4/25/10: LIVE! from the 8th Annual Investor Summit at Sea

Most of the time when we do a show, our producer keeps us locked up in the cold, lonely studio with our headphones on.  And even though we have each other, we have to use our imaginations to see our listeners.  But this week, we get to do the show in front of a LIVE STUDIO AUDIENCE! Better yet, we’re aboard a cruise ship sailing through the Caribbean!  Best of all, we’re hanging out with some the brightest, most committed real estate investors on the planet.  Toss in our SPECIAL GUESTS and the whole experience is over the top awesome!

On board and behind (and in front) of the microphones on the beautiful Carnival Triumph for this week’s show:

•    Your Captain and a mighty sailing man, host Robert “Skipper” Helms
•    Your brave and sure first mate, co-host Russell “Gilligan” Gray
•    The Godfather of Real Estate, Bob Helms
•    Rich Dad’s Asset Protection Advisor, Garrett Sutton
•    Rich Dad’s Real Estate Advisor, Ken McElroy
•    Rich Dad’s Creative Finance Advisor, Wayne Palmer
•    International Real Estate Developer, Beth Clifford
•    International Entity Planner, Attorney Mauricio Rauld
•    Special guest from Puglia’s restaurant in Little Italy, New York; featured entertainer in Adam Sandler’s Big Daddy, the one and only Jorge Buccio
•    Fine passengers that sailed that day, a cast of thousands (okay, maybe a few dozen), our live Summit at Sea audience!

As we’re stuffing the faculty and studio audience into the Big Easy Piano Bar for this live taping, we quickly that discover fitting everyone in (physically into the room, but also getting their comments into a one hour broadcast) is anything but easy!  However, the Skipper quickly takes control and before we know it, we’re off and running.

After some brief opening remarks, the Skipper asks each of the Summit Faculty to share their insights and reflections on the remarkable week we’ve all had together.  For the Rich Dad Advisors, this was their first (but hopefully not last!) Summit with The Real Estate Guys™.   They’ve all heard Robert Kiyosaki call us wild and crazy, but now they had a chance to observe it first hand.  Of course, none of that stuff makes it into the show because Summit Rule #1 is “what happens at sea stays at sea”.  Sorry!  Join us next year and then you can be a Summit Insider too!

For today’s show, each Faculty Member shares some of the highlights from their Summit presentations.

Ken McElroy taught on how he approaches real estate in today’s economy.  This is a guys who has over 10,000 doors under his control and is actively acquiring more…in spite of the “bad” real estate market.

Garrett Sutton spoke on state-of-the-art asset protection structures for real estate investors.  He also did a class on how to properly structure deals using investors and partners.  Many well meaning people end up in trouble when they raise money to buy real estate – simply because they don’t know what they don’t know.  Considering that syndicating is arguably the fastest path to big deals and big bucks, a small investment in knowing how to do it right is time and money well spent!

Wayne Palmer comments about his extensive series of classes on the creative use of private notes.  Wayne uses notes for putting together real estate deals which might not otherwise happen.  He also uses them to create equity and cash flow from next to nothing!  It seems like magic, but during the Summit he revealed some of his trade secrets.   Also, he shared the guidelines he follows to mitigate risk and optimize return.  His classes were among the most demanding, but also the most popular.  Powerful and practical principles for profiting from paper (say that fast 10 times).

Beth Clifford wowed the group with her amazing presentation on the how and why of going offshore with some of your investments and business ventures.  Hers was one of the most popular topics at the Summit, even with the faculty!  Wayne Palmer said Beth’s presentation stretched his brain and was his favorite of the Summit.  Now THAT’S saying something!

Mauricio Rauld expanded on the concept of international investment and business structures – and how to avoid the dangerous schemes which land so many novices in trouble.  There are many valid, legal and ethical structures which can be used to better protect assets, protect privacy and mitigate taxes.

There’s a lot more that happened on the Summit which just can’t fit into the radio show – even in a summary – including the Apartment Investors Panel, the Ask the Attorneys Panel and the Investor Roundtables.  Plus the fun in the sun real estate shore excursion in Belize, the more fun in the sun beach party in Cozumel and all the private shipboard parties.  Alumni will never look at a napkin the same way again!

Going into the Summit, we weren’t sure what the Rich Dad Advisors would think by the end of the week.  After all, they get to hang out with Robert Kiyosaki and talk in front of crowds of thousands!  But when it was all said and done, they had a great time.  Don’t take our word for it.  Listen to the show and you can hear it for yourself!

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To get in on the EARLY BIRD deals for the 2011 Investor Summit at Sea, use the Feedback page to send us your request.   You’ll be given an opportunity to sign up at the lowest public price.  And after listening to this show, why wouldn’t you want to be with us on the 9th Annual Summit at Sea?

Seven Lessons from the Summit at Sea

The Real Estate Guys™ 8th Annual Summit at Sea was a huge success! We feel sorry for everyone that wasn’t with us this year.   All the energy, education, experiences and relationships are hard to put into words, but we have 7 lessons we believe will help you.

We kicked off the 2010 Summit in the French Quarter of New Orleans. Many Summit attendees wisely came in a day early and made plans to stay a day or two later in order to enjoy the hospitality of this amazing city.  Those who got the most out of their trip had invested the time to research the city beforehand.  When they arrived they had geographical context and some idea about what they wanted to see and do.  One of our attendees had plans to attend a certain restaurant he’d heard good things about.  The food of the French Quarter was certainly one of the highlights of this trip. Russ took the opportunity to try turtle soup and fried alligator.  Both were great and he’d order them again!

Summit Lesson #1:  Life’s best surprises go to the curious and adventurous. Invest time to visit new places, meet new people, try new things and discover new ideas.  You’ll be the richer for it.  If you’re not that way naturally (like Russ) – hang out with people who are (like Robert).  Some of our best real estate deals and business relationships have come from simply exploring.  Deal hunting is as much art as science.  You can’t always script it.

Back to our attendee. So this guy is heading out according to his plan.  But when he steps into the hotel elevator, he runs into Rich Dad Advisor® Wayne Palmer and his family.  The short of it is our guy ends up going to dinner with Wayne!  We’ve been at Rich Dad events with hundreds and thousands of people in attendance, many of whom wait in line for a long time just to get two minutes with an Advisor.  Can you imagine being able to enjoy a long casual dinner with Wayne Palmer?

Summit Lesson #2:  Great opportunities to meet interesting people and learn new things won’t happen to those who stay home, arrive late, leave early or aren’t flexible. If you want to build strategic relationships, you must go to where the right people are and put yourself in a position to get lucky (speaking purely in terms of business).

As real estate investors, it’s important to practice exploring markets. There’s so much more you learn from actually being there.  The internet can’t capture the spirit of a market.  From cab drivers, to hotel and restaurant workers, to local shop keepers and business owners, to the people on the street, there is a lot you will discover about what’s REALLY happening in a local economy when you’re physically in it.  People living in a community know what’s happening right now with rents, prices, migration trends, demographics and job creation.  Only when you add this anecdotal information to your own real life observations can you begin to put statistics into useful perspective.  Remember: stats reports things that have already happened – not what’s happening now.

We noticed that New Orleans is a very entrepreneurial city. Perhaps in the wake of Katrina (the effects of which were still apparent) the bravest, most resilient and dedicated people have returned first.  In any case, these folks weren’t asking for handouts.  They were happy for the opportunity to earn our business – and very thankful for it when they got it.  As our nation and world continues to work through the effects of the financial crisis, the people of New Orleans gave us hope.  If people all over the world dedicate themselves to working their way out of a mess like these people are, our world is going to come out of this Great Recession just fine.

Summit Lesson #3:  Entrepreneurship and hard work (not handouts) are the keys to personal and societal recovery. Everyone who’s struggling in this economy should take a trip to New Orleans and see how winners react to adversity.  No wonder the Saints won the Super Bowl.  If we all take the spirit of New Orleans back to our businesses, this recession will quickly fade into the rear view mirror.

After a great session in the hotel, the group headed to the pier and boarded the ship.  We sailed on the Carnival Triumph, which was SOLD OUT!  Cruise lines are actually weathering the financial storm pretty well.  Why? Perhaps people realize that a cruise is a great value, meets a basic human need (to refresh themselves) and attracts financially capable people from all over the world (a broad market).  Do these principles apply to real estate investing?  It’s obvious that real estate meets a basic human need, but we’re reminded of the importance of having a large, financially capable target market.  No matter how badly someone wants something, if they can’t afford it (or don’t think they can) they won’t buy.

Summit Lesson #4:  Pick markets and properties that appeal to a large demographic of financially capable people and you will weather difficult times more easily.

The next lesson came later, but is an extension of lesson #4.  Rich Dad’s Real Estate Advisor Ken McElroy talked about the markets and properties he targets:  B-Class apartments (meets a basic human need – housing) with affordable rents (provides a great value) that appeal to working class people (a large, financially capable demographic) in markets with good mid-to-long term job creation (he focuses on areas with fundamental and growing industries such as energy).

What was very interesting is that on the real estate shore excursion to Belize, we saw a very different variation on the same themes.

In Belize, we visited a piece of beautiful waterfront land and listened as the developer shared her vision for the property.  She plans to build high quality, moderately priced residential units suitable for resort, retirement or ex-pat full time occupancy.  While the country of Belize is sparsely populated and very poor, it is a land of breathtaking natural beauty and terrific year round warm weather.

Like the cruise ship, the project in Belize provides great value, satisfies a basic human need and desire, and appeals to a worldwide, financially capable demographic.  In other words, the project’s success isn’t dependent on the local population to be successful.  It attracts people from all over the world.  And because there will be so few units available relative to the size of the market, it’s hard to imagine the project won’t be successful.  It’s very different than B-class apartments, but like the cruise line, follows a similar fundamental formula.

Summit Lesson #5: Essential principles of successful investing don’t vary much, even though markets, properties and target customers might. Or as the old adage says, there’s more than one way to skin a cat (though we have no idea why anyone would want to do that – it’s cruel).

Even though this was our 8th Summit, there is no doubt it was our most compelling line up of speakers. We were very fortunate to have not one, but THREE of Robert Kiyosaki’s Rich Dad Advisors® teaching at our Summit.  Creative real estate genius Wayne Palmer taught a powerful and practical series on how to create capital, produce profits and generate cash flow with the creative use of private notes.  Even though people had to ice their brains after each session, Wayne was gracious to make himself available during non-class times.  He answered questions and even did some individual personal consultations.  These opportunities weren’t part of the official program, but some people at the event got lucky (see Summit Lesson #2).  People left the event believing they could use the education they got to do at least one deal which would more than pay for the cost of the entire Summit – and next year’s too!

To quote Robert Kiyosaki, “Savers are Losers”.  Though we agree with his premise (and highly recommend you read his latest mega bestseller Conspiracy of the Rich), we’re saying it for a completely different reason.  We think people who “saved money” by not coming on the Summit actually lost money.  We know.  That sounds like sales pitch.  But anyone who’s ever tried to do an event like this knows that no one is getting rich by promoting it.  More, if you saw the surveys of the people who came, you’d realize that we still haven’t figured out how to over-promote the Summit.  Everyone felt it was easily worth the time and money.

When you’re around people who know how to make money in a tough economy; who are optimistic about the future; who are resourceful and busy taking advantage of all the opportunities they see in the market, you quickly realize those who lost out were those who wanted to attend and chose not to because they told themselves “I can’t afford it”.  This paradigm looks at the Summit (or similar events) as an expense and not an investment.  The difference is that an expense pays for something that is consumed and doesn’t produce a profit.  An investment pays for itself and returns a profit.  The paradigm should have been, “I can’t afford not to” and “How can I afford it?”  Most people believe a college education is worth the price, yet hesitate to invest in non-institutional education.  Could it be they believe the degree is more important than the knowledge?  What do you believe?

Summit Lesson #6:  Paradigms affect potential and profits, so pick your paradigms carefully. The Summit was full of winners and after living with these amazing people for a week we found ourselves picking up new paradigms and making commitments to shed some bad ones.  One of the great challenges is to manage the influences to our thinking.  We look for every opportunity to hang around top performers.

One common theme we noticed in the presentations of nearly all the speakers was “control”.  Wayne Palmer talked about his rules for risk.  He follows strict (but flexible) guidelines for collateral, loan-to-values, target returns and cash flows in order to control the risks he takes in any deal.  Rich Dad’s Asset Protection Advisor, attorney Garrett Sutton, talked about entity planning and how to structure your affairs in order to control liability and tax risk.  Attorney Mauricio Rauld spoke on international entity structures which further control liability and tax risk when investing outside of the US.

Ken McElroy talked about his guidelines for market and property due diligence, as well as his dogged attention to cash flow.  He uses these disciplines to control market risk.  He says this control is why his real estate investments aren’t in trouble even though he’s going through the same challenging market conditions that are wiping out so many others.  He doesn’t rely upon the market to do the work for him.  He looks for deals with upside and works to improve the cash flow, which in turn increases the equity.  Then he uses prudent leverage to release the new equity and return his seed capital so he can move forward with positive cash flow – all on no money invested.  This produces what Robert Kiyosaki calls “infinite returns”.  Meanwhile, he recycles the seed capital to do the next deal!

Robert Helms stressed the importance of controlling one’s mindset when investing in the wake of an unprecedented drop in values (see Summit Lesson #6).  Each had a different angle, but again, all variations on a theme: control.

Summit Lesson #7:  Pay careful attention to the things you can control so you’re able to withstand the challenges caused by the things you can’t (inflation, taxes, market cycles, interest rates, etc).  When it comes to investing, most people are out of control.  Fear overrides common sense and they buy high and sell low.  They turn their money over to bankers and Wall Street and hope for the best (hope is not a strategy).  They manage cash flow by feel rather than budgets and bookkeeping.  Worst of all, they wait for external circumstances to get better rather than investing in making themselves better with education, relationships, strategies, disciplines, systems and a willingness to take action in the face of uncertainty.

We could go on and on!  There are SO many great lessons to glean from the Summit.  Of course, the only way to really get them is to actually be there.  The Real Estate Guys™ Summit isn’t the only event of its type, but after reading the surveys of the attendees, and even more, hearing the feedback of the Rich Dad Advisors®, we think it’s one of the best.  And we’re already making plans to make next year’s Summit even better!

We encourage you to make it your goal to be with us in 2011. Without exception, every survey we received said the event exceeded expectations and was well worth the time and money invested.  Over one third of this year’s group has already signed up for next year!

To make sure YOU get the upcoming announcement about The Real Estate Guys™ 9th Annual Summit at Sea in 2011, be sure to sign up for our newsletter. To be extra sure you get the early bird deal, use our feedback page to let us know you’re interested and we’ll put you on our VIP notification list.

All the best!

Robert Helms and Russell Gray
Hosts
The Real Estate Guys™ Radio Show

3/14/10: Hedging Your Real Estate Bets with Life Insurance

Are you kidding?!?  Life insurance?  What does life insurance have to do with real estate - and how can it help a real estate investor succeed?  Good questions!  So we turned to one of the foremost experts on the creative uses of life insurance and learned how to add another powerful financial tool to our investor’s tool box. Check it out!

Backing the hearse up to the studio doors:
•    Chief Undertaker and Show Host, Robert Helms
•    Pallbearer for Hire and Co-Host, Russell Gray
•    Hearse Driver and “The Godfather of Real Estate”, Bob Helms
•    Non-traditional Financial Planner, Kim Butler

Let’s face it.  Most people would cross the street to avoid a life insurance salesman.  Who wants to spend a bunch of time talking about dying?  Worse, who wants to spend money on a product you hope you never use – and when you do, all the benefits go to someone else? Yuck!

That’s what we thought until we met Kim Butler.  Kim calls herself a “non-traditional” financial planner, which had us liking her right away.  If “traditional” means turning your money over to the Wall Street Wizards to play with, we’re not fans.  So we’re very interested in what Kim has to say.

Kim teaches what she calls “Prosperity Economics” and what it means to real estate investors.  Sitting here wallowing in the Great Recession, “Prosperity Economics” sounds pretty good!

The first thing Kim tells us is that life insurance “done right” means benefits to the LIVING! What a great concept!  She says rather than waiting to die to “enjoy” (we use the term loosely) the benefits of life insurance, she explains how life insurance is a powerful financial tool in the here and now. We like it.

One of our FAVORITE parts of the discussion is when Kim reveals how one particular type of life insurance has amazing similarities to real estate as a financial tool.  Even better, she tells us how savvy investors actually use life insurance not as an investment, but as a cash management tool.  Very interesting!

We came away with pages of notes – and are still hungry for more!  Look for a follow up show on this intriguing topic in the near future.

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1/24/10: Practical Tax Tips and Insight with CPA Tom Wheelwright

It’s the most wonderful time of the year….

Not Christmas. Tax time!  This is the time of year when all the bills from the holidays show up in the mail, along with your 1098’s, 1099’s, W2’s, 1040′s and our personal favorite, the K1.  Let the fun begin!

Before you tune out, we invite you to listen to our recent interview with CPA Tom Wheelwright.  He promised us he could make taxes fun, to which we said, “Great!”

So we broke out some month-old eggnog, stoked the fire in the fireplace, and tossed a few chestnuts into the pan for some good old fashion roasting.

Huddled around the microphones to talk taxes:
•    Your Host, Robert Helms
•    Co-host and Financial Strategist, Russell Gray
•    A man who has probably paid more taxes than everyone else on the show combined, The Godfather of Real Estate, Bob Helms
•    Certified Public Accountant, Tom Wheelwright

Like little kids on Christmas morning, we came into the studio to open up gifts of tax wisdom from one of the brightest real estate tax advisors we know.  After a few opening comments, we got Tom Wheelwright on the phone and started the grilling.

Tom opened up with some paradigm breakers as he explained that taxes are not only fun, but actually a very powerful tool for wealth creation.  Wow! Sounds good to us!

Then we asked him, “What are the most common and costly mistakes most real estate investors make?”  One of his answers astounded us when he told us about a special form every investor should know about, but few use properly.  Getting it wrong can cost you many thousands of dollars!

It would be sacrilegious to talk taxes and leave out 1031 exchanges, but for most experienced investors, the 1031 is old news.  And in today’s challenging economy with so much equity in hiding, who cares about a 1031 anyway?  So Tom gave us some great tips on why we might NOT want to use a 1031 exchange.  What????

Now that the eggnog was kicking in, we got into some of the tax changes for 2010 (and beyond) that affect real estate investors.  Then he gave us the inside scoop on how to find a great real estate CPA.

Before we knew it, the show was over!  Time flies when you’re having fun.  The topic wasn’t as taxing as we thought!

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