Every business, household and Real Estate deal. Follows this formula right here. If you want to succeed in any of those things, you need to master this formula here. So the first one, of course is AI or Income. Now every household has
Income as in a W-2 or a pension or Social Security. Or maybe you have multiple forms of Income and you all hear about making lots of Income through side hustles. But Income as Income doesn’t matter if
it’s a business or sells pizzas or or some sandwiches or trinkets, it doesn’t matter. Or in my case, it’s rent primarily for multifamily. But every business, every household and every Real Estate deal has Income and your ability to grow
Income as it continues to shrink and be used for other things is the key to this whole formula. The second thing is expenses. Now, just like in a household where you might have rent or a car payment or utilities or just the food that you eat or buy or whatever, it might be, but
everyone has expenses in a Real Estate deal. It might be property Taxes, utilities, Insurance, those kinds of things. And a lot of cases. You have those in a home. You also have those in businesses. You have rent, you have utilities and all kinds
of things that it takes to run a business like poise. So you have the Income and you have expenses. And then after that, that big D word of course, is Debt. And this is the thing that’s taken most people down right now. And this is the thing that you’re
going to see is going to continue to take people down in a household. This Debt could be a mortgage, it could be an auto payment. It might be you Financed a
new boat. It could be you’re financing Capital improvements to your houses. It doesn’t really matter. But Debt is that it could be Credit card Debt. So a lot of businesses, a lot of households and a lot of Real
Estate deals use Credit cards. So Credit card Debt is part of this. But Debt is definitely something that takes away from your Cash Flow, which is what you should be driving. Everybody should be driving
toward Cash Flow. I’ll give you a couple examples. You might have a very successful business of selling whatever it is you’re selling, and then you have your expenses to run the business that might be rent in a space that you’re at. It might be labor, it could be
products or services that you have to buy to sell to the public. It doesn’t really matter. And then a lot of times they load up on what’s called a line of Credit or some kind of Credit line for their business. And we’re seeing that right now in a
personal and a home through Credit card Debt. And Credit card Debt is what’s killing people right now. You see it in student Loan Debt. That is Debt, and it takes away from
your Cash Flow. And the Cash Flow is the magic. Cash Flow is what you actually need and use to be able to take you to the next level. Cash Flow is what the banks rely on. Cash Flow is what everyone relies on to see
whether or not they’re going to give you more Debt in order to Finance and get more Income. So in a Real Estate deal,
all banks look at your Cash Flow or your net operating Income first, which is Income minus expenses, and then they Loan against that to see how much Debt you can afford because they want their
Insurance policy. That’s when you hear about Debt service coverage and things like that. That’s when you get a higher Loan to value or lower Loan to value. The bank is always looking at Cash Flow,
Cash Flow from the business, Cash Flow from the property that you might own or want to buy, or Cash Flow from you as an individual. Everyone’s looking at your potential Cash Flow. And there’s one thing for sure Wall
Street wants it. Wall Street wants this money. They want to get you more in Debt, and they want you to spend more money, but they also want you to use it to grow Income. So the secret to all of this is trying to figure out how to generate enough Cash
Flow to take the stress and anxiety off of you, to be able to use it, to be able to grow your Income. The goal of knowing this equation is, of course, to increase your Cash Flow, but what’s most important is understanding the priority or the
waterfall and what you start and end with. Most financial gurus and people on the internet are going to focus on E! They’re going to focus on expenses. This is actually wrong. This is not where you need to focus. They’re going to say, cut up your Credit cards, do things
that cut back on your lifestyle so that you can grow your Cash Flow. That is the wrong advice, because the number one thing you need to do is actually figure out how to grow your Income. Now, you can grow your Income through side hustles. You can
grow your Income through making more money where you’re already working. Maybe it’s just simply asking and say listen. Ways Inflation has not kept up with regular Inflation, and I’m falling behind because that was happening to
millions of Americans right now. But you definitely have to focus on Income if you’re going to move the needle personally. You have to focus on Income. All businesses focus on Income. All Real Estate deals focus on
Income. Top line Income through making sure that they maximize occupancy. Are looking for other Income opportunities inside of the rent roll or with the tenants that are already there. One of the properties that I own in Sedona, which is a hotel
resort where people come and spend the night, we focus on what’s called on property Revenue, again, focusing on Income, because when people are staying on our property, what are they doing? They’re going to breakfast, they’re going to lots,
they’re going to dinner, they’re buying a bottle of wine. They’re buying all kinds of stuff in our main clubhouse, where they go check in and register to get their hotel room. So these are all on property Revenue. So you’re focusing on
Revenue because why? Because my expenses at the property are somewhat fixed. I have to pay for my chefs. I have to pay for the waitstaff. I have to pay for the guard. I have to pay for all the things that it cost to run that property that’s going to be fixed. The one thing
that’s going to move the needle is Income. So all these financial gurus, they tell you to focus here, there’s only so far you can go. There’s people that are focusing here so much that they have stress and anxiety. And now they have nowhere to go. They have no
Cash Flow. Focus here on Income. The second thing that you got to focus on is Debt. Now Debt is a big wild card. And this is what Wall Street definitely wants. They want to get into your pocket and get you into
Debt. The problem with that it can be priced at 3%, 4%, 5%, 20%. The cost of Debt is really important. So the second thing that you can do is focus on your cost of Debt. Now a lot of people don’t like to have any doubt at all. There’s
nothing wrong with that. That just means that you’re going to have more Cash Flow. For me, I like to have a lot of Cash Flow and be able to use minimal amounts of Debt to grow my Income. Expenses, in my opinion, are the very
last thing. The cut. Although it’s very important that you’re always keeping these in check. In other words, can you move from a $1,500 apartment to $1,000 apartment? Yes, you probably can do that. Is it going to really change your lifestyle very much? Probably not. Beyond that, there
are going to be things that actually dig in to the way you want to live your life. So the point here is you grow your Income, minimize your Debt. If you have 20%, 18%, 22% Credit card Debt, you’re falling behind and
it’s hurting your Cash Flow. Once you get to this Cash Flow number personally, you’re going to be fine. So when I’m running a property, I’m focusing on all things Income because I know that I’m going to have property
Taxes increase. I know my Insurance is going to go up. I know my utilities are going to go up. I know my labor costs and my marketing costs and everything is going to go up. I know expenses are going to go up. We don’t have to fight over this. And so if you
manage your Income, you’re going to cover your expenses. If you focus on the plus on the positive thing that you can control, which is growing your Income, you’re going to be able to more than hedge any expense increases, and you’re not going to
have that kind of stress and anxiety. When businesses, Real Estate or even households go down, it’s typically a result of a drop in Income. It’s almost never a result of a rise in expenses, and it’s often predicated by getting too far in
Debt. And this is when you start to see people filing bankruptcy. And when a lot of businesses closed from the pandemic, it wasn’t the expenses or the Debt, it was the lack of Income. When people start paying for something, whether it’s
rent or maybe it’s just a restaurant or whatever it is, or your Income stops, then that’s when you get into trouble. So in all cases, focus on the I. This is the key. This is the one that’s going to get you out of trouble. Focus on Income. What
this is all about is Cash Flow. And this is actually when it starts getting fund. When you start to have a lot of Cash Flow or passive Income, then you can start to build reserves. Reserves for trips, reserves for your family, reserves for time
back. That’s what this is for. When you have Cash Flow coming in, you get a lot of financial freedom. So these three things are very important. But the whole goal, of course, is to have Cash Flow coming in while you’re sleeping so that you don’t
have to be the sole source of the Income. This is the whole point of having a business. This is the whole point of owning Real Estate. Does it have somebody else paying the rent, paying all this and having the Cash Flow to go do what it is that you
want to do. So I’m currently over $700 million in Debt, but it’s all covered by my Income. Now. While everyone is focused on cutting expenses, you can actually use Debt to turn it into Income. If you want to learn how
to do that, just watch this CashNews.co here.
CashNews, your go-to portal for financial news and insights.
Great and very informative!!! Willing to work for FREE!!!
😂😂😂 όχι
Thank you for sharing. Financial education is crucial today to show incredible resilience and discipline in the volatile market, masterfully balancing strategy and insight for success. This dedication to continuous learning is inspiring…managed to grow a nest egg of around 100k to a decent 432k in the space of a few months… I'm especially grateful to Sandy Barclays, whose deep expertise and traditional trading acumen have been invaluable in this challenging, ever-evolving financial landscape.
Indeed !
Thank you sir, very much. 🙏🙏🙏🙏
I lost my retired off real estate shirt I need another one Kenny Mac!!
Hello ken!! My wife and I have two properties, and we need your advice. One of the properties, we rent it out and it pays by itself and plus we make $1,500 extra every month. (It's a duplex), and we are about to pay it off in about 2 years. Do you recommend refinancing and then buying a 3rd house, or should we just pay it off? I'm 34 years old, and my wife is 32.
Such a great way to close up all of the holes that others leave open.
2 masters degrees in engineering and management and never have I learned so much in such a little time…for free.
Improvised explosive device 🧨 💥
Lfgggg
Good info. Thank you for posting.
Cut Your Expenses = Advice For Lazy People.
Thank you, Ken
Thank you
The title scared me lol
Awesome Advice thank you
wool socks to bed = sleep quality you dont know about🟫 advice 🟣for some reason youll take this personally but dont cope around it🟥🟩