the man behind the firm and Is
10:57
everything is highly dependent on me is the more
11:00
dependent your business is on you the less valuable
11:03
it is It's only valuable to you, but anybody
11:06
else that picks it up and starts to run with
11:08
it if they're not you it's not going to do well.
11:10
And so one of the things that oftentimes people
11:13
miss when you're building a business is making
11:15
sure that a business you eventually want to sell,
11:18
is you need to build it in such a way so as it's
11:20
not dependent on you 100%. You bring value in
11:24
who you are, you've got client contacts, but
11:27
you want to build it up in such a way so that
11:29
after a transition period of one, two years,
11:32
the business can continue else no one's going
11:35
to want to buy it so for a broker that means
11:37
setting up a good team that means having a good
11:39
system in place that means think turnkey when
11:43
you walk into a house is this ready to move in
11:45
i don't know is there furniture in there do i
11:47
have to bring my own furniture do i have to redo
11:49
the windows i mean think of it in those terms
11:51
In the same way as a broker, if your goal is
11:54
to eventually sell your business or spin it off
11:57
or whatever it is, you want to set it up in a
11:59
way that it's not dependent on you. And I think
12:03
one of the biggest things people are missing
12:05
today, which I love about Avanti is taking advantage
12:07
of AI. A quote that Enrique Teran said, I'll
12:11
never forget it. He said, you're not going to
12:12
be replaced by AI. You're going to be replaced
12:15
by someone who is using AI. in your industry.
12:18
And the same is true as a broker. You're not
12:20
going to be undone by AI. If you're not taking
12:23
advantage of that resource, your competitors
12:25
are going to beat you if they're using it and
12:27
you're not. And so it's a great way to make the
12:30
business less and less dependent on you. But
12:33
if you're a broker that wants to one day retire
12:36
in a different way, maybe not necessarily sell
12:39
the business, but let's say you want to pass
12:40
it on to an heir, which is a great plan to retirement
12:44
is a key aspect. Investing both in real estate
12:47
and in a retirement plan, a 401k, a self -directed
12:51
IRA, a SEP IRA, a Roth IRA, a traditional IRA,
12:56
a 403B. There's a lot of different things you
13:00
can invest in. Whatever avenue you ultimately
13:02
take, again, it goes back to the same thing.
13:05
I've got a buck in my hand today. What am I going
13:07
to do with it? Am I going to spend it today because
13:09
it's in front of me? Or am I going to place it
13:12
in reserve for the future so that 10 years, 20
13:15
years from now, That dollar is $200. And so that's
13:20
where as a business owner, not just a broker
13:22
in the real estate, but as a business owner.
13:25
And again, this is really hard. Last I checked
13:27
my crystal ball, it ran out of magic. It doesn't
13:30
tell me the future. It's just not working anymore.
13:33
I don't know what happened to it, but it never
13:35
worked to begin with. Let's be real. It's impossible
13:38
to know what the future is going to be. But like
13:40
I tell realtors, you don't know if you're going
13:42
to make $500 or $500 ,000 in commission. But
13:46
don't bet against yourself and set yourself up
13:49
in a way where, I mean, I'm probably not gonna
13:52
make much, so it's not worth having a business
13:54
structure. No, that's the terrible mindset to
13:56
go in, go in thinking you're gonna blow it out
13:59
of the water and set yourself up for success
14:02
as a broker in the same way. You may not know
14:04
if you're gonna sell or if you're gonna spin
14:06
off or whatever it is, set yourself up where
14:09
the business is not so dependent on you that
14:13
it's only valuable. You want it to be valuable
14:16
to anyone who comes along and says, hey, I'll
14:19
give you five mil for that thing. Yeah, here
14:22
it is, turnkey. You don't want someone to say,
14:24
hey, I'll give you a mil and a half because it's
14:26
dependent on you and I need you to stick around
14:28
for three years. No, I don't want to be around
14:31
for three years. I want to enjoy that mil and
14:33
a half you gave me. And so a key thing there,
14:36
when you're building your business, make sure
14:38
that you're building it in a way where it's not
14:40
so dependent on you that someone can't step in.
14:43
take over and you move on to another project
14:46
or or sail off into the sunset and retire. Great
14:49
points and in terms of you know we did this wealth
14:52
building analysis or webinar I should say that
14:56
you were part of at Avanti that was super super
14:59
informative because to your point of an agent
15:03
starting out you know they might be bidding against
15:06
themselves they might not be knowing where to
15:08
start so the best thing I think would be like
15:12
if they put money aside for transactions and
15:16
taxes and everything from their transactions,
15:18
sorry, into, you know, taxes and investment vehicles
15:23
and stuff. Can you tell us a little bit about
15:25
what that setup looks like? Because a lot of
15:28
agents aren't used to being 1099s. So how those
15:32
buckets of money differ from like a W -2 employee?
15:38
Sure. Well, first off, we have a saying in Spanish.
15:41
Someone, something is mango bajito, low hanging
15:43
fruit, born and raised in Miami. Naturally, I
15:46
have a ton of Cuban dichos as they say, but it's
15:50
low hanging fruit to set aside taxes, money for
15:53
taxes. Like that's, that's a given. And I say
15:56
that because you don't know how many realtors
15:59
don't. do that. You run into the end of the year,
16:02
it's like, hey, here's your 1040. Here's your
16:04
tax return. You owe the government $8 ,500. What?
16:09
What do you mean? How do I owe $8 ,500? Well,
16:12
you got a 1099 and you have self -employment
16:14
tax on your net income plus federal. So, oh,
16:17
I don't have money to pay that. Okay. But we
16:21
can't reduce it because I want to buy a house.
16:23
So my numbers need to look good, but I can't
16:25
pay the tax. I'm like, well, which one is it?
16:27
I have that conversation. with realtors at least
16:31
20, 30 times a year, like a tax year. I've come
16:36
to get used to it and expect it. I'm like, well,
16:38
who am I going to talk to like this this year?
16:40
And what ends up happening is, to your point,
16:42
nobody sets aside money. Nobody puts money to
16:46
the side to cover their taxes. Again, I think
16:49
at the end of this, I'm going to guarantee we're
16:51
going to look back and say, well, how would you
16:53
summarize the whole thing? It's like stop thinking
16:54
short -term and start thinking long -term, right?
16:57
And when I say mango bajito, it's a given. It's
16:59
like that's low -hanging fruit. You should be
17:02
setting aside money as a realtor. Why? Because
17:04
you're getting a 1099. What that means is you're
17:07
not an employee. Nobody's paying your taxes for
17:10
you. If you went and got a job as, I don't know,
17:13
a marketing advertising person working for Avanti
17:16
and you were on their staff. you would get a
17:19
W -2 and you agreed to a salary of $80 ,000,
17:22
right? You're not gonna get paid $80 ,000. That's
17:25
your gross salary, but you're gonna get deducted
17:27
from that 7 .65 % for Social Security and Medicare.
17:31
And then based on how you filled out your employment
17:34
documents, they're gonna withhold money from
17:37
your paycheck to go toward what you potentially
17:41
might owe the government at the end of the year.
17:44
And that's why people get refunds. People get
17:46
excited. Oh, I got a refund on my tax return.
17:48
I must have a really smart CPA. No, you must
17:50
have paid way too much to the government during
17:52
the year. And now you're getting your money back.
17:56
People miss that. People get excited. I hate
17:57
when I get a refund because it means I gave the
18:00
money an interest free loan. I mean, I gave the
18:02
government an interest free loan. No, I wanted
18:05
my money when I got paid. And so as a realtor,
18:08
though, you rarely ever get a refund because
18:10
nobody's taking money out for your taxes. So
18:13
you get commissions of one hundred thousand dollars.
18:15
You have expenses of 30, 40K. You're left over
18:19
$60 ,000. You have to pay 15 .3 % in self -employment
18:24
tax on that 60 ,000. Plus, that 60K, not including
18:29
the rest of your world if you're married, your
18:33
spouse's salary and all that. Plus, you've got
18:35
to pay at least 12 % to 22%. on that 60K. So
18:40
you're looking at a significant tax, but just
18:43
in self -employment alone, that 60K, you've already
18:45
got a $9 ,000 tax bill. I haven't even included
18:49
12%, which is another six, seven grand, $16 ,000
18:54
on 60K. I don't think anybody's thinking, let
18:56
me put away $16 ,000 from all my commission.
18:59
Nobody's thinking that. And so as a realtor,
19:02
that's the huge difference between you and employee
19:04
is nobody's thinking about you tax -wise. you've
19:07
got to think about you tax wise. And that's always
19:10
the surprise people get when they get that 1099
19:14
as realtors. And that's a generally any contractor
19:17
if they're not prepared and setting aside. And
19:20
so those buckets, when we talk about setting
19:23
aside money in buckets, you've got your tax bucket
19:26
and there's only two things certain in life.
19:29
You're going to die and you're going to pay taxes.
19:32
I'm sorry, it's part of life. But then in addition
19:35
to that, you're gonna get old. Well, third thing,
19:37
you're gonna get old. And when you get old, are
19:40
you gonna continue? I don't know any 87, 90 year
19:43
old that can produce at the capacity they could
19:45
produce when they were 40 or 50. I'm sorry. Maybe
19:50
there's one crazy guy out there or girl out there,
19:52
but generally speaking, you're not at the same
19:55
level you were at when you were in your 40s or
19:57
30s or whatever age you're stepping into the
20:00
real estate world. Setting aside for retirement
20:03
is vital, like vital. You're setting yourself
20:08
up for failure as a realtor if you're not investing
20:12
in your... future life where you don't have to
20:15
be dependent on the next deal. And I don't know,
20:19
Jen, I don't know if you want to get into details
20:20
or we can, you know. I would like to back up
20:23
a little bit for new agents because we've also
20:26
had conversations about being either a PA or
20:29
an LLC. So let's say a new agent were to come
20:33
to you. What would be the first, so we know you're
20:35
going to tell them to set money aside for taxes,
20:38
but what are the first, let's say the top three
20:40
things that you're going to tell a brand. new
20:42
agent that comes to you and say, I just got my
20:44
license, I'm working with AvantiWay commercial,
20:47
what do I need to do? Numero uno, you need to
20:50
set up for yourself an entity structure. People
20:53
get, and again, just whoever listens to this
20:56
or don't get confused, PA, LLC, they're both
21:01
essentially going to be the same thing. And what
21:05
I mean by that is, whether you set up an LLC
21:08
for yourself, or you set up what's called a professional
21:11
association, a PA, a PA is a corporation. An
21:15
LLC, if you have one owner, is what's called
21:18
a disregarded entity. I can lose people just
21:20
saying that. But regardless of which one you
21:22
open, what's going to end up happening is your
21:25
tax professional should be making what is called
21:27
an S corporation election. And that is a tax
21:31
specific treatment that turns your entity if
21:34
it qualifies, which LLCs and PAs, practically
21:37
any corporate entity where the owners, there
21:40
aren't any foreign owners, qualifies to become
21:43
an S corporation. The benefit of an S corporation
21:47
is that it's what's called a pass through entity.
21:50
That means that the income and expenses, once
21:52
they're calculated and reported on the corporate
21:54
tax return, flow through to the ultimate owner
21:57
and then the ultimate owner pays tax one time.
21:59
If you set up a corporation for yourself and
22:01
don't make an S -corp election, you will get
22:04
taxed twice. Once at the corporate level and
22:06
a second time when you take the money out. As
22:08
a realtor, at minimum, you should be setting
22:12
up for yourself some type of entity, whether
22:15
LLC or PA. Don't get confused, right? LLCs are
22:19
easier to set up and they're easier to maintain
22:21
legally. So sometimes the recommendation is that.
22:24
But PAs are what's naturally the thing that people
22:26
set up. When you think of an attorney, an accountant,
22:30
a doctor, what typically a sole practitioner
22:33
in those industries and any other licensed industry
22:36
set up is a PA, a professional association. By
22:39
default, a PA limits the scope of what you can
22:41
do. You have to specify this is why this PA exists.
22:45
And when you have a PA, you're saying to somebody,
22:47
I'm a licensed individual and my license is tied
22:50
to my business. But whether it's a PA or an LLC,
22:53
They're both going to end up being the same thing
22:57
for tax purposes. That's number one. Number two
23:01
is get organized. I said this in a presentation
23:06
we did recently. I'll say it forever until I
23:08
die. I'll say to every client, I'll say to every
23:11
paper pushing, receipt dropping person that steps
23:14
into my office, get organized. Keep track of
23:18
your expenses. Stop guessing. a year. I don't
23:22
know what I ate yesterday. I don't know what
23:25
I spent my money on last August. I just I couldn't
23:28
tell you. Gun to my head. I couldn't tell you
23:31
where my money went or what I had for lunch August
23:34
12th of 2025. I can't even think about today.
23:38
I don't even know if it was a Tuesday. I don't
23:40
know. And in the same way, imagine as a business
23:43
owner, because that's what you are, by the way,
23:45
as a realtor, you're a business owner. Just you're
23:48
a business owner. See yourself that way. Keeping
23:50
track of expenses because it didn't come to the
23:52
end of the year cycle. I can only conjure up
23:53
10 grand in expenses. And you really had 40 grand.
23:56
And that's because you're not thinking about
23:58
all the things you did, all the miles you drove,
24:01
all the restaurants you went to, all the conversations
24:03
you had, all the times you covered that client
24:06
cost. The only way you're going to remember that
24:09
is if that day you have a software running in
24:11
the background that's connected to your bank
24:13
account that is automatically downloading those
24:16
transactions for you. And if nothing else, putting
24:19
them in a platform where you sit down and you
24:21
categorize them. And that's the best, the best
24:25
way to remember where your money is going. And
24:29
then number three, be patient. And I know that
24:32
sounds silly, but any realtor, any business owner
24:36
will tell you, These things take time. But if
24:39
you don't set yourself up for success from the
24:41
beginning by getting some type of corporate structure
24:43
that really legitimizes your existence, sets
24:46
you up properly for taxes, and also gives you
24:50
that flexibility for setting up retirement, one.
24:54
Two, get organized, get yourself a good accounting
24:56
software. I know, this is boring. to think about
24:59
that, right? I saw a video the other day that
25:01
says, do you ever want somebody not to talk to
25:03
you and ask you more questions? When they ask
25:05
you what you do, tell them you're an accountant.
25:06
The conversation will die instantly. He's like,
25:11
tell them you're a doctor and they'll show you
25:12
a thing. Tell them you're an attorney and they'll
25:14
say, talk about accounting and everybody goes,
25:16
oh yeah? All right. I know it sounds boring,
25:18
but accounting is get organized. It sounds silly,
25:21
but get organized. You won't realize how much
25:25
you'll save yourself in taxes just by getting
25:27
yourself organized. And three, be patient and
25:30
be willing to grind because this is going to
25:32
be any business you start, whether real estate
25:34
or wherever. is going to be a grind. But if you're
25:37
willing to put in the work, you're going to reap
25:39
tremendous benefits if you're patient. Yeah,
25:41
I think you really have just covered so many
25:44
important things. And one of the things that
25:47
happens in our industry, especially if you do
25:50
commercial real estate, for example, you've done
25:52
business sales, you can understand the idea of
25:55
that there are people that, and I have a client
25:58
that always comes to mind because for 45 years
26:01
they built this business and it was him and his
26:04
wife. But it was operated by him. He was at the
26:07
center of it. And there was really no scaling
26:10
of that business other than what was coming through
26:13
his hands. And it was a very niche business.
26:15
And it was wonderful. And he said, look, we've
26:18
been doing this for 45 years. It's great. We
26:20
put two kids through college. We have our house.
26:23
It's great. What you really did is you built
26:25
yourself a job. You really didn't build a business
26:28
that is marketable, a business that you could
26:30
actually sell. And ultimately, this person, after
26:33
45 years, the most that they could get out of
26:36
selling that business was about 40 grand. right?
26:39
Because it was an asset sale at that point, right?
26:42
Because unless you have an operator in there
26:44
and unless you basically replace yourself, right?
26:48
And a lot of what you mentioned, which I think
26:51
is important, is that AI has the ability and
26:54
technology has the ability to replace a lot of
26:57
the things that you do so that it is structured.
26:59
So I really I do appreciate you driving that
27:01
point, which is, you know, which is very important.
27:04
I'm wondering if what have you seen success look
27:07
like? from the point of view of, I know you drive
27:11
this point about organization, which I believe
27:14
is really where the key is, but how do people
27:18
make this dumb proof? How do they set themselves
27:22
up in a way where it's automatic and where they
27:25
don't have to think about it? Because I think
27:27
a big part of success in our business is how
27:31
good do you become at managing money? Because
27:35
to your point, especially in commercial real
27:37
estate, we just closed a deal that we spent a
27:39
year working on. We've worked on leases that
27:42
have taken two years because they're complex.
27:45
And then the money doesn't always come in when
27:47
you're expecting it. And there are extensions,
27:50
delays, all those things. Managing that money
27:52
keeps you in the game. But sometimes people,
27:55
when you're going through that management, you
27:57
increase your debt, you use credit cards, you
27:59
do all these things. So I'm wondering... What
28:02
does success look like? What have you seen where
28:04
people have automated some of this so they don't
28:07
have to think about it and they don't have to
28:08
be in that seesaw that sometimes happens in this
28:11
business? To your point about AI, even as a CPA,
28:17
that actually, when I heard Enrique say that,
28:19
that actually got me immediately investigating.
28:21
I ended up finding an AI specific to the tax
28:25
and accounting industry that I've been using
28:27
and it has Made a lot of menial tasks that I
28:31
would spend hours doing a minute like I can I
28:35
can churn out a ton of engagement letters or
28:39
have it do and you know an initial analysis of
28:43
a tax situation that I then pick up right where
28:46
it leaves off and do my own and it shaves hours
28:50
off of my time and so I was watching a There's
28:53
this thing I follow on YouTube. It's a gentleman.
28:55
He speaks to millionaires And he just finds them
28:58
on the street and he asks them for their advice.
29:01
And he ran into a guy, as soon as I'm watching
29:03
it, I'm like, oh, this guy, he's a bro, as they
29:05
would say on the street. Oh, this guy's a bro.
29:07
He said one of the most, like, it was, I was
29:10
like, wow, this guy just blew me out of the water.
29:12
I judged the book by its cover and I was dead
29:15
wrong. He said, you know what? The difference
29:17
between the middle class and somebody who goes
29:20
and makes themselves millions of dollars is they're
29:22
not content staying in that. nine to five W two
29:27
job. They see the industry they're in. They see
29:30
the people around them doing something and they
29:32
say, okay, how can I do this for myself efficiently,
29:38
faster and better? And then they go and chase
29:41
that. And I said, wow, I mean, I literally did
29:44
that in my own. I've been accounting for, I don't
29:47
know how many years looking around. I'm like,
29:48
I could probably do this, but I wouldn't do it
29:50
this way. I would probably Mind you, I had no
29:52
idea what I was doing. I still sometimes like,
29:54
man, I feel like, but I'm still learning as a
29:57
business owner. And when you see an industry
30:00
and you see something and you say, how can I
30:02
do this more efficiently? How can I better this?
30:05
How can I offer service greater than the other
30:07
service I'm currently offering right now as a,
30:10
as an employee or whatever it is, you know, that's
30:12
the person that ends up knocking it out of the
30:15
park. That's the person that ends up building
30:17
for themselves something sellable. To your point,
30:20
you don't know how many times I've run into that
30:23
situation where somebody has that business. I'll
30:26
never forget when I started this, a guy I admire
30:29
dearly said to me, hey, make sure you're not
30:31
building a job, you're building a business. And
30:34
those words, you said it, it came back to me.
30:36
Those words stuck with me. And it's taken me
30:39
a while, but outsourcing some of the menial tasks
30:42
to other individuals involving my wife, as silly
30:45
as it sounds, she quit her job and I involved
30:47
her and instantly transformed my administrative
30:50
side, creating workflows for menial things that
30:53
happen over and over again. The same thing happens,
30:56
tax returns start to finish. And that has dramatically
30:59
reduced the amount of time I and we spend doing
31:02
things. So taking advantage of AI, taking advantage
31:05
of software, I think is vital. Identifying, okay,
31:09
does these tasks happen over and over and over
31:11
again? How can I automate this? How can I turn
31:13
this into an executable action in whatever AI
31:17
platform? This email, how can I turn this email
31:20
into a follow -up, into a reminder, make it part
31:24
of my marketing? I mean, I'm thinking as a realtor,
31:26
right? Because you're stuck in a deal for a year.
31:29
You're not, okay, all my attention is going to
31:30
this deal. I hope I get it. No, that's ridiculous.
31:33
How can I turn every interaction into an actionable
31:37
events that eventually turns into multiple deals.
31:41
And we have incredible tools for that. I know
31:43
Avantiway has incredible tools for that. That's
31:46
what Enrique and Andres are always harping on
31:48
when you go to any one of those is turning every
31:51
interaction, whether it's at a party, it's at
31:54
whatever it is, a family, not that everybody's
31:57
a business transaction. Absolutely not. You don't
31:59
want to come across that way. People sometimes,
32:01
and to add to this, You don't ever want to come
32:04
across as you're just in it for business transactions,
32:06
because then you're not a personable, likeable.
32:08
Nobody wants to deal with somebody that only
32:10
sees them as a dollar sign, right? So you have
32:12
to strike that balance between I need to be just
32:15
myself, but at the same time, see opportunity
32:18
from far away. And I never know when this guy
32:22
sitting across from me I'm talking to is going
32:24
to need a real estate deal. I want him to think
32:25
of me. So I will subtly make mention of my industry,
32:28
what I do, all that. That happens to me as a
32:31
CPA. Sometimes business just happens because,
32:34
oh, you're a CPA. Okay, cool. And I was nice
32:36
the whole time. And then, oh man, you know, we
32:39
hate our CPA. He's a jerk. Oh, cool. I hope I'm
32:43
not a jerk. And I've gotten clients like that.
32:46
And the same is true as a realtor is you need
32:50
to be able to turn conversations and interactions
32:53
into transactions. And the only way you're going
32:56
to do that One person, one brain is by taking
32:59
advantage of software, taking advantage of AI,
33:02
having a good, and now the word escapes me, but
33:05
oh, Jennifer, what is that called? Client management,
33:08
oh my goodness. CRM. CRM, there it is. Having
33:11
good, a good, and if you don't know what CRM
33:14
means, welcome to the party. Well, here's your
33:20
problem. It's contact relationship manager. Yes,
33:25
you need to manage those that contact relationship.
33:28
You need to manage those well. So I think you
33:30
brought up a really good point. And this is something
33:33
that took me a while again. You know, I didn't
33:36
like doing the bookkeeping. I didn't like like
33:38
it was always it's it's more fun to be out there
33:41
meeting the people and finding the deals and
33:44
going to the neighborhoods like it's so much
33:46
more fun. So then people wait and it's like,
33:50
oh, my gosh, it's the end of the quarter. I need
33:52
to file my quarterly returns and you're going
33:54
through paperwork, the best thing that I did
33:56
was hire a bookkeeper. That was the first thing
34:00
that I did. I hired a bookkeeper because I knew
34:02
it was something that I didn't like to do. I
34:05
also knew that it was something that wasn't as
34:08
valuable as me going out there and getting the
34:10
deal. So I think the fact that you pinpointed
34:13
like your wife, right? Who can help you do the
34:16
stuff that you don't? like to do. That's part
34:19
of your team, too. Your team isn't just your
34:22
transaction coordinator and your buyer rep and
34:26
your seller's rep, right? It's your entire team.
34:28
And that's why I think having a CPA and having
34:32
a bookkeeper and doing all that at the very,
34:35
very beginning is the foundation for your success.
34:38
So I love the fact that it's not just all systems
34:41
and computers and programs. It's also the people
34:44
who are going to do the stuff that you don't
34:46
want to do. And as you say that, I'm thinking
34:49
of a particular realtor. I won't mention him
34:51
by name, but he works for Avanti, awesome guy.
34:54
And he has been super successful. And you know
34:56
what I've noticed? He has an assistant. He takes
35:00
advantage of systems. He's part of a team. He
35:03
manages now a team. I think he even manages a
35:06
branch. And it was because he took advantage
35:09
of the people around him. And he's done well.
35:13
He's one of the realtors I work with. He's one
35:14
of the more successful ones. And I'm just, as
35:17
you're saying that, I'm noticing, I'm like, oh
35:18
yeah, he did this. Oh yeah, he did. Oh, that's
35:20
right. Yeah. Cause now I get messages from his
35:22
assistant, not from him. Oh, okay. And he's doing
35:25
really well for himself, very well as a realtor.
35:28
And he started, I watched him start from the
35:31
floor. And now he, I mean, so taking advantage
35:36
of the people around you, to your point, Jen,
35:38
I think it's... It's often over, I overlooked
35:41
it. I'm saying this from my own experience, even
35:42
as you speak, I would rather be sitting here
35:44
doing these all day than my stupid books. It's
35:49
being honest. I would rather, I love interacting
35:52
with clients. And then I sit down and do the
35:53
tasks and I'm like, yeah, just talking to them
35:55
and get paid for it. But now I have, I have a
36:00
team of people that do a lot of that. I ended
36:02
up coming in for the review portion. and it's
36:05
increased my business 30 something percent in
36:07
the last year. That's awesome. So we've talked
36:10
about the beginning agent and how to set up.
36:13
So now we're in, I don't know, year five, six.
36:16
We're doing really well. We've got a flow. I've
36:18
got money in whatever retirement plan, whether
36:23
it's 401k or a self -directed IRA, whatever my
36:27
accountant and I decided is the best tool for
36:30
me. Now what? What's the next step for again,
36:35
making the money for retirement, future generations,
36:39
et cetera. I'm going to quote a very famous philosopher
36:43
and scholar. Her name is Dory. She's a blue and
36:47
yellow tang fish. She would say, just keep swimming.
36:51
At a certain point in time, you get in the groove
36:54
as a business owner. You just keep doing the
36:57
things you've been doing. I had an old friend.
37:01
but back where I used to work and he would always
37:03
say, do what you're supposed to do and be where
37:05
you're supposed to be. If you do those two things,
37:09
99 .999 % of the time, everything else that you're
37:12
looking for is just gonna happen. And so you
37:14
continue to pursue opportunities. You don't satisfy,
37:18
you're not, okay, I made it. Okay, now I'm good.
37:21
No, if you're at that stage, you're five years
37:24
deep and you're continuing to produce. Continue
37:27
producing continue Being a student. I think that
37:31
the biggest one of the biggest failures people
37:34
in general have is they become satisfied with
37:36
what they already know and they think this is
37:40
the way No, that's a way and there's always another
37:44
way and there's nothing wrong with Constantly
37:47
trying to fine -tune and find better ways to
37:50
do the same thing So for anybody in that season
37:54
where i'm in five six years in and man, I have
37:57
built an incredible system, continue to build
38:00
on that future proof by involving the latest
38:04
and greatest in technology, by reassessing the
38:07
professionals you currently use. I mean, who's
38:10
your go -to attorney? Who's your go -to, I mean,
38:13
your closing agent? I hope it's fully a title
38:15
because Nelson and Ricardo are 10 out of 10,
38:18
I highly recommend. Even something as simple
38:20
as sitting down, some realtors do this, sometimes
38:22
they'll ask me, hey, What's the latest and greatest
38:25
thing happening in the tax and accounting world
38:27
with real estate? Oh, did you hear about the
38:29
Airbnb rule that came out last year in July of
38:32
2025? Oh, wow, I didn't know that I can sell
38:35
on that. Speak to your your title agent. Hey,
38:38
just five, 10 minutes of your time, anything
38:40
new that I need to know about anything. When
38:42
that law changed with the whole commission thing,
38:43
I hope that every realtor was and if you don't
38:45
know what I'm talking about, welcome to the party.
38:49
did you have a conversation with a trusted closing
38:51
agent you've done transactions with? Do you have
38:53
access to a real estate attorney? Did you attend
38:56
CPEs, which we call them, continued education,
39:00
and learn about, because it's a constant learning
39:04
process. And so if you find yourself in that
39:07
middle arena where you're five, six years, and
39:09
this sounds boring, and like I tell people, especially
39:11
with finances, if it sounds boring, it's probably
39:13
really good for your wallet. If it sounds super
39:16
fun, it's probably terrible for your wallet,
39:19
continue investing in your 401k, your self -directed
39:24
IRA, which I mean, by the way, if you would have
39:26
invested last year some of your money in the
39:28
market, you would have earned on average anywhere
39:31
between 19 and 22 % last year. Right now this
39:34
year, I'm way ahead in the market. Same thing
39:37
with real estate. The way that rentals are going
39:39
right now, if you invested in your self -directed
39:42
IRA and you have an investment in property that's
39:45
generating for you, rental activity, not only
39:49
is it being generated tax free for your future
39:51
benefit, but you're also, you're getting a significant
39:54
return on your investment. And so continuing
39:57
to build on those things. And the best part is
39:59
my favorite, there's a gentleman he does, he's
40:02
very, very, very conservative, not for everybody,
40:04
but I love him. His name is Dave Ramsey. and
40:08
he talks about, I love Dave. I love his rants
40:11
on YouTube. He is a ranter. Yes, but it'll tell
40:16
you once you make it to where you're a millionaire,
40:19
getting to two million happens faster. You'll
40:23
find this even in investing. Once you get your
40:26
first, things start to, it takes forever to get
40:28
to that first big moment, but then you'll find
40:32
all the other moments, they happen, start to
40:34
happen a lot faster. Money grows faster when
40:36
there's more of it. And so if you find yourself
40:39
in that five, six year mark, and okay, I'm sitting
40:42
on a pot of investment, man, continue to double
40:44
down on that. Because time, especially in the
40:47
investment world, time is your absolute best
40:50
friend. In real estate and in stock and market
40:53
investing, time is your absolute best friend.
40:57
The longer you sat and the more that you've put
41:00
into it, the faster things tend to grow. So if
41:03
you're in that five, six year mark, continue
41:05
doing. but don't become stagnant in, oh, I'm
41:09
satisfied with where my systems are. I am satisfied
41:12
with my, no, do not be satisfied with where your
41:16
knowledge base is and where your systems or your
41:19
processes are. Always continue fine tuning them.
41:22
So with real estate, as a real estate professional,
41:27
right, we get certain tax benefits if we invest
41:31
in property, right? And then you briefly touched
41:34
on owning real estate in a self -directed like
41:39
Roth IRA where it grows tax free and the money
41:41
comes out tax free. Can you talk a little bit
41:46
about maybe not so much which is better because
41:49
I think they're both good vehicles, but can you
41:51
talk little bit about each one of those items
41:56
in terms of like, how would somebody start investing?
41:58
Do I start as a real estate professional and
42:02
buy whatever it is that I want to buy and take
42:05
the depreciation and all of that kind of stuff?
42:07
Or is it better for me to put it in something
42:09
that I can't touch for a long time or do both?
42:13
Yes. I figured you would say that. I love that.
42:18
The answer is yes. Can you just define how both
42:22
of those benefits work? Sure. On the one hand,
42:27
the way that I would split investing is there
42:30
is the taxable investing and there is the non
42:34
-taxable or deferred. taxable investing, right?
42:37
The taxable investing is the one that a lot of
42:40
people think of, which is I just bought a property,
42:43
I put it under the name of an LLC, and now I'm
42:45
renting it. Then I'm generating rental income,
42:48
and I am expensing all my expenses, and I'm cash
42:52
flowing. I'm awesome. This is great. The big
42:55
benefit to that is I can take a loan out on the
42:58
equity in the future. A lot of new loan products
43:00
are out such that they'll lend to you based on
43:02
how it cash flows and what it generates in rental
43:05
revenue. So you've got a lot of avenues as an
43:08
investor to invest in property. The downside
43:11
to that is any earnings you make from it are
43:13
taxable the day you make them, right? The beautiful
43:16
part of investing in real estate, people often
43:18
overlook, is depreciation. Depreciation, to keep
43:21
it real simple, is, hey, I'm using this asset.
43:24
I can't write off my $700 ,000 piece of real
43:29
estate. I can't. Because it has a future benefit.
43:32
So what does depreciation do? Well, If it's commercial
43:35
real estate, it's good for 40 years, according
43:37
to the IRS. If it's residential real estate,
43:39
it's good for 27 and a half years, according
43:41
to the IRS. And what that means is I get an annual
43:44
expense for the amount I've invested in real
43:47
estate divided by one of those two numbers, depending
43:51
on what it is. What does that mean? That's an
43:53
expense on my books that is not an expense in
43:56
my pocket. And so I could make $30 ,000 a year.
44:00
which is pretty good, a return on investment
44:03
in a residential real estate, but depending on
44:06
how much I paid for it and depending on what
44:08
my cap X was, not have any tax because of depreciation,
44:12
right? And so as a beautiful thing, in addition
44:16
to that, that thing is appreciating in value.
44:18
And one day I can sell that property. And because
44:21
I sell it, it's a long -term investment. I am
44:25
now gonna pay a capital gain tax on it, which
44:27
is a reduced preferential tax rate. versus what
44:30
I'd pay on say a W -2 interest or certain dividends,
44:35
right? Versus I can invest in a brokerage account,
44:38
which is still great. People make money there
44:40
too. Just because we're talking about real estate
44:43
doesn't... Anybody who's married, no, I only
44:45
do one thing. That's not the person you should
44:48
ever listen to. It's just like at the gym. I'm
44:51
not married to squats. One day I might have to
44:53
do a different exercise because I'm getting older.
44:56
And I turned 40 this year. And now I can do,
44:59
yeah, that's what they keep telling me, but I
45:01
don't feel like a baby. That's not, I don't wake
45:05
up feeling like a baby anymore. But you can't
45:07
be married to just this one strategy and nothing
45:10
else. No, you invest in a brokerage account,
45:12
those stocks are gonna generate for you capital
45:14
gains, they're gonna generate for you dividends,
45:16
they're gonna generate for you interest, all
45:17
of it taxable, right? You'll pay tax on it today
45:20
versus an IRA or a 401k or a Roth IRA, right?
45:26
tripped up by the words, let's just call it future
45:29
retirement investing, right? The benefit to that
45:32
is that in the future, when I take out the earnings,
45:35
depending on the type of account, which a Roth
45:38
is usually the way most people will go nowadays,
45:41
a Roth means I pay tax when I put money into
45:43
it today, but I don't pay any tax on it tomorrow
45:47
when I take money out, which means I don't pay
45:48
tax on what I put in and I don't pay tax on what
45:51
it made me. The downside to that is I can't necessarily
45:54
touch it until a certain age. And so the recommendation
45:58
always, and see, now you start to kind of see
46:01
why it's so important. You alluded to it earlier,
46:03
buckets. It's different buckets. I have my cash
46:07
bucket, which is good for taxes and emergencies.
46:10
I have my investment bucket, which I can take
46:13
out and pay tax on today. And then I have my
46:16
retirement bucket, which I can take out tomorrow
46:19
and maybe not pay tax depending on how I structure
46:21
myself. As an individual, you want to be okay.
46:24
I need to set aside 10 to 15 percent for taxes
46:27
and all that. I need to set aside. I would want
46:30
to set aside 10 percent for what call it savings,
46:33
but I wouldn't put savings. I wouldn't call it
46:36
savings. At that point, you're actively investing
46:38
in today's market. And then I would set aside
46:42
something that is what would be my retirement.
46:44
I'm not touching this for whenever I decide to
46:48
retire. You scale it based on how quickly you
46:51
need it, right? I'm not touching it for a very
46:53
long time without penalty. So that's that I can
46:56
touch it and I might pay tax, but I can still
46:58
touch it. It takes a little less. It takes a
47:01
lot less effort than this bucket. And then there's
47:03
the, I need to touch it without any issue. And
47:05
I needed tomorrow bucket. And that really should
47:08
be your buckets as any professional, not just,
47:13
I mean, you could go to so many different schools
47:14
of thought. They split it up so many different
47:16
ways, but Really, those are your buckets. This
47:19
should be your emergency, what they would call
47:20
your emergency fund cash or you're saving it
47:23
for a, I want to buy this thing and I need this
47:26
cash to buy this thing. So I need it readily
47:29
available. I don't need this readily available,
47:31
but it can be readily available. If I need it
47:34
in a week, I can sell stock. I can sell like,
47:37
you know, real estate is a little harder to sell.
47:39
So you should be progressively like from very
47:43
easy to touch to very difficult. to touch and
47:47
that, and you should have different buckets as
47:49
a professional along the way, where you're putting
47:52
money in all these buckets. Then you say to me,
47:54
well, Chris, what about my, I wanna travel bucket?
47:57
What about it? It can be at the beginning, right?
47:59
And this little bucket that I wanna, I wanna
48:02
travel. There's nothing wrong with traveling.
48:05
Just don't do it when you're going, you know,
48:08
check to check. Because what are you gonna do?
48:12
That's why these buckets are vital. Again. If
48:15
it's boring, it's probably really good for your
48:18
wallet. Well, and to your point with the travel
48:21
bucket, I love that where where, you know, people
48:24
can put stuff aside. So you talked about the
48:27
emergency bucket. OK, well, maybe once my emergency
48:29
bucket is there and I've started my investment
48:32
bucket, then the additional goes into the travel
48:36
bucket. Or you said real estate is hard to sell.
48:39
Yes, it's hard to sell, but it's very easy to
48:41
borrow against. Right. So you can do a cash out
48:44
refi. You can take out a home equity line of
48:47
credit if you need it. do improvements. We did
48:50
several cash out refis on our properties to help
48:53
pay for kids college, right? So yes, it's, you
48:56
know, I think that that's something that as real
48:58
estate professionals we need to understand. And
49:01
even if you're not a real estate professional
49:03
and you're investing in real estate, that yes,
49:05
it is an illiquid asset in the sense of you might
49:08
not want to sell it or it might take longer to
49:10
sell, but there are ways to cash out. And the
49:14
other thing that you mentioned is when you buy
49:17
an investment property and it's cash flowing
49:20
instead of using the money from your work. to
49:25
do the fun stuff in the travel. You use the money
49:28
that you've invested. You use the money that
49:32
that investment makes to do the fun stuff in
49:35
the travel, right? So that that money is always
49:38
growing. Yeah, and this is just speaking in general.
49:42
Now I'm just speaking to people. We spend so
49:45
much time on social media. Do not chase, oh,
49:48
I've got to go to Italy. My friend went there.
49:49
You have no idea how they went there. maybe they
49:51
got there on credit cards and now they're drowning
49:53
in debt. If you really are serious about this,
49:58
going back to Dave Ramsey as a quote, I love
50:00
it, live like no one else today so that later
50:02
on you can live like no one else. So you might
50:05
look a little weird with your buckets. People
50:08
be like, what? How could you? But that's so that
50:11
not too long from now, People are like, oh, wow,
50:14
you went here, you went here, you went here.
50:16
Yeah. And funded by this property and this investment
50:19
and this thing and this thing. And so if you're
50:23
going to be responsible with your business, because
50:25
let's call it what it is with your business,
50:27
it will take some sacrifice today. And I think
50:30
all of us can attest to that. You know, the both
50:33
of you myself, there were years where my trip
50:36
was at Marco Island, and that was where I went.
50:38
And it was a weekend. But I was building something.
50:43
I just got back from Hawaii. I could not have
50:46
gone to Hawaii 12 years ago. I could have, but
50:50
it would have been a financial stretch. Today,
50:53
by the grace of God, it was not. And that is
50:56
because things were built up, things were put
50:59
in place, and it took time to get to this point.
51:02
I think that's super important and also the fact
51:05
that you do have a PA or an OLC. If you're at
51:08
the beginning of your career, get creative with
51:11
your travel. So we go to a lot of conferences,
51:15
right? Because to your point, we're always learning.
51:17
So if we know that there's a conference somewhere
51:20
and it's like, oh, this year it happens to be
51:22
in, I don't know, Taos, New Mexico, and I've
51:25
never been to Taos, New Mexico. Okay, it's going
51:28
to be an expense that I have to take out of my
51:30
business. but I can tag on a certain number of
51:35
days from vacation. You can't write off the vacation
51:38
part, right? But you can write off the portion
51:40
that was the conference, that was the travel,
51:43
that was all of that. And you can tie it in that
51:47
way. So we're not saying that everything that
51:49
you have to do is work, work, work to put money
51:51
away in all these buckets and not have fun. But
51:53
there are ways to be creative legally where you're
51:56
not going to get audited. And if you have a CPA
51:58
like Chris, you know, who understands who understands
52:01
real estate, who understands building a business,
52:04
I think it's a great resource. Before we leave,
52:07
real quick, I just wanted to point out, because
52:09
we did talk about creating PAs and LLCs, and
52:13
I just want to let you know, if you have a real
52:15
estate license in the state of Florida, your
52:18
PA and LLC name needs to be the name of your
52:24
license. So if you're Fernando Adencivia, Jr.,
52:28
the third PA, That's your PA, right? Because
52:32
his license is underneath that. If I'm Jennifer
52:35
F. Wolman, my... LLC is Jennifer F. Wolman LLC.
52:41
We've seen a lot of people, agents get excited
52:44
and they're like, I am the best real estate person
52:47
ever, LLC. And then we're like, you can't register
52:51
that with DBPR and your LLC, your PA, if you're
52:54
going to be accepting commissions through there
52:57
has to be filed with the DBPR. So I just wanted
53:00
to clarify that because people who listen and
53:02
don't call you or don't call us and just go out
53:04
and do it on their own, we want to make sure
53:06
they don't. do it wrong and then come back and
53:08
go like, they didn't give us the right information.
53:11
Amen. Thank you for saying that. I cannot stress
53:14
that enough. Yes. If it says junior, you need
53:17
to put junior. If it says senior, and if that's
53:22
the realtor that happened to, I'm like, I told
53:24
you, exact, exact. Now, if you want to do a DBA
53:30
within reasonable bounds, you can. There are
53:33
rules for DBAs and she was a DBA. doing business
53:36
as so if you want to brand yourself in the luxury
53:39
arena let's say because there's something there's
53:42
something that you know about about christopher
53:45
a sierra pa that doesn't roll off the tongue
53:48
when i'm in a conversation but you want to brand
53:51
yourself with a particular phrase in the luxury
53:54
world so long as it meets the standards that
53:57
are specific to the india and i know that um
54:00
your broker should be up to date on what you
54:02
can and always check in with them before you
54:05
open up some wacky thing, you can with a DBA.
54:08
But your PA, because remember, DBA is not a company.
54:11
It's just a recognized name of a company. Coca
54:15
-Cola is not the name of the company that is
54:18
Coke. That's their DBA. And it happens to also
54:22
be their trademark registered and all that, right?
54:24
So don't be so like, oh, my full name. you can
54:28
do a DBA and brand yourself differently if that's
54:32
what you want to do. Awesome. So in closing,
54:35
is there anything that you want to share that
54:38
we should have asked that we didn't for either
54:40
a new or close to retiring agent? And then finally,
54:44
if you can give us you mentioned organization,
54:47
can you mention any organizational tools for
54:51
either mileage or paperwork or accounting or
54:53
whatever that you've seen that? you think is
54:56
user -friendly? Yeah, you know, just speaking
55:00
generally, I cannot stress enough how I have
55:05
seen, especially in real estate, I have seen
55:07
so many realtors who are, I mean, Fernando, they're
55:12
just disorganized. I cannot tell you. It sounds
55:17
stupid and simple. You say, this guy is saying
55:19
basic stick. Sometimes the basics are our best
55:22
friends. And so I can't stress enough how important
55:26
it is to be organized. I can't, I mean, from
55:30
now, oh, Chris, I only have two transactions
55:32
a year and maybe it doesn't matter. You need
55:35
to get organized now. If you're not gonna be
55:37
faithful with two transactions a year. and 10
55:41
expenses a month, you're not going to be faithful
55:42
with 200 transactions a year and 2000 expenses.
55:47
So you need to from now, from now be organized.
55:52
And to that point, QuickBooks. I mean, that's
55:56
like the accounting standard, right? QuickBooks
55:58
is fantastic. A less expensive one, Xero, X -E
56:03
-R -O, by the way, I don't make money from any
56:05
of them. X -E -R -O is another one that you can
56:08
download and you can use. There's one more and
56:11
now I can't remember the name of the software
56:13
to save my life, but there are dozens of different
56:16
accounting software. All you want to look for
56:18
is a relatively inexpensive one. Five bucks a
56:22
month, right? What's a cup of coffee at Starbucks?
56:25
Skip one Starbucks cup of coffee a month. And
56:27
I know you're getting Starbucks, but whatever
56:29
I'm talking about, come on. I at least get one
56:32
cup of coffee a month from Starbucks. Five bucks
56:52
a month make sure that it has software that secure
56:56
software Nowadays, most of these companies use
56:59
what's called Plaid, which is a secure connecting
57:02
software that connects to your bank account.
57:04
Yes, by the way, Realtor, get a separate bank
57:08
account for your transactions. Get a separate
57:12
credit card for your expenses. Connect those
57:17
two accounts to your accounting software. If
57:20
your accounting software cannot connect to your
57:23
bank account, That is not your accounting software.
57:26
These are not the accounting softwares you are
57:28
looking for. Find the one that can connect to
57:30
your bank account. Automatically download your
57:33
transaction. Spoiler alert, AI does a great job
57:36
of guessing what's what and giving you opportunity
57:39
to correct and teach it so that it continues
57:42
to categorize things properly. So that you're
57:45
reviewing what it's thinking, not one by wanting
57:48
every single transaction. And so get a software
57:51
that does that. and get organized into that realtor
57:54
that's been in the business for a long time.
57:57
I congratulate you. I would encourage you to
58:01
not just think about retirement, but think about
58:03
how you can give back to your real estate community.
58:07
I know it sounds silly, but there is something
58:10
about coming back. And there's something now
58:13
about speaking to a CPA that's just starting.
58:15
I love talking. I was recently I met one and
58:18
I call him every now and again. Hey, how are
58:20
you doing? Because When I started, I didn't have
58:24
a CPA that I could just call and say, hey, so
58:27
what happens when, no, I had to go off what I
58:30
learned from my old boss, and if you're in that
58:34
arena, give back, right? Be part of a team, become
58:38
a mentor, those things, because even for an old,
58:41
not only will it add value to yourself, your
58:44
life personally, but it'll also, believe it or
58:46
not, it'll add value to your business, because
58:48
you don't know how that person that you're pouring
58:50
out into They might become part of your team
58:52
and help propel in the back end of your career,
58:57
more commission, more collection, more activity.
59:00
And so, you know, those just. things that come
59:03
immediately to mind. Thank you guys both again
59:06
for this. This has been a lot of fun. I like
59:08
this style is my this is my style. So everybody
59:11
knows we didn't have a script. I wasn't given
59:13
anything. I was just told this is the name of
59:15
the podcast. Jump in and I'm like, okey dokey.
59:19
I love this. This is much more. I like this a
59:22
lot. I love this a lot. It was a pleasure being
59:24
here with you both. Absolutely, Chris. And thank
59:26
you so much for joining us, for pulling up a
59:28
chair, as we say to all of our audience as well,
59:32
and to be here today in between two chairs. Jennifer
59:35
always does a very great job of sharing links
59:38
to your website and contacts in the show notes.
59:41
So that'll be there as well for anybody who wants
59:44
to reach out to Chris and have a conversation
59:47
about how boring. things that you do consistently
59:51
and lead to the life, the extraordinary life
59:55
that you want to build for yourself and your
59:56
family if you want. That's right. Exactly. Absolutely.
59:59
Thank you. Thank you, Chris. We appreciate you
1:00:02
so much. And thank you for playing. We are totally
1:00:05
freeform here. Fernando and I never know the
1:00:07
topic. We never know what each other is going
1:00:10
to ask. We never do questions ahead of time,
1:00:13
which makes it very unnerving for people who
1:00:16
are planners and preparers. but you did amazing
1:00:20
and we love the free forum and a ton of knowledge.
1:00:23
So thank you so much for sharing all of that
1:00:26
with us. Again, it was a pleasure and you both
1:00:28
are awesome. And Fernando stopped drinking Starbucks
1:00:32
coffee. I knew my caffeine one way or the other.
1:00:39
So if it's not a little window, it's a drive
1:00:43
through Starbucks. So, yeah. All right, everybody,
1:00:47
thank you so much for joining us for Jennifer
1:00:49
and I. Bye. Ciao.