Strategies for Success: A Conversation with a Multi-Talented Real Estate Entrepreneur with Timothy Lyons

0:01Light that, Sparkfire Nation. JLD here and welcome to Entrepreneurs on Fire. brought to you by the HubSpot Podcast Network, the audio destination for business professionals with great shows like My First Million. Today, we'll be breaking down strategies for success, a conversation with a multi-talented real estate entrepreneur. To drop these value bombs, I have brought Timothy Lyons into EO Fire Studios. Tim is an active NYC firefighter and former ER nurse who made the pivot to become a real estate investor and Amazon number one bestselling author, as well as a podcast host of the Passive Income Brothers podcast.

0:39In today's foundation, we'll talk about seemingly having it all. We'll talk about the five ways that real estate can pay us. We'll talk about trading time for money and maybe what you should do instead, and so much more. And a big thank you for sponsoring today's episode goes to Tim and our sponsors. Sales Evangelist, hosted by my friend Donald Kelly, is brought to you by the HubSpot Podcast Network, the audio destination for business professionals. Each week, Donald interviews the world's best sales experts, successful sellers, sales leaders, and entrepreneurs who share their strategies to succeed in sales right now.

1:14A recent episode you should definitely check out is the five ways to do daily outbound with LinkedIn. Listen to Sales Evangelist wherever you get your podcasts. Is today your day? Visit thrivetimeshow.com to see testimonials of how Clay Clark's business coaching has helped over 2 ,000 entrepreneurs to dramatically increase profitability. It's month to month and less money than an average minimum wage employee. Schedule your free consultation today at thrivetimeshow.com. Tim, say what's up to Fire Nation and share something that you believe about becoming successful that most people disagree with.

1:52JLD, such a pleasure to be here. Thank you, my man, for having me. Something about being successful that most people disagree with is that you need a college education in the field that you study in order to be successful. And to me, JLD, that is just downright not the right thing. Well, I got to be honest with you, I am completely in agreement with that. And it's actually interesting that you brought the word up college because Fire Nation, Tim and I both went to the same college, Go Friars Providence College. So we have that in common and as well as a love for men's college basketball, Providence College Friars.

2:27So we definitely have a bond over that, but we also have a bond over strategies for success, which is why I brought Tim on the mic today, because we're going to be talking about those strategies throughout this interview. And there are, Tim, a lot of entrepreneurs who seemingly have it all, yet they still desire to be, to do, and to have more. Can you speak to this? John, I had two careers that I absolutely loved. Right now, I am still a lieutenant in the New York City Fire Department. I have 18 and a half years doing that. I have 18 months left before I made the decision to retire or not. And I was an ER nurse in a level one trauma center.

3:09I was pre-med for about 15 minutes back in Providence. And that's a different story for a different podcast. But I had it all. My bills were paid. I had a pension to look forward to. I was making decent money. I had a beautiful family. I had a home. I had two vacations a year, John. But I still had a burning desire to be, to do, and to have more. And it was that that really put the motivation and the gas in my tank to come out of my comfort zone and become an entrepreneur. And I love that, Fire Nation. And I love seeing people who have just done it on such a high level. I mean, I just interviewed the founder of Reebok.

3:50This guy's 88 years old, and he gets after it every single day. That's my dream. I mean, I don't want to be running around in circles with a chick with my head cut off, but I want to be getting up every day with a purpose, with a desire to impact the world, to be more, to do more, to have more, because why not? This is our one go around the planet. I mean, if this guy Joe, again, the founder of Reebok, still gets up at 88 after all he's done and does it, I mean, why shouldn't we? Why can't we? And we can. But a problem, Tim, and both you and I know this, is that a lot of people think they can save their way to wealth.

4:30You believe we need to become financially educated. What do you mean by this? So, John, not only do I think it, I'm actually somebody who practices it, right? I mean, I came from the old school tradition of go to school, get a good job, buy a house, get married, have kids, right? You did go to a good school, by the way. Oh, 100%. 100 % go for us. Listen, you can save and you can, you know, dollar cost average into a taxable, you know, stock or account. And, you know, when you're 65, John, then you'll be in a lower tax bracket. So you can take out 4 % a year and you can, you know, that's how you're going to go out.

5:06And to me, that wasn't good enough. I mean, I was like, man, what are we doing here? Why would I want to be in a lower tax bracket when I'm 65? Why wouldn't I want to be in a much higher tax bracket? Why am I going to keep on deferring and deferring and deferring my happiness and my experiences? Because as you just alluded to, this is our one go-round. My kids are only going to be little for one time, one space in time. And it didn't sit right with me. So the more I became financially educated, and that was by reading books and listening to podcasts and YouTube videos and going to conferences, there was so much that I needed to learn.

5:44There was so much I didn't know. And it was once I became financially educated, and that means about money and banking and using leverage and real estate and equity and debt and underwriting and all these different things, right, and different vehicles and asset classes. things that really should be taught to us when we're in school, but they're not. Taxes. John, I love taxes. I read books on taxes. I listen to podcasts on taxes. I go to conferences about taxes. If you knew me 10 years ago, you'd think that I'm probably crazy, but no one's coming to save us. You have to become financially educated because if you try to save your way to wealth, especially in today's days with the inflation the way it is, your purchasing power is going to be eroded and you're going to end up at 65 wondering where all your dollars went.

6:31It's so true. And Fire Nation, you literally have two options in life. You can either educate yourself, you can become financially educated, or you can move to Puerto Rico and just stop paying tax, keeping all the money that you make, not pay any capital gains. And even the uneducated down here, you will find a way to accidentally become wealthy. That's just the reality. But listen, living in the Caribbean, it's just not available to everybody. We have to live all over the world. So if you're listening to this Fire Nation, become financially educated. Educate yourself because you don't want to be trading time for money for the rest of your life.

7:13Believe me, it's not the way that you want to be living your life. So Tim, what should we do instead of trading time for money? John, this is the one thing that launched me forward, right? Because I had two careers that I absolutely loved, and every day was an adventure, right? And I found myself working 70, 80, 90, 100-hour weeks with two 24-hour shifts in the firehouse, two 12-hour shifts in the ER. And you know you don't get out on time because that's when the craziness starts, right? When everyone's trying to leave. And then I'd work some overtime, whether it's in the firehouse or the hospital.

7:51And before you know it, I was missing my entire life. I enjoyed what I did. But I was missing bedtime. I was missing bath time. I was missing dinner. I started to feel it. My wife started to feel it. My kids started to feel it. So trading time for money, while it was working in one sense, it was not working for my destiny, me, my life, my goals, what I wanted to do, how I wanted to be. So I realized that I couldn't trade my time for money more. I needed to start focusing on attaining equity. And John, through the process of self-education and surrounding myself with the folks who were doing the thing that I wanted to do, I found out it was really in one of two ways that I was going to be able to accomplish this.

8:33And the first way was to start a business. And although that sounded okay to me, it wasn't really fitting within my lifestyle. I already had two jobs and I couldn't just leave one right away. So starting a third was going to be tough. And the other one was real estate. So I really got educated, bought a three-family property and became a landlord. And I was hooked, you know, hook, line and sinker, did better on my taxes, had cash flow, built equity. And from there, we started a, when I say we, it's my brother and I, we started a real estate private equity company who focuses on multifamily self-storage and industrial products now.

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12:46you decided that real estate was your answer to wealth. You wanted to, at some point, stop trading time for money. And I loved how you put that before the break again. You know, you had these two jobs. You couldn't just stop one because, you know, the money was coming in. You needed the money. You had a family. You had expenses. Things were happening. So just adding more to that, another job, a business, wasn't as feasible as, hey, I'm going to start investing in real estate because it pays us not in one, not in two, not in three, but in five ways. Let's talk about those five ways now. You can go down a rabbit hole when researching real estate investing and find quote unquote gurus and they're going to have you run to the back of the room and buy products and everything.

13:30Because it can sound too good to be true, right? I mean, real estate pays you in five ways. I mean, it sounds like some sort of scam. But being from New York where everybody's guilty to a proven innocent in my mind sometimes, I had to do it for myself. I had to get my hands dirty. So by doing the thing, I was able to put that education that I had given myself into action. And real estate pays you in five ways. The first way is appreciation, right? Something you can't bank on, but if you buy it right, you manage it right, and you finance it right, you can come out in several years with some appreciation.

14:04Number two is cash flow. John, cash flow has now become my main focus in life because once your cash flow equals your monthly expenses, you're quote unquote, financially free. Absolutely. Right. I mean, because, and then, and then once you get your cashflow to equal your monthly expenses, then you want to do 200 times your cashflow. So now you're financially free, but with, you know, extra cashflow. So number three, loan amortization, right? The tenants are going to work eight hours, 10 hours, 12 hours a day to come home to a clean, safe, affordable apartment. Or, you know, if you're going to store your stuff from, uh, and, and Susie's house in a self-storage place, or, you know, oh my gosh, we want to have Amazon supply shops or we want to have manufacturers make our things.

14:49They need to be in a building and to position yourself in one of those areas is huge, right? The tenant will do the loan pay down. Number four is tax benefits. Oh my goodness, we could do another huge podcast on tax benefits of real estate, but just know that they're there. Number five is inflation profiting. And this can take a little bit of time to get your head wrapped around, but you will profit from inflation. Believe me, as a real estate investor, when you use leverage, fixed rate loans, and you can buy it right again and manage it right and finance it right, you can inflate away a lot of your debt and pay down your debt with inflated, debased dollars.

15:28Fire Nation, five ways you will get paid by real estate. Now, I want to go through those five ways again, Tim, but this time, let's give a quick example of what that could look like in real life? Sure. So the appreciation, if you buy a building for, say, a million, you sell it for 2 million, well, that delta right there is$1 million in appreciation, right? That's your equity. Number two is cash flow. So if you buy a, let's call it a million-dollar building, and at the end of the month, when you pay down all your expenses from the income generated by the property, and you service your debt payment, whatever's left over is called your cash flow.

16:07So if your cash flow is, say, I don't know, let's call it$1 ,200 a month, that's your spendable cash for the month because you paid all your bills from the income from the property. Loan amortization, right? So if you buy a property, say, again, it's a million dollars, and you maybe put$700 ,000 down, well, now you have a 70 % loan to value, right? You put 70 % of the equity down. I'm sorry, you put 30 % of the equity down and the bank brought the other 70 % to the project. Well, over time, when you pay your debt, you're also paying some principal when you're paying some of the interest back to the bank.

16:46And that will bring your loan amount due to the bank down. Number four, tax benefits, right? So once you learn about how real estate, how you can treat income, how you can deduct some of the expenses, some of the deferred maintenance, some of the capital expenditures, and this magic thing called depreciation. Go right now, Google depreciation in real estate and find out how you may be able to use it in your situation. Number five, inflation profiting. So everyone knows that a dollar today is worth more than a dollar tomorrow. Because in the last, I don't know, 18, 24 months, John, we've had a cumulative government reported like 20 or 22 percent cumulative inflation.

17:29That means our value of our dollar has gone down by 20 percent from like 18 to 24 months ago. I mean, that's incredible. That's why we're going to the grocery store and fueling up our cars and lumber and all these things are costing more money because the value of a dollar is not there anymore. So if you can get a loan at, say, I don't know, call it 5 % for the bank, and then you're going to pay the bank back with devalued dollars over the next, say, 10 years, you're winning. You're on the other side of that trade, so you're winning. I really think that's one thing that people don't think about that much is that inflation profiting aspect of things.

18:10But, man, has it become so relevant recently? I mean, like you said, the government's reporting like 20 % or 22%. It's much higher than that. I mean, they're always underreporting stuff like that. So that inflation profiting is real, Fire Nation. And of course, the other things that Tim talked about, really exciting when it comes to you building real wealth. And Tim, you believe that investing as a limited partner or a passive investor is the next big thing. Give us the details on what this means and what the steps would be to start doing this. You know, when I got started, John, I'm not a handy guy.

18:46My wife won't even let me hang a picture on the wall in our house because I will literally have, either the picture will fall down, there'll be a hole in the wall or several holes in the wall. I'll be cursing. It'll be a bad scene. Okay, let me break in here for a second because I got to be honest. So we're about to have a child, like literally any day now. In fact, by the time this is airs, we will definitely have a child. And we were looking to hang some pictures above our baby's crib. And our baby's crib was pushed back against the wall. And I was like, oh, I'll do that tomorrow. She looks at me, she's like...

19:16Do you really think that I would let you hang pictures above our baby's crib? Noted. Noted. Just wear it, John. Just wear it. I said, hey, you're right, babe. And I just walked away and said, let's call the handyman. Bring him in. Bring him in. Let's bring the expert in, right? Who, not how. I love it. You can certainly do that. And the life cycle of a real estate investor, John, is usually, especially guys like me, right, from New York. We don't really trust anybody, you know? And we want to do their own thing. We don't want to get scammed, right? So we want to be able to see the property, to mow the lawn, to shovel the snow, to hang the pictures, do the thing, collect the rent, pay the bills.

19:56But what happens is you get excited, then you buy a second, third, tenth property. And then you're like, man, I just bought myself this crazy job because now I have to do all these things or find people to do all these things. And it becomes cumbersome. And then they want to find out, well, how can I wrap those up and sell those and become more passive, right? And that's where our company, Cityside Capital, we help limited partners or passive investors get into commercial real estate deals, multifamily self-storage industrial. Listen, at the end of the day, stock market things, to me, I understand it.

20:31I've been a stock market buff my entire life. I've been reading the Wall Street Journal since my PC days when the Wall Street Journal was free, John, in the mailroom. I don't know if you remember that. But I've been reading since then. It makes sense to me, but you know what? By the time regular retail investors get paid or they make money in stocks, so many other people have made money on top of you that it's almost like, oh, sweet. But when you're in real estate and you can actually kick the tires in a property, you can understand the operator, what is the asset class? How are we using debt leverage?

21:05Who's going to be running the property? And you can really get behind it. You can actually forecast out what some of your cash flows will look like and it's tax advantage income it makes so much sense we have built a business around it people are using their cash they're using their self directed iras their solo 401ks they're doing 1031 exchanges all into the projects that we're doing because people want certainty they want clarity and most of all john they want confidence that what they're putting their money behind has been uh tried and true and proven and uh real estate's been around for millennia.

21:36So I really think going forward, people may still have their stock accounts and their dollar-cost averaging ideas, but I really do think that there's going to be a big push in the next couple of years towards alternative investments and direct participation. Fire Nation, mic drop. I hope you're fired up. And Tim, what if Fire Nation wants to learn more? Let's hear how we can connect with you. You have a book. You have the Passive Income Brothers podcast. Tell us more about that. Taking a page out of your book, John, I actually bought your book on podcasting and I bought your other book. And I was really fired up and I wanted to do my own thing.

22:17So my brother and I started a podcast called the Passive Income Brothers Podcast. We are going to be two years old in December of 23. And it's been a ride of a lifetime. But yes, I've been a co-author for a number one Amazon bestseller called Bring Value, Solving Problems and leaving a legacy. If anybody wants a physical copy of that book, John, all they got to do is email tim at citysidecap.com. Let me know that you heard me on JLD's podcast, shoot me over your address, and I will send you a physical copy. But if that's too much, I will send you a digital copy too, just by sending me an email.

22:50Fire Nation, take action on this. And Tim, one more time, Tim, what's that email? It's tim at citysidecap.com. Give Fire Nation one takeaway from our entire conversation today. What do you want to make sure that our listeners walk away with value bomb wise? I'm going to give them two. It's never too late to start, but you have to get going, right? And done is better than perfect. If we needed a PhD, every time we had to make a decision, we would never, literally, never get anything done. So get going out there. Fire Nation, you're the average of the five people you spend the most time with. You've been hanging out with TL and JLD today, so keep up that heat.

23:33For links to everything we talked about, visit eofire.com. Just type Tim in the search bar. The show notes page will pop right up. Links to his book, links to his podcast. His email will be there, so you can send him an email for his book, digital, or a physical copy. Tim, thank you for sharing your truth, your knowledge, your value with Fire Nation. For that, we salute you, and we'll catch you on the flip side. Thanks, John. Hey, Fire Nation, a huge thank you to our sponsors and Tim for sponsoring today's episode. And Fire Nation, over the last decade, I've interviewed more than 4 ,000 of the world's most successful entrepreneurs, and I've created a revolutionary 17-step roadmap to your financial freedom and fulfillment.

24:09I put it all into my first traditionally published book, The Common Path to Uncommon Success, which is the step-by-step guidance that you need to achieve the lifestyle of your dreams, visit UncommonSuccessBook.com, and I'll catch you there or on the flip side. Sales Evangelist, hosted by my friend Donald Kelly, is brought to you by the HubSpot Podcast Network, the audio destination for business professionals. Each week, Donald interviews the world's best sales experts, successful sellers, sales leaders, and entrepreneurs who share their strategies to succeed in sales right now. A recent episode you should definitely check out is the five ways to do daily outbound with LinkedIn.

24:48Listen to Sales Evangelist wherever you get your podcasts. Is today your day? Visit Thrivetimeshow.com to see testimonials of how Clay Clark's business coaching has helped over 2 ,000 entrepreneurs to dramatically increase profitability. It's month to month and less money than an average minimum wage employee. Schedule your free consultation today at Thrivetimeshow.com.