The Secret Formula: Buy Flip Holds for Maximum Profit

Brett McCollum (00:00.941)
All right, guys, welcome back to the show. I am your host, Brett McCollum, and I am here today with Calvin Cannon Jr. And today we’re going to be talking about buy, hold. That’s right. Before we do, guys, at Investor Fuel, we help real estate investors, service providers, and real estate entrepreneurs to 2 5x their businesses to allow them to build the lives they’ve always dreamed of and the lives, ultimately, they’ve always wanted. Without further ado, though, Calvin, how are you,

Calvin Cannon Jr (00:24.778)
I’m doing good, Brett. How you doing,

Brett McCollum (00:26.609)
Dude, I am great good catching up with you pre show and getting to know you a little bit and I I am there’s some cool stuff We’re gonna be talking about today, and I’m excited to keep that with you before we get real far I always like to ask you know just kind of give some background who’s Calvin give us some background. You know who are you man?

Calvin Cannon Jr (00:31.694)
Thank you.

Absolutely.

Calvin Cannon Jr (00:43.308)
Yeah.

I’m

My private investor went from a nine to five, started doing real estate, went to college, wanted to get out of my parents’ house, right? So I bought my very first property, turned that over into a flip. And this is the man that you see today. One of the biggest things that we talk about is the buy flip hold like Brett had mentioned. And our slogan is rents due.

Brett McCollum (01:34.447)
That’s right. Dude, that’s super cool. So Philadelphia, have you been born and raised? you still like, what was like, are you a transplant?

Calvin Cannon Jr (01:41.646)
Yeah, absolutely. So I’ve been born and raised in Philadelphia. I have traveled a little bit, know, went to Delaware, Virginia State, but, know, born and raised in Philadelphia. And I love it.

Brett McCollum (01:53.169)
Very cool. Yeah, very cool. I mean, yeah, I’m down here in Florida and I got some friends up in the Pennsylvania areas and they’re like, man, it’s so, I’m like, man, it’s 80 degrees today, dude. Yeah. Hey, that 50 feels like it may as well be summer at this point, right? Yeah. Yeah. So I’m actually originally from Ohio natively.

Calvin Cannon Jr (02:04.91)
Yeah, yeah, yeah, right now it’s like 50 degrees up here and yesterday was 30. So yes back for

Calvin Cannon Jr (02:15.256)
Yes, yes, absolutely. 50 feels good for us.

Okay, awesome.

Brett McCollum (02:22.257)
I remember man once we I was like I played baseball my whole life, you know, and I remember when spring spring baseball came was end of February basically, right and early March like kind of you know timing is now and when we got outside and it was 45 degrees I was like, it’s great. It’s so nice outside, you know, and yeah, but anyway, but so let’s walk back a little bit real estate. So you began approximately when was your first, you know, dip your toe in the water real estate. What was that like?

Calvin Cannon Jr (02:31.128)
Yeah.

Calvin Cannon Jr (02:36.846)
Hmm. Yeah, for sure. Yeah.

Sure.

Brett McCollum (02:52.211)
.

Calvin Cannon Jr (02:52.462)
you

Yeah, man, it was an awesome experience. So a lot of people jump into real estate because they’re looking for something. I kind of stumbled into it. was 18 years old, 17, 18 years old, just graduated out of high school. And, you know, I was living with my parents and, you know, my mom is very, very strict. So in my mind, I was like, hey, I want to be my own man. I want to get out of the house. I can’t live in this house with all these strict rules and regulations. Right. So I was going to Temple University back in 1991. And I was actually doing my financial aid for Temple.

and you know, being a young kid, know, knucklehead, wasn’t doing things right, I put my financial aid in pretty late and I got a stifin check. And for those who go to college, know that, you you get a stifin check for your books, you know, for your room and board. And that stifin check came after the semester, was $5,000. So at that point I’m like, hey, if I can cash this check and I can keep it, I’m just gonna use that money for the following year. Well, lo and behold, I found a duplex at 32nd and Cecil B. Moore in the Philadelphia area for $5,000. That’s all I had was $5,000.

property. It was a bad property at that time. know, the windows didn’t work, the front door didn’t lock, upstairs was totally tore apart. So I stayed on the first floor. I moved in there, stayed there for two years while I was in college.

Brett McCollum (04:06.299)
How old are you? You’re 18? Yeah.

Calvin Cannon Jr (04:07.736)
I was 18 years old, yep, 18 years old. And my goal was, it wasn’t real estate, the goal was independent. I wanted to be independent. So I wouldn’t get out of my parents’ house. So I stayed there for about a year and a half to two years. Then this gentleman, he had his own entrepreneur pharmaceutical business in the area. So he approached me and said, hey, I wanna buy the property. At that point I’m like, you wanna buy this? Because it was a piece of crap. had robins all over the place.

Brett McCollum (04:11.153)
Thank

Brett McCollum (04:16.026)
Yeah.

Brett McCollum (04:26.768)
Okay.

Calvin Cannon Jr (04:37.68)
want to buy it for $60,000. Now back then we talking 90, 92, 93, I’m like $60,000. So I’m like, okay, yeah, whatever. So the guy came back about a week to two weeks later with a bag full of money and some documents. I probably signed about maybe 12, 12 pieces of papers that signed my name on it. Gave him the documents. He gave me the bag full of money. I ran inside the property. I bagged up all the clothes that I could inside of my school and took it to my mom’s house. I get there. so excited. I’m like, we’re rich. You can quit your job. You don’t have to worry about nothing else. I got a whole bag full of money.

Brett McCollum (04:58.831)
Heck yeah, you did.

Calvin Cannon Jr (05:07.6)
like you’re crazy. So long story short.

Probably like six months after that, ran through the money, but I did save about maybe like 20, 30,000. And I took that money and I went and bought another property, which was a quad on a 4,400 block of Germantown Avenue. So I paid $8,000 for that, turned around and bought another one for $10,000. And at that point I started seeing that, if I spent five and made 60, I made a 55 to a $50,000 profit, then I started buying more and more real estate. At this time I’m still working. So, you know, I’m a young kid, I’m working a nine to five, I’m working in the supermarket business.

and I’m trying to figure out this real estate thing on the side because I’m making all this money, but I’m burning through it. I’m burning through the money. So at that point, I took a step back and said, hey, I’m going to start educating myself on learning real estate. So I went and got my real estate license, started really studying real estate, studying the rules and regulations and the laws in the back office of real estate. Then I started buying more and more properties and eventually I disrespectfully, respectfully fired my boss.

Brett McCollum (06:05.723)
Yeah, right. Yeah, I mean, you are now promoted to customer, right? Yeah.

Calvin Cannon Jr (06:10.272)
Yeah, you are now from what it comes from. Absolutely.

Brett McCollum (06:14.105)
Yeah, man, that’s really incredible. mean, you such a young age, but it’s interesting how people like get to that place at some point in years was independent. was not in that something, you know, and I think there’s something to be said for the fact that the I think people that the driver is money. It always comes a little bit more difficult.

Calvin Cannon Jr (06:18.296)
Yeah.

Calvin Cannon Jr (06:26.548)
It wasn’t the money.

Calvin Cannon Jr (06:36.812)
Yes.

Brett McCollum (06:38.001)
And that’s just people like over the years than my experience that I’ve seen with folks is when I’m gonna get into real estate because I heard that it makes more millionaires than anybody else. That’s a large and by the way, it’s not wrong and you should do it too for that reason. I get it. Like I’m for it. I’m very pro that but I always find that when people attach their reason for entry to money, the path is usually a little more difficult.

Calvin Cannon Jr (06:54.808)
Yeah, for sure.

Calvin Cannon Jr (07:03.148)
Mm-hmm. Mm-hmm.

Yeah, you know what, Brad? I always say that.

The best success you’re gonna have in business, and for me and for you, it’s real estate, but the best success you’re gonna have is when you’re passionate about something, right? So if you’re chasing the check, you know, lot of people are chasing money, but you’re never gonna catch the money. They print money every day. So if you’re in it just to chase money, the passion for it is not gonna allow you to have the success that you wanna have. So you gotta have different reasons for why you’re getting into business, and you gotta believe and understand that doing business is doing business, right? You just can’t get in there and say, hey, I wanna do this as a hobby.

Brett McCollum (07:17.361)
Mm-hmm.

Calvin Cannon Jr (07:39.982)
I want to do this as a get rich quick strategy and scheme is never going to happen. You got to understand the business so you can have longevity for future generations.

Brett McCollum (07:49.317)
Yeah, and then you kind of got a vision of that even at like at a very early age of like you realize the money I’m burning through it. I’m doing this like because I mean, let’s be honest that you were a young man at the end of the day and probably like I got money and I’m going to like I don’t know what you were doing. But like I imagine you might have been having a little fun, you know, doing like, yeah, I’m I’m speculating. We don’t know each other. But having fun and you know, but then realizing at the same time is like

Calvin Cannon Jr (07:54.008)
Yeah.

Calvin Cannon Jr (08:07.704)
A lot of fun.

Calvin Cannon Jr (08:12.332)
Yeah, yeah.

Brett McCollum (08:18.669)
I have this opportunity in front of me and I need to grab a hold of it. So there’s something that was going on, even though you’re having fun and making some silly choices maybe over here, but there’s the other side of your brain that’s going, when did that responsibility, was there something that happened that really was like, all right, this set me off that I need to become responsible with this? Or was there a moment or was it just kind of it evolved organically?

Calvin Cannon Jr (08:39.459)
Yeah.

Yeah, for sure. So when I got the money, remember, so the reason for getting the property was to have my independency and get out of my parents’ house. So when I got the money, I went back to my parents’ house. So it’s like I got the money, I’m spending the money. Then when the money started running low, I got the flashback of the rules and regulations of being inside of my parents’ house. I got to get out of here again. So then I said, OK, I’m going take the money that I have left and go buy another property. When the bug hit me,

was when I realized that I was making $30,000 at my nine to five job and I just blew through $60,000.

Brett McCollum (09:18.0)
Yeah.

Calvin Cannon Jr (09:18.39)
When I’m thinking to myself like, I’m going to work every day, working eight hours a day, and I’m only making $30,000. So the first thing kicked in was I need more money. So I started working hard, took my job more serious, right? So I started working more harder. I started getting promoted. Then I became the district manager of the company. Then I became the regional manager of the company. And then at that point, I started feeling like, hey, I’m giving this company all of my time. Yes, my salary increased, but I’m giving this company more of my time and I’m unhappy.

But when I was living in that, you know, a road infested apartment building, although it was bad, I was happy. So then I realized, hey, you know what? How do I get my happiness back and still maintain the money and stop buying foolish things? Like, you know, I felt like I was buying the cars of convertible Mustang, the Jaguars, the Mercedes Benz’s. And I had to realize that, you know what? This this is bringing a different type of attention that I wasn’t used to. You know, I was a shelter child. I wasn’t out, you know, out partying and doing different things so that

Brett McCollum (09:56.111)
Interesting.

Calvin Cannon Jr (10:17.872)
attention that was coming to me, it was overwhelming and gave me anxiety. So I said, you know what, I got to get rid of that and just focus on the things that are making me happy. And I realized that the happiness was my freedom. It was the freedom from the independency. It wasn’t the money I blew through the money. I didn’t respect the money. What I respected was my freedom and my independency. And when I got hit with that, I realized that, hey, if I want to be free, if I don’t want to wake up and go to the supermarket and work, you know, eight, nine hours a day in order for me to get that freedom, I have to learn how to make money in my

Brett McCollum (10:21.806)
in the mean time.

Calvin Cannon Jr (10:47.802)
sleep and that’s when I started realizing that hey this is what I have to do to get that freedom.

Brett McCollum (10:51.663)
Yeah. a couple things. I want to rewind and highlight it just for a second. you guys go back and listen on your own, go back in 30 seconds, 45 seconds, and you may mention, said, I didn’t respect the money. Man. I don’t think I’ve heard people say that. You hear people say you need to be a good steward. You hear different things. But hearing it, I didn’t respect the money.

Calvin Cannon Jr (10:57.112)
That’s it.

Calvin Cannon Jr (11:06.296)
Yep. Yes.

Calvin Cannon Jr (11:15.32)
Yeah.

Brett McCollum (11:20.517)
That’s a powerful, I really just wanted to highlight that. That was really a good thing. Wanted to ask you this. So approximately at this point, you were 18, first one. When was this realization of like, I’ve got to respect the money. I’ve got to, how old were you at this point?

Calvin Cannon Jr (11:24.27)
Sure.

Calvin Cannon Jr (11:35.742)
Probably like 21, 22. I had to start with respect.

Brett McCollum (11:39.311)
So early on, yeah.

Calvin Cannon Jr (11:40.822)
Yeah, so I had to start respecting it because money was coming, money was going, but I wasn’t understanding it. When I when I did my first, when I had to file my first income taxes for myself is when I started respecting. I had to respect the money because I did the person that that sold me the property 1099 me. So I had to show that income coming off of that. Although we didn’t go through a title company, he’s still 1099 me. So I had that. Then I had my job income where I had to file taxes on.

When I realized that at the end of the year I had to pay money to somebody and I didn’t have any money to pay them, I said wait a minute I’m doing something wrong. So then I had to go back get some more education start asking a lot of questions like hey you know I never became an accountant but I went back to school I wanted to study business management to learn how do I keep the money. A lot of people talk about all the money that they make but nobody focuses on how much money do you keep.

Brett McCollum (12:36.539)
Right.

Calvin Cannon Jr (12:36.652)
And at that point, I made a lot of money, but I wasn’t keeping money. So that’s when I learned how to start respecting money, when I had to pay the government back, when I had to pay the IRS back, because they definitely was coming for the things that I had.

Brett McCollum (12:47.665)
Yeah, yeah, yeah. All right, so you’re I mean at this point it’s still I mean you’re in it’s still the Mid 90s at this point, you know kind of catch us up. mean this year we’re talking, you know, how many 20 30 years ago, right? Catch I mean quickly I mean because I know we don’t have all the time in the to go through 30 years Walk me through kind of the evolution of like hey, I alright

Calvin Cannon Jr (13:09.363)
Yeah, for sure.

Brett McCollum (13:17.039)
respect, now I’m starting, right? Because at that point, it was your entry and you’re like, you don’t know what you don’t know. It wasn’t like you’re like, I’m out here trying to do things the wrong way. I’m just trying to figure things out. Well, now I’ve got some education from real world. I’m sure you learned a lot, lot more over the years too, but kind of catch me up a little bit.

Calvin Cannon Jr (13:17.997)
Yep.

Calvin Cannon Jr (13:28.992)
figure it out.

Calvin Cannon Jr (13:35.182)
Yep.

Yep. So basically once I started respecting the money, I educated myself more, got my real estate license, went back to school, got my business management degree. And then at that point I started taking real estate serious. So I wanted to make real estate my career because I loved what I was doing and I understood it. So at that point, you know, I still worked at my job, kept doing the things at my job. I used the information from my job. My company taught me how to create SOPs, taught me how to read P &Ls, taught me how to manage people, taught me

Brett McCollum (13:56.049)
Mm-hmm.

Calvin Cannon Jr (14:06.8)
about HIPAA, taught me about customer service. So I utilized the information from my job and turned it into my business. I learned how to create LLCs. I learned how to create business partners with lenders. So at that point, I started scaling up faster. So I started buying, you know, maybe one or two properties a year. I turned the one or two properties over and started buying one or two properties every three to four months. So now I’m currently buying at least two properties every three to four months now in my current career. I eventually left my job and went full time

Brett McCollum (14:18.976)
Mm-hmm.

Brett McCollum (14:29.051)
Mm-hmm.

Calvin Cannon Jr (14:36.72)
out of real estate and I never turned back. So that’s when we got into the buy flip hold scenario. Whereas though I realized that if I did one flip a year, was the salary, was 50 % of the salary that I was getting from my job when I was at the high end. If I did flips a year, I was actually grossing exactly what I grossed at my particular job. So at that point I made the transition. I left corporate America and I focused on real estate full time. Hired a mentor, picked up my mentor and it’s just been history from there.

Brett McCollum (15:07.077)
That’s amazing. Well, that’s a good transition point. Let me ask you, I, bi flip hold, break it down. What are you doing with that?

Calvin Cannon Jr (15:13.016)
Yup. Yup.

Yep. So buy flip hole is the recipe and the strategy that we use at the cashflow roadmap. And what we basically do is we buy a single family home in our area, right? We take that single family home. We renovate the property. put the property on the market for a retail buyer. Typically as an FHA buyer, they put 3.5 % down. We sell that property. We take the proceeds of that property and we transition that to an IUL policy. I’m sorry. First, we do a 1031 exchange. Then we take it to an IUL policy. Take half of that money.

a hold property, is a multifamily property, have the tenant service the loan, then we do the birth method where we pull the forced appreciation equity out of the property. Most people do 75%. We take out 60, 65 % because we wanna stay moderate. Then we take that money out, split that in half again, and then we go buy another single family home to buy flip hold and to get cash flow, supersedes your flips. So that’s our strategy for the recipe.

Brett McCollum (16:09.681)
Beautiful. Yeah, that’s incredible. Yeah, because you’re truly leveraging the assets to pay for more assets. Yeah, yeah, super incredible. I want to spend a few minutes talking about this, too. So you were talking about you splitting. So you get 65 % of the LTV on it. It comes in. then let’s say that however much money doesn’t matter. You just take that and split it in half again. What are the two buckets that it’s going to?

Calvin Cannon Jr (16:16.91)
Absolutely.

Calvin Cannon Jr (16:37.794)
Yeah, so we split it. The first bucket is going back into the acquisition. Then the second bucket goes into a profit and then it splits again where I take I take some of that net and then the other half of that net goes into a IUL policy. So we can compound.

Brett McCollum (16:52.057)
Right? Yeah, okay, so that’s where I was trying to get to, because we kind of pre-show, were talking that a little bit, and on the life insurance policy there, right? Because if you don’t know, guys, it’s a type of life insurance policy.

I want to spend a few minutes talking about that because there’s not, like, and by the way, guys, just so you’re aware, there are two, like, we’re just going to make it, and I’ll let you talk and break it down high level for us, Calvin, but we’ve got two sides. You’ve got a whole life policy and you’ve got term life policy, and there’s different types of term, different types of whole, and what Calvin’s doing, and I’ll let you explain it, is a form, it’s a type inside the whole life policy. Can you speak to that, kind of break it down a little bit for us?

Calvin Cannon Jr (17:20.856)
Yep.

Calvin Cannon Jr (17:34.03)
Yeah, absolutely. So what we do is an indexed whole life life insurance policy. It’s almost, if you look at it, it’s almost like a bank account, right? So when you put your money inside of a bank, you’re actually building a relationship with that lender and then you can borrow against your money because the lender sees the money that you put inside. So with our index IUL, what we do is we put the money inside of our IUL versus putting it inside of the bank. So when we put it inside of there, we borrow against it. Now, when you think about this principle, when you

money from the bank you have to pay the bank back right if you miss a payment guess who’s coming for you the bank well with the index IUL is basically creating your own bank so I’m borrowing against that bank and if I miss a payment guess who’s coming for me me

Brett McCollum (18:06.662)
Right.

Right.

Calvin Cannon Jr (18:19.574)
So it’s not me owing the bank, it’s me owing myself. Now, you don’t wanna miss payments, you wanna continue to put your money inside of there, but this is how we build our financial relationships by using the index IUL policy and we borrow against it to increase our portfolio for real estate.

Brett McCollum (18:35.759)
Yeah, and I’m gonna try to tee you up for another inside of that question, okay? But Calvin, I just opened it up, you know, and I’ve only been able to put, you know, I mean, I scrimped and saved, and I only got $10,000 to put into it this year. How could I ever borrow against $10,000?

Calvin Cannon Jr (18:40.014)
you

Calvin Cannon Jr (18:55.566)
Absolutely, typically what we do is we’ll create a million dollar policy or maybe a two million dollar policy and even though you put the $10,000 in there, you can borrow up to a certain percentage of your 10,000. So a lot of people think that, because it’s a million dollar policy, I put in 10,000, I’m gonna take out 100,000. That’s not how that works. So it’s the money that you put in and it’s a percentage of the money over time that you can take the money out. Now the benefit of it is even though you borrowed against your 10,000, let’s say you put in 10, you took out five.

Your 10,000 is still compounding as if your 10,000 is still there because you borrowed against it. So you’re paying your 10,000 back with interest.

Brett McCollum (19:31.345)
Mm-hmm.

Calvin Cannon Jr (19:34.894)
So imagine paying back the lender with, you know, six, 7 % interest. You’re paying back yourself that 5,000 plus the six or 7 % interest. So that’s the reason why we wait till we do the buy and flip, because now we have a bigger net profit after the 1031 exchange where we can drop 30, $40,000 inside of there. And if we’re doing two flips a year, let’s just call it 60 to 80,000. And then the second year we may take, you know, 40,000 out of that because we’re borrowing against the IUL to go back inside of real estate. So you, so you do want to put a large portion of

Brett McCollum (19:35.131)
Mm-hmm.

Calvin Cannon Jr (20:04.858)
money in there if you can and if you can’t just at least put something in there put something in there each month to build it up to build it up so it can start compounding.

Brett McCollum (20:12.901)
That’s right. Yeah, and there’s some recommendations of like how long you should season it for before you try to, you know, yeah, what do you guys recommend on what you see? Yeah. I mean, I’ve even heard two years, right? Like it’s a, yeah, because you want to build up to, because of the compound effect, you want to make sure that it’s doing its job. Yeah, and guys, that’s it. The reason why I wanted Calvin to break that down is, you know,

Calvin Cannon Jr (20:17.208)
Yes, absolutely.

Six months to a year. Six months to a year.

Yeah.

Calvin Cannon Jr (20:29.602)
You want to pull it up? Yeah, absolutely.

Brett McCollum (20:38.179)
it’s kind of the more you know kind of thing, because there’s a lot of disinformation on whole life. But I’ll be honest with you, if your whole life isn’t set up properly, then it isn’t really beneficial, right? It has to be set up correctly, and it should be with somebody that knows how to do exactly the strategy that Calvin’s talking about, probably don’t do it.

Calvin Cannon Jr (20:42.958)
Yes.

Calvin Cannon Jr (20:48.365)
Mmm.

Calvin Cannon Jr (21:01.262)
or you need to reevaluate it every 12 months. So sometimes things change in policies where if you just set it and forget it, you could be leaving money on the table and you can be losing out. But if you go back and analyze it every 12 months, go back and talk to a specialist, like, hey, I’ve been doing this. I don’t really see my money growing. Do you have another program or you have another product that you can transfer me in inside of this IUL? So always evaluate your IULs every 12 months.

Brett McCollum (21:05.988)
Yeah.

Brett McCollum (21:25.785)
Incredible. Yeah, and that’s great advice to do that One more question on the whole life side of things Traditionally speaking well just from let’s say that you know what I am more of the passive I’m gonna you know slowly put money into this account and What’s the benefit of even just doing that outside of like guess it’ll compound at some point, but what’s the growth projections versus let’s say I don’t want to put in the stock market like why like pros and cons

Calvin Cannon Jr (21:55.278)
Yeah, so for me, the pros are that if I put $50,000 in the bank and I’m getting 0.0025 % off the interest on my money, right, it’s not growing, it’s not compounded. If I put my money into the IUL and I’m picking up 4 5 % off of my money, then now my money is compounded and as it compounds, it increases and compounds again. Stock market, I’m not too familiar with the stock market, but what I do know is that if I’m going to be a high risk investor, I’m putting it inside the bricks, the red bricks, I’m putting it inside of real estate.

I’m not really putting it inside a stock market because the stock market fluctuates up and down. Not taken away from the stock market because I know a lot of people are doing very, well in it. However, it’s time consuming, right? To me, I feel like the stock market is more active income versus passive income because you have to actively be in there and watching the candles and different things of that nature. With the IUL, I’m dropping my money in there and there’s nothing else I have to do. So, you know, the IUL is working for me behind the scenes to compound the money while I’m working for myself to

to build up more real estate. So I feel more comfortable with the IULs. There may be some stock market experts out there that might say, hey, if you did this, it can probably compound faster. Maybe, but my success has been with the IULs.

Brett McCollum (23:08.049)
Yeah, and that’s where your peace lies too, right? Like, and that’s where you’re at with it. Yeah. My limited, I’ll be it limited, I don’t want to claim any expertise. There’s also predictability of the IUL, you know, four or five percent is lifetime. It’s always been that, always. In recession, in non-recession, even 2008 when everybody lost their butts in real estate, it still performed, you know?

Calvin Cannon Jr (23:11.182)
Sure.

Calvin Cannon Jr (23:26.338)
Yes. Yes.

Brett McCollum (23:36.177)
And that’s because in the insurance world, they control, that’s where that money’s at, right? Those policies are inside of it, it’s in the insurance world. And they navigate the markets not because of real estate or not because of stock markets or not because like they’re gonna, so that money’s held in those buckets over there with the insurance. So that’s why your predictability is four or 5%, you know what I mean? And that’s really been a very cool thing.

Calvin Cannon Jr (23:46.306)
Yeah.

Calvin Cannon Jr (23:59.352)
Cheers.

Brett McCollum (24:04.601)
And so the other side that I like to do is looking at the stock market, like people put in the 401k, right? Because it’s a set and forget it and it’s more passive in its nature, like we’re talking about. But I have had many friends that bad timing, know, or acquaintances or like my in-laws age or people like that are at that retirement age. And in 2008, when it all went to just boom.

Calvin Cannon Jr (24:12.962)
Yep.

Calvin Cannon Jr (24:17.836)
Yep.

Calvin Cannon Jr (24:28.472)
Yep.

Brett McCollum (24:32.933)
And that 401k that was here is now gone just like that. Now traditionally and historically, 401k has always been really high performing. But there’s nothing to say that you don’t hit a recession tomorrow or another corona event that could happen tomorrow. We don’t have that control, but it’s been predictable. So for us, I like predictability. I think that…

Calvin Cannon Jr (24:33.027)
Yep.

Calvin Cannon Jr (24:36.568)
Yep.

Calvin Cannon Jr (24:41.58)
Yep.

Calvin Cannon Jr (24:52.174)
Sure. That’s right.

Calvin Cannon Jr (24:58.222)
You

Brett McCollum (25:01.839)
having that is a cool thing. So that’s my little soap box on that, man.

Calvin Cannon Jr (25:05.358)
And you know what Brett I also look at it like this and a lot of people may not understand this that Your bank is backed by insurances

The bank money comes from insurances, right? So people think that the bank has money sitting in the vault. It’s not in the vault. The money is in insurance policies. When you do private lending, when you have investors, a lot of these investors and a lot of these small mortgage companies, small hard money lenders, they’re pulling money off of a line, off of their insurance. The other part of that also is that remember, it’s still insurance. it’s a death insurance policy. So if I have a million dollars in my IUL and I have, you know,

a million dollars in my 401k and something happens in the 401k and the stock market tanks, I’m losing more money. If I stress out and pass away, guess what? This million dollar policy is still covering me because it’s my life insurance, it’s covering my life, right? 401k is not protected, it’s covering my life. It covers how it performs. And for me, I wanna bank my money on where my life is going.

Brett McCollum (25:57.393)
That’s right.

Brett McCollum (26:05.99)
Yeah.

Brett McCollum (26:09.583)
Yeah, well, let’s bring this back into the to real estate conversation. The cool, like because you’re it’s you’re thinking in the future, you’re not thinking for today and you’re able to build, you know, for you, for your family, for legacy, like with that in mind, too. And you can leverage real estate to be able to do that, you know, and you’re diversifying it in multiple ways with, you know, hey, for every hundred dollars, it’s getting split accordingly. And, you know, over time,

Calvin Cannon Jr (26:17.933)
Yes.

Brett McCollum (26:38.499)
I imagine it creates some peace of mind of like, sure. Things might not be the easiest and like, hey, Calvin, go and find a deal today. Like the scratches, you know, it’s a little harder than it’s been, you know, but there’s still peace of mind because you have over the years now, how many performing assets and things like that that you’ve been able to do. And that’s been a really thing. So today, what is it? What are you working on now? Like what’s the future looking like? What’s that?

Calvin Cannon Jr (26:43.286)
Right.

For sure.

Calvin Cannon Jr (27:01.218)
Yeah, for sure. For sure. Yup. So I mean, you know, we still stick with the recipe by flip and hold. know a lot of people talk about, the interest rates are high and you know, the inventory in the market is low. How are you still doing real estate? I love real estate. We do real estate every day. There is never a bad time to buy real estate. And here’s the reason why.

Real estate comes with multiple strategies and multiple ways to pivot. When a lot of people don’t focus on the back end of the business side of real estate, they get stagnated and just focus on, the interest rates is high, I’m not gonna buy. there’s no inventory out there, I’m not gonna buy. there’s not enough buyers or sellers out there, section eight is doing bad, or the tenants aren’t doing good. Every market is gonna have its challenges, but you can pivot and learn how to pivot with having different strategies and different options, you’re always gonna survive in real estate.

I buy all year round. There’s never been a time that I hadn’t bought in real estate. In fact, when we went through the pandemic, which was, you know, 2000 to 22, I bought the most real estate. How many? Let’s say it again. Five years ago today, right? I bought the most real estate in my career because when I started back in 1991 in real estate, a hard money loan.

Brett McCollum (27:59.003)
Five years ago today, by the way. Five years ago today.

Calvin Cannon Jr (28:13.134)
If I took out a hard money loan, my interest rate was 11, 12, 13%. So when people, the new investors nowadays are like, oh, it’s eight, 9%. I’m like, okay. that’s not, they’re thinking that is abnormal, right? That is eight to 9%. And I’m saying that that’s normal.

because when I was getting 11, 12%, people were still buying real estate. So when the interest rates right now are eight or 9%, it’s not a big deal to me. I’m used to it. Actually, it’s better for me because I’m not in double digits. So when we went through the pandemic and the interest rates dropped to 4%, I went crazy.

I thought I said to myself, I said, these lenders are going to just pull this money back and say there was a mistake. I bought probably about 25 to 30 single family homes during that era because the interest rates were 4%. I picked up DSCR loans. I put some tenants in there. Some of them, I just carried the mortgages. And guess what? Today, that’s the single family homes that now I’m flipping inside of my buy flip hold because we picked up the inventory and we waited. The key to this is don’t wait to buy real estate. You buy real estate and wait.

Brett McCollum (29:11.675)
Yeah.

Brett McCollum (29:19.119)
Yeah, that’s killer. Well, man, we could probably talk for ages on this. And I wish we could. You know, but it’s been great. How if people want to reach out to you, connect in some way, what’s the best way for that to happen?

Calvin Cannon Jr (29:24.814)
Sure.

Calvin Cannon Jr (29:28.462)
Sure. Absolutely, Brett. People can reach me on all social media platforms at Calvin Cannon Jr. C-A-L-V-I-N C-A-N-N-O-N-J-R. I’m on all social media platforms, Facebook, Instagram, Twitter, TikTok, whatever. Just run my name there, you’ll find me. Tap in with me, send me a message, let me know that you were on this podcast, guys, and we will definitely connect the network. I appreciate it.

Brett McCollum (29:51.323)
Man, Calvin, dude, this is incredible. I really enjoyed talking to you. Thanks for diving deep on this with us. And guys, I hope you got a ton of value from it.

Calvin Cannon Jr (29:57.74)
I appreciate you. Thank you for having me.

Brett McCollum (30:01.553)
Alright guys, until the next time, we will see each of you on the next one. Thanks Calvin, take care everybody.

Calvin Cannon Jr (30:07.054)
Thank you, Brett.