How to ask for Loans

This is a long post.  You’re warned.

Look around you. Everyone walks around in a financial stupor.  Have you ever tried to start a conversation with a friend about how much they make?  Yeah, that’s difficult.  Let’s make it easier, have you asked a sibling exactly how much they made last year and what they are doing to save for the future?  No?  Let’s go even easier, how about your parents as they prepare for retirement (or maybe they’re retired)?  Haven’t discussed it with them either?  Why not?

Financial discussions are taboo to Americans.  We discuss finances about as often as we discuss sex with our parents (even then both discussions are equally comfortable).  Why is that?  Don’t we all (claim) we want to retire early?  If you don’t believe me, look at how many articles on many major news outlets discussing how difficult it is to retire at 65.  These articles don’t even include the people whose pensions have been destroyed by bankrupt cities such as Detroit and Central Falls, RI; see: In Plain Sight from NBC News.

So, we know it’s difficult to only discuss finances with friends and family, let’s see if you’ve talked with people you’re supposed to discuss money with: bankers.  When was the last time you went to a banker to have a frank discussion about money and how to ask for loans?  What — the last time you discussed a loan with the bank was for your mortgage?  Ten years ago?!?

As I’ve said, it’s easier to discuss embarrassing physical issues with your doctor (or Dwight Schrute: https://www.youtube.com/watch?v=exykRoUX7-g), than it is to discuss your finances.

Why is that?

I don’t know.  It shouldn’t be.  If you want to get ahead, you have to discuss your finances with someone.

So, we’ve established it’s difficult to discuss finances with others.  How the hell are you going to ask for a loan?  I’m not going to lie, it’s difficult.  It’s incredibly difficult.

Even before you can ask someone for a loan, you have to identify who to ask.  Why do you choose who you ask?  Do they have a successful business?  Do you ask family?  How about friends?  Maybe even coworkers (not the best idea)?

My first attempt to start a business was to purchase an established Laundromat.  (Please note: This is fail #1)  I negotiated the price, and tried (the easy route) of establishing a home equity line of credit (HELOC).  Turned out my house didn’t have enough equity, so I had to go the route of asking family and friends.

I literally made a list of my entire family and friends who I thought may have some money to lend.  I tried to be conservative when I estimated how much I thought they would be willing to lend and tried to come up with two times the cash I needed.

The first person I approached was my friend (and boss) at my construction firm.  He and I discussed finances and various investments on a semi-regular basis, so it was relatively easy for me to approach him.  I invited him to lunch (I paid).  At lunch, I had all my financial analysis of the Laundromat, showing monthly profit, annual profit, expenses, etc.

We sat at lunch, and even though we readily discussed investments, it was difficult to utter the phrase “I would like to purchase this Laundromat, may I borrow some money to do so?”  Really, really difficult.  And this was a guy that regularly discussed finances.  I got out of that lunch meeting feeling like “holy crap, that was difficult, how am I going to get through any more discussions?”  My friend asked me to do some follow up on the investment analysis before he would provide an answer.  Fair enough.

I then sat down with my cell phone, and a list of people to call.  One of my family friends is quite a jovial gent, easy to talk to and more than willing to discuss business.  I figured he would be a really good first call to make, so I dialed his number.

By the time the phone rang the first time, I was sweating.  By the third ring, I could feel sweat running down my back.  I had written my script, so I knew I didn’t have to improvise.  I was beginning to think I was lucky enough to talk with an answering machine

[damnit!! He just picked up!!]

My conversation went something like this:

Me: Hi John, how are you?
John: Liam!  Great to hear from you, how are things going?  What can I do for you?
Me: {thinking: Holy cow, already off script} Uhhh, great, I’ve got a question for you, not sure if it’s cool or not, but you’ve always said that if I ever needed anything, I could talk with you.  {good, back on script} Well, I’ve found an investment…I was wondering if I could borrow some money to purchase it?

The entire time I was talking with my friend, I distinctly remember thinking I was going to vomit and trying to figure the closest trashcan or toilet.

I don’t remember how the remainder of the conversation went, but we left it that if I was able to raise up to a certain amount of money, my friend would pitch in the difference so I had enough to purchase the Laundromat.

Great, first call down with a verbal commitment.  Score Liam: 1, Doubts: 0

Second call: My uncle who owns a few successful businesses.

Again, hoping for the answering machine, my uncle answered on the third ring.  “Liam, how are you?”  The conversation continued perfectly on script for the next two minutes while I described what I wanted to do, how much I needed (in total), and the finances of the Laundromat.  Then, at about minute 2.5, my uncle dropped the bomb “Liam, that all sounds great.  Before I can make a decision though, I would like your business plan, the financials for the Laundromat and updates as you proceed through the buying process.”

Me: “uhhhh…GREAT!  I’ll get that together for you and send it right off [thinking: What the?!  A business plan for a Laundromat???  Does it have to be more than you put quarters in and I take them out?  What am I going to do?!? <end of thought>].  Thanks Uncle.  I’ll be in touch with the information you need.”

So, what did I do?  Well, naturally, I turned chickensh!t and decided I would never be able to raise the funds for the Laundromat, so I stopped trying.  There were the regular nagging questions in the back of my mind: what if people stop using the Laundromat?  What if costs go up faster than revenues?  What if…what if…what if?

Score: Liam 1, Doubts: 5

This experience was a great learning experience for me.  I learned what made me feel uncomfortable, and because I didn’t have a proposal for how much and what terms I wanted, the conversations were a little stilted.

The second time I asked people for money was in the wake of the Great Recession and housing crisis.  I knew I wanted to purchase a rental property, I just didn’t know where or when.  Once I was convinced I wanted to start a real estate business, I approached two of my friends to see if they would commit to a loan, even though I didn’t have a specific purchase in mind.

Using several online calculators as well as some calculators that I developed, I knew that about $20,000 would be enough to get me started with one rental.  To cover my bases, I also applied for a larger HELOC.  I figured that I would have backup if one of my friends backed out.

Prior to meeting with my friends, I determined what terms would be a worst case scenario for me (aka: breakeven).  For this particular deal, my worst case terms were 6% for 5 years.  Rather than ask for the worst case scenario terms, I calculated payment terms that I wanted.  I figured they would negotiate so I would start with my preferred terms, which in this case were 5% fixed for 10 years.  Both of my friends accepted my proposed terms (their money is secured with some stock).

The second time I asked people for money I learned almost as much as the first time.  The five main take-aways I learned are as follows:

1) You need to know what terms are acceptable.  If you don’t get your preferred terms, you have to ask yourself if you want to keep looking for someone willing to lend at those terms, or if you will accept a counter-offer.

2) Present these preferred terms to the people you are approaching.  Offers are much easier to stomach if they are concrete.  Imagine if someone came to you and asked: “I would like to invest in this fixer-upper down the street, can I have some cash to do so?”  Your first response is a furrowed brow and the question “How much?”

Now, imagine if someone came to you and asked: “I would like to invest in this fixer-upper down the street.  May I borrow $5,000 at 5% for 10 years?”  That question is much easier to answer.  The person you’re asking either has the $5,000 or doesn’t.  If they do, the cash is probably languishing in a bank at sub-1% rates, so the 5% you’re offering could be 10x what their money would be making.

3) Have a plan.  After you’ve asked “I would like to invest in this fixer-upper down the street.  May I borrow $5,000 at 5% for 10 years?”, now think about adding “The house I intend to purchase needs to have some new carpeting, a good cleaning, some drywall patching and new paint.  I’ve done some cost estimates and I estimate it should cost $1,000 to replace the carpeting and an additional $400 for the other fixes.  I’ve done some research and the house should rent for $700 per month.  I anticipate the improvements will take me one month to complete.”

At this point, you’ve asked for the money (the really hard part), you’ve presented your preferred terms, and you’ve described how you plan to use the money.  Your lender now knows that you don’t plan to take a sweet vacation in Europe, they know you are going to invest your time in the project and that you have done some research so that (at least you) are convinced the investment is a good one.  Who would say no to that?

4) Do your homework and have confidence.  Do your homework so you can minimize your risk as much as possible.  By doing your homework, you will project confidence.  Sure your pitch might fail, but you’re not going to die.  I mean come on, what’s the absolute worst that can happen (so long as you don’t ask a loan shark)?  The absolute worst thing that can happen is that the person you ask says… “No.”  NBD.

5) Be ready for curveballs from the Lender.  If you seriously want to borrow the money, don’t get defensive (“I TOLD you already!”) and be ready to say “I’m not sure, but I’ll find out and get back to you.  Would you have time to discuss this loan next week?”  It’s not the end of the world.  Look to your lender as a mentor.  They want to protect their money, and that in turn helps protect your investment so long as you are open to their critiques.

In addition to my lenders and mentors, this group is also a sounding board for my Hare Brain Schemes:

Not my lenders, but friends helping me along the way (Highlife at the top of Tuckerman's in NH)

Not my lenders, but friends helping me along the way (Highlife at the top of Tuckerman’s in NH)

Taking Risks

White Horse Ledge, NH

White Horse Ledge, NH

There is a huge difference between security and freedom.  When you’re most secure, you’re the least free and vice versa.  Just like the robot brain in the movie “i Robot”, the humans are safest (most secure) if/when they are all locked up, with no possible interactions with other humans.  When we are at our  most free, we are able to do what we want; we are also able to take risks which may cause us to stumble, maybe even stumble a few times.

Look at many of the great leaders and entrepreneurs of the past 150 years.  How many failures did Thomas Edison have before he found the correct filament for the light bulb?  How many times did the Wright Brothers design aircraft before they hit the right design?  Richard Branson’s first business (Student Magazine) was a failure.  Abraham Lincoln was quite unsuccessful until he was voted in to the Presidency.  Elon Musk was almost bankrupt before he founded Solar City and pushed Tesla Motors to the apse of EVs.  Even Henry Ford failed three times before he established the Ford Motor Company.

Failure is to be embraced so long as you learn from your failures and don’t repeat your mistakes.  You will always learn more from failures than you do successes.

Our freedom allows us to take risks.  Risk leads to reward but risk and reward are always related.  The more risk you shoulder, generally the higher potential reward, but also the higher the potential calamity.  You want to evaluate any situation to determine if the potential reward is worth the risk.  Think of the Mercury and Gemini astronauts.  There was HUGE personal risk, but they’re all national heroes.    Imagine the marines assaulting the beaches in Normandy on June 6, 1944.  There was enormous risk, but the reward, a liberated Europe, was well worth the risk.

In business, you want to quantify and reduce your downside risk while increasing your potential reward.  There are ways to reduce the risk, but you have to realize that you will never entirely eliminate the risk involved.  If you entirely eliminate the risk, you entirely eliminate any potential reward.  Is that a good investment?

For my investments, I have developed an Annual Property Operating Data sheet (see: Resources) which allows me to very quickly assess a property’s potential reward by using known quantities including: existing leases, utility information, tax and insurance quotes, assumed repair bills, property management fees, etc.  Based on this information, two properties may appear very similar, but because of existing leases, or minor differences between the properties, one property may offer a significantly better investment opportunity (lower risk) than the other.

To further reduce my risk, I prefer to purchase undervalued properties that offer equity by improving the property as well as positive income from the rental of the property.  I will specifically look for ‘unique fixer-upper opportunities’ (UFUOs) to increase my equity while knowing the improvements to the property can be financed through the monthly rent.  My first two properties had unique challenges, but also offered increasing rewards.

The first property I purchased was a single family home that needed a few electrical updates, minor plumbing updates, paint and new flooring on the first floor.  I purchased the property for $17,500 cash in August 2012 (see: How Do You Ask for Loans?).  Within in two weeks of my purchase, I rented the property for $825 per month (utilities included; max electric of $100).  I spent approximately $3,000 on the improvements to the house.

The improvements to the property were relatively low risk (for me).  The improvements forced me to stretch my existing skill set slightly outside my comfort zone, but I knew that the improved house was worth at least 2x what I paid for it (see: How to Value Homes; What to Do with Your Equity).

The second property I purchased was a duplex that was only half rented which represented increased risk to me.  The purchase price was $40,000 with a $2,000 owner assist for an effective purchase price of $38,000.  The half of the duplex that was not rented needed a full electrical update, plumbing upgrades, new flooring, a new kitchen, a new bathroom, new flooring and some plaster/drywall work, including painting the entire duplex (see: UFUO #2 and updates).

The work needed to improve the duplex represented a significant risk if the potential increase in equity did NOT at least cover the costs.  Going into the rehab work, I knew the increase in equity would cover the costs by at least 1.5 times (mostly because of my labor savings).  The $11,000 I invested would return at least $16,500 in equity which is a good investment according to my personal criteria.  (please note: Based on research after I started this project, I believe I should be able to increase the equity by about $25,000.)  When I’ve finished the half duplex, I will provide some follow up to see how accurate my estimates were.

By initially estimating the single family home was worth at least double what I paid, and the duplex would return $16,500 on an $11,000 investment, I was hedging my risk.  Even if I overestimated the value of the single family home by 50%, I would still break even on that investment.  I played my duplex more tightly, allowing for only a 33% overestimation for a break-even (Assuming my down payment is not lost; eg: $16,500 x 33% = $11,000 investment).

Understanding and quantifying your risk is extremely important.  Most of my calculators have some built-in, not-quite-hidden hedges against risk (see: Resources).  While these hedges will never fully eliminate risk, these calculators should allow my estimates to be more conservative (eg. reality will be more lucrative) while providing me with a level of comfort with my investments.  HBS has owned the single family home for 12 months, and the hedges have proven successful.  I need to wait until I’ve owned the other duplexes for at least a full 12 months before I can make an assessment on those investments.

When you begin your venture, you need to fully understand your exposure.  What is at risk?  Is it only the money involved in your venture?  For me that is the down payment.  My wife and I discuss our investments and while we don’t directly ask “Are we willing to lose this money,” we do discuss other options for our money which may carry a larger margin of safety.  Your venture may be tied to your house.  Are you willing to lose your house for your venture?

Make sure you understand your risk and have an appropriate margin of safety.

UFUO #2 – Update 2

The bathroom in the UFUO Duplex was a disaster.  The toilet had leaked for long enough that about 30% of the subfloor was rotten; the faucet in the tub had rusted shut; the electrical ‘improvements’ didn’t quite fit, so the sink base had been cut to accommodate the ‘improvements’; lastly, exposed wiring ran behind the toilet (what?!?) over to behind the sink (double ‘what’?!?).  I removed the rotten subfloor, replumbed the pipes, laid a new tile floor for under the tub, and have laid new hardwood flooring for the rest of the bathroom (it’s a small area).  I still need to hang some drywall (see the electrical pictures), install a light, the toilet, the faucet and the tub hardware.

Pictures to date:

UFUO #2 – Update 1

I’ve been working on the duplex, in my ‘spare’ time since early April 2013.  By the time I finish, I will have personally completed at least 95% of the work.  A friend of mine is helping paint in his spare time and I used Bath Fitter for the tub (after some initial issues with a sales trainee, Bath Fitter was awesome).  Beyond that, I have reframed walls, hung and finished drywall, laid tile floor, laid hardwood floor, patched plaster, repaired a shoddy wiring job, painted, removed and replaced urine soaked subfloor, and will replace all of the stair treads because most are broken.  It’s been a little crazy.  My wife has really held things together at home while I’ve been doing working on this project.  I’ve made good on my promise that our next real estate purchase would be a fully rented building (Duplex #2).

Some paint and new subfloor:

 

UFUO #2

I haven’t posted UFUO #1 yet, but here’s the #2 project.  This building is a half-rented duplex.  When I factor in vacancy and repairs, the duplex costs me about $40-$80/month to own.  I should be able to get $575 – $625 per month when I complete the UFUO.  By increasing the rent and eliminating my utility costs, I will net approximately $525-$550 per month on this duplex.  I have done 95% of the work myself, reducing labor costs.

 

Update #1

Update #2

Update #3

Update #4

Update #5

Update #6

What’s this blog about?

Sunset on the west coast.

Sunset on the west coast.

Through this blog, I am going to document my progress to reach my goal of at least $4,033 pre-tax dollars through investments (mostly real estate).  I want to document this progress for two reasons: I want to show you exactly how I do it (what works and what doesn’t work for me) and I also want to be held accountable to my own goals.

In addition, I will explain how I got to where I am with three rental properties and approximately $710 monthly cash flow to my bottom line on a salary of $49,400.  I will outline exactly how I did this so you will have ideas for how to replicate my success.  I will describe and photograph each of my projects to show you.  This blog is to share ideas in creating wealth by using your head and hands.

I got the idea for this blog after I read through a variety of blogs including Timothy Ferriss, Mr. Money Moustache, and Richard Branson’s entrepreneurship blog to name a few.  Many times I was left feeling, well how exactly did you ‘buy your first rental property’?  What steps did you take?  When you asked your friends for a loan, did you simply say “Hey, I want some money, so, uhhh, can I have some?”  Many times these nitty-gritty details are left out of the discussion.  These discussions will be tackled in this blog.

Many of the blogs I follow discuss the excess in which we American’s live.  Do you really need three TV’s?  How about that HUGE DVD collection (ever heard of Netflix…it’s an even BIGGER DVD collection you can borrow!)?  Do you really need to buy a fifth pair of jeans? that third pair of black shoes? that new car? the newest iAnything?

Mr. Money Moustache espouses saving almost 50% of your take home pay (is it even possible if you aren’t in the top 25% of the nation’s earners?).  Tim Ferriss recommends creating an online money tree which keeps selling products with little input from you (great, but what if you can’t think of the next great gizmo of the hour?).  Pat Flynn recommends building a stream of passive income (is there really such a thing as ‘passive’ income?).

After reading these blogs, I felt a little dejected; doubts crept in “would it ever be possible to retire as early as I wanted to?”  I really didn’t want to have to work until I’m 65+ (if I choose to, that’s fine, so long as it’s my choice).  At some point, I realized all of the ideas in these blogs are great ideas, I just needed to take the ideas that worked for me, as I understood them, and apply them to my life, hence this blog.

I want to show that many of the success stories profiled on each of the websites are not an overnight success.  There are ups and downs; successes and failures as well as road blocks and speed bumps.   But it’s possible.  It is possible to be a success while dealing with these speed bumps and failures.  The methods described in many of the blogs and websites I mention work (or at least should…maybe I’ll fail).  If I do fail, at least you’ll see what not to do.  If I do fail, I will learn from my failure and be more successful in the future.  If someone sees me take a wrong turn somewhere, please, speak up.

What do you plan to do?  How can you make it a success?  Maybe real estate isn’t your thing.  Maybe you’re an avid photographer, could you start a camera rental business (http://money.cnn.com/2013/07/01/smallbusiness/camera-gear.moneymag/index.html)?  What if you really like pets, could you start a pet treat truck (http://www.nbcnews.com/business/doggie-food-trucks-fetch-company-profits-6C10411778)?  What can you do to start a business?

Goals

As I’ve mentioned previously, goals are extremely important.  What would football be without an end zone?  How about baseball with no home plate?   How would a business function with no bottom line?  Goals help you to focus.  They tell you where you’re going and keep you on track as you work towards the goal.  Steven Covey, in his book “Seven Habits of Highly Effective People”, advocated starting with the end in mind (Habit #2).

Too often, people ignore the simple fact that you NEED to have a goal in order to be successful.  No one is going to hand you the keys to a 10-unit rental property with 20% margins.  Do you think Steve Jobs only wanted to create cool devices?  Don’t you think his GOAL was to bring classy design to mundane objects (Walkman = iPOD; Extreme lightweight computing = iPad; rabbit ear TV = iTV)?

People say that they want money.  That is all well and good, but ‘wanting money’ is not a goal.  Having money usually happens when you define your goals and take actual steps in pursuing those goals.

Single Family Home #1

Single Family Home #1

These goals, your goals, need to be documented and defined.

My goal is to have the financial stability to live my current lifestyle while having the ability to work any job I choose or to create any business I desire.  I do not want to have to continue to work longer hours while looking for higher paying jobs in order to have a good retirement.

Sounds great, but what exactly does that mean?  On simple terms, I want my investments to drop enough cash to my bottom line (take home pay) that any job I do take is extra cash, effectively a monthly bonus that would allow me to actually live better than I do now.  So, what does my current lifestyle cost?  Well, here we go:

Monthly budget (all numbers rounded up to the nearest tens)
– Housing: $850
– Food: $600
– Pet food: $200
– Electricity: $50
– Water: $40
– Sewer: $40
– Phone: $150
– Internet: $70 (Need to see about reducing costs here)
– Entertainment (Netflix): $10 (single DVD out at a time, no streaming)
– Investments: $90 (Two DRIP plans)
– Employer 401k Match: $80
– Vehicle (insurance, gas, maintenance): $225
– Eating out (Generally Starbucks, twice a week): $80
– HELOC: $150
– Heating system loan: $150
– Savings/Misc: $240

Total post-tax cash needed: $3,025 monthly

Assuming an effective tax rate of 25%, my gross take home would have to be $3,025 / 75% = $4,033 ($48,400 annualy; please note: health insurance is taken out pre-tax, so I lump the health care payment into the ‘effective tax’ rate of 25%; I am actually in the 15% tax bracket).

Therefore, my goal is to receive at least $3,025 monthly, after taxes and health insurance through some sort of investment.  For me, these investments are real estate.  In addition to knowing how much I need to receive, I also want to set a time frame for this goal.  In football, there are a total of 60 minutes of play in which to outscore your opponent.  My time frame is five years, a total of 1826 days (my clock started counting in July, 2012, so there is only one leap year).  Five years has no actual significance, simply a reasonable time frame in my mind.

Maybe five years sounds like a lot.  To me, it doesn’t sound like a very long time to meet my goal.  If we break down the financial goal ($4,033) by the time to deliver (1,826 days), I will need to increase my monthly take home pay, through these investments, by $2.21 per day for all 1,826 days.  $2.21 per day may not sound like much, but that is an increase of $66.30 monthly or $795.60 annually (let’s use $800 for ease of math).

If we assume a linear trajectory, during my first year of investment, I will need to bring home an additional $800 monthly.  At the end of my second year (after I’ve held my first year’s investment for 12 months), my gross income will have increased by $9,600 (12 months x $800 per month).  Obviously, that will not happen with one single property.  You may not receive $800 per month with two properties.  It may take four properties to reach the $800 per month target.

I am going to assume (hope) that the growth of my investments will not be linear, but rather some sort of curve, increasing at a faster rate each year.

Without a goal (a touchdown), I would not know how much I need to increase my annual take home (how may yards per carry/pass).  I would be hard pressed to develop a strategy to increase that take home in a sustainable manner (four downs to get a first down and get closer to the touchdown).  I could throw a hail mary in year five, and try to achieve the $4,033 all in one year, but that is not sustainable.

What have I achieved so far?

As of this writing, my wife and I own a small real estate investment business, HBS Real Estate, LLC.  The business has been ‘active’ for one year as of early August, 2013.  Our business is a Limited Liability Company (LLC) which I deliberately chose in order to protect our personal assets (see: Business Types).  Through the business, we own: one single family home and two duplexes for a total of five rentable units with approximately $710 monthly cash flow with a roughly 12.5% margin of error (see: Losses and Safety Factor).  Removing the margin of error, my monthly cash flow would be approximately $810, right in line with my rough calculations to make my goal of $4,033 monthly cash flow within five years.

What is your goal?  When you have your goal in mind, break it down into simple, measurable steps.  What is your first step?  The goal may seem insurmountable, but the first step is always easy; the trick is taking that first step.

Who am I?

 

A cold trail run.

A cold trail run.

“Who am I” is a difficult question to answer.  Have you ever tried?  Most people respond with “I do [fill in your job title here].”  Is that really who you are?  Do you have kids?  How about pets?  What are your plans for the future?  Is there one special place on Earth you enjoy spending time?

When you read a really good book, don’t you become the main character?

While I tend to identify myself with a list of goals (more on this later), below I will define myself by answering the questions in the first paragraph (and a few others).

I have an engineering degree from Penn State University.  My wife and I met at the university, traveled the country looking for a place to live but returned to central PA.  Initially, I could not find an engineering job, so I began work as a delivery driver for a pizza/calzone restaurant.  I knew I wanted to do more than drive calzones to drunk college students, so I started attending the Net Impact group at the university’s business school.

At one of these meetings, a speaker from a local ‘construction’ firm was discussing plans for building an eco-village in the area.  I approached the speaker to ask if he had an internship available and if I could submit my resume.  When I heard back from the hiring manager, I learned that they were not actually a construction firm, but rather an environmental law firm (was I still interested?).  I started work at the law firm about two weeks after meeting the principle.  Roughly three months after I started work at the law firm, one of the principles started a construction company.  I transferred to the construction company.

I am married with one kid, six dogs, four cats, one rabbit, nine chickens, one really overgrown garden, one car, lots of tools and a house perpetually under construction.   I have three rental properties, one single family house and two duplexes.  My plans for the future include photographing the Moon over all seven continents (I’ve got North America so far), being financially able to work any job I want, and being at home for my daughter as she grows.  I would like to visit Europe, Japan and Patagonia.

I enjoy trail running in Rothrock State Forest and my most favorite place in the Forest is Bear Meadows Natural Area.  I enjoy cooking (I do most of the cooking at home), and my wife really enjoys the baking (and she’s infinitely better than I am at making pancakes).  My wife converted me to a plant-based diet (think vegetarian, heavy on the vegetables).

I believe in hard work.  In addition to working between 45 and 55 hours at the construction firm, I will spend between 20 and 30 hours per week developing my company, HBS Real Estate, LLC.  I also believe that we all have to work a certain amount of hours before we can retire.  Those hours can be spread over 45 years, or you can front load the hours and, like compounding interest, those hours compound and you can retire ‘early’.

My definition of retirement is having the financial means to do what I want to do while maintaining or increasing my current lifestyle.  Quite honestly, I plan to continue working after I’ve met my definition of ‘retirement’, but I want to be able to do whatever it is that I want to do.