Writing about success reminds me of the interview question tell me about yourself? If you are not familiar with this question, it is an interviewer’s question to get the candidate to start talking. Some call it a 60 second commercial! It is supposed to focus on the skills you bring to the job. I thought I would describe myself through my journey to success.
It all started a long time ago! I was thirty-one (31) years old and thinking corporate finance and accounting was my passion in a corporate setting. I was just thinking about investing and it grew from there. Seven (7) years later, I had a business that allowed me to quit my day job. If it were really that simple everyone would do it! There is a great deal more and it started close to three decades earlier. I grew up poor in an affluent family. My parents were rich and successful, but lived as though they were poor. We lived in a ten (10) room house in the City (New York) next to my doctor and dentist and we had a country place in New Jersey. They also owned two (2) cars and two (2) businesses. When I say owned, there was no debt.
My parents were very busy and I do not remember seeing them much as a child except at work. I think this had a strong influence on me as I grew up. I remember staying very busy taking piano lessons, practicing, playing with friends, playing games (cards and board games) and working with my parents. I think I learned a great deal from being around my parents, but I did not know how much until much later. I was always fascinated with money and business, so it was not a surprise that I would pick a career in finance and accounting. It made sense to me to take my math skills into business. It allowed me to combine my interests with my skills. The best part was I was paid to do what I loved to do!
What influenced me? I think I was always trying to get my parent’s attention. It was routine for me to work with my parents every weekend from a very early age. I think I started going to my mother’s store as early as four years old. I would work for a couple of hours and have lunch. Just being around them in business taught me a lot. I never thought it was unusual except that I did not see them much. My earliest memory of getting their attention was when I earned a little money. I was seven (7) years old and rented parking spaces on my parent’s land for an afternoon. This became an annual event and I saw my income grow for just working a few hours. I made just a few dollars, but my parents were thrilled. Next I sold candy for the 4-H Club door to door. I wasn’t the best, but I learned to overcome my fears and build confidence.
My parents influenced me in many different ways. It was never the things they said, instead it was the things they did. As far as I know, my parents never had any debt except their first home. Their first mortgage was tiny compared to today’s numbers, but significant for 1929. They built a custom home as the country slipped into The Great Depression! The mortgage was approximately $9,000 with an $85 monthly payment. I remember my parents were big savers. They influenced me to be a saver too. They lived well, but did not waste money on frivolous things. They bought bonds, real estate and started businesses. One other thing influenced me although I did not realize it at the time. I do not remember ever seeing my parents go to the store to shop. I am sure it was because they did not have the time. I do remember that they bought everything wholesale. My mother had a children clothing store and she would just add to her orders for me. They always had connections which influenced my purchasing habits.
School was a huge influence! I always attended private school, but I went to a prep school in the seventh grade. Living away from home was a huge change! Living and going to school with children of successful people influences you in ways you don’t realize. Children of successful people have traits and characteristics that can motivate you to do better. I was always competitive, but it raises your game! Classes were small and you could not hide. There were plenty of opportunities to get help from teachers and other students. Besides all the support, I developed lifelong relationships. I still talk to my ex roommate from nearly fifty (50) years ago. Watching and learning from other successful people helps you succeed too.
When I finished college, it was the height of the Vietnam War! My student deferment turned into a draft notice! It came shortly after getting married and starting my first career job. I was drafted and inducted into the army, but never made it overseas. Instead, I taught business subjects to inmates at the USDB (armed forces prison). My wife even joined me in Kansas. This experience matured me fast and taught me how to get things done in a difficult environment. I made my own opportunities. I was attending grad school at night and networked to get this assignment. My short military experience motivated me to try different things which helped me throughout my life.
Was it a lucky break?
One of my first career jobs was with a Fortune 100 company when I met a colleague who invested in income property. I think I asked him thousands of questions and took my first step into investing. My first step was finding a real estate broker who would school me in rental property. I must have interviewed twenty-five (25) to thirty-five (35) real estate brokers before I found a “good” one. My first investment was a nine (9) unit and I was on my way. It was all about the numbers which I thoroughly enjoyed. I was looking for growth not cash flow! I did not need the income although I wanted it to break even. Income property is sold based on a multiple of income or cap rate. My goal was to raise the income so the property would increase in value so I could either sell it and have capital gains or do a 1031 exchange for a larger property. A 1031 exchange is a tax provision that allows an investor to defer taxes.
When I bought the twenty-four (24) unit, I had an opportunity to fill eight (8) units. Although rent control limited the increases, you could raise the rent to market when it was vacant. I decided to approach marketing of these units to maximize value. This was a working class apartment building where the rents were modest. Normally, I asked for first and last months rent and a cleaning deposit security. I decided to lower the move-in costs and raise the rent by twenty-five (25) dollars. My theory was that coming up with $1,000-1.200 upfront was a stumbling block for many credit worthy people. I lowered the deposits by $300, but raised the rent by $25 per month. I screened the perspective tenant more and basically broke even in twelve (12) months. The bonus was every unit rented at the higher rent generated an approximately additional two thousand dollars in value. Most of the tenants stayed longer than a year and each (percentage) increase was based on the higher rent. It is all about the numbers!
Over time, I successfully traded (1031 exchange) my rental properties for larger buildings or added new properties. One of the properties I bought were ten (10) townhouses, I was thinking of converting the townhouses into condominiums, instead I kept them as rentals. My last investment was a shopping center (11,500 sq. ft.). My income property provided a steady income to live reasonably without a day job. I was thirty-eight years old and took the leap of leaving the corporate world! What was I going to do? These properties did not take forty (40) hours to run it. I started to add businesses not just to fill my time, but to balance the lack of liquidity of real estate. I added a fast food restaurant, studio catering company and consulting followed. I never earned so much money, but it was a lot of work. About twenty (20) years ago, I started to sell it all off and concentrate on consulting. I started to change directions because it was no longer fun! Turning all my investments into cash did not hurt either.
I thought I would try out teaching by becoming a substitute teacher. I thought if I liked it, I might teach until I was ready to retire. I have been a teacher for twelve (12) years and thoroughly enjoy it! I like influencing young people and sharing what I have learned. I teach business and computer applications. About five (5) years ago, I created a number of classes such as personal finance, careers and virtual business. I get to use my business and personal skills to influence young people. Teaching is a very fulfilling profession for me. Along with a career I enjoy, I get great benefits and a pension too. Is it a lucky break or good planning? “Luck is what happens when preparation meets opportunity” (Edison). Doing something you enjoy provides immense benefits, you are happy and other opportunities occur. Two (2) years ago, I started a blog and this year I started volunteering. I volunteered to put together some workshops for the Boys and Girls clubs for spring.
I managed to do everything I wanted to. Since I am just past middle age (66 years old), I still have a lot to do. I have a plan and I am constantly adding to or changing it. Success is not automatic! I learned a great deal from my parents, but that was just the start. I attribute my success to savings and investing. For me, my decision process is examined and thought through in a planning process. I start my process with questions! Questions that range from what is the outcome to what I want to achieve? I always try to think long term. What do I want my retirement to look like? Not just financially, but what will I do? I have really become pretty good at asking questions of myself and others. Little did I know that is the basis for search engines! I use questions as a method for negotiation as well as learning. I started this off with focusing on my skills and strengths. Although my experience may be unique, I believe everyone can achieve success. I hope my success will encourage your best effort.
Photo by: thinboyfatter