by Joe Firmin 3 ½ Minute Read
OK, I realize I could be walking a tight rope here but hang in there with me on this topic. Making any big investment decision shouldn’t be taken lightly, which is why it’s important to be on the same page with your spouse when it comes to your finances. Especially when 36.1% of divorces in the U.S. are due to financial problems. This is super important.
Every person develops a different internal money story and feelings about spending, saving, and investing habits based on their parents’ teaching, childhood and other life experiences. This is why one spouse may be open and adventurous, and the other may be risk-averse. One’s the spender, one’s the saver so they say…
Making decisions about your financial strategy together is an important part of your relationship, which is an important component of your life. It can also be exciting and draw you closer together.
This post will give you a behind-the-scenes sneak peek into how I (Joe) from True Freedom Capital helped my wife Saray get on board with the idea of investing in real estate.
When I first learned about investing in real estate it was a clear departure from the 401k only mentality that I had always assumed was the only route to go. Sock it away in the 401K and forget about it… ouch. Saray (my amazing, beautiful wife) and I are, fortunately, on the same page about most personal subjects, and among them, finances, even though we grew up with very different views on money, even culturally (Saray is from Mexico - see pic).
This hasn’t always been the case. Largely though, because I’d spent years before we were married spreadsheeting my entire financial life and then using budgeting software. Our plan, or lack thereof, was for Saray to stay home with the kids and me work full-time and base our budget on one income. Saving for retirement in the company 401k. Sound familiar?
Beyond my dedication to the Mvelopes budgeting software, we talk about our finances frequently (OK, maybe not frequently enough), but enough to plan for the future we both want, where we can go on vacations, how much house do we need, etc. I wanted more security though and to create additional cash flow each month, but moreso to accelerate our wealth building so we aren’t tied to my full-time job salary.
I dreamed of moving on to a less stressful job - enjoying life more with time to be more with Saray and the kids. I shared that dream with Saray. This is the key – vision of a better future state – paint it.
As I shared in my 1st post on this site, I was burned out and needed to mitigate my own employment risk by creating additional income streams. I wanted our investments to create cash flow.
I spent tons of hours educating myself about real estate investing and I think Saray was impressed and maybe inspired by my dedication and drive to learn. Early mornings and drives to/from work I’d pop in earbuds after the kids went to bed so I could listen to BiggerPockets and other real estate podcasts. She also saw me pouring over blog posts, crunching numbers, and constantly on the phone with people from whom I could learn.
I would learn something and share it with Saray. Key #2: share the knowledge. That helped her learn alongside me and to trust what I would soon present as my master plan. I wanted her to see that I’d done extensive research and analysis toward generating passive income and that this was no split-decision.
Saray is more of a risk taker than me so she was ready and on-board quickly as we decided to move forward in buying a duplex. The goal being more passive income through real estate syndications later – true passive investing without the hustle and grind. She had a lot of questions and I’m sure I wasn’t always patient, but she was patient with me. It has been a great exercise to learn about capital preservation, stock market risk, and long-term thinking about having assets that generate cash flow and increased liquidity.
If you are on the fence about diversifying into real estate either actively through your own investing or passively through syndications, I’d encourage you to take your time. Ponder your risk tolerance and develop a great understanding of real estate syndications. Although I have plenty of autonomy, we talk about what we’re doing with our money before it happens, so she’s comfortable with our journey and investments.
Saray knows we’re in this together and neither party gets to “blame” the other for things that go wrong, because we both have had ample opportunities throughout the process to ask questions, express concerns, and talk through risk factors.
So far, here are the main highlights of our investing journey:
- We stay motivated by dreaming together about what investing can do for us. Set goals together.
- Using real dollar amounts in our projections has helped us to truly see how we can take out lives to the next level and understand the changes we have to make to get there.
- I’ve been able to earn credibility as a solid investment partner throughout the process by committing to research, education, and vetting the choices presented.
- Consistent and frequent communication is key to staying on the same page and truly sharing our successes and failures along the way. This one is huge – with our first duplex, we knew it would be a learning opportunity and that there would be failures. This helped us pick ourselves up quickly and move on.
Conclusion and Takeaways
Be open and transparent about the financial journey toward active or passive real estate investing. Keep your spouse in the loop every step of the way.
Share any new mind-blowing facts with her immediately. Those moments of excitement and discovery can serve to not only learn together but invigorate your relationship overall.
Real estate investing is not a race, and if it is, it is a marathon. It also isn’t something that should be a point of contention in your relationship. Planning your finances and dreaming about your future should be an adventure you both WANT to take together. Plan for ample time to learn and grow together, have fun during the process, and you’ll be a passive income power couple in no time!
If you’re interested in learning more about investing in value-add investments and becoming a passive investor in real estate syndications, consider joining the Freedom Network. It’s absolutely free to join with no commitment necessary, seriously. If you don’t join, we won’t be able to send you opportunities (sorry, SEC rules). So join today! Not sure how it will work? Check out this post to understand the logistics.