I Have 10 Thousand Dollars What Should I Invest In (LA 1664)
I Have 10 Thousand Dollars What Should I Invest In (LA 1664)
Transcript:
Steven Jack Butala:
Steve and Jill here.
Jill K DeWit:
Hello.
Steven Jack Butala:
Welcome to the Land Academy Show, entertaining land investment talk. I’m Stephen Jack Butala.
Jill K DeWit:
And I’m Jill Dewitt broadcasting from the Valley of the Sun.
Steven Jack Butala:
Today Jill and I talk about, well, I have $10,000. What should I invest in?
Jill K DeWit:
This is so funny. So here’s where this came from. We’re sitting here thinking about out what’s going on at the end of the year. We want this last week to be really valuable, some good information for you to ponder. And there’s a lot of people on Facebook that have this exact thing. Like, Hey, I’ve got some money saved up. It’s the end of the year. Going into 2022, what should I do? So I wrote down some real answers and some of them are like, what the heck? It’s funny. So I will share those, and we’ll talk about what we think you should do if you’re in this situation.
Steven Jack Butala:
Before we get into the topic, let’s take a question posted by one of our members on the landinvestors.com online community. It’s free, and don’t forget to subscribe on the Land Academy YouTube channel and comment on the shows you like.
Jill K DeWit:
We forgot to look that up. We don’t know where we are right now, do we? Okay.
Steven Jack Butala:
I can look it up while we’re-
Jill K DeWit:
Okay, got it. All right. While I’m talking?
Steven Jack Butala:
Sure.
Jill K DeWit:
You’re good. Peter wrote, I got a call back on a piece of property that is largely in a flood zone, and some of it is in a regulated flood zone. The original offer price was $8,000 for three acres. And I was thinking about turning around with a revised offer of $1,000. What are the major considerations you all keep in mind when repricing an offer due to flood issues? Thanks for any thoughts.
Steven Jack Butala:
This is very, very, very common and not so specific to the flood issues, but stuff comes up.
Jill K DeWit:
Yeah.
Steven Jack Butala:
A deal comes back. You look it up. Usually on NeighborScoop. There’s some flaws. Hopefully they’re not fatal flaws like access.
Jill K DeWit:
Right.
Steven Jack Butala:
And so you go back to the seller with a revised offer. In my opinion, Jill’s the one who does this, so she’ll tell you the way she does it, but this is all how it’s handled. And so if you just say all this property sucks, and I know we talked about 8,000, but I’m going to you a thousand because there’s flood zone issues. That’s not going to work. But if you make a little video, a screen video of you rolling through Google Earth, a screenshot video and narrating why and how the property, where it sits and why the flood issues have dramatically reduced the usability of the property when you price it at 8,000, they’re going to take you seriously. And here’s why, because whoever buys the property’s going to have the same issues. So you’re just kicking the can down the road.
Jill K DeWit:
I’m going to have to disagree.
Steven Jack Butala:
No, really? After all that?
Jill K DeWit:
I don’t need no stinking video.
Steven Jack Butala:
Really?
Jill K DeWit:
No I don’t. You know what? So here’s-
Steven Jack Butala:
Throw Jack under the bus week actually.
Jill K DeWit:
No it’s not. There’s plenty times, Buddy, when you go, “Nope, this is what you do.” This is my turn. Because you know what really, I am dealing. I’m on the front line a little more in this scenario. Not that you’re not, and you haven’t done this for decades, but.
Jill K DeWit:
So here’s how it goes now. Number one, do you even really want it? So here’s my thing. Is my buyer’s pool going to be so darn small, and I’m going to be running around trying to make $3,000 off of my $1,000 when I can just move on. So there’s really got to be some other redeeming quality for me to even care. If my 8,000 is now 1,000, now I’m scratching my head going, do I even want to do this deal?
Jill K DeWit:
So if there’s something else there that, oh, but it’s just really beautiful hunting land and you can camp on it and it’s near this stuff. So yeah, the chances of somebody building on it are very slim kind of thing, but there’s six other things they could do with it and everybody around there is doing that, so this is why this is still good. Okay. There you go.
Jill K DeWit:
But I just think you could have a very nice professional conversation with a guy, and you really just say that because a lot of times, unless they’re a little old lady and they didn’t even know their husband had it, they often know. They really often know the problems. They have tried it. Especially, you can look back and see. It’s funny to me that not everybody does this, but I dig. I spend five extra minutes of digging on properties real quick to see how long have they had it. What’s going on.
Jill K DeWit:
If they had it for 30 years, okay, that’s one thing. Things didn’t pan out. They thought they were going to retire there. Somebody passed on. They can’t afford it now, whatever it is. Those are the reasons that they might be selling it.
Jill K DeWit:
But if they’ve loaned it for six months, okay, there’s a flag. Why are they now undoing this transaction? Chances are they accidentally bought it, not knowing what the problems were, and they want to pass it to you. So when you say these flood things make it unbuildable, they’re going to go. “Yeah, I know,” kind of thing. So dig a little bit and find out.
Jill K DeWit:
So, and then like I said, I appreciate your video. But to me that’s a lot of time and energy, and I can have a really easy, simple conversation and go, “Shucks. I know we talked about eight, and if I could do this, it would be eight all day long. But because of this and this, the best I can offer you is one. If that works for you, great.” Because it could be a recreational fun thing for somebody. Hey, for a thousand dollars, I’ll roll the dice and see what happens. But if you want to hang onto it and try to get more for it, have at it. But if something changes, let me know. I will be here and let it go.
Steven Jack Butala:
Today’s topic.
Jill K DeWit:
Oh yeah. Got it. You just want to get this over with. Sorry.
Steven Jack Butala:
No, no, no.
Jill K DeWit:
Okay.
Steven Jack Butala:
I completely agree with you.
Jill K DeWit:
Yeah.
Steven Jack Butala:
Completely. It’s all how you handle it. Jill has a way of getting what she wants from buyers and sellers.
Jill K DeWit:
And I can’t remember the last time I made a video and showed him anything, honestly. So sorry.
Steven Jack Butala:
Today’s topic, I have $10,000. What should I invest in? This is why you’re listening.
Jill K DeWit:
Okay.
Steven Jack Butala:
Tell us about Facebook, Jill.
Jill K DeWit:
This is the funniest thing. So here we are at the end of the year, everybody’s like, okay, thinking about 2022. I accidentally, I was so funny. I was laying in bed this morning, and I’m thinking I was accidentally thinking 2023. I’m like, what the heck? I’m like skipping a year here. I don’t even know what year I’m in. That’s all so funny.
Jill K DeWit:
So anyway, and I’m scrolling down in Facebook, and I’m seeing this note. I’m like, oh I love this. I’m sure there’s a lot of people that have not spent a lot of money this year, and they put some stuff aside and now they’re thinking, all right, I need to be smart about this in 2022. What should I do? And I’ve got to tell you some of the answers because these are real answers too, by the way. And it’s a woman’s real estate investing group in Facebook that I’m in, and these answers, I’m like, “What the heck?” on some of them.
Steven Jack Butala:
There’s some magic to this $10,000 number too.
Jill K DeWit:
Well, actually it was 15 even.
Steven Jack Butala:
Okay.
Jill K DeWit:
This person even has more money. They’re like, “I have 15 grand. What should I do?” So I’m only going to give you a snapshot. I wrote down one, two, three, four, five, six because I liked number six the best. Number six made sense. Like thank you. Number one was buy more doors. Well you can’t really do a lot with 10 or 15 grand.
Steven Jack Butala:
Doors meaning-
Jill K DeWit:
Another rental.
Steven Jack Butala:
… rental units.
Jill K DeWit:
And then it’s funny because in some states, the whole rental, the renters are mad at the rentees, and they have a whole stigma. There’s a whole thing about it. I’m like, “I don’t want to be in that scenario.” We have a rental near us, and we are the best landlords.
Steven Jack Butala:
Yep.
Jill K DeWit:
We undercharge because she’s awesome, and she’ll never leave, and that’s our way of doing. And she takes beautiful care of our home, so.
Steven Jack Butala:
You will never build an empire renting out houses or apartments.
Jill K DeWit:
Yeah.
Steven Jack Butala:
Trust me.
Jill K DeWit:
That’s not why we have it too.
Steven Jack Butala:
And if you do, if the small chance that you do, it will take you 50 years to do it.
Jill K DeWit:
Yep. So and the second one I saw was, I thought this was very interesting and nutty. Start a universal life policy that earns high interest, and then you use that to lend against for yourself.
Steven Jack Butala:
Worst idea ever.
Jill K DeWit:
I’m like what?
Steven Jack Butala:
That’s ridiculous.
Jill K DeWit:
I know.
Steven Jack Butala:
You know what? There is just so much bad advice out there.
Jill K DeWit:
Isn’t that wild? They said, “Start this policy, put more money in it as you can, and then you just borrow against yourself.” And I’m like, “I’m so confused about that. That’s nuts.”
Steven Jack Butala:
That’s rolling the dice with your money.
Jill K DeWit:
This one was good. I appreciate this person. They said flip a mobile home. I just did.
Steven Jack Butala:
I think that’s great.
Jill K DeWit:
That was smart.
Steven Jack Butala:
That’s great advice.
Jill K DeWit:
That was really good. Invest in a REIT. Eh, not my thing.
Steven Jack Butala:
REITs never return.
Jill K DeWit:
I know. This is-
Steven Jack Butala:
A REIT is a real estate investment trust.
Jill K DeWit:
Yep.
Steven Jack Butala:
You might as well go buy stock.
Jill K DeWit:
Well, yeah, you put that much money in, exactly. It’s like, okay. Three years later on 15 grand, I now have a thousand dollars maybe.
Steven Jack Butala:
Those are good numbers.
Jill K DeWit:
Right, and it’s like-
Steven Jack Butala:
If you’re lucky.
Jill K DeWit:
Right. What I could have done with that 15 grand?
Steven Jack Butala:
And I mean lucky. It’s pure luck.
Jill K DeWit:
Yeah. Okay. This one is 100% real. I did not make this up. They put buy a house in Detroit.
Steven Jack Butala:
We can make fun of Detroit because that’s where I’m from.
Jill K DeWit:
I know. I’m like, “Oh that was good.” All right, and the last one, which I that whoever put this in there, no, it wasn’t me. But it said become a private lender.
Steven Jack Butala:
Yeah. That’s actually-
Jill K DeWit:
That’s a good one.
Steven Jack Butala:
Yep.
Jill K DeWit:
That is my favorite, and that makes sense. So if you were to ask, “Okay, so here I am, Steven, I have 15 grand. I want to get my feet wet in real estate. I’m a woman. What should I do?”
Steven Jack Butala:
I would find some group to join where you’re the stupidest person there. Everybody else is smarter, and learn. And it might be five groups that you have to join. And then I would pick one or two of them, maybe land is your thing, maybe it’s not. And then put some money into education and really learn how to do it and do it slowly. I would take let’s just give yourself six to eight months of pure solid education. This idea always seems to register better with women.
Jill K DeWit:
Which parts? The research part?
Steven Jack Butala:
No, takes six to eight months, chill out for a second, take six to eight months and do research. Get yourself in a couple of groups where there’s real smart people, like kind people like you.
Steven Jack Butala:
I’ll give you an example. When my sister graduated from college, she immediately went and became a licensed real estate agent and started making some money immediately. And the first thing she did was in her neighborhood, she joined a woman’s invest stock market investor group because she knew nothing about that. And her portfolio’s massive now. It’s like in the millions of dollars, and all these women get together. They probably drink wine and stuff while they’re doing it. And they decide which stocks they’re going to buy. And everybody puts in three, four, $500.
Jill K DeWit:
Cool.
Steven Jack Butala:
So some version of that is what I would spend. And my second answer is this. Nothing. I don’t understand what this is. Jill and I were talking about, because we always talk about our cash position versus our real estate position. And there’s sometimes we have way more cash. Sometimes we have way more real estate. And Jill, very candidly recently in the car said, “I just don’t feel right when we have all this cash.”
Jill K DeWit:
Yeah. I’m not comfortable.
Steven Jack Butala:
I’m not throwing you under the bus here, but it makes me feel right with the world.
Jill K DeWit:
Oh, that’s so funny. I hate it.
Steven Jack Butala:
Your money doesn’t have to be put to work.
Jill K DeWit:
No, no, no. I’m just uncomfortable having that much cash sitting around. I feel like… You know what I feel like? I feel like an investment, even if it’s a big gold bar in the safe, I just feel uncomfortable with a net bank balance.
Steven Jack Butala:
Oh I see.
Jill K DeWit:
Safety wise, that’s why.
Steven Jack Butala:
I see.
Jill K DeWit:
That’s what. You know, Y3K is going to happen someday.
Steven Jack Butala:
Yeah. I think we’ll be expired at that point.
Jill K DeWit:
I know. So anyway, I just feel uncomfortable with that, but I was going to say too, hold onto your hat because next week, which is next year, I’m going to talk about this book that I’m reading. And boy, have I got some information from you men about, and I hate to say it, but it’s true. There’s studies, there’s proof, and it’s all, the book that I’m reading is all about female investing and why we make different decisions. We don’t have these egos. We don’t buy and sell crazy fast in the stock market, and we are not risk takers. I’m giving a lot of the information right here, and I’ll go into a much more detail when I am further along on this book also, which it’s awesome.
Jill K DeWit:
By the way, I’m going to end on this. I’m getting my hair done the other day, and this cute girl, she’s like in her twenties, and I’m reading the book. She’s like, “What is that?” I’m telling her all about it. I’m like, I know I’m helping her. I’m planting the seed. I’m like, “We women, we’re better at this stuff. You know?”
Jill K DeWit:
And I even said, “You know, sometimes, remember the first time your mom told you don’t go to the ATM at night and trust your gut?” She’s like, “Yeah.” I said, “You know, that’s right. You are right.” So that applies to a lot of things like business and deals. If something’s not right, buying a property’s not right in your gut, don’t buy it. That’s all true. Thank you.
Steven Jack Butala:
Hey, if you do have 10 or $15,000, all kidding aside, becoming a private lender is a great idea, but you can’t do it cold.
Jill K DeWit:
Yeah.
Steven Jack Butala:
It’s not like-
Jill K DeWit:
True. You want to know what you’re getting into.
Steven Jack Butala:
So-
Jill K DeWit:
And know the-
Steven Jack Butala:
So my point is-
Jill K DeWit:
And know the person.
Steven Jack Butala:
Before Jill ends it here. My point is there is no better investment than education.
Jill K DeWit:
True. I agree. Happy you could join us today. Five days a week, you can find us here on the Land Academy Show.
Steven Jack Butala:
Tomorrow the episode on the House Academy Show is called at some point, the house sales price is just too high. And we are approaching that in this market that we’re in right now. You are not alone in your real estate ambition.
Jill K DeWit:
Yeah. Isn’t that funny? We were talking about that. I was looking at some real estate reports here in the Phoenix area showing the buckets of the number of homes in the certain price ranges. You know what I’m talking about. Like south of a million dollars, how many buyers you have. North of a million dollars, north of two million, north of three million, north of four million. Right? You have to make decision.
Jill K DeWit:
Well, number one, it’s getting nutty. And number two, do I want to be, even if I could afford whatever I can afford, think about your buyers pool, and it translates to our properties too. That’s why we have a sweet spot with our investment properties. Now I’m kind of giving away the show tomorrow, but anyway.
Steven Jack Butala:
All these things are connected. The purchase price of an SFR or primary residence is connected to wages of the people that are buying it. And it’s connected to the cost of services, so inflation is really dramatically affecting all this. And we’ll talk about it tomorrow.
Jill K DeWit:
Thank you. And thank you for tuning in. By the way, if you are a Land Academy member, make sure that you are with us on Discord. We’re Steve and Jill.
Steven Jack Butala:
Information.
Jill K DeWit:
And Inspiration.
Steven Jack Butala:
To buy undervalued property.
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