Isn’t it a dream to do work optional while you are out there doing what you love? You may recall our interview with Daniel Markert last year. What’s happened in his life in the last 12 months? Tune in as Dan shares how he became financially independent in only 6 months! He sits down with Chris Miles to update us on how he escaped the rat race!
Chris Miles Bio:
Chris Miles, the “Cash Flow Expert,” is a leading authority on how to quickly free up and create cash flow for thousands of his clients, entrepreneurs, and others internationally! He’s an author, speaker, and radio host featured in US News, CNN Money, Bankrate, and Entrepreneur on Fire, and he has spoken to thousands getting them fast financial results.
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How Our Client Escaped The Rat Race In 6 Months With Dan Markert
I’m excited to do this interview because this is a twelve-month before and after. Last year, we had a who was about to retire colonel from the California Army National Guard out there, Dan Markert. We had interviewed him before, right when he was about barely hiring us. He decided to share some of the experiences back then, where he was coming from, and the things he had learned that got him to find us. The cool thing is we’re getting an update from Dan, who is now retired. He is in a place where now he’s working optional and doing what he loves. He’s on a new site there in Truckee. Dan, welcome back to our show.
I appreciate that, Chris. It’s a pleasure and an honor to help share our story with your audience. For those who may not have known, I did 34 years in the Army and 30 years as an officer. I retired as an Infantry Colonel in the California National Guard last year. As I approached that retirement point, through friends and some of my own thoughts and research, I was like, “Am I ready to retire?” The answer was no because I looked at like, “I’ve been pretty traditional, low-cost, mutual funds, index, big savers.” It came clear to me that was not enough. That wasn’t going to be sufficient for four boys putting up through college.
Even though I was retired from the Army, I’m not ready to be retired yet because I got three kids in college this year. One graduated. I got a fourth on the way. I reached out to Chris because I follow this show. I was like, “I need some help on that.” The journey has been substantial. What I would share with people and what I learned was that investing in your house and having a bunch of debt equity is anti-financial advice. That’s not good advice. Our economy is less capitalism and more creditism. If you’re not taking advantage of smart leverage, you can cover your debt-to-service ratio or whatever they call it that you should be borrowing money or a loan if it’s a low-interest rate and get it as something higher.
After a conversation with Craig and going through the cashflow optimizer worksheet, the discipline of doing that, even though you might know it, having somebody to talk it through and build it out, and seeing what the potential is for dramatically increasing your cashflow is significant. You need to run the numbers. I refinanced when the interest rates were at their lowest. I took advantage and did a cash-out refinance. It was substantial. I put it into private equity and credit investments. One was an ATM fund, where you get a cut of ATM transaction fees. Another one was with Lane Kawaoka, an apartment syndication in Phoenix. The other stuff went into accurate land and acquisition rights to oil and gas that pays monthly. I like that.
That grows as they add more wells. I went from the savings we had, and a brokerage account went from a couple of hundred bucks a month, but usually, those are quarterly distributions typically. We say it was maybe $2,000 a year. Now my passive income cashflow is over $13,000 a month. There’s debt to go with that. There’s a home equity line of credit I threw on top of the cash-out refinance. There’s another $2,000 a month. Plus, I did the insurance-backed line of credit with Bancorp that you had on your show to use the infinite banking concept there. That’s probably $300 to $400 a month.
There are interest payments going out and $13,000 passive cashflow coming in. Let’ say it’s $3,000 in debt servicing because you want to pay down some of it and build up that dry powder for the next thing as you pay down the insurance-backed line of credit is how I’m doing it. It was a big journey, change, and transformation. What I learned was that you truly want to have people you trust that turn you on to people. I wouldn’t have known about Eckard Land and Acquisition for being a client of yours. I wouldn’t have been quick to jump in with Lane on a real estate syndication if I hadn’t seen the cross podcast references, plus I had a friend that was invested with him already.
If you’ve got a good tribe, you want to call it people that you can trust. It’s wise to do that. I was resistant to pay for it. I was like, “I can figure out this. I’m a pretty smart guy.” I overcame that resistance. There’s a lot of advice out there on it, which is you can figure it out on your own, but how long will it take you? How many hard lessons would you have? Once you’re dealing with 5 or 6 figures worth of investments, you don’t want to have your own hard knocks if you can learn them from someone else and pay a modest coaching fee or mastermind fee or whatever different people call them different things. It makes sense. It’s hard when you’re getting started. When you see the monthly checks start coming in and the ATM fund pays monthly, that’s a big deal. That’s my story. That’s what I’ve learned over the last year.
You really don't want to have your own hard knocks if you can learn them from someone else. Click To TweetIt was fantastic progress. Going from a few hundred a month to about $11,000 a month net even after the debt servicing everything else, that’s pretty fantastic. The thing I want to do is at least give kudos to you because we get clients here from time to time that they’ll act, but they’ll act slowly to the point where they’re getting the results, but it’s going to take them years to get the results not because they couldn’t get it sooner, but because they’re too afraid to act. The one thing for you is you have the faith to try it out, to at least say, “Let’s invest in this consulting fee to make sure this is going to work,” which, for you, you’ve made that back now in about every month.
What helped me do that was I had a career of being a decisive person and making decisions with imperfect information. Here’s the other thing that helped. I had a good friend who started on this path maybe 6 to 8 months before I did. He did some toe dipping with a friend, who is somebody he knew from the military who was a real estate syndicator. He got into that, and then he dove in. That’s how I got with a couple of things. The ATM funds were one of the referrals, and then the land was a referral. It does make it easier to be decisive if you’ve seen firsthand like, “This guy’s going to check every month.”
It’s clockwork. One hundred twenty days from the time you make your investment, the ATM fund starts paying you out. It pays on the 21st of every month. It’s the same thing with Eckard. As soon as it goes into pay status, here’s your 5th of the month check, and then every 25th of the month, you’re on gas revenues. It does help. I hope that interviews like this that you do and that you share client testimonials or whatever help other people realize that they should take the plunge. You can start small, but don’t wait too long. It’s one thing to start small, but be fast about it. It’s another thing to drag it out too long because you’re missing out on a compounding effect.
It’s hard to be patient. I’m all year in. There’s no annual compounding yet. I was like, “Next year,” and send these alternative investments. It might be 4 to 6 months until you start seeing the cashflow, but that’s the nature of that type of investment. You do a value-add real estate deal, and you’re not stabilizing the rent. It’s realizing increased rent revenue from the new construction to the new renovations you’ve done until they’re done. That takes time.
It depends on where you’re at, what age, and what stage. I started this, and I wish I’d started it sooner. If you are in the professional class and you have a good W-2 job, and you’re able to do good savings, if you’re a homeowner with that equity, it’s a different story. You can move much faster if you have a big savings account. I also redeployed a lot of 401(k) and IRA money into self-directed. That was the other thing I did pretty quickly. If you’ve been a big saver, traditionally over 30 years, those are big numbers. That allows you to deploy capital pretty quickly.
If you’re younger, if you’re in your 30s, it’s a little different story. Your savings rates are a little bit lower. The amount of capital you’ve saved up is smaller. That might be tougher. You’re not going to replicate what I replicated in twelve months. It’s different pieces for different people at the ages and stages that they’re at. The key thing is, to me, don’t let debt equity stay in assets that you own. If you had rental properties, don’t leave it there either. Look at that, redeploy it, make use of guaranteed whole life policy, match ROI whole life policy to double dip on that. Do not leave. Especially in 401(k)s, they’re awful. I’m a fan of dividends stocks. There’s a place for them in my portfolio.
Those things, if you get the right companies, they grow their payouts, so you have increasing cashflow, so they cash flow. There’s a place for those, especially on a Roth IRA account. You don’t want to leave too much. 401(k)s are horrible because they’re in these big managed funds with a lot of fees. Get that stuff out of there. Those are the three big takeaways that you could make a big difference if you did those three things. No debt-equity. Don’t leave your 5 or 6-figure numbers. It gets worse the larger the number is in a 401(k). Do the guaranteed whole life. Get into the other investments that you can. If you can qualify as an accredited investor, you’re leaving a lot on the table if you don’t find the right syndications.
You’ll hear it all on other podcasts or video logs. You want to invest in the operator. It doesn’t matter what the asset class so much or the deal. What you want to find is who’s a good operator, who’s trustworthy, who knows how to underwrite, who knows how to manage risk, who knows how to properly use leverage, and who has a good network of other people that they work with to execute investments as general partners. That’s hard to do on your own. It’s time-consuming if you try to do it by yourself. There’s already a universe of people out there who have trusted groups of people they work with. Money Ripples is no different than some of the others. Chris, I put you in that category. You’re a trustworthy source of investment operators.
If you try to do it yourself, there's already a universe of people out there who have their trusted groups of people they work with. Click To TweetI appreciate that. I know we were talking about this before. Maybe I will end with this for you. I know you have a big passion for the ripple effect we’re trying to create. I’m sure it goes more personally deep for you, but why is it you’re passionate that others do like what you’re doing? Why are you so passionate that people break these chains and break free?
Maybe it sounds corny, but to me, it’s the American ideal of the self-reliant person. America was founded by people who didn’t want to be servants of other people. They wanted to be their own landlord. They wanted to do their own thing. They were entrepreneurs. They wanted to have their own farm, candle making, or fishing, whatever it was. It’s a healthy society that has a large number of people who are wise stewards of the capital resources that they’re at, their human capital of their time.
Passive income helps you have more time. You have the option to have more control over your time if you so choose. You then can be more of a contributor. My passion has this bigger sociopolitical economic viewpoint. If you’re an owner and if you’re an investor, you have a stake in the rest of society. A lot of times, maybe investors get painted as selfish people, greedy, or all about themselves. It’s like, “No, I’m trying to be independent. I have the ability to be generous and not be a burden on anyone else. In fact, it’s the opposite. I can be a benefactor and not a burden.” It’s an alliteration, be a benefactor, don’t be a burden.
It’s interesting you spent so many years fighting for our freedom for our country and everything else. Now here you are talking about people becoming free, becoming wise stewards. The founding fathers were fighting for ownership. They wanted that right of freedom to determine their own destiny.
It’s the freedom to transact, engage, and bring value to others. The money follows the value. It is more challenging to provide value the more in debt you are or the more constrained you are from paycheck to paycheck. Your paychecks aren’t going to grow with inflation. Our economy is not built that way. We have fiat currency and the economy’s built entirely on credit. You want to own assets that can allow you to get credit as opposed to being the borrower all the time.
I like that because many people say, “Don’t try to become beholden to the government.” You’re saying don’t even become beholden to your own job because that won’t keep up inflation. You need something else to create that freedom.
It would be a challenge. Speaking of jobs, I’m going to have to get back to mine. I have chosen to have a job instead of living off my investment.
That allows you to compound your investments faster, too.
It allows for a bigger savings buffer and then to stack things up.
Dan, I appreciate you joining us. Those are amazing stories and amazing results coming from an amazing man. It’s a reflection of who you are. I agree with you. Time is our most valuable asset right now, and what we are going to do with our time. I appreciate you joining us. Everybody else, I will give the same advice. The good news is this. The results are your fault, good or bad. You have the choice. The question is, what will you do to get there? It’s great to read this, but at what point will you get this to take action to where it gets you results? That’s not just something you read. You’re not just to read the word, but you’re a doer as well. That’s my challenge to each of you. If there’s any way we can serve you, let us know. Go to MoneyRipples.com. Everybody, make it a wonderful and prosperous week. We’ll see you later.
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About Daniel Markert
Experience in building and developing inter-disciplinary teams to accomplish complex tasks with constrained resources; experience in technology business and product requirements development, experience in working in austere and hazardous environments and ensuring public safety and security; experience in personnel and logistical management of large organizations; experience in developing and implementing training strategies for individuals, teams, and “teams of teams”; experience working with and advising foreign military, police, and emergency response personnel; experience working with local law enforcement, fire, rescue, and emergency response professionals. Experience with federal and state budget planning, spend planning, and execution.