Building Multiple Streams of Income using Passive Real Estate Investments with Jeff Anzalone

Neil Henderson: 00:01

Dr. Jeff Anzalone is a full time practicing periodontist in the great state of Louisiana author and founder of debt free doctor calm. He focused on teaching doctors and other high income professionals to create passive income from real estate so that they can stop trading their time for money. In this episode, we talk about two key setbacks that shifted Jeff's mindset towards building multiple streams of passive income. Why he doesn't invest in single family rentals. The lessons learned from losing his first $50,000 invested in syndication, and the great question he uses to find other potential groups to invest. I'm Neil Henderson, and this is the road to family freedom. Before we get to this week's show, we'd like to make you aware of something we are self storage investors, we buy existing self storage facilities and vacant buildings that can be converted to self storage in the Sunbelt. We buy them with cash and some with loans, and we use private lenders who've become Equity Partners in our deals, these Equity Partners share in the cash flow in the profits when we sell when we find a deal that we're considering. We call the Equity Partners and offer them a share of the ownership secured by the property. So if you've ever driven by a self storage facility and thought I wonder who owns those things, and you have any interest in learning more about the storage business, we'd love to chat with you head on over to road to family freedom.com slash storage that's road to family freedom comm slash s t o r h g and set up a time to check We look forward to speaking with

Brittany Henderson: 01:24

you. All right, and I thought of us Let's hit the road to family freedom.

Neil Henderson: 01:31

Jeff Anzalone Welcome to the road to family freedom.

Jeff Anzalone: 01:34

Thanks, Neil. Happy to be here. And I looking forward to it.

Neil Henderson: 01:36

Yeah, absolutely. So I want to hear your story of how you you graduated from or you finished your residency and you you sort of hit the you were hitting the road to your career and you had a little bit of a hiccup. Can you describe to us what happened there?

Jeff Anzalone: 01:53

I would think it's probably a little more than just a hiccup. But looking back on it. So a couple weeks before I finished my training as a periodontist at LSU, the group that I was supposed to go in with group practice, for whatever reason, pull the job offer out from under us. And you have to realize that if you go to dental school or medical school or law school or anything like that, they only teach you your trade, they don't teach you anything about running a business or in my part running a practice. So that that's what scared me the most, along with having about 300k in student loan debt, two month old, no patience, no practice. And we'd already bought a home that we were paying interest only at the time. So I was actually in more than $300,000 in debt, but did a lot of praying at that time. We did a lot of networking. And luckily someone reached out to me that I didn't even know he said he was also a specialist in this area and Louisiana, said kind of the same thing happened to him. And he said, you know, come on him office, you can rent space from me, I'll teach you teach you the ropes. So luckily did that I was with him for a couple of years, and then found a building and moved and started my own practice. And away I went. But I think, you know, when when you're in school like that, and you have a lot of debt, you know, for me, it really wasn't that bad, because I knew I was gonna get out have a decent income. So I would say I went from an abundance mindset to one that happened to like a fear, slash scarcity mindset. And I still honestly nail I still battle with that today. It's gotten much better, but you just never know when things can go south. I mean, take last year, what happened? Who would have thought that the world would have shut down and I wouldn't be able to treat patients for two months? You never know. So so that happened. And luckily, when I was in my residency, I'd heard a guy by the name of Dave Ramsey, and this was over 20 years ago, and we followed his baby steps. You know, he was actually the first one that I've ever heard of that said that you could save up and pay for a card and cash. I've never heard of that before. And just use his principles got got out of debt, and then got to the point where it was like Okay, now what? And then, you know, eventually led me into other ventures, which I'm sure you want to get into a little bit later.

Neil Henderson: 04:39

Yeah. Well, a couple of things you said I want to sort of speak on. One is the idea of, you know, when you're in school, when you're in college, whether it be I went through an acting program, you went through a dental training, they don't teach you they teach you your craft. They don't teach you how to make money doing it, they don't have to teach you how to do it as a business. And I think that also, you also run into that a lot with a lot of real estate gurus as well, you know, they sort of teach you, the teacher, the nuts and bolts, but you really don't necessarily learn how to run it as a business. They just kind of like, shove you out the door and say, Good luck. Right? What was it that you think you What were you missing? When you started your dental practice?

Jeff Anzalone: 05:31

I actually I wrote a book called what they don't teach you in dental school. And what I did is as, as the gentleman that I was working with, for those two years, you know, as I was learning things from him, such as how to do payroll, such as how to order supplies, how to hire fire, train, everything that, that you take for granted that you don't know about, I started writing it down. And then lo and behold, I looked up a few years later, and I had a pretty, pretty thick stack of, of notes, you know, on a yellow notepad and converted that into book format. And, you know, if a redneck from Louisiana can write a book, I mean, anybody can write a book. So it was actually pretty easy. But yeah, just any, anything and everything that we aren't taught. So I guess you could just classify it as non clinical that I learned about and just wrote that down.

Neil Henderson: 06:30

Anything that it brings to mind is that we talked about this a lot, which is that you're often your W two income, no matter how good it is, is a single point of failure. Like you said, a year ago, would you could have never imagined that you would have been shut down for two months. Due to no fault of your own at all, you know, I mean, you're you're, we're one pandemic, or one accident, one angry boss, you know, one hurricane, whatever, away from being completely shut down and losing our w two income.

Jeff Anzalone: 07:06

So a few years ago, we were snow skiing, got off the lift, had a kid cut out in front of me, swerved to avoid killing him and myself, and I fell. And when I fell, you know, when you fall, you admit, you know, automatically put your hands down. And when I did that, luckily, it wasn't a really bad wrist injury, but it did injure my wrist. And I think that was the starting point of me realizing. Okay, Jeff, what would you do if you couldn't use your hands? Yeah, what would you do if you couldn't work? Because I was focused on only one income stream at that time. And probably like many of your listeners in the old day. Sometimes you get a wake up call, like, Okay, well, I only really dependent on one income stream, what would happen if that shut off? I think that was a really big eye opener for the whole country last year that or when, you know, when the pandemic hit that, Hey, you got one income stream coming in? What? What can you do to mitigate that risk moving forward? And I'm on a, it's a very popular dental forum. Actually, I think they're based out of Vegas dental town, Howard, Fran, maybe they're not in Vegas, but they're out that way. But anyway, there's over 200,000 dentists that are on that website. And as you can imagine, being shut down for two months, it gave us a lot of time to read and get online. And, and if you could, you know, went out some of the things that I was reading about dentists that were just speaking their thoughts At that time, you know, a lot of them were saying, I'm never, I'm never using a credit card. Again, I'm never gonna pay for cash moving forward for all my purchases. So, you know, they couldn't work on teeth, and they had all these bills piling up. And it really, again, you never think about all you just think, Okay, I'm going to go to work, I'm a BLP pay my bills, or what if the income stops, but the bills keep coming in. And I think for many, many, many dentists, at least on that forum, and I know that many other ones that weren't on that forum, they were thinking the same thing. And a lot of them are talking about getting out of the stock market too, because that at that time, it was you know, going down and then it to me, I knew but eventually go back up. But what really shocked me, which has made me rethink even investing anything in the stock market is how people can go and put out a tweet or something and the market can go down 1000 points or go 1000 points, um, do you want your retirement locked up in something where somebody can just tweet something? You know, a good bit of it go away. So that that made me rethink my in total investing strategy?

Neil Henderson: 10:15

Yeah. Well, you know, one things I love about, I mean, I invest in the stock market, I invest in, you know, primarily index funds, but my my chief focus on is on real estate, because I understand what goes into the valuation of the real estate that I'm buying, especially when it's commercial real estate, you know, it's based on, you know, net operating income divided by the cap rate, you know, I know that if we can increase the noi, we're gonna probably increase our cash flow, and we're gonna increase the value. I love Apple products. I couldn't tell you, I could not tell you what goes into the valuation of Apple's stock price. Other than it's really popular, same with Tesla, I, you know, I dreamed about owning a Tesla someday, I could not tell you, the foggiest what goes into the valuation of Tesla. So I don't, I don't like banking, my future income and my future retirement earnings on that?

Jeff Anzalone: 11:11

Well, I can tell you as a new Tesla owner, that those things are pretty fun to drive. I bought my wife one last month. And if anybody's ever been to Epcot on test track, on those cars that go around the track, I mean, you you hit the you hit the accelerator, and man, you are pushed back. I mean, it is unbelievable. So that's about the only thing that I know about a Tesla.

Neil Henderson: 11:35

But the other thing you bring up is, you know, you're talking about this forum full of full of dentists, you know, dentists are a fairly high income earners. I mean, if they're worth their, you know, their worth their weight. It also, you know, work hard. And they have to, as you said, the LA Times that come out in pretty massive amounts of debt, but if people who are high income earners are getting kicked in the teeth, by by an incident like this, it's not much, you know, how is somebody you know, who's who's just a restaurant worker or an executive at a an insurance company or a bank, they're also going to have the same issue, which is you've got solo economic dependency, as my friend, Mark Podolski says, you know, you've got to find ways to generate passive forms of income other income streams that are diversified.

Jeff Anzalone: 12:31

Yeah, you're exactly right. And that's really important, especially for those that are married or you have kids, you know, because they're all dependent on you and up. And with with two teenage boys. It's our food bill Scott Ha. So that, that, yeah, that's really important, depending on your situation. Gotcha. All right. So

Neil Henderson: 12:49

let's talk about we sort of covered our backgrounds a little bit. How did you talk to me about how you discovered real estate,

Jeff Anzalone: 12:58

after the ski incident ski trip incident with the wrist injury, I knew how to do something about it, getting alternative alternate streams of income, but I didn't know where to start. So I'm an avid reader, and started reading a lot. And I actually eventually got into podcast. So realize, and reading books, you know, the everyday millionaires book that Chris Hogan put out a few years ago with Dave Ramsey. And you know, the Millionaire Next Door, you know, all these books about millionaires, they talked about, the average millionaire has anywhere from, I believe, three to nine streams of income. And 90% of the millionaires out there have real estate in their portfolio. At that point, I only had one stream of income and the only real estate I had was the home that I lived in. So I knew that, okay, well, looks like I need to do real estate. At that time. The only thing that I thought you could do was be an active investor. I'd never heard about passive investing. So I have friends that either have their own rental property in this area, or they help manage their their family's rental property. So I started asking them questions, they helped me out and almost pulled the trigger on a single family home, decided not to, because I went to a meeting in Dallas, where it was a dentist that was talking about real estate teaching other dentists about real estate, and talked about pretty much everything but active investing, which I really thought it was gonna be about active investing. That really opened my eyes to Hey, there's other things out there, besides being a landlord. And I'm really glad I went to that meeting, because it led me down the road to finding different ways to To invest without taking extra time away from my family.

Neil Henderson: 15:05

Well, and it's a matter of, you know, your if you're whether you're a doctor or a dentist or a lawyer, and you're a high income earner, you're any time you're trying to take away to do active real estate investing any kind of acting investing, you're taking away from your earning potential from what's making you most of your money.

Jeff Anzalone: 15:26

Yeah, my anaesthesia nurse yesterday, we were working together. She's got a couple of single family homes. And we talked about syndications all the time. She said, Well, you're gonna like you're gonna like this story. Two nights ago, my husband was out of town, he had my two daughters, they were at some rodeo convention or some meat or something. And I got a call at 130 in the morning from one of my tenants, the hot water tank had busted and water was going everywhere, she was actually walking around her house, slashing and water, and, you know, really didn't know what to do and finally had to go over there and try to figure it out and help her shot back it up and cut off the water. And she said, Man, these syndications are looking more and more better each day. So now, you know, she said, with the repairs and insurance claims and all that, you know, that that's now that's gonna put her way behind, you know, she got you know, is ahead with the with the the ramp and that's gonna put her way back in the hole, just as she's going to have to collect the whole, you know, a whole lot more rent, just to get to where she was. So it's, you know, like, one step forward, seven steps backwards.

Neil Henderson: 16:37

Yeah. Well, especially if you're dealing with a single family home single unit, you know, you're, you know, maybe making 200 to $400 a month, net cash flow. And, you know, all it takes is, you know, a bad tenant that trashes the place on the way out, or right now a tenant who can't pay, you know, who can't pay their rent, you can't evict them or frozen pipes. A lot of people are dealing deal in frozen pipes and Texas and you're talking there's a good chance you're wiping out a year or more of cashflow

Jeff Anzalone: 17:11

right here I'm

Neil Henderson: 17:13

so have you ever if you ever bought a single family home, you know a direct what you what you would call an active real estate investment.

Jeff Anzalone: 17:23

I have not but the home that we're remodeling right now it has a mother in law house attached to it. So last year, there was a family that we go to church with, they're in our life group. They've been trying to sell their house forever. And all of a sudden, somebody bought it and they had to move out quickly. So I said look, I've got a you know a guest house here two bedrooms. Do you want to run it with why you found a house? Well, it took them eight months to find a house and man about pulled my hair out those eight months because every little thing they're texting me, you know this and that I'm I can't imagine having 20 of these things and 20 tenants calling me and texting me. So that really something that really sealed the deal right there that I did not want to be an active investor and manage it myself. Gotcha.

Neil Henderson: 18:17

So talk to me about that first syndication that you bought into.

Jeff Anzalone: 18:25

Well, I had done a little bit of some small debt deals with crowdfunding online it was crowdfunding was starting to get a little bit big at that time, this was you know, back maybe 2016 2017 got a little comfortable with that. didn't know what I was doing. So I decided to step it up, went to realty shares comm which was probably one of the bigger ones at that time, kind of like a fundrise or roof stock now and decided to do my first equity deal was a apartment complex in Oklahoma and Tulsa, did Jeff's way of investing, looked at the pictures on the website and immediately went to the returns, I didn't really know what that stood for our our something or whatever it looked, it was high. So I said, I'm gonna put 50 grand in eight to nine months later, we got an update that stated all the investors that were in that project, unfortunately, we're going to lose their money, all of it. So that was a big wake up call. Not a lot of fun. I wrote an article about it on my website. And that's probably one of the most talked about articles as you can imagine out there.

Neil Henderson: 19:44

So it was an apartment and what was the location again? Also, it was in Tulsa, Oklahoma, how many or how many units it was,

Jeff Anzalone: 19:51

it was I think close to 200, maybe like 180 something like that. Okay.

Neil Henderson: 19:57

And what was the last one went wrong.

Jeff Anzalone: 20:01

What they didn't tell us was the area more people were moving out the moving in because of crime. And the sponsor group immediately started throwing a lot of money in it, trying to renovate it. But again, more people are moving out of the complex than moving in, they tried to market it promoted, they couldn't do it. And he basically ran out of money and folded up and, and left. And they did what they could they try to sell it, they try to sell it, you know, of course at a loss and just just never could and it fell through. And then eventually, shortly after that realty shares went under, and it was bought out by another company. And, you know, they've, they kind of picked it up, they were trying to, I guess, you know, do a lot of these. From what I read, that wasn't the only one that fell through with that platform. So they tried to clean up a lot of the mess with several other ones. I don't know if they were successful or not, that really made me take about a year off from investing. And I could have quit, you know, easily quit, but I knew that. That, you know, if I wanted to create passive income and do the things that we wanted, that I had to figure it out. And so that really changed my philosophy on how I'm best. Now,

Neil Henderson: 21:30

what was the key lesson learned there? on that Tulsa deal

Jeff Anzalone: 21:34

with those platforms, those online platforms, you don't know who you're investing with, you don't get to know them. And if I'm, if I'm giving somebody 50, grand or 100, grand, I want to know, them personally, I want to know other people that invested with them. At this point, I want to know where they live in their cell phone number. I mean, I get that personal, not that I'm going to do anything, but it's just nice to have that if I have an issue or question I can email or call or text or whatever, you don't get that on those platforms.

Neil Henderson: 22:09

Gotcha. Well, and it's important to remember that when you're investing in syndication, you're just like with a with a stock, you're giving up control, in exchange for it being passive, but you're also giving up liquidity, you know, you can't typically just go, Hey, I'm not, you know, I need that money. Now, I'm not comfortable with, you know, where this is going, I want to pull my money back out. Because that that is very much up to the syndicator or the sponsor on whether or not you can do that. And often, it's not an easy, easy process, and especially if the deals going bad, they're not gonna, they're not gonna, you know, lead ever we start pulling their money out, because it'll just make it worse. When I talk to people about investing in a syndication, I say, often, you know, a good sponsor can make a bad deal good. A bad sponsor can make a good deal bad. And most of the passive investors that do it full time that I know, are usually more often than not investing in the sponsor, more than they're investing in the deal.

Jeff Anzalone: 23:08

Right, and you don't get any of that on those platforms, you're just looking at the data, and you can put anything, as you know, on a platform on a website. And just because on a web site, don't mean it's true. So I found that out pretty quickly.

Neil Henderson: 23:23

So after about a year, you got back into it, how did you change things up?

Jeff Anzalone: 23:28

I was at a meeting in Dallas, and I started meeting other investors. And there was a couple of sponsor groups there. And I've started networking and you know, as with anything, you start to hear the same names go across, hey, you should invest with these people. They're really good or stay away from this group. And, and eventually, the first group that I invested with was actually Dallas steel was Ashcroft, capital, Joe fairless. I got to meet him, he was very instrumental and teaching helping me and after that, it kind of took off from there.

Neil Henderson: 24:15

What time period is that?

Jeff Anzalone: 24:17

That was I think, November December ish. 2017. Okay. And the reason why I remember that is I just got an email from them that actually first deal is in the process of exiting now. So that's actually my first deal that has exited. So I've been able to go full cycle on that one. But that's when I started to, to get a little more serious about investing directly with sponsors.

Neil Henderson: 24:42

Gotcha. And full disclosure, we are we're invested with Ashcroft on a deal as well. So not that, I'd have to say that but it's good. Good to get that out there. How did you once you decided to sort of get back into it? It sounds like it really became much more about just networking with others. Passive investors correct?

Jeff Anzalone: 25:02

As far as investing in future deals,

Unknown Speaker: 25:04

yeah, yeah, and

Jeff Anzalone: 25:06

you know, pre COVID, it was a lot easier because you could go to meetings and you know, you have this whole big room full of people. And you had all these speakers and you know, they could you'd sit next to somebody, oh, yeah, I've invested with him or her, check them out, go to their booth. So it's a little bit harder now. But I think maybe as things open up, it'll get better.

Neil Henderson: 25:26

Yeah, I mean, for me, my my networking has has come down to this, which is podcasting. You know, you get to get somebody on and you talk to them? And do you have a system for qualifying sponsors, now,

Jeff Anzalone: 25:41

I have a pretty good bs meter to where, you know, I talk to somebody, you know, you kind of get that gut feeling. And, you know, there was one particular guy that I won't mention his name, but, I mean, he just said everything, right, but there was just something about it, or something about him, and come to find out after talking with other people that are like, it's probably good that you didn't invest with them. So there's, you know, just talking with somebody for me helps, again, talking to other investors, and, and asking those investors, hey, do you know anybody else in the deal that I can talk to? Cuz I don't want to, you know, of course, the sponsor group is gonna give you like their, their top investors to talk to, but I want to know, hey, is there anybody else? Another good question to ask, the sponsor would be, if you couldn't invest in your own deal, who would you invest with? And that, that really, that really helps a lot to find out the credible people, as well. But this isn't something that I mean, I'm sure from your experience, too. This isn't something that's going to happen overnight, it's taken years and years of networking and researching and listening to podcasts. And, you know, that's how I get most of my material from and meet people is from Podcast, where they'll have somebody own and that person may mention a book, or may mention a meeting or may mention something and, you know, kind of go from there and then see where it takes me?

Neil Henderson: 27:16

And are you primarily focused in on apartment communities?

Jeff Anzalone: 27:21

I am and I think it's really important to, especially if you're married to set financial goals, because those goals are going to lead you what to invest in. So for us with two teenagers, I want something that's less risky, more conservative, you know, the returns are probably going to be lower. But if I was single, it would be in I wouldn't mind investing in new construction, higher risk, but you know, the process of possibility of having higher return so that you know, whatever your goals are, those are going to help guide you down the process of what to invest in and started with apartments, like a talk to you about before the call, we are looking at some self storage, which I know that you're very familiar with. But as of now, it's it's apartments, gotcha. multifamily.

Neil Henderson: 28:14

How many how many deals are you invested in now,

Jeff Anzalone: 28:18

as of now, six getting ready to be five because that one's selling. But that's, that's what we're at. Now.

Neil Henderson: 28:27

Often, I tell people that there's, you know, in my mind, there's kind of two types of investors, there's the cash flow investor, and there's the equity growth investor, and then there's kind of the blend. And it sounds to me like you're more of a blend sort of cash flow investor, correct?

Unknown Speaker: 28:45

Correct. Yeah. And often,

Neil Henderson: 28:47

you know, so, you know, a development deal. While it can be a great equity play, is often it's not going to be cash flow in the beginning, or at all, a lot of times, it's just an equity play as you're just sort of, you know, give give somebody your money and they're going to be sitting on it for, you know, two to five years, however long it takes to get the properties property stabilized and then exit the deal. But when you're investing with a sponsor, like Ashcroft, I know Ashcroft's business plan is much more they like to buy stabilized assets that have a value add component. So you're getting, you're typically getting cash flow right off the bat. And then there's also the potential for an equity multiplier at the end when you exit, Correct.

Unknown Speaker: 29:33

Correct.

Neil Henderson: 29:34

What was it that drew you to apartments over any other syndication?

Jeff Anzalone: 29:41

I think it was a familiar familiar layer of apartments, which at that point, I'd lived in apartments for almost 10 years. And just knowing that people have to have a place to live and most of the syndicators that at that time that I was looking at, that's pretty much all they had to offer. So that's that's what you know, led me to them initially.

Neil Henderson: 30:05

When you because you, you've got your website, debt free doctor and you have a lot of focus on teaching other medical professionals about syndication? Can you sort of talk to us about what you know how you sort of guide someone through explaining it in that process,

Jeff Anzalone: 30:24

when I first started was just all education and it was what I was learning that I thought was pertinent for somebody. So if, for instance, cap rate, you know, so I would learn about cap rate, then I would write an article about it. And then eventually people started reaching out to me asking, Well, you know, what, what about this, or what about this term. So, initially, it was all about giving people what they wanted to know about as far as articles. And then I started seeing this, actually, this is the third year that I have had the blog. And, you know, like with anything else was just kind of flatline for about two years. And then now it's really starting to pick up, the more traffic that comes in. So, of course, there's people that want to list that want to read the articles. But then there was a certain group of people that would reach out to me that wanted to know more, that actually wanted to potentially invest. And so what I did, I just created a second group within the blog called the passive investor circle. And that allows them to, you know, we talk one on one. Some, sometimes I tell people, I don't think Real Estate's your best interest, you know, ethically, I think we have that. That's what we should do. And you know, so for instance, I spoke with a still remember, he was a young dentist, in Nebraska. And after we started talking, he had like about six or $700,000 in debt. By the time you look at his practice, loan, student loan, his mortgage, and I said, you know, being honest with you, I just, I think you should hold off on real estate and clean up some of this debt. So that's, that's why I like to do the calls, you know, just to see where they are in their life. And then, if they do want to invest, what I do is I just put out a deal that I'm investing in personally, and they can just invest alongside of me, because, as you know, most of these people are busy. They don't want to read all these articles, or listen to podcasts. And they're like, Okay, well, I know you, Jeff, I trust you. So if you're going to invest in it, you know, we will, too. So that's, that's kind of where you know, how things have led up into this point,

Neil Henderson: 32:42

you bring up a great point. And it's really hard to have a conversation with people sometimes who are, who want to invest, but they are in in huge amounts of debt. And it is a kind of a moment where you have to sit them down and say, Listen, you know, I know you're excited about this, and it feels like you're maybe you've got some fear of missing out. But when you pay down your debt, you're getting a guaranteed return on whatever on whatever the interest rate is. And something you know, if they're lucky, it's low. When I had student loans, my interest rate was 9.5%. Oh, guaranteed interest rate. And now and and you can't and it was a there were subsidized loans. So you can't, you can't get out of them. You can't refinance out of them. And they're not I can tell you, they're not many investments that can guarantee you a 9.5% return. And that's what that's what they're really what you need to the mind shift that you need to have when you're thinking about God It sucks paying down this debt feel like I'm missing out on investing in you know, Tesla or or apartment syndications? Well, you know, don't think of it that way. Think of it as as getting a guaranteed return of whatever your interest rate is.

Jeff Anzalone: 33:55

It's very psychological. No, I think that's why Dave Ramsey has been so successful as he teaches it more from a psychological standpoint less than like a practical thing that you would think okay, well, let me start with the highest debt, highest interest rate loan fires, but he says no, start with the smallest debt you have, as far as them out, get that win, get, you know, get fired up about it and then you know, move on. So that's that's what we did.

Neil Henderson: 34:24

So, you know, you talked about getting yourself educated you you know, he did a lot of networking. You ended up meeting Joe fairless listening to a lot of podcasts. Is there any other way that you went about getting yourself educated on on apartment syndications before you kind of got started?

Jeff Anzalone: 34:40

I would probably say the other way was listening to podcasts such as yours and listen and actually reaching out to the if I wanted to connect with one of the people that were interviewed. Sometimes I was able to get in touch with them and that's It's probably been the second best way that I've done it. So if you're listen to a podcast he really liked to hear so so for instance, the, you know, once once we're finished, I am going to be talking with somebody that heard on another podcast, he just came out with a book, he has a podcast. So we actually have connected with each other. So that that's kind of how I've done it. And you, you sit here and you listen to somebody talk for 3045 minutes, you know, you kind of feel a connection. And especially now with more and more people are doing video, you can actually see what they look like. And, you know, because that's, to me, that's, that's just as important as listening to them. And if you, you know, had that connection with them, I recommend that people reach out to them and then go from there. Yeah,

Neil Henderson: 35:47

I absolutely agree with what Jeff is saying. And I, you'd be surprised, you know, you're sitting there listening to a guest on podcast, or even a or even a host, you know, I put out an offer for every show for people to give me a call and, and you'd be amazed at the people, the number of people who take me up on it. And most of the time, it's not, I'm not selling anything, it's for me, the value is I get to have a conversation. You know, I get to network with another investor, I get to, you know, teach somebody about self storage, if they never heard about it, I get to maybe talk with another Self Storage investor and learn from them. There's all this give and take. So I would encourage people to not be shy. You know, I think what you what you're doing there is great, you're listening to a guest, and you like the way they sound? reach out to them. You know, you'd be surprised at number of people who would be completely open to that.

Jeff Anzalone: 36:46

Yeah, for sure. Pretty much everybody. and myself included, and probably yourself included. We are where we are in life, because of all the people that have helped us along the way. So I really noticed that most really successful people, they don't have any issues with taking the time to try to help other people as well.

Neil Henderson: 37:08

Was there anything else? Was there a key piece of knowledge that you had to learn that you didn't know before? In order to you think that allowed you to be successful now?

Jeff Anzalone: 37:20

I'd never reached out or sought out a mentor before. And that was one of the thing I found a local one here. He's actually probably one of Louisiana's only few billionaires with a be it. Yeah, he has several businesses, but one of his main ones is real estate. And as you can imagine, I was you know, nervous about, you know, meeting with him. But when I called him and I said, Hey, you know, I'm interested in real estate. Remember, we talked to the grocery store, you said call you I said, I'm calling you? He said Yeah, great. He said, Let's meet and, and he said, What's he was like, what's best for you? I was just kind of taken aback like, you know, thinking he's got all this scheduled, but he sat me down in his office, two hours and 15 minutes. And I left there. And I told my wife, I said, I learned more in two hours and 15 minutes, and I probably did in to our two years of college. I mean, it just my mind just just open to the possibilities. Because you listen to where somebody started. And it was just like, step step, step. It's like, I could do that. You know, so that, that that was a really cool doing that.

Neil Henderson: 38:37

So you, you're still practicing, you're still practicing periodontist? Correct. Correct. Okay, so how much time would you say your real estate endeavors outside of the blog that you're having to do? How much time would you say those are taking you each week?

Jeff Anzalone: 38:56

Hardly anything. You know, just if I want to go and log into a portal and check if my k ones ready to download or if I got a distribution. As far as that part of it, you know, a few minutes a week you know, not not much at all. Gotcha.

Neil Henderson: 39:13

And then when you are looking at a deal, how long would you say it takes you to look at a deal

Jeff Anzalone: 39:21

I would probably say a couple hours you know, I like to go over the pro forma I like to talk with who's doing the underwriting like talk with the group. If I can tour the property, either in person or now with all the technology that have you know, you could do it remotely. So I would say about like that.

Neil Henderson: 39:42

And location wise you're in Louisiana you're investing in in Dallas where else

Jeff Anzalone: 39:49

mainly in the southeast in the Carolinas, Florida, Georgia, Alabama, not too far of a drive away from from

Neil Henderson: 40:00

But have you visited any of the properties that you've invested in?

Jeff Anzalone: 40:04

Yeah, in person? No. But when, when they go and do the walkthroughs, you know, they have a camera that so they're, you know, looking at stuff and moving it around a couple properties I looked at this past summer that we're in Fort Worth in person would decided not to, to invest in it, they had some issues with handicap access that they did not want to, to address. So that actually fell through the more and more as I transition out of practice, I'm going to get more hands on and be able to free up and travel and you know, once our kids move out, go off to college, that'll free up time with that, too.

Neil Henderson: 40:42

Well, Jeff ends alone. Thank you so much for sharing with us today. You've got your website, debt free doctor. And you've also got, you've got a free guide that you give away as well. Can you talk to us a little bit about what that is?

Jeff Anzalone: 40:55

Yeah, it's just a basic, you know, for people that don't really know much about passive income. So one of the things that to think about and ways that I've started creating it, so they could download that on the website, debt free dr.com forward slash free guide. If people have specific questions and I want to reach out, they could email me directly, Jeff j. f. f. At debt free. dr.com. Okay.

Neil Henderson: 41:24

Well, Jeff, thank you so much for sharing with us today. It was great meeting you.

Jeff Anzalone: 41:27

Yeah, you too, Neil. Thank you and wish the best of success to you and your endeavors.

Neil Henderson: 41:33

You as well. Okay, that was Jeff Anzalone from debt free doctor.com. I highly recommend you go and check him out. Especially go and get his free guide at debt free doctor.com slash free guide. So for me, the key lesson learned on this one is that investing in real syndication real estate syndications is not like investing in a stock, you're not investing in a company, you're giving up the control, just like investing in a stock. But you're also giving up a lot of liquidity. So if things go bad, you the real risk is that there's a chance you're not going to be able to, to pull that money out. And I thought Jeff had a great point about when he invested through one of the crowdfunding sites. He all he knew was the deal. And what they were telling him about the deal, he didn't actually know the sponsor. And his biggest lesson learned was that he now he wants he wants to sponsor a cell phone number. And I highly recommend that as well. You know, we we've invested in a couple of syndications. And I have a note, I know the sponsor, I can pick up the phone, and I can call them and they pick up the phone, not if I call them the middle of the night. But you know, there are people there actual people I can have a conversation with and ask how things are going. And it's not, I'm not just getting communication with them, the quarterly report, money, he, he got started with $50,000 that he invested in a an apartment community in Tulsa, Oklahoma, and he lost all of it. And that was on that deal. And that was his key lesson learned there was, you know, get to know the sponsor. And that is, you know, one of the drawbacks of syndication is often the barrier to entry is often you know, you're talking 25 to $50,000, a lot of times to get into a deal. That typically is going to be the minimum investment, it also frequently, these are going to be only open to accredited investors, not always, sometimes you can find some that are operating under a different sec guidance. And I can't remember if 506 C or five, six B, I can never remember which one it is I always get them mixed up. But where they will take sophisticated investors, you know, people who they've had a previous relationship with it also, those are the kinds of deals that are very definitely not going to be advertised they can't that's the rule. The SEC doesn't allow them to advertise for them. So time, how much time does it take him? Really no time. That's the whole point. Of these these are, you know, next to investing in stocks, this is probably the most passive real estate investing that you can do. And that's why we really recommend it for people who are higher high income earners who are making a lot of money at their job. focus on making your money at what it is that you're good doing. If you hate your job, and you want to go off and become an active real estate investor, then go and do that. But don't try and do both at the same time. Give up the control handed off to the professionals that you know and like let them give you a good risk adjusted return for your money. knowledge he talked about He went to a lot of real estate meetings, you know, pre COVID he listened to a lot of podcasts. And he basically started networking with the guests and, and the podcast, you know, he met Joe fairless. He networked with other guests that he heard on the podcast. And I highly recommend you do that as well. Like we said, you know, don't be shy, shoot somebody email and say, Hey, you know, I'd love to hear more about what you're about. He also sought out a mentor, he you know, he picked up the phone and he called a billionaire. They're in in, in Louisiana. And the guy was generous enough with his time to give him two and a half hours and he said it was he learned more in two and a half hours and he did have two years in college location. This is very location independent. Listen, you can he lives in Louisiana, invests in Florida, Georgia, Alabama, and Texas. And he said as he builds this up and starts to draw down his practice, he can go and pretty much live anywhere in the world and his money will continue to make him money.

So okay, once again, that was Jeff Anzalone from debt free, Doctor calm. It was wonderful speaking to him. I'm Neil Henderson. We're doing this all again next week. Let's hit the road. I. Hey, before you go. If you liked the show, we would be delighted if you'd head over to pod chaser and leave us an honest review. And do let us know why you liked the show how long you've been listening, and in particular, what you find really useful or entertaining. And let us know if there's anything you think we should change. Also, if you have specific questions about real estate investing, especially self storage or short term rentals, shoot us an email at info at Rhodes family freedom calm, and we'll be happy to answer your question on the show, and might even turn it into an entire episode. Thanks for listening. We're doing this all again next week. Until then, safe travels on your road to financial freedom.