Long Term Planning (CFFL 572)
Long Term Planning (CFFL 572)
Transcript:
Jack Butala : Jack Butala with Jill Dewit.
Jill Dewit : Hello.
Jack Butala : Welcome to the show today. In this episode Jill and I talk about long term planning and why it’s so important. Or maybe it’s not for you. We don’t know yet. Before we get into it let’s take a question posted by one of our members on the Landinvestors.com online community. It’s free.
Jill Dewit : I’m trying to imagine going through life without any kind of planning, when you said maybe it’s not for you. Could you imagine?
Jack Butala : No.
Jill Dewit : If you’re like, yeah I’m going to do this now? Yeah, I’m going to do that now? I mean, how, I don’t …
Jack Butala : It sounds nice.
Jill Dewit : What?
Jack Butala : It sounds kind of nice.
Jill Dewit : What if you wake up and go I don’t want to be married anymore or I don’t like these kids any more, because there’s no planning anymore?
Jack Butala : That sounds awesome.
Jill Dewit : Yeah. Jack.
Jack Butala : You asked the question.
Jill Dewit : I did. I didn’t think …
Jack Butala : I’m watching this show on Netflix called Life Below Zero and it’s about these people that chucked it all and went up to Alaska and they’re just, they’re literally living off the land. Like they, there’s no money involved in their life at all and they just go fishing, they shoot Elk and stuff and you know …
Jill Dewit : Jack there’s long term planning there. I watch the show with you. They have to plan with you.
Jack Butala : I know but I …
Jill Dewit : They have to plan in October, because they’re not going to make it ’till April with food and fire wood if they don’t long term plan.
Jack Butala : I know. I wasn’t saying that’s not the planning.
Jill Dewit : Okay.
Jack Butala : It’s just for a few minutes I have a little fantasy about doing, just living off the land. That’s all.
Jill Dewit : Oh, you want living off the land with an assistant? That’s your way of making it work. No, I know.
Jack Butala : Living off the land with an army.
Jill Dewit : Yeah. That’s what you want. You just want to walk in and have everything done. I know you. That’s really what you want.
Jack Butala : You know what? I can’t even talk my way out of that. Jill you’re absolutely right.
Jill Dewit : This is going to be, so we all know the reason that we did this show is because Jack’s, long term planning is very near and dear to Jack’s heart.
Jack Butala : That’s true. Actually, this is my show and not Jill’s
Jill Dewit : So, that is why we’re talking this. Totally. All right. So back to the question. So, Steven asked, I was just contacted by a seller with an offer sent in June asking if I would still honor it. I said that I would and I would start my due diligence. Should I ask him to send the original signed purchase agreement or should I send a new one?
Jack Butala : This is …
Jill Dewit : Oh, this is good.
Jack Butala : We’re preparing ourselves for Jill’s rant on purchase agreements and how they’re not necessary.
Jill Dewit : No. It’s okay. Or should I send a new one with a new deadline closing date? After reading the recent post about not using a notary and sending a deed with instructions and a new purchase agreement, the deadline to head off procrastination, and then sending a regular check as a stated normal closing procedure and was thinking of trying that. What would you do in this situation? Okay. May I please?
Jack Butala : Yeah. Well, I mean, first before you do the caller’s obviously, there’s a bunch of stuff that was answered on Landinvestors.com on that forum there.
Jill Dewit : Uh-huh (affirmative).
Jack Butala : So, …
Jill Dewit : Yeah. So they, I think they took bits and pieces of different people tweaking their procedures, thinking it would make it better and my point is stop reinventing the wheel. So, I mean, I just think you’re going to get too confusing here. Are you just trying to close a deal? Then, yeah. Do we need to do all those extra steps and paperwork and do this and try to trick people with, what was the word here, to head off procrastination? No, and sending a regular check saying no, that’s my closing procedure? Wait until it clears or something? I don’t know. I don’t like any of this.
Jack Butala : I don’t either. Here’s why.
Jill Dewit : I’m a be upfront and honest kind of person and that, this to me smells of not being upfront and honest.
Jack Butala : If you’re not a licensed real estate agent and this goes for the whole country, there’s no deal police. There’s not somebody at the country or some public official, you know, it’s one of the things that just this generation, it’s unfortunate and it’s not this generation’s fault. They just think that there’s somebody always looking over their shoulder and that some teacher’s going to yell at them or somebody going to say no, you’re doing it wrong and …
Jill Dewit : You really think that? You believe more people believe that, walk around like that?
Jack Butala : Well I think that it’s not their fault. I think it happens.
Jill Dewit : Do you think our kids do that?
Jack Butala : I think after, these kids, this generation is post 9/11. Or they’re too young to remember it. So, I just think that there is a lot more regulation but what I’m here to tell you, here’s the good news. When you buy and sell these properties this way, there’s not you know, there’s a lot of room for error and even if the worst stuff happens you can go back and alter it at the end you know, after it’s done and correct it with paperwork. So, there’s no rightened way, right and wrong way, no right or wrong way to do this. You know, Jill doesn’t do a purchase agreement ever.
Jill Dewit : No. If they send it back, you know what happens if they sign it and send it back or whatever, they make a point to get it back to me, I just like whatever. It’s like, thanks, just kind of put it aside. It’s not necessary at, in this at all. Does it need to be recorded with anything? No. Do you need to keep it for your records for anything? No. So, seriously it’s a formality. It’s a way for me to get my offer to them.
Jack Butala : Right.
Jill Dewit : That’s really what it is, my purchase agreement is my version of a formal offer to them to accept or decline.
Jack Butala : It’s real good for their head too. That’s what I, the value in a purchase agreement the way we do this, with houses and everything is you know what? The seller signs their name and says I made a commitment.
Jill Dewit : Right. You made a commitment and I’m making a commitment. That’s what it is but it’s really just in their heads.
Jack Butala : When you get right down to it is it a legal, is it really a legal binding contract? I would probably have to say, I’m not a lawyer at all but I think if you, there’s pros and, there’s for’s and against on that. Are you even, but in the end is it really a binding agreement? I don’t think so.
Jill Dewit : We had someone else the other day too like because they just called in and were asking about offers to owners in our thing and they’re like do you have to buy them and I was you know, coaching our team no tell them to read the thing because you know there’s six things on there saying that if this doesn’t meet my criteria or X isn’t correct, I have to verify you know square footage. Whatever it is. There’s lots of things on there that you can say you know what, this didn’t, thank you very much but this, I don’t want to purchase this asset you know and you don’t have to and that’s, and it’s legal.
Jack Butala : What the PA says is I’m going to offer you 25 thousand dollars for your property. If that’s okay sign below. However, after you sign it we’re going to take a look at the property real close. We’re going to perform due diligence and if there’s anything we don’t like about this property at all we’re not going to buy it and so …
Jill Dewit : We’re not going to follow through and that’s it.
Jack Butala : You know, it’s an contingency.
Jill Dewit : Uh-huh (affirmative). Exactly. It’s the same as anything. Like, you buy a house, you buy a boat. You know, you wait for the inspection. Then when the inspection comes back or the survey comes back then you can decide yea or nay. It’s the same thing.
Jack Butala : I love boats. Is this about boats now?
Jill Dewit : I had to put that in there.
Jack Butala : You know why Jill put that in there?
Jill Dewit : Why?
Jack Butala : Jill just killed a deal on a very large boat based on a survey.
Jill Dewit : I did.
Jack Butala : For us. Like, a personal boat.
Jill Dewit : Exactly. So, and then …
Jack Butala : I frankly think she didn’t like the people involved in the deal and she killed it.
Jill Dewit : No. The people were okay. I didn’t like the, you know at the end of the day I wasn’t, I wasn’t all, I wasn’t in love with the boat.
Jack Butala : Okay.
Jill Dewit : Now, the boat I really am in love with I don’t want to do right now. I won’t get, that’s a whole other story.
Jack Butala : It’s a different show. Not even an episode.
Jill Dewit : It’s a whole different show. If you have a question or you want to be on the show reach out to either one of us on Landinvestors.com. Today’s topic, long term planning. Like how I do that?
Jack Butala : Yeah.
Jill Dewit : Thank you.
Jack Butala : I love when you take control of this.
Jill Dewit : I did take control. Jack this is the meat of the show. Go
Jack Butala : Hey, thanks for the intro Jill.
Jill Dewit : You’re welcome.
Jack Butala : Now we sound all professional.
Jill Dewit : Somebody asked me, I got asked, I’ve got to tell you right now … This is, okay not to interrupt you but the TV show …
Jack Butala : I’d do it to you.
Jill Dewit : Thank you. Thank you. Yeah. I was talking to our potential director, editor, everything, a lot of hats for this TV show we’re working on and she’s like I’ve got to go listen to some of your stuff. I’m like yeah, you kind of should. So, she said, we were talking about well how much production, and she said probably the same as what you put into your podcast and I said, oh no.
Jack Butala : I’m sure that’s not the place.
Jill Dewit : I said, oh no, Marci that’s not at all what goes on.
Jack Butala : So, you mean zero?
Jill Dewit : Yeah. Exactly. I said, Marci that’s so unrehearsed. I said, but now we have it down. So, I just thought that was funny. Thank you Jack.
Jack Butala : So, long term planning, I think there’s three phases to anything you do in life, right? You get this light bulb over your head or whatever, you’re on the internet and something strikes a chord, so you test the waters. That’s step one. You know you say, you know maybe I would like to send a bunch of offers out. Maybe I would like to ask a girl out in theory. Things like that. Then step two is all right, I’m going to give it a shot. I’m actually going to, I’ve tested the water, the girl doesn’t seem too crazy. Sending out offers, there’s all these other people …
Jill Dewit : She doesn’t think I smell.
Jack Butala : There’s all these other people on this silly site called Landinvestors.com or this silly television station called HGTV that seem to be successful at how they do it. Everybody’s got a kind of different twist on it but it seems like it’s relatively viable. You know what, self, real estate there’s a bunch of people that do actually really well in real estate. So, I test the water, I send some stuff out I look into it and it passes my test. So now, number two, make a commitment and so during this commitment phase this is where I see a lot of people falter. Number one, there is a lot of people who will sit around and say, everyone I know who’s serious about real estate owns a really large yacht. That’s easy to say and then sit around and dream about it.
Step two is making that commitment and then sort of following it through and to get a few deals done and get them done, either fail out a few times or figure out what the issue was and succeed at it and then step three is the long term planning, to kind of institutionalize it is what I call call it at our office but here’s the thing that Jill and I were talking about before the show. Long term planning for me is always in the back of my head Jill and I think it is with you too.
Jill Dewit : Yeah. I wrote that, I wrote down three things and one nice set is always on my mind. You have to always be thinking like that.
Jack Butala : Like what’s a real exit, exit strategy, you know? So, Jill and I now since we started Land Academy we responded to our members and some people who are not members who said they want tools you know? Like so we developed a tool called Offers to Owners and one called Parcel Fact and this is not a big long commercial. So, those are tools to help people get real estate deals closed faster and easier and cheaper.
Jill Dewit : Uh huh (affirmative).
Jack Butala : Those all have, those were, a tremendous amount of three step process long term planning involved in that too.
Jill Dewit : Uh-huh (affirmative).
Jack Butala : Like playing Ms. Inspiration. How do you use long term planning?
Jill Dewit : I mean, is that a save me?
Jack Butala : No. I mean, …
Jill Dewit : Oh, I was listening. I’m over here content listening and I’m thinking about my stuff. So, for me when you say long term planning, what’s important and I do, so there’s business and there’s personal. So, I think you’ve been talking about mostly business right now Jack and so I do think about that. Like, is this a company that I want to keep for the rest of my life. Is there a company I want to, is this a company I want to sell someday? I mean, then I’m going to set them up differently.
Jack Butala : Right. Wait, there’s a perfect example. Can i stop you right there?
Jill Dewit : Yeah.
Jack Butala : So let’s say you start a company that only has, you know you’re only going to buy and sell four assets because you have a partner. So your partner puts all the money up, you go and find the assets and you flip them. You know exactly without really saying it out loud and maybe now without thinking about it what your exit is on that company, those, you’re going to buy those four assets or your partner is. You’re going to sell them. There’s going to be a bunch of money left over. You’re going to split the money up however you agreed to it, long term planning. The next one because it went well might even go better. I mean, you might even say let’s do eight assets at this little company or maybe 80.
Jill Dewit : Uh-huh (affirmative).
Jack Butala : Or maybe I’ll buy a large piece of property in Texas and subdivide it all up, cut it all up and piece it out on terms to sell. Long term planning and how you’re going to get out of what you’re getting yourself into today in the future is, should always be on your mind sort of.
Jill Dewit : Uh-huh (affirmative).
Jack Butala : Some people would argue that you should handle personal relationships the same way. Like, how am I going to get out of this at the end?
Jill Dewit : No. Long term planning is what, when are we going to retire and what are we going, what trips are we going to take.
Jack Butala : That’s it.
Jill Dewit : That’s long term planning. Not how do I get rid of her.
Jack Butala : What’s my exit strategy in this marriage?
Jill Dewit : Exactly. No.
Jack Butala : You know, I’m never talking about you.
Jill Dewit : Not, like I’m going to put some money over here that she doesn’t know about. No.
Jack Butala : You know, if you listen to this show at all you probably, you’ve probably picked up on the fact that there were potentially, people in our lives before each other.
Jill Dewit : Potentially. What are you, what are you trying to say there Jack? You’re dancing around the …
Jack Butala : No. When I say you know I have an exit strategy in marriage I mean not you Jill.
Jill Dewit : Thank you.
Jack Butala : You know that.
Jill Dewit : We all have, well not all of us but most of us you know you reach a certain age and you’ve had more than one relationship. How is that?
Jack Butala : Right.
Jill Dewit : That’s what it is. So, you’re so silly. Boy how did we get down this path?
Jack Butala : Long term planning.
Jill Dewit : Sheesh. I’m trying to bring it back in here and that’s like crazy.
Jack Butala : Here’s some, a few things since we’re talking about this that I don’t think you can plan for at all and you really just have to calm down about it and I’m really talking to myself now versus anybody else. Raising children. You just don’t know what you’re going to get. So, you can manage it and you know, sometimes you have to put a tremendous amount of time in it and sometimes it just raises itself or some version of that.
Jill Dewit : That’s true.
Jack Butala : It’s talking to me again. No I was just joking.
Jill Dewit : No. That’s true. I like that. Well, even having a family that’s, you need to long term plan that.
Jack Butala : Real estate fortunately and real estate deals and partners and stuff, business partners, man it couldn’t be easier.
Jill Dewit : Yeah. That’s easy and then when you talk about family and personal stuff it makes, you know what’s funny this whole conversation because there’s business long term planning and there’s personal and family long term planning. The more you talk about it the more the easier the business long term planning gets and what’s funny is I think most people think that’s the hardest one. Like, I can figure out my life. I just don’t know my career. I just don’t know this. I don’t know that but man all that’s the easy part. It’s the personal part that I think is the hardest because like you said you can’t, there’s things you can’t account for because there’s other people involved. You know? Business, business exists on paper and that makes me happy. Do you know what I mean? A paper’s not going to argue with me but boy, a person will.
Jack Butala : Since we’re talking about this, I think when you start, so in a business situation there’s contingencies and there’s a scenario, there’s an if then for just about every situation. So, if this deal goes sideways but this one’s great then this happens and if this happens then this happens. If your partner ends up being the biggest ding dong there ever was then this happens.
Jill Dewit : Then that’s the last transaction with you together.
Jack Butala : Almost impossible to do that in a social relationship without some pretty serious repercussions.
Jill Dewit : Yeah.
Jack Butala : So, that’s why I couldn’t agree with you more.
Jill Dewit : If this child turns out to be a pain in the ass …
Jack Butala : Or a serial killer. You can’t say ass on this show Jill.
Jill Dewit : No.
Jack Butala : It’s rated G. You can say anything you want on a Thursday call.
Jill Dewit : Okay got it. Sorry. Like what the heck. So, all right but yes. You’re so funny.
Jack Butala : We have a rated G, like a five star rated G rating on iTunes and we just killed it.
Jill Dewit : Then what’s so funny. I’m the most rated G person normally.
Jack Butala : I know.
Jill Dewit : I hate to say I’ve learned a few words from you. All right.
Jack Butala : That’s for a different show.
Jill Dewit : Okay.
Jack Butala : Join us in the next episode where we discuss flipping pitfalls.
Jill Dewit : We answer Peter’s question about Florida lots and scrub jay feeds.
Jack Butala : Yeah. You know all about that.
Jill Dewit : This will be very interesting.
Jack Butala : You are not alone in your real estate ambition. Good show Jill.
Jill Dewit : That was good. It’s important, we’ve had a lot of big picture topics. We came off the whole millionaire series and now you’ve got some other big things.
Jack Butala : Which just did really well by the way. We haven’t talked about that but boy I’ll tell you, that did well.
Jill Dewit : That word sings to people. You know what’s funny, remember when a million dollars was a lot of money?
Jack Butala : I know.
Jill Dewit : Now it’s like a billion is more money but, so you know what?
Jack Butala : There’s a big difference between a million and a billion.
Jill Dewit : Well you know what’s interesting too?
Jack Butala : It’s almost unfair.
Jill Dewit : It’s not hard now. Nowadays, I mean a million seemed like a lot of money and now it’s not hard for a lot more people to be millionaires and I like that. You could be a millionaire.
Jack Butala : You know what, a million dollars is a hundred thousand dollars time ten. So if you make a hundred thousand dollars a year it’s only ten years.
Jill Dewit : Uh-huh (affirmative). A billion or a million?
Jack Butala : A million.
Jill Dewit : Right.
Jack Butala : A billion is a thousand million. So, a thousand years.
Jill Dewit : That’s a lot.
Jack Butala : I mean a thousand times a hundred. So, you can’t you know, my point is it’s not fair to say million and then billion. I think you can say million and then a hundred million, or 30 million or 20 million and then now you’re talking.
Jill Dewit : Got it.
Jack Butala : I’m not criticizing you. I just hear people say …
Jill Dewit : I’m want to write to Bill Gates.
Jack Butala : It’s just that, you know what, it’s because the people on the top of the list now are multi-billionaires and now all of a sudden billion’s been a target and it’s so unrealistic for, even us, there’s almost zero chance, no there’s a zero. I want to say zero chance.
Jill Dewit : I don’t want that. I don’t want that. I don’t want that at all.
Jack Butala : Staking away a couple of hundred million bucks is good.
Jill Dewit : I’m good with that. That’s really good. Hey, like our show? Please subscribe and rate us on iTunes or wherever you’re listening and yes I did.
Jack Butala : Information and inspiration to buy undervalued marriage.
If you enjoyed the podcast, please review it in iTunes . Reviews are incredibly important for rankings on iTunes. My staff and I read each and every one.
If you have any questions or comments, please feel free to email me directly at jack@LandAcademy.com.
I would like to think it’s entertaining and informative and in the end profitable.
And finally, don’t forget to subscribe to the show on iTunes.
