A.B.L. (Always Be Learning)

I just ordered a book from Amazon, Commercial Real Estate Investing for Dummies. The title pretty well sums up my lack of knowledge on the subject. Last week I was catching up with one of my old friends; they all seem pretty old these days. Since our last phone call, he invested a good portion of his “nest egg” in a small office building located near a county court house in another state. He is happy with the income his property is generating and he is looking forward to watching his investment grow in value. Our conversation peaked my interest. There are really only two ways for the average American to build wealth, the stock market, or owning income-generating rental properties. While I have read a book or two on investing in real estate, my mind always came up with frightening stories that sent me scampering back to index funds and conservative dividend paying stocks.

Closing my eyes, I envisioned buying a small two bedroom home in an undervalued lower middle class suburban neighborhood. My first tenant is a young woman attending a local Bible college. Wait! She falls in love with a biker, who transforms my investment into a crack house. During a gun fight with the local police SWAT team, my house catches on fire and burns to the ground. So far, the idea of renting office space to a couple of legal firms, seems—safer.

I want to learn more about this subject.

My whole life I have wanted to learn more about something or the other. As well as completing two bachelor’s degrees, one with a double major, I have attended 17 for credit college courses funded by my employers on my time, 10 of those classes led to my MS. I have taken a variety of life enrichment courses from calligraphy to the National Guild of Hypnotists’ certification training. In addition, I have studied subjects like investing, finance, comparative religion, Tai Chi, and even a little bit about the law on my own time and dime.

At my age, I have regrets, both for what I have done and what I have failed to do. I am not a perfect person and I don’t live in a perfect world. However, I don’t regret any of the studies I have undertaken over the course of my lifetime. Some of these undertakings, like my BS in Mechanical Engineering, changed my life in a measurable way. Some of my efforts did little but make me a more entertaining guest at the dinner table, but all of them made me a better person and allowed me to live a fuller life.

In the first five years of retirement, I have felt like I have been slipping a bit, not learning enough. I thought about this subject as I went for my morning walk on the campus of my first Alma Mater. It isn’t quite true. My wife and I lost three parents in five and a half years. I have learned a lot about wills, power of attorney, taxes, probate, advanced directives, and hospice care. Now that chapter of my life, one that we will all have to face at some point, is drawing to a close. It still might take up to a couple of years to sort out every last detail, but the heavy lifting is almost finished.

I can face the future, start learning something new about this wonderful world, a world that seems more interesting and alive than it did in the waning years of my career. Neither my body or my brain works quite as well as it once did. I can tell the difference. There was a point in my life when I didn’t tell the same funny story to the same person more than two or three times, but I am thankful to be enjoying good health in a comfortable retirement.

I may or may not ever pull the trigger on my first commercial real estate deal. While I doubt that I will ever become the strip mall king of my new home town, I may, just may, diversify my portfolio into commercial real estate, after I have learned enough about the subject to have an intelligent conversation with someone smarter and more knowledgeable than your servant, the humble author of this blog.

Always Be Learning! Never Stop!

Yes, There Are Giants In The Land

As the Children of Israel were getting close to the Promised Land, Moses sent out an exploration and evaluation team consisting of twelve spies, one representative from each tribe, to explore Canaan. He wanted an intelligence report containing information on the soil, plant life, cities, and the current inhabitants of the land.

All twelve men came back with the same report. The land was exceedingly wealthy, flowing with milk and honey. They brought back a bunch of grapes that was so large it took two men to carry it, as well as samples of other high quality produce. However, they also saw large fortified cities and the giants who lived in those towns.

Two of the spies, Joshua and Caleb, thought that the Children of Israel would be well able to conquer the land. In fact, Caleb silenced the listening crowd when he said, "We should go up and take possession of the land, for we can certainly do it." Unfortunately, the other ten reported that the land was dangerous, that if they attacked, the land would devour the living. When describing the giants, they said, "We seemed like grasshoppers in our own eyes and we looked the same to them."

That night, after listening to the reports, the members of the community cried, wept, and complained. They were ready for a recall election to get rid of Moses and Aaron, so they could choose a new leader to take them back to slavery and Egypt, believing it a better option than dying in the wilderness, or getting annihilated by giants in Canaan.

So, there you have it.

At times in our life, we are called upon to choose to take on the role of a faith filled spy, a spy filled with doubt and fear, or just an innocent bystander who has to make a decision, "What report should I believe?" It isn't just about invasion planning. This story can find application in many of the important issues of life. Since this is a personal financial blog, consider any given economic situation. The facts can usually be sorted out from the speculations of the pundits. The interest rates, the gyrations of the stock market, the numbers of unemployed, housing sales, tax rates, and similar such information are the report of what was seen in the land.

Now what are you going to do with that information? Are you going to counsel others that, yes, there are some giants in that land, whoppin' big ones, and they live in strong fortified towers? I don't know about your city, but in my city, it seems that banks, insurance companies, and hospital systems own the largest, strongest fortifications. However, no matter what is happening, even during the worst day of the Great Depression, somebody was making money. Are you going to be like Caleb and say, "We can do it."

Or, are you going to report, "The little guy doesn't have a chance. The game is crooked. You can't find a decent job." In the glorious days after the end of World War II when the United States had the only industrial infrastructure that hadn't been bombed into rubble, there were losers, failures, and derelicts who had given up on life.

Most of time, you won't be one of the spies, someone who has actually seen the Promised Land of someone's successful marriage, a man with only a high school diploma, Bill Gates comes to mind, who is a wealthy businessman, or a formerly fat guy who just finished his third marathon, with your own eyes. You will just be one of the Children of Israel listening to the evening news or surfing the Internet out of boredom.

Be careful what you choose to believe. Be careful what words you choose to repeat. The ten men who spread a bad report were cut down by a plague and died before the Lord. The rest of the nation, excluding Joshua and Caleb, were condemned to continue wandering about in the wilderness for another forty years, until all of those who had seen the miracles performed by God on their behalf in Egypt and the desert, yet believed the bad report, were dead.

Of all those present, including Moses and Aaron, only the two, Joshua and Caleb, made it into the Promised Land. My prayer is that you will be one of those who makes it-to whatever financial freedom means to you.