Why Net Worth Beats Net Income in Real Estate Wealth Building

George (00:00)
Yeah, see that’s and this is where a lot of people struggle because when it comes to an investing, you know, it’s it’s an it’s a It’s an it’s a you’re expending money in expectation of achieving a profit just yesterday. I was hosting a Here here. I’m here in Florida. And so I was hosting just yesterday a Session a workshop session here in Florida with a facility that wanted to partner with us And so we opened it free for the community and was great and we were talking about this yesterday where

You have to expend money in anticipation of achieving a profit, but there’s no guarantee you will get a profit on the other side when you’re investing. why people fear at times, even when buying real estate, just like I was many years ago when I bought my first one, it’s not so much the fear of losing money.

Erika (02:16)
Hey everyone, welcome to the Real Estate Pros podcast. I’m your host, Erika. And today I’m thrilled to be joined by someone that I’ve been looking forward to chat with, George Thomas. George, it’s great to have you here.

George (02:30)
Hey, thanks, Erika. Appreciate you having me on and I’m very excited about this conversation.

Erika (02:35)
Yeah, yeah, I think our listeners are going to learn a lot from you and how you empower people and help them with financial management. So let’s get started. First off, for our listeners who aren’t familiar with your world, can you give us the rundown and share how you got started in the real estate world?

George (02:55)
Yeah, real estate world is just a powerful tool. ⁓ My parents were immigrants from the Dominican Republic that came here many, many years ago and landed in New York. Made an honest living from my sister and I. We did a lot of great things and had a great life. ⁓ But they ended up trading a lot of time for money along the way and I saw how hard they were working. So it seemed as if ⁓ they were working very hard without all of the rules to the game. And ⁓ from afar, I decided that…

that wasn’t for me and I wanted to be able to access a life where it wouldn’t allow me to have to always trade time for money. And so getting connected with the right people, being mentored and such along the way, I got into real estate and ⁓ my life has been never the same after that. And ⁓ I just find that that particular sector of finance to be so powerful ⁓ in a lot of ways. You can do things in the human factor and of course financially as well.

Erika (03:52)
Yeah, so walk us through what was going on in that real estate journey that made you say, this is it. I’m starting my own financial coaching company.

George (04:03)
Yeah, so in real estate, you know, of course, you know, I did alongside my wife. We’ve been married. be next year. be 10 years. Crazy lifetime goes fast. you ⁓ know, when we bought our when we got our first house many years ago, we decided that, you know, from here we wanted to expand and, know, we had a great mentor. I told us, hey, you guys should get into real estate, you know, start looking into residential properties that can do multifamily components within a residential property.

⁓ And you guys can start doing really well So the first I remember the first property how scared we were and you know, you’re jumping into this unknown But I just remembered that once we bought it How accomplished we felt and the thrill of the opportunity in front of us was and since then it’s never been the same So I I had found a journey in a path where I could find myself on a journey to financial freedom

So the whole purpose behind why I started Financial Freedom Builders is that I found this path and I’ve been on it ever since. I just decided to stop on the road, turn around and look back and look for anyone else that’s looking for this road along the way. And it’s something that I’m very passionate about. We care about people, we care about their financial future. And ultimately that’s what led us to start in this company.

Erika (06:03)
How would you say that financial freedom builders sets you apart from the rest of the coaching companies and what you do?

George (06:12)
That’s such a great question. And again, there’s a lot of great individuals and organizations doing great things out there and they’re helping people and providing them solutions. The things that make us different, number one is that you have accessibility to all of us. A lot of times with these coaching companies, they’ll offer you a service, but they’re only available when you’re there for your session. Or you may get a curriculum and just follow the curriculum and on the other side, you’ll be exactly where you’re supposed to be and you can even teach that to somebody else.

We’re very hands-on. You we have a team of coaches that we have within us that provide 24-7 access to us, you know, for questions, guidance, etc. Within that, we also have a private community platform where all of our community members can access, whether it’s investing opportunities, whether it’s for real estate, whether it’s investing in the stock market, whether it’s financial literacy. And then our key differentiator, Erika, is that we have just specialized in explaining finance in a way that’s easy to understand.

We use practical analogies where you can literally envision what we are saying and then we translate it back to financial terms with the analogy at hand. And so we’re very big on empowering the mindset when it comes to finances.

Erika (07:25)
That’s a really awesome, what would you say is the biggest misconception that you find with people when they do join and they need help? What kind of problems do you see that, or struggles that people have?

George (07:39)
Yeah, you know, the crazy thing is, it’s such a large spectrum. know, ⁓ someone’s, it’s all relative, right? So someone’s problem today may be that they can’t pay their bills. Someone else’s problem may be is that they have access to a couple hundred thousand dollars and not really sure what to do with it. It’s all relative, but they’re all problems. And then we are essentially trying to find solutions for their problems. But one of the biggest misconceptions I would tell you is that most people believe that their net income is the most important factor when it comes to their finances.

I think a lot of that is just because I were we’re taught and we’re programmed right? So for example, we are all going to school to get a degree or to get an education or a degree in something through let’s say a college or a university of those that end up going well when you go to college or the University what you’re essentially you’re doing are being groomed To then leave that place to be accessible to another institution to utilize your service. Well, that’s time for money so

All along the way, we’ve been programmed that the amount of money we make is our key factor, but most times people are trading time for money. But the most important fact that we teach this in our financial community is not your net income, it’s actually your net worth. And your net worth is an equation, right? It’s your net income less your total expenses. So yes, you can increase your net income to increase your net worth.

That’s not the only way you can increase your net worth. You could also decrease your total expenses and that also will increase your net worth. The fact that with the decrease in of total expenses is you’re not trading time for money in that part of the equation to increase your net worth. So we just give that misconception that you don’t have to get the second job. You don’t have to go OT. You don’t have to do Uber Eats if you don’t want to. There are other ways to increase your net

Erika (09:29)
Given ⁓ George, your emphasis on empowering financial mindsets, how do you help people shift their perspective when it comes to building long-term wealth? you know, in this instance, real estate investing.

George (09:45)
Yeah, see that’s and this is where a lot of people struggle because when it comes to an investing, you know, it’s it’s an it’s a It’s an it’s a you’re expending money in expectation of achieving a profit just yesterday. I was hosting a Here here. I’m here in Florida. And so I was hosting just yesterday a Session a workshop session here in Florida with a facility that wanted to partner with us And so we opened it free for the community and was great and we were talking about this yesterday where

You have to expend money in anticipation of achieving a profit, but there’s no guarantee you will get a profit on the other side when you’re investing. why people fear at times, even when buying real estate, just like I was many years ago when I bought my first one, it’s not so much the fear of losing money.

We all think it’s because, we’re worried about losing money. It’s not necessarily that. If we really unpack the layer behind that, it’s not the money that we fear.

It’s the time we spent to get the money we put into that investment that we’re about to lose. Because then the mornings you wake up not wanting to go to work, or if you’re sick, or if you’re miserable, or if you’ve been dealing with a ⁓ nagging boss or an annoying coworker and all these things, all these sacrifices you made for that income, you’re investing into that property. If it doesn’t pan out, then what was it worth? So

We try to tell folks, you have to remove the emotions when it comes to investing, even when it comes to real estate. There were no guarantees I was gonna do well on my first property. But what I knew was, to work until I’m 65 or work until I die, the only route for me and my wife to make money wasn’t gonna work either. So I was willing to put the money forward and expect on the other side and anticipate that I would get a profit in…

From there, think everything changes. So that’s the mindset. We try to empower that, that you have to remove your emotions when it comes to investing.

Erika (12:21)
Absolutely. ⁓ you know, those emotions can, you know, really throw a wrench and things in, as you know, every real estate pro has a turning point. Maybe a deal didn’t go as planned or a moment required a complete pivot. Can you share one of those moments on your real estate journey, George?

George (12:41)
Yeah, man, there’s been so many. was a duplex at one point. ⁓ My wife and I were going to purchase in Miami. We decided it was actually, it was an opportunity that was in front of us and it made sense to why we would go do it. But we’re there and we’re trying to work the comps, trying to work the specs, et cetera, et cetera. And one of the details or one of the issues with my end is that…

You know, I’m a solution oriented individual by default, right? That’s why I got into coaching it, because we provide solutions. But the problem is, that ⁓ your vision and what your long-term plans are, if you’re not careful, it can cloud your judgment in regards to a decision you’re making, especially when it comes to investing, right? Trying to be very judicious as to what you’re doing. And ⁓ for whatever reason, well, there were reasons, not for whatever, there were really legitimate reasons why it wasn’t going to work. But…

I was almost trying to craftily find ways to make it work because I really wanted the duplex because from my end, my standpoint, the income I can get from it was going to be substantial long term. But the numbers weren’t going to make sense for us to make the purchase based off of what the terms were. walking away with that was very difficult, Erika. It was very difficult because it almost felt like, man, like I failed. Like I failed on an opportunity in front of me, but…

Hindsight now, years later, hearing about the particular property, man, it was the right decision. And I’m so glad that I didn’t force the agenda, even though in my mind at the time, I felt as if I let go of an opportunity in front of me.

Erika (14:19)
you approach deals now having had that experience and having to go through that?

George (14:25)
Yeah, man. So, so now, you know, especially in that’s, and that’s just an example. I’ve had a couple of examples since then, but that one was one that just for whatever reason resonated with me. But now in particular, well, A, you know, one thing that I’m very good at doing when it comes to, know, especially with the residential properties, I can eyeball the kind of cash flow I can get out of an investment in it, right? I just particular styles and particular things we’re looking for when we’re looking for real estate ⁓ properties. But,

One of the things for me now is that I’ve learned is that if it doesn’t make sense now, it’s easier to just walk away more than ever because what you don’t want to do on your journey on building wealth, especially long-term wealth like Erika you’re talking about, you’re not trying to have setbacks because setbacks can set you back weeks, days, months, and at times even years. if you’re trying to get ahead, you can’t be taking too many setbacks. so…

You have to be comfortable walking away and understanding that the right ⁓ opportunity will come in front of you.

Erika (16:09)
Yeah, absolutely. And as you know, in the real estate world, relationships and connections are so important. Have there been any networks or connections that you’ve made that have been a game changer for you when it comes to leveling up and achieving financial freedom?

George (16:16)
Mmm.

Yeah, you know, when I first got into it, you know, when we bought our first property, we had a family friend that was connected to these, to this real estate couple here in Florida that they’ve been working with for a while and whatnot. And they connected us with them. You know, we were fortunate enough that these people became mentors of us. You know, they’re, they, they’ve done very well financially. ⁓ But there was something about the first encounter that we had with them where we really made us some sort of bond. guess they were very fond of us and

the potential and the upside we had and we were able to take them take they were able to take us under the wing asking them questions and and understanding the mindset the process Being receptive a lot of times, you know when it comes to finances in general, I think feet people become very Prideful and private those are two peas you never want to do with finances pride and privacy So it’s both of those things can really hinder your growth if you’re not careful

You know, if you’re prideful, you’re not being willing to or receptive to, ⁓ you know, to ⁓ embracing the reality that you may not know everything, that there may be a better way. You know, if you ask my parents, if, you know, when they came to the States, if they were told something different than ⁓ some advice, boy, they would have been significantly further advanced decades later. But they lost time because they were trading time for money. So, and in privacy,

People get very private with finances and I get it, you know, for a lot of reasons, right? You know, we’re all hardworking individuals. We work hard. We make an honest living, right? We talked about the emotions earlier. So if we’re not where we want to be, you know, in regards to our goals, our financial goals, our plans, and then we have to convey our shortcomings to some individual, it’s almost as if we take, we take a onus of the situation as if

we’re a failure, we’re not good enough and so we’d rather not tell anybody or have someone tell us that we’re not good enough. But that’s not the case. It’s just honestly figuring out how do we retool and so I was just glad to have those individuals be mentors of ours and they took us under their wing. And I have stories for days I can tell you another time but it’s important to get community and have people involved that can give you guidance.

Erika (18:40)
Absolutely. And another question for you, George, if you were going to start today in real estate from scratch, what would you do if you were in those shoes?

George (18:53)
Yeah. Well, it’s complicated question. Number one, there’s assumptions have to be made in that question. Number one is that you are financially able to go on into real estate on your own. That’s number one. If you can’t, doesn’t mean you can’t do it today. So that’s a tip I would give to folks. A lot of folks are struggling financially and 60 % of Americans are paycheck to paycheck and they would love to get into real estate. And they’re like, yeah, that’s going to be something down the road I’ll do in the future.

But why? Right? Because, and this goes back to privacy and pride, right? They give that answer, but there’s so many layers to unpack to that question. I would generally ask them, why? Is it because money’s tight? Why? And so if you want to get into real estate, one quick way, quick, not quick, but quicker way you can get in is get a business partner. Get someone in to share the burden with you.

You won’t reap all the benefits, but you won’t have to hold the entire burden. And that may be a way to catapult you into real estate where you have a partner with you, someone you trust. Of course, you got to find someone you trust. And ideally someone who’s objectively thinks different than you will be great. Someone that sees things a little different. So you guys are encompassing all in one. None of us know everything, but that would be one way as a tip for someone else wants to get into real estate.

buying their first rental property or whatever the case may be, get in with a business partner, share the burden, share the wealth. And that may be a way you can kind of catapult. And then from there, you can kind of build your own legs and stand on your own.

Erika (20:34)
That’s a really awesome advice, George. And you’ve helped so many people when it comes to their financial freedom. What’s next on the horizon for you?

George (20:46)
Yeah, I think the biggest thing right now is I we have a really big emphasis on folks that are looking to buy their first home There are so many people in our community right now ⁓ We have business owners. We have athletes we have all sorts of folks But there’s a very large population of individuals right now that are currently renting now Some may be renting because they want to rent and there’s no harm no foul on that But there’s folks there that they simply are renting because they’re just not necessarily aligned

or prepared to be able to purchase their first home. And so we’ve got them now on a plan, setting them up for success ⁓ through multiple, multiple strategies that’s going to allow them to advance their agenda quicker. And then again, talking about the mindset, making sure that they’re giving themselves ample time to get to those goals. That just because your sister bought a house, you know, this year, doesn’t mean you have to buy your house next year to quote unquote, keep up, right?

So give yourself the right timeline to be able to get there. ⁓ And so our focus right now is finding folks that are looking to buy their first home. There are so many people right now, Erika, renting that would love to buy a home. ⁓ And it feels almost like it’s hopeless. Like you’re not gonna be able to get there. The economy and all these things going on. But ⁓ we believe we can provide viable solutions to these individuals, give them a structure and a plan. And we wanna work with them to get them where they wanna be.

Erika (22:11)
Absolutely. And that’s wonderful that you want to keep helping people as you scale and grow. How do you still develop that hands-on personal touch when it comes to coaching?

George (22:23)
That is such a great question, Erika. You know, this is the part when it comes to scaling in general, whether it’s in business, even in real estate, right? And I’ll go back and answer your question, but I just want to plug in real estate. know, especially in the early on, my humble beginnings in real estate, I was very hands-on about everything. I wanted to draft the contract. I wanted to manage the accounts, the finances. I wanted to do the marketing. My wife would do the showings, the whole thing. We wanted to be very hands-on because

⁓ No one’s going to take care of your what belongs to you more than you right? ⁓ And so we wanted that to be us but as the scaling went on if you really want to scale you’re gonna have to incorporate an investment into resources whether it’s you know software systems processes People whatever the case may be and so that was part of the scaling even when real estate if you buying a you know a large commercial property

You’re not going to be able to do that on your own, right? You’re not going to be able to fix all the problems. You’re going to have to invest into it. So for us, what what our, what our, ⁓ what our program, the hands-on detail is important, man. The fact that people can access their coach and feel that someone’s in it with them is such a powerful thing. So it’s literally finding the people to come alongside the right coaches, not just that you’re knowledgeable. We can always teach folks our principles, right? We have six fundamental principles, which is expense management,

Budgeting savings growth net income growth investing and succession planning We could always teach anybody those things if they’re willing to learn right going back to being receptive But we want the people that that are there for the right reasons that care about people and if you care about people ⁓ especially in this industry, you’ll make yourself accessible for the people because If you got to figure it out on your own, then I don’t need you That’s that’s our that’s our whole theory The whole reason why we want to be a part of this is because you’re gonna be in it with us

Erika (24:21)
Yeah, well, George, it’s been awesome having you on today. Before we close, if someone wants to get in touch, collaborate, or maybe they need help with buying their first home, what’s the best way for them to reach you?

George (24:35)
Yeah, well, there’s a few ways. Well, first off, know, Erika, I want to definitely give a thanks to your great company here. You guys are just providing such a wealth of knowledge here on real estate, all things real estate. So many people are lacking knowledge. So I love the fact that your organization has decided to plug in and lean into this particular area of finance. I just think it’s valuable value add and your audience are very thankful for you and anyone listening to this.

whether it’s through this or through people I connect back to this episode, this organization and what your company’s doing is great. ⁓ Two ways to get ahold of us is you can either check us out online. We have a website which is www.financialfreedombuilders.net. It’s a great way to get plugged in, segue to understand and see the things that we do, some of our different tiers that we offer.

And then from there, you can plug yourself in in that way. Other way you can find us is on social media. We’re very heavy on Instagram. You can find me at The Financial Constructor. And so there, you’re welcome to connect with us. We’re very engaging. We’ve got a great community going on, full of great people, ⁓ motivated to their goals, goal-oriented folks that are really locked in. And being in an environment like that can get you kind of kick-started on,

I really need to lock in because there’s a lot of people in here really locked into what they’re trying to do.

Erika (25:58)
Well, again, George, thank you so much for your time and all your wisdom in the real estate world and finances.

George (26:07)
Yes, appreciate your time, Erika. We’ll talk soon, okay?

Erika (26:09)
And for our listeners, if you got value from this episode, make sure that you’re subscribed to the Real Estate Pros podcast. We’ve got more conversations lined up with pros like George who are out there building incredible real estate businesses. We’ll see you on the next episode.