First Gen Immigrant to RE investor: Why Did I Start Investing?

I shouldn’t be complaining, I told myself.

I have a great cushy job as a data scientist for a Fortune 10 company.

I was living my American dream - the dream I left home in South Korea for at the young age of 12.

But I soon realized that I was on a treadmill.

Every day I woke up, I had to climb back on the treadmill to make money.

And if I stopped, I fell off. No more money, no security. I felt stuck.

I don't have a trust fund that I can rely on. If I get sick, I would become homeless very soon. 

I was trading time for money. But I felt ungrateful (to whom? the universe?) since I was making good money and I knew there were other people who were struggling.

I knew I needed to own and control the source of income, preferably from multiple sources.

That’s when I knew I had to create a path, a system to take me off the treadmill and get me to financial freedom.

But first, you have to identify your wealth process: You make money, save money, invest in your wealth vehicle (more to this later), and scale (meaning keep doing it over and over again).

I wanted to generate income from investments and preserve the investment value at the same time. But I didn’t want to work 100+ hours (as many entrepreneurs end up doing). This is where investing in real estate shines over other businesses.

I don’t mind working hard initially but I wanted to leverage systems and processes in order to make it as passive as I can (but repeat after me: no investment will ever be 100% passive. Even if you have a manager, you still have to manage the manager!).

I’ve found the mix of house hacking, residential development, and short-term rentals as my initial wealth vehicle.

Residential Development: Equity Building + Cashflow (if Build-to-Rent (BTR) or sale) 

Short-term rental: Strong Cashflow + Equity (with value-add constructions forcing appreciation)

House-hacking: Reducing living expenses (#1 expense line item!)

The goal is to place your earned income into income-producing asset as fast and tax efficient as possible. So this means, for most people including me: 

1) Get a high income skillset (Data Science/Machine Learning/AI in my case) 

2) Identify and purchase an asset that produces income (without you trading a lot of time) 

3) Repeat & Diversify to other assets

Look at your personal P&L sheet. 

(By the way, do you track your net worth? If not, you should. 

More to how to track your net worth in another post.) 

Basically your personal P&L should have these things: 

1) What are your monthly income and sources? (and are they predictable?) 

2) What are your monthly expenses? (and rank them in order to see your top 5) 

3) Are you cashflow positive (meaning you have money to save and invest) or negative (credit card debt, etc)? 

For most people, their #1 expense is housing cost. 

If you can reduce that by house hacking (renting out a part of home), you have more money every month you can save and invest. 

Now let's repeat and rinse all the way to your financial freedom!