354: Frank Advice on What to Do When a Real Estate Investment Goes Wrong

You’re one bad real estate investment away from being cash flow-poor and debt-rich. That’s right, not every investment property works out, and when leveraged the wrong way, a single property could put your financial future on the wrong track. While it’s easy to watch social media real estate investors flaunt their infinite cash flow and no money down tricks, buying profitable real estate is a little harder than it seems. Today’s guest, Shane, finds himself in this position, as an over-leveraged investment is causing him to hemorrhage cash. Welcome back to another episode of Finance Friday, where hosts Mindy and Scott bring financial suggestions, no matter how extreme, to guests in many different situations. This week, Shane walks through his numbers, and from the start, Scott picks up on a big problem. Shane and his partner bring in a solid amount of income, but it’s slowly slipping out of their accounts every month as an overleveraged short-term rental property and high consumer debt eats away at their respectable income. This isn’t an easy position to dig yourself out of, and Scott has some serious suggestions for Shane that could flip his financial position 180 degrees. But, doing so will require Shane to make drastic moves that will force him to reevaluate his relationships with spending and debt. While this “rip off the band-aid” type approach can be painful at first, it could save Shane years' worth of time on his path to real estate riches. In This Episode We Cover Staying away from consumer debt and how it can destroy your financial position Real estate leverage and why too much of it can cause you to have negative cash flow Sacrificing subscriptions, eating out, and other spending categories that may be tanking your budget Having a money date with your partner or spouse to get on the same financial footing The biggest moves to make if you’re serious about getting out of debt and on the path to financial freedom Budget busters and how to build a more sustainable pattern of spending And So Much More! Links from the Show Find an Investor-Friendly Real Estate Agent BiggerPockets Money Facebook Group BiggerPockets Forums Finance Review Guest Onboarding Mindy's Twitter Scott's Instagram Listen to All Your Favorite BiggerPockets Podcasts in One Place Apply to Be a Guest on The Money Show Podcast Talent Search! Subscribe to The “On The Market” YouTube Channel Listen to The “On The Market” Podcast: Spotify, Apple Podcasts, BiggerPockets Check Out Mindy’s 2022 Live Spending Tracker and Budget Designing a Frugal But Luxurious FI Life by Age 32 Food Spending Eating Away at Your FI Plans? Here’s How to Eat for Cheap BudgetBytes.com The Money Date: What You Should (And Definitely Should Not) Do to Align Your Finances as a Couple Click here to check the full show notes: https://www.biggerpockets.com/blog/money-354 Interested in learning more about today's sponsors or becoming a BiggerPockets partner yourself? Check out our sponsor page! Learn more about your ad choices. Visit megaphone.fm/adchoices