Investor Retires in 6 Years ($120K/Year) by Doing This

Summary

BiggerPockets Money Podcast: Investor Retires in 6 Years ($120K/Year) – Detailed Summary

Episode Information:

• Title: Investor Retires in 6 Years ($120K/Year) by Doing This
• Host: Mindy Jensen and Scott Trench
• Guest: Beau Webb
• Release Date: August 15, 2025
• Description: Beau Webb shares his journey from a Blackhawk helicopter pilot in the Army to achieving financial independence in his 30s through strategic real estate investments and leveraging military benefits.

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1. Introduction to Beau Webb's Journey

[00:00 - 01:18]

The episode kicks off with Mindy Jensen introducing Beau Webb, a former Blackhawk helicopter pilot from the Army, who transitioned to a successful real estate investor. Beau achieved financial independence in his 30s by diversifying his investment portfolio, which includes real estate, mobile home parks, and traditional markets.

Key Points:

• Beau’s military background and transition to investing.
• Inspiration from the FIRE (Financial Independence, Retire Early) community and BiggerPockets.

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2. Financial Starting Point Post-West Point

[01:03 - 02:47]

Beau explains the financial landscape for West Point graduates. Upon graduation, officers receive a substantial starting salary (~$70K-$80K) along with tax-free allowances for housing (BAH) and subsistence (BAS).

Notable Quote:

“You commission as second lieutenants, which is the first kind of officer grade in the army. And you're making, you know, it's around 70 or $80,000 a year right off the bat.”
— Beau Webb [02:06]

Key Points:

• No student loan debt for service academy graduates.
• Commitment to military service adds a layer of financial stability.
• Importance of utilizing allowances effectively.

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3. Initial Financial Habits and Realization

[02:47 - 07:55]

Initially, Beau spent less than his income but lacked a structured savings or investment plan. Exposure to the FIRE community and resources like BiggerPockets sparked his interest in strategic investing.

Notable Quote:

“I was not spending all of it. But I wasn't totally tracking my expenses and or my savings rate, but I definitely was spending less than I had coming in.”
— Beau Webb [03:20]

Key Points:

• Pre-investment lifestyle focused on saving without strategic planning.
• Realization of the potential for greater financial independence through investments.

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4. First Real Estate Investment: The House Hack

[07:55 - 17:45]

Beau details his first foray into real estate—purchasing a duplex in Fayetteville, North Carolina, using an FHA loan. By living in one unit and renting out the other, he achieved positive cash flow, significantly boosting his savings rate.

Notable Quotes:

“If you live on post or on base... pocket the difference and vice versa.”
— Beau Webb [03:59]

“So that's where I was at initially. But then I saw some big opportunities for improvement as I learned more and more.”
— Beau Webb [05:42]

Key Points:

• Utilization of housing allowances to fund real estate investments.
• Strategic use of FHA loans for low down payment investments.
• The importance of building trust and leveraging military connections for seller financing.

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5. Scaling the Portfolio Through Seller Financing

[27:06 - 33:32]

Beau shares his strategy of using seller financing to acquire additional properties with minimal down payments. He successfully negotiated 100% seller financing for a five-unit property and later expanded to a portfolio of ten properties through similar agreements.

Notable Quotes:

“...I was able to build trust with this gentleman and give him the purchase prices he would need to be willing to sell me all 10 properties.”
— Beau Webb [27:06]

“So I could use seller financing later... I bought that 5 unit property.”
— Beau Webb [13:26]

Key Points:

• Benefits of seller financing in scaling real estate portfolios.
• Building relationships and trust with property sellers.
• Leveraging military discipline and strategic thinking to negotiate favorable deals.

---

6. Diversification and Expansion

[34:29 - 39:06]

Beau diversified his investments beyond residential properties, including mobile home parks, assisted living facilities, commercial spaces, and self-storage buildings. This diversification contributed to robust cash flow streams.

Notable Quote:

“Today, my direct real estate ownership is, is spitting off about $9,200 a month just from real estate.”
— Beau Webb [39:10]

Key Points:

• Transitioning to different real estate asset classes.
• Partnering with family to expand investment capacity.
• Continuous reinvestment of cash flows to grow the portfolio.

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7. Achieving Financial Independence and Transitioning from Military to Full-Time Investing

[40:29 - 41:25]

In 2024, Beau left the military to focus entirely on his investment ventures. His disciplined approach allowed him to retire from active military service, supported by the substantial passive income generated from his investments.

Notable Quotes:

“It is paid off entirely... mostly a stay at home mom.”
— Beau Webb [41:27]

“Yeah, it is, yeah. For the past year or so my full time job has been kind of managing the real estate portfolio...”
— Beau Webb [41:10]

Key Points:

• Full-time commitment to managing and expanding the investment portfolio.
• Utilization of health sharing services post-military.
• Support from family in managing and scaling investments.

---

8. Daily Life and Future Plans

[43:27 - 44:34]

Beau describes his typical day balancing family life, investment management, and personal well-being. He emphasizes maintaining a healthy work-life balance while continuing to grow his investments.

Notable Quotes:

“I woke up early and I went and played pickleball and then I actually stopped at the Boise river...”
— Beau Webb [43:33]

Key Points:

• Structured daily routine that balances personal and professional life.
• Ongoing commitment to investment growth and portfolio management.
• Future goals include rebalancing his portfolio for less real estate exposure.

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9. Concluding Insights and Lessons Learned

[44:31 - 49:35]

Hosts Mindy and Scott reflect on Beau’s journey, highlighting the importance of strategic thinking, leveraging unique opportunities, and maintaining financial discipline. They underscore Beau's success as a testament to effective financial planning and investment strategies.

Notable Quotes:

“This is worth it, that the risks you take or the all out approach that you take early in life can improve or go well in ways that you don't expect.”
— Scott Trench [46:13]

“But he's thinking outside the box and he's thinking about all the possibilities...”
— Mindy Jensen [45:27]

Key Points:

• Strategic investment and willingness to explore unconventional financing methods.
• The significance of building trust and relationships in real estate investing.
• Inspiration for military personnel and others aiming for financial independence through disciplined investing.

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10. How to Connect with Beau Webb

[45:08 - 45:27]

Beau encourages listeners to connect with him via Instagram for insights into his real estate journey and to engage with his experiences.

Contact Information:

• Instagram: @realestatewebb

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Conclusion: Beau Webb's story is an inspiring example of how strategic real estate investments and leveraging unique opportunities, such as military benefits and seller financing, can lead to remarkable financial independence. His disciplined approach, coupled with innovative financing strategies, enabled him to build a robust investment portfolio, ultimately allowing him to retire from the military and focus full-time on his investments.

Listeners are encouraged to consider similar strategies, adapt them to their unique circumstances, and pursue financial independence with determination and creativity.

Transcript

[Mindy Jensen]

Today's guest, Beau, went from flying Blackhawk helicopters in the army to achieving financial independence in his 30s through a diversified investment strategy. He's built wealth through real estate, mobile home parks, and savvy use of military benefits while still crushing it in traditional markets. If you're ready to learn investment strategies that go far beyond basic index funds, this episode will open your eyes to what's possible. Hello, hello, hello, and welcome to the Biggerpockets Money podc. My name is Mindy Jensen, and with me, as always, is my real estate savvy co host, Scott Trench.

[Scott Trench]

Thanks, Mindy. Great to be here. Always great to talk about the tenets of financial independence. All right, we are so excited to be joined by Bo Webb today. We recently did an episode on using military benefits to help soldiers achieve financial independence. And we are now excited to hear about Bo's fire journey today because whether or not you have military benefits to tap into, there are aspects of his portfolio and his journey that I think anybody can can learn from. Beau, welcome to Biggerpockets Money.

[Beau Webb]

Thank you, Scott. Thank you, Mindy. Super happy to be here. I'm a longtime follower of Biggerpockets Money and Biggerpockets in general. So pumped to be talking to you guys.

[Scott Trench]

Awesome. Us too. We are so excited to hear about this story. Can you tell us a little bit about where it begins and what you were doing in the military?

[Beau Webb]

Sure, yeah. It was about six years ago. I was a Blackhawk pilot in the Army. Before that, I had graduated from West Point, the US Military Academy. I was from a small town in Texas, and I had been raised to spend less than I make, to work hard and save when you can. But around six years ago, as a young officer in the army, that was kind of the extent of my financial literacy. I didn't know much about investing, didn't really have any interest in investing up to that point. But around that time, I was exposed to things like the fire community and bigger pockets and real estate, and a lot of things changed for me then.

[Scott Trench]

Awesome. Can you remind us a little bit about the start that West Point graduates get? So let's talk about the day after you graduate the academy. What does a financial situation look like for. For a typical graduate there?

[Beau Webb]

For all the service academies, West Point or Air Force Academy or the Naval Academy, you're not paying for school. It's totally free from a financial perspective, but you do incur a commitment to that respective branch of service. So for West Point, when I graduated, though, I didn't have student loan debts. I did owe the US army five years of my life. And then for me, I went to flight school and incurred an additional service commitment for my time at flight school. So it added a couple of years to that. But in terms of our pay, we commission as second lieutenants, which is the first kind of officer grade in the army. And you're making, you know, it's around 70 or $80,000 a year right off the bat.

[Scott Trench]

And on top of that 70 or $80,000 a year, you also get allowances for housing and food, is that correct?

[Beau Webb]

Yeah, you get a basic housing allowance that's tax free. And then there's bas. It's a different type of tax free allowance that you get and that's just kind of a different breakdown in your pay.

[Mindy Jensen]

Were you spending your entire salary and your entire BAH and your entire bas, or were you saving some of that? And for those who aren't in the military, like me, do you have to spend your entire BA and bas or can you look for deals?

[Beau Webb]

Initially, I couldn't even answer that question other than I could tell you that I was not spending all of it. But I wasn't totally tracking my expenses and or my savings rate, but I definitely was spending less than I had coming in. That changed over time. But when it comes to the housing allowance, if you live on post or on base, sometimes you're going to have a spot by yourself, or you may split that with a roommate, or if you're married, but they will take your whole housing allowance for you to live on post or on base. If you choose not to live on post or on base, then you can receive that housing allowance and then go and spend it as you wish. So if you find something that's much cheaper than that, pocket the difference and vice versa. If you're looking to be a high.

[Scott Trench]

Roller, this is actually a much higher effective starting pay grade than most people get coming out of college because you can effectively consider all of that allowance for housing and subsistence as tax free. So it would be the equivalent of maybe $100,000 or $110,000 base salary for years coming out. So it's a very actually pretty good income. It sounds like you were saving some of it, but not very intentional at the very beginning of your journey. Can you give us a glimpse into what your peers, fellow graduates, what you thought they were doing? Were they saving or investing? By and large?

[Beau Webb]

Well, let me introduce one other pretty cool opportunity we had. It's called the Career Started Loan. And coming out for me as a junior and senior at West Point had the opportunity through USAA to take a $36,000 loan. You pay it back over your commitment. So six years, or I'm sorry, five years and the interest rate was 0.75%, so less than 1% and a way for them to kind of generate your business and they know you have a stable income coming out of the surface academies. Back to Scott's question. I did see a lot of my peers use that loan to buy trucks or to, to go on big trips in Europe, things like that. I did go on a trip in Europe, but I used the rest of it to save and, and ultimately a few years later to, to invest same thing for kind of the monthly pay. I think a lot of us are just in this, this, we were in this position where we, we knew we had more coming in than we were spending, especially kind of the single lieutenants at the time. And we knew that that wasn't really going to change. It's a pretty stable source of income short of something bad happening to you or you doing something very illegal and getting kicked out of the military. So the mindset was as long as I'm saving a little bit, I'm all right. And that's kind of where I was at initially. But then I saw some big opportunities for improvement as I learned more and more.

[Scott Trench]

Tell me about the career progression over the five years of your service. How did your career progress and at what point did you discover financial independ independence?

[Beau Webb]

Right when I graduated, I went to Fort Rucker, Alabama, which is the Army's home of, of aviation, to learn how to fly. I spent about a year and a half there getting paid just to learn how to, to wiggle sticks and fly helicopters. So a little bit unique for me for the first couple years. But then I went to Fort Bragg, North Carolina as my first duty station after flight school. Even though you're, you're an official pilot, you're still learning in the field and you're learning from very experienced pilots and you're leading in certain ways. I call it my first big boy job. And I learning a lot of lessons about what I was good at, what I wasn't good at. One of those lessons was that I really valued my autonomy, being able to choose how I spend my time and what I spend my time on, which was kind of the impetus for me looking into things outside of that. And that led ultimately to coming across things like biggerpockets and books that taught me about real estate and investing and showed me that there Was a different way for me to set myself up for hopefully future options and the ability to leave the military in the future. But I still had a five or six year commitment. So that was kind of the timeline that I was working with to see if I could try to replace my income.

[Scott Trench]

Bo, you start out at Fort Rucker. I think that's like a six month usually training.

[Beau Webb]

No, it's like a year and a half.

[Scott Trench]

Okay, so we're there for a year and a half and then you go to Fort Bragg. Are you promoted around that time?

[Beau Webb]

Yeah, around that time is when I was promoted from second lieutenant to first lieutenant, kind of right when I arrived to my to my first duty location after flight school.

[Scott Trench]

Is that a meaningful jump from second lieutenant to first lieutenant?

[Beau Webb]

It's a pretty meaningful jump in how people look at your expected expertise when they see the rank in your chest compared to second lieutenant. As far as pay, I said I don't exactly remember what the jump was. It was probably $500 or $1,000 a month. So meaningful for me at the time for sure.

[Scott Trench]

It sounds like you discovered the fire community in Biggerpockets and some of these resources around this time. A year and a half to two year mark. What changes around the way that you're handling your money? And you're also discovering that you value freedom. What changes around how you handle yourself and your finances at that point?

[Beau Webb]

One of the early books that I read called Set for Life. Never heard of it, Most people haven't. But Set for Life helped me understand that if you're trying to make a meaningful impact on your savings, there are a few categories that you should really focus on. It's not skipping Starbucks. I mean that that has an impact. But it's like you would say, Scott, it's your housing, it's your transportation, it's your food. And for me, especially since we talked about kind of the housing allowance situation earlier, I saw that was paying for housing is the lowest hanging fruit for me to affect my situation. So as I learned more and more about real estate, house hacking became the extremely obvious kind of first step for me to have a meaningful impact on moving the arrow as far as how much I could save.

[Scott Trench]

And this is in Fort Bragg, which is North Carolina. Is that where you purchased your first house?

[Beau Webb]

Hack.

[Scott Trench]

Can you tell us about that deal?

[Beau Webb]

Before that I was living with roommates and a rental. And so it was still somewhat, you know, I was probably spending six or seven hundred dollars a month for my part of that house. But I realized that I Could. I could do better than that house hack.

[Scott Trench]

So what was your bah?

[Beau Webb]

Bah? I think it was probably 12 or $1300.

[Scott Trench]

Reminder for those who can't keep up with the acronym that. That's Basic Allowance for Housing. There's a lot of acronyms in the military, which I found out the hard way over the years as I've talked to people in the space.

[Beau Webb]

So, yeah, and don't quote me on these exact numbers because this is kind of going off, off memory of five or six years ago.

[Mindy Jensen]

They don't have to be the exact numbers.

[Scott Trench]

That.

[Mindy Jensen]

That shows that there's a huge difference. You were essentially spending half. There are other people in your position that were spending the entire amount or even more of their bah on their housing, and you chose to spend half. What were you doing with the other half of that bah at that point?

[Beau Webb]

I was. I was just kind of saving, and I didn't really know what. What for, but I was. I was just kind of softening it away and saving.

[Mindy Jensen]

Do you mean like in a savings account that was paying, you know, a nominal savings you weren't investing it in, like, the stock market?

[Beau Webb]

This is prior to me kind of diving into becoming more financially savvy. But, yeah, I was. I was talking in a way. What it ended up becoming was a down payment on an FHA loan duplex, and a little bit after that, an engagement ring for my girlfriend. So I found a use for all of that savings of it.

[Scott Trench]

Cash flow positive property, cash flow positive spouse. This is this. Things are starting to really go well. Just kidding.

[Beau Webb]

It's called wife attacking Scott.

[Scott Trench]

There you go.

[Mindy Jensen]

Oh, that's a new one. How did Beau go from a Blackhawk pilot to financially independent in six years? We can't wait to jump back into his fire story right after this.

[Scott Trench]

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[Beau Webb]

It was a duplex that a buddy of mine who was in real estate that I had kind of taken out for, for coffee and pizza and stuff, he came across it and he said, hey man, this, this might be what you're looking for. Because I had told people like, have you guys heard of house hacking? This is what I'm going to do. This is how I'm going to save money. He pushed me this, this duplex that had just come on the market. I went and viewed it with the real estate agent that Zillow connected me with when I said I'm interested in this property, right. Did everything wrong initially, but it worked out. I put an offer in on the duplex using for the, the asking price, which is $108,000 at the time in Fayetteville, North Carolina.

[Scott Trench]

What year is this?

[Beau Webb]

It was late 2018. Yep. So yeah, different, different price point. And that's, that's that's been a big part of my journey. I was in markets where, yeah, the price point was a lot different than other parts of the country, so that was helpful.

[Scott Trench]

And this, this duplex, really nice, big updated, fancy living arrangement for you wouldn't.

[Beau Webb]

Say that is two bedroom, one bath each unit. One of the units was, was pretty crappy and the other unit was really crappy. So I lived in the really crappy unit and then fixed up the pretty crappy unit. As far as the FHA loan, so I made an offer using a VA loan, found out that the sellers had been under contract with a VA loan on maybe it was even a different property prior. And they just didn't really like the experience. So they had this idea in their head, which I think is not accurate, that VA loans are harder to work with than FHA loans. So they, I said, okay, I'll put three and a half percent down instead of zero percent down. And they, they said they were okay with that. So that's just how it worked out for me at that point. Had intended in the future to use my VA loan. I was okay just kind of biting the bullet on that 3 1/2% down payment, knowing that I could use the VA loan later.

[Mindy Jensen]

Okay. I'm a real estate agent and I live in an area where the VA loan is not that popular. We get veterans who are using it, but we don't have a military base close to where I service. So there's really not a lot of opportunity for real estate agents here to understand the VA loan. And there's a lot of pushback on VA loans. And let me tell you, the worst deal I ever did was an FHA loan, not a VA loan. So the VA loan is super easy to use so long as the house isn't falling down. Like, you can't have peeling paint. It has to have an oven. And I think that's kind of it with the appliances. It has to have an oven and you can't have peeling paint or like rickety handles on the stairs.

[Beau Webb]

Yeah, the handrails on stairs seem to be kind of the biggest thing.

[Mindy Jensen]

Yes. Meanwhile, the FHA loan, I could go on forever and won't, but they find a lot more reasons to make that more difficult.

[Scott Trench]

I want to call out a couple of things about your overall situation that I've observed here. First, if we were sitting here and you were asking about this, this purchase, I would say use the FHA loan or a low down payment conventional loan instead of the VA loan, because in your situation you never know if you're going to get stationed to a much more expensive market at some point reassigned to some much more expensive market. And that would be one where you'd want as much as possible of that VA loan available to you. The cash, I imagine 3,500 bucks or 5,000 bucks, whatever the down payment was, was not a material amount of money for you relative to your overall earnings or financial position at that point in time. Although it probably felt like a big deal, you could definitely bring that cash to the table for a purchase like this. Is that kind of how you see it in hindsight, or would you have rather used the VA loan?

[Beau Webb]

You know what, that's exactly how I see it in hindsight. But at the time I didn't see it that way. I just saw it as a necessary adjustment I had to make to give the sellers what they wanted. But. But yeah, I definitely see it as a benefit to kind of maintain your VA loan for as meaningful of a purchase as you can make.

[Scott Trench]

Well, tell us about the payment and the rent that you received on this property. How did it impact you financially from there?

[Beau Webb]

$108,000. On the purchase price, I put three and a half percent down. I put in, I think, 10 or so thousand into kind of just doing a light renovation on one of the units. My monthly payment, when you're principal, interest, taxes and insurance, plus the PMI that comes along with the life of any FHA loans, it was $790 was my monthly payment. I rented out side one that I was not living in for $800. I rented out the room in the side I was living in to a roommate, a buddy of mine that I went to west point with for $300. So for that I was pocketing about $310, plus that 12 or $1300 for Bah that I didn't have to put into hous, had a huge impact on my savings rate at that time.

[Scott Trench]

What was your happiness level like living in this property for this time? And how long did you. Did you live in this property? Like, what I want to understand is it's a home run financially. We don't have to get into that. This is, this is an absolutely absurd return on a $3,800 down payment. Was it misery?

[Beau Webb]

No. I had a great neighbor across the street named, named Gloria, who I got. I got tight with and lived with a good buddy of mine. I was pumped about what that meant in my bank account on a monthly basis. And I was a single guy at the time. I was at work most of the time.

[Scott Trench]

What's this property like today? Is it. You still own it?

[Beau Webb]

I still own it.

[Scott Trench]

Did you end up refinancing out of that FHA loan at some point?

[Beau Webb]

Still have that same loan in place? It was a very low interest rate. The same tenants have been there on both sides for. For about four years now, and they're paying $900 per month each side.

[Scott Trench]

You're clearing 700 bucks, 800 bucks easily on this thing. You know, outside of the odd capex month after all your expenses.

[Beau Webb]

Yeah, and we've definitely had some capex. It's. It's on septic and there's been a couple of leaks I've had to deal with, but. But overall, yeah, it's. It's had very good returns and good cash flow.

[Mindy Jensen]

Well, and the Fayetteville market has gone up dramatically since you purchased it. Do you have any idea what it's worth now? You paid 108?

[Beau Webb]

Yeah, I think it's worth probably a little bit more than. Than 200,000 or so right now.

[Mindy Jensen]

That's a nice doubling of your property in just a few short years. Do you think you're going to keep this property for a while or do you have any plans to sell it?

[Beau Webb]

I don't have any current plans to sell. I plan to keep it until something changes.

[Scott Trench]

How does the journey progress from here? Obviously, it sounds like we're able to really stack a lot of cash at this point. Where do you take that and how does your career and the next phase of your journey unfold?

[Beau Webb]

I at that point understood that using a primary residence purchase to turn into an eventual rental was an awesome strategy. But you can only do that so often. And so I certainly plan to continue doing that as often as I could. And I went on over the next few years to buy two more fourplexes using my VA loans in Fayetteville. So those three kind of primary residence purchases there. But at that time, as you can only do that so often, I was desperate to find other ways to buy real estate with no and low money down, to quote an old bigger pockets book. And one of the strategies that I didn't know anything about until that point was seller financing, because seller financing kind of has infinite levers you can pull. It can be very negotiable with the right buyer and seller if you find a situation that works. And one of those opportunities is to convince the seller to let you buy a property for. For a small down payment. So that became like the number one thing I was looking For I was looking for paid off homes where the owner was probably a landlord and hopefully a tired landlord might consider seller financing. And then I was looking for ways to kind of build trust to them and show them that I was going to take care of the property and do well by them and convince them to let me put small down payments down. And that ended up working out for me. I got pretty lucky finding some good properties, looking for that.

[Scott Trench]

And you're living very frugally during this time, especially at Fort Bragg and these house hacks essentially the whole way through. So it seems like you're able to accumulate a lot. I would imagine you're able to accumulate a lot of cash like maybe 40 to $50,000 a year starting after that first house hack at least. Is that a fair ballpark?

[Beau Webb]

That's probably true, but I was dumping it into properties. I made some other purchases and pretty much dumped any excess cash I had into those properties in those early years.

[Scott Trench]

I consider that accumulation personally. That's going into an investment.

[Beau Webb]

I wish that I tracked it more at that time, but I didn't. I just was kind of bank account balance finance, you know, I have some more cash. Let's, let's look for another property. And that's, that's how I did it back then.

[Scott Trench]

One more question before we get to real estate. Were you doing anything else with any of this cash? Any stock investments at all?

[Beau Webb]

I was blindly maxing out my Roth IRA and I would just. I had all of that in VTS X because someone had recommended the simple path to wealth to me and that was my key takeaway. So I was blindly doing that. And then my tsp, which is the, the military or government equivalent of a 401k, they will match you or the government would match me up to 5%. So I was putting in 5% into my TSP and investing that all in the C fund, which is just like the large cap stocks S and P500 equivalent.

[Mindy Jensen]

You said you were blindly doing this. Do you regret doing that?

[Beau Webb]

No, I don't. I don't. In fact, I still do it, but I just didn't really have a great understanding of what I was doing. I was just kind of doing it because it sounded the right thing to do. And I still think it was the right thing to do. Specifically, what I came to appreciate with Roth IRA contributions is that you can withdraw your contributions from a Roth IRA at any time, penalty free and tax free, which became valuable to me when I started to care about reserves and access to liquidity. As my real estate portfolio grew. So I think it was the right decision. I just didn't really know is the right decision at the time.

[Mindy Jensen]

And is that where your investments lie in real estate and the stock market through the TSP and the Roth ira? Do you have anything else that you're.

[Beau Webb]

Invested in at this point? Yeah, my investment portfolio looks a little bit different than it did at that point. But as I was kind of in growth mode, it was, it was mostly real estate. And then I was putting in kind of those, those minimum amounts into, or maxing out my, my Roth IRA and then putting in the minimum 5% of my pay into, into the TSP at this point. And I don't know if it's time to talk about this, but I'm in bitcoin, I'm in, I'm in private credit funds and I do private lending myself. So it's changed a little bit because my personal finance situation is different than it once was. But yeah, it looks a lot different now.

[Scott Trench]

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[Mindy Jensen]

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[Scott Trench]

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[Mindy Jensen]

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[Scott Trench]

Let's hear a quick overview of the real estate journey. Now we have the three house hacks, the duplex, the two quad plex. Can you tell us about the first deal outside of those house hacks, how you got that done and then give us an overview of the rest of the portfolio as it escalated from there.

[Beau Webb]

So like I said, I was in search of seller financing opportunities. So I became pretty smart on being able to explain all the implications of seller financing and understanding how to look for it and the type of person that may consider it and just how to speak to that if I encounter that person person. So I just started cold calling like crazy. I had a list from another investor of high equity properties and a lot of those properties had out of state owners and small multifamily also was what I was interested in. So I just started cold calling and the first one I came in contact with a woman who lived out of state, she lived in Texas and she was a retired military officer as well and she owned a five unit property in Fayetteville and she wanted to make sure I wasn't just one of those other investors that's going to waste her time and throw her a low ball offer. Initially it was kind of tough to keep her on the phone, but over time I was able to build, build some trust with her and just kind of explain my situation, explain what I was trying to do and I kind of bought some of her time and it just so happened that I was, I was heading back to Texas, that's where I'm from, for Christmas. So I said hey, you know, I'll be in Austin area. She was in San Antonio. I said I'll, I'll drive a couple hours and come, come meet you. So I did. And, and throughout that conversation I explained seller financing and if worked out well that she didn't need the money from a sale right up front she kind of was just looking to make a Wise decision. And we were able to work out a situation to where she financed 100% of the of the purchase price over 30 years at a, at a fixed interest rate and appealing interest rate. I don't remember what, what it exactly was and it's actually changed because she did a refinance with me a few years later, which I can, I can get into. But I bought that 5 unit property. 100% seller. Finance was just over the moon about it and she was happy about it because she was getting a much better purchase price or sale price than what she had bought the property for. And it was turning into a source of income that was secured by a property that she'd owned for years. And her gut feeling about me was that I was a safe bet in terms of another military member and someone that was not going to run the property into the ground. In fact, I was going to improve it and improve the value of her collateral. So it turned into kind of a unicorn situation. That was and still is one of my best properties.

[Mindy Jensen]

So over the years that I was the community manager for biggerpockets, I was in the forums all day, every day and I would see people talking about, oh, I can't find a seller financed property. I love that you had a list. You don't just start calling people or calling listings from the MLS and say, hey, would you sell or finance? As I'm a real estate agent and right now I've got calls from people saying, oh, would they sell or finance? I'm like, no, it's on the market to be sold. They want to be done with it. But having a list of properties that aren't on the market. I wonder if she was even thinking about putting the house on the market. And you said, oh, she didn't want me to be wasting her time like all these other people. There are so many people out there who want to, oh, it's worth a hundred thousand, I'll give you 40. Well, great. I would make that deal all day too, but that's never going to happen. You have to make it attractive to them. And getting it for a low price is not, not nearly as important as getting it for 100% financing. It's not like you paid double what it was worth just so you could get 100% financing. I mean, how much do you think it was worth when you bought it and what did you pay for it?

[Beau Webb]

So I did get a good price on it, but I gave her a higher price than she was asking. So I think I bought it for around $150,000, which is a crazy price.

[Mindy Jensen]

For a 5 plaque.

[Beau Webb]

So listen, this is a monster home, right? So this is an old home that had been converted into five one bedroom or studio style apartments. So it was a unique property. And she was having issues with the tenants she was renting it out to. I don't know, it was just, it was attracting tenants that were not working out well for her. So she gave me a price and I said, essentially, if you can finance it at these terms, I'll give you even more than that price because I think that's what's fair. And she was happy to do that. I saw it as an opportunity to get into the Airbnb market, which was, that was kind of a new strategy at the time. But I thought that there was an opportunity to turn those all into pretty inexpensive short term rentals. They were very profitable when I did do that. So I kind of changed the situation in terms of who it was being rented to and it became a very, very valuable property to me. And I think a lot of people kind of started doing that in that area because it was a desirable area. And the property values drastically increased over the next two or three years.

[Scott Trench]

When I think about the 100% seller financing stuff, I think that for a lot of people this concept is a pipe dream, frankly, and it's not really realistic realistic. And I think that that changes in a situation like yours. Because if someone says, hey, I want to buy a property with 100% seller financing or whatever, I'll laugh them off most of the time. But I'll listen. If a captain in the army from West Point gives a call and that person is living in a crappy half duplex to save a bunch of money on there, clearly saving everything they've got and has two or three years of real estate experience under their belt, is not way over levered relative to their situation, and is making 70, 80k a year plus those two things. I don't know if this person, this seller, knew or understood all of those things about the underlying bet that she was making around there, but to me those scream really good odds compared to this person has no job, no source of income, no other things in motion. Now I'm going to be collateralizing my, my, my loan against just the property. Did that play at all into, into this dynamic with the seller or how did you perceive your ability to convince people to give you seller financing of this sort?

[Beau Webb]

I think you're exactly right. I'm not pushy when it comes to kind of negotiating with real estate. But I do try to be mindful of the picture that I'm sending to, to the seller and the, the different things they may value and what a potential buyer may have, especially with seller financing. Because you need to understand and trust in the person you're selling your property to. Because you're not just walking away from it completely. They are now your borrower. They should look at you kind of the same way that bank looks at a lender.

[Scott Trench]

Give me one more item on this. Could you have paid, could you have put down a substantial down payment on this property if required?

[Beau Webb]

I could have put down definitely more than, I did more than that, zero percent. But at that time I probably didn't have a ton to put down. Also I probably had maybe 10 or $20,000 that I could have, could have put down. And I explained to her and I told her that, I said there's some, some issues that I want to get after in this property if I buy it. There was kind of some, some water intrusion issues in the basement. I said, you want to, I have money to fix this property up. And that made sense to her. And one of the reasons she was okay doing that 0% down financing.

[Scott Trench]

Got it. Okay. So there was cash put into the deal. It just wasn't in the form of a down payment.

[Beau Webb]

That's correct.

[Mindy Jensen]

Were you going to be living in this property? Did you have any plans to move into it?

[Beau Webb]

Not this property, no.

[Mindy Jensen]

I'm wondering how you would have financed this if you didn't do seller financing because it's a commercial deal. But if you're not going to live in it, then because you can't live in your commercial property, can you, for a commercial mortgage?

[Beau Webb]

I'm not sure about that. And I call it five units. But it's just an interesting property where it's probably looked at as a, as a fourplex. In fact it says like on the tax records, duplex non conforming. So it's kind of an interesting property. I don't think that it would be looked at as a five unit apartment building. And if it were, there's probably some changes I could make. Take down a wall and turn it back into four. But in my journey at that point four or five years ago, that's probably a wise question to ask. And I was not asking those questions yet. Yet. I was just excited to get what I was pretty sure would be a good cash flowing asset, putting very little of my own money into it at a good price.

[Scott Trench]

So after your house hack and Your illegal cash flowing fiveplex. Well, how does the rest of your journey.

[Mindy Jensen]

Non conforming, Scott. Not illegal, non conforming.

[Beau Webb]

The journey went a lot faster than, than I had expected it to. I kind of set my sights on if I can work towards getting $10,000 a month in real estate income by the time, you know, five years from now. That will give me, I think the confidence I need to, to leave the military if I still feel like that's the me to do and have income in to support my lifestyle. So that was the goal. All I was thinking about in terms of investing was how do I build up my cash flow to work towards this goal. And I told you seller financing specifically is what I was looking for. So there was a another home that came available in my neighborhood. When I say available, it was a for sale by owner and sharpie. A sign in the yard which I was immediately attracted to. I called it, it was a gentleman. I'm going to make this a long story short, but a gentleman that I got to know, he had military ties as well. Also his son just so happened to have gone to, to West Point. So we had some great connections. And turns out that he had nine other properties, 10 total properties. He was in his 80s, he was looking to get out of the rental business. They were all debt free. He didn't have any loans against the properties and they were well off financially. It was kind of a side hobby for him. So this was another unicorn situation I had kind of stumbled across where I was able to build trust with this gentleman and give him the purchase prices he would need to be willing to sell me all 10 properties. I put $500 down on each property as skin in the game. So he knew I was really invested. He understood I was not putting much down. But it was similar to what you talked about earlier Scott, where I believe that this gentleman, his name is Mr. Taylor, felt like he was making a good bet and who he was selling the property to and he was ready to be done with it. And I told him I will make it easier for you than anyone else will. There's no renegotiation, there's no, you know, I'll come to your house and sign all these contracts and that's what happens. Long story short, I bought these 10 properties for pretty much 0% down and I did have to put in a lot of money into those properties once I bought them. But that, that was a huge kind of leap and bound in my journey growing towards that, that cash flow goal.

[Scott Trench]

What year is this?

[Beau Webb]

2020 it was great timing, great.

[Scott Trench]

And you have one or two more years left at Fort Bragg after you purchased this.

[Beau Webb]

Had about a year and a half left after, after I purchased those. And by the way, my wife, all my friends that kind of knew I was dipping my toes into real estate thought that I just totally lost it when I bought 10 properties in one fell swoop because it kind of looked like I potentially was putting myself in a position to be over my skis. But I went for it and it worked out.

[Scott Trench]

And what was the total purchase price of this 10 unit portfolio?

[Beau Webb]

Yeah, I don't have the exact numbers, but it was around half a million dollars that I bought all 10 properties for. Again, this is a different price point market and values hadn't really started increasing like crazy kind of when Covid hit. And after that it was around $500,000 total purchase price on these properties. He financed them for 30 years at 3% interest. It was another kind of home run deal for me. But even with those terms, initially they weren't, they weren't cash flowing because they weren't, they weren't getting market rent. They had some deferred maintenance. So I went in and cleaned them up and invested a lot into them. But by the time they were getting market rent, they were, they were cash flowing very well. And then similar to that duplex that I explained how it went from around $100,000 in value to around 200,000 dol, that's kind of the same story I've seen for any other properties that I owned in Fayetteville that I bought around 2020 was almost a doubling in the price from, from then to the height of the market a year or two ago.

[Scott Trench]

Let's also put that in perspective, right? I think people hear, oh, you got 10 properties for 100% seller financing at this point. But if you look at like a market like Denver, right. Like my context in this one duplex is $500,000, right. And you're an army first attempt tenant at this point. When you're purchasing this, you could have bought a house for 500 grand and probably qualified at that point with, with your income. So this is not an insane overreach in this particular situation. And, and you weren't going in over your skis on it.

[Mindy Jensen]

And now you have how many properties and how many units?

[Beau Webb]

So today, looking at my notes, I have 52 residential units. I also got involved in a mobile home park, a partnership. So I, I own third of a mobile home park. It's got about 46 units in it or 46 lots. I have an assisted living building that we rent to operators, so we just don't own the building, my father and I. And then we have five small commercial spaces, two small self storage buildings in Alabama. So I've kind of branched out in terms of the different asset types and asset classes within real estate. But it was all in search of cash flow and there's a lot of seller financing mixed in with, with, with a lot of those purchases.

[Scott Trench]

What is your real estate income from this portfolio? What's an approximation of the cash flow.

[Beau Webb]

That you, you generate cash flow wise? Today, my direct real estate ownership is, is spitting off about $9,200 a month just from real estate. I'm also doing private lending with, with money that ultimately I kind of extracted from real estate through some refinances and things like that. And that private lending is, is probably bringing in 4,000 or so on average per month. So, so very meaningful monthly income for me just, just from that real estate investment.

[Scott Trench]

That's awesome. That 9200 include all the commercial and the mobile home park as well, or is that just the residential portfolio?

[Beau Webb]

It includes the mobile home park and all the commercial as well. So when I moved back to Alabama around that time and this was a big, a big shift for me, my father, who's always, he was a business owner and he's financially savvy, he became interested in kind of what I was doing in real estate specifically. So, so we worked out kind of a partnership where from that point forward, kind of any deals that I found, I pitched to him and I found a way to kind of work backwards on the numbers to where he's still going to get a 12 or 13% return. And then I'd have him put in as as much money as he could to still get returns at that kind of threshold. And then I'd put in the rest, which was usually a lot less than 50% of the total cash needed. So maybe some unnecessary details, but it worked out well and helped me to scale because I had my dad that, that wanted to scale with me and could bring some money to the equation.

[Scott Trench]

Bo, if, if you paid off all your properties, all the debt and all the properties, kept all the partnerships in place and those kinds of things, but paid off all the debt, what would the cash flow be at that point for this portfolio?

[Beau Webb]

Off the top of my head, I, I don't have that. It would be substantially more because to grow, you know, in my growth phase, I, I took on a lot of leverage so there, there's still a lot of debt involved in the real estate side of the portfolio and I pay a lot to debt service. But what I can tell you is that with that debt pay down right now there's about $65,000 in principal pay down per year on that debt just, just from making those minimum payments that the tenants are ultimately funding.

[Scott Trench]

Is this your full time job now?

[Beau Webb]

It is, yeah. For the past year or so my full time job has been kind of managing the real estate portfolio and also spreading myself into other kind of asset types and kind of rebalancing the portfolio if you will, into a little bit less real estate exposure. That's kind of the goal.

[Scott Trench]

What year did you leave the military?

[Beau Webb]

I left the military in 2024. So yeah, last year.

[Scott Trench]

Okay, so you went directly from the military to full time investor essentially?

[Beau Webb]

Correct.

[Scott Trench]

Is that immediately after your five or six year commit or did you stay at any length of time over, over that?

[Beau Webb]

I stayed in about six months extra because we were expecting a child and it just kind of made, made sense to stay put for, for a little bit longer.

[Scott Trench]

What do you do for healthcare benefits?

[Beau Webb]

So I do, it is not insurance, it's called health sharing. But I use crowd health specifically for our health sharing needs. It's a lot more affordable. There's some different kind of risks associated with it or just some different considerations but for our family and the way we, we value health and how affordable it is, it made made sense for us.

[Scott Trench]

What is your wife do for work?

[Beau Webb]

It's mostly a stay at home mom. She, she does a little bit of social media management and marketing for a couple businesses. One is her, her father's restaurant and then there's another business. So she makes about $1,200 a month doing kind of those, I, I would call them sort of side hustle kind of social media type things. But mostly she's a, she's a stay at home mom and we have a two year old and a nine month old. So she stays busy. Yes, she does.

[Scott Trench]

That's very busy on there. So congratulations. I got two kiddos around the same age here as well. We have this, this full time job as a real estate Investor. We have 1200 bucks coming in from your wife. You are a real estate professional I take it? Does the depreciation on your portfolio give you very low AGI in this situation?

[Beau Webb]

It helps a lot. This is the first year that I'm, I'll be. Or 2024 will be the first year that I'm a Real estate professional because I wasn't able to be one while I was full time in the military and my wife also previously worked. So this is the first time that we'll be able to qualify for real estate professional. And yeah, it'll be able to offset almost all of the income. I hope, you know, that's, that's more of a question for, for my cpa, but that's the goal.

[Scott Trench]

I'll be really interested to see how that goes for you in the next year, especially if you keep buying lots of real estate and how you handle things like accelerating depreciation on properties you've owned for a while. Maybe that option exists and some of them. That'll be fascinating and really interesting.

[Beau Webb]

Yeah.

[Scott Trench]

What does Tuesday look for you in this quasi fire world that you live in as a full time investor?

[Beau Webb]

Well, today's Tuesday. So this morning I woke up early and I went and played pickleball and then I actually stopped at the Boise river on the drive back home and I jumped in the river and I came back and I sat in this here sauna for a little bit, had breakfast with the family and then my wife and kids left to go to the gym and I spent a few hours kind of working on real estate stuff and today preparing for this podcast. But you know, I look at what's going on in my world in real estate and investing and I spend some meaningful hours there. And then I usually wrap it up around 3 or 4 or so when the kids are done, done napping and go on walks or go to the park or things like that. Cook a healthy dinner and then usually chill on the couch to an episode of TV and go to sleep early.

[Scott Trench]

Pretty good Tuesday. Well, that's, that's what's possible for folks. There's a lot of work that went into that, a heck of a lot of sacrifice, some luck and a lot of really good decisions and really smart investments that you made there. So congratulations on that. I'm jealous. I'm sure a lot of folks are about that. That sounds like a pretty good Tuesday.

[Beau Webb]

Thank you. I'd say a lot of luck, a little bit of sacrifice.

[Mindy Jensen]

Yeah, that sounds like a great Tuesday. I like the go to bed early part the best.

[Scott Trench]

Thank you for sharing this incredible story. I think it's an inspiration to really any officer in the armed services that wants to go and repeat. Maybe there's some timing factors, maybe there's some really good deals that you got here. But somewhere along this continuum from having very little following your five year service commitment to Having something along the lines of what you've produced should be possible for many, many more officers. And that should be a goal of ours. Alrighty. Well, should we get out of here, Mindy?

[Mindy Jensen]

That sounds like a good idea. Scott, Beau, thank you so much for your time today. Is there any place people can find you online?

[Beau Webb]

Probably the best way is on Instagram. I'm ealestateweb. W E B B. It's my last name, eelstateweb. I post kind of my journey there and I wouldn't say I'm super active today, but, but I'm always happy to respond to messages. If you have any, any thoughts or, or comments on, on things we've talked about or want to connect, I'd love to connect as well.

[Mindy Jensen]

Awesome. All right, thank you, Beau and we will talk to you soon. Thanks for your time today. All right, Scott, that was BO and that was so interesting. I love the fact that he has strategically purchased his real estate, not looking to squeeze every single dime out of the profit. And I can't stress how good that is as a seller. When somebody calls up, hey, are you willing to do seller financing? Sure. Okay, I want the rock bottom price too. Well, that's an instant turnoff. So he's using these ideas of like he's thinking outside the box and he's. What's it called? 4D thinking. He's thinking. Or 3D thinking, I can't remember what the phrase is, but he's thinking about out all the possibilities, all the benefits, not just I got to get it for the lowest price. And I think far too often real estate investors kind of focus right on that.

[Scott Trench]

I just think the outcome that he's created is absolutely phenomenal. I mean, this guy is a multimillionaire with the 10,000 plus a month in passive cash flow number easily, plus any amortization, plus any returns from the rest of his portfolio outside of real estate. This kind of situation, this kind of option is exactly why we do what we do here at BiggerPockets. Money is every single person who has this. There's something good that's going to come from this. Some contribution to the world, Happier kids, happier family, healthier life. It's just fantastic to see. And I think that the lesson is that this is worth it, that the risks you take or the all out approach that you take early in life can improve or go well in ways that you don't expect. Whether that's in stocks, whether that's in real estate and these other areas, as long as you don't get in over your scheme as long as you're doing the fundamentals correctly of living way below your means and really investing yourself in whatever side business or rental property portfolio or work stream that can expand is going to look like. And I just love it. I think it's, I think it's a fantastic money journey.

[Mindy Jensen]

I do too. I love that he's taking advantage of all the opportunities that he has. And I think everybody has different opportunities that they can take advantage of. And I don't want to say explore, but I almost want to say exploit. And you know, your opportunities, Scott, are going to be different than mine. Mine are going to be different than bo's, but you take advantage of what you can take advantage of. And you know, you can get so much farther by just tweaking these little like he's not doing anything illegal. He's taking a loan. What is it? A career starter loan. And he did take a trip, but then he also used it as his cash reserves and as to invest. I think that's all awesome because he's got this opportunity to have a 0.75% interest rate. And you know, anybody in the military who wants to get ahead needs to go back and listen to this episode again.

[Scott Trench]

I think a two part open ended question that I look forward to exploring with you in the next year or two, which is the fire community or at least the bigger pockets money community is clear. They like the golden ratio portfolio. They like low cost index funds for their purpose purposes. But what they really want is they want to keep growing post fire and they want a portfolio that allows them to do that in a way that, that they'll feel great about. They feel great both about sustaining a baseline level of spending, a baseline level of fire and they'll be able to see their net worth grow. And I think that's the question that we now need to answer is what does that look like for a traditional or passive portfolio in the stock, stock, bond, gold, whatever world out there and what does that look like once we think about layering in real estate into that equation? I think those are the two questions that emerge for me from this that'll be really worthy of exploring over the next year or two.

[Mindy Jensen]

Yeah, that'll be fun to brainstorm with you, Scott.

[Scott Trench]

I think this is more closely aligned with my goal as well. I do want to spend more of my portfolio and I have and will continue to build out this golden ratio portfolio. But I'm not sure if spending, getting the maximum amount for the rest of my life is actually my goal for my net, my personal net worth. I'm not sure it's yours either, Mindy.

[Mindy Jensen]

It is not my goal. It is my goal to be able to afford all the things that I want.

[Scott Trench]

So let's help Bo figure out his goal. And then in the meantime, let's pose that question and see what folks come back with. We'll be reviewing the YouTube comments, or you can send emails to scottiggerpocketsmoney.com and mindyggerpocketsmoney.com if you've got ideas on how to answer this question.

[Mindy Jensen]

Awesome, Scott. Should we get out of here?

[Scott Trench]

Let's do it.

[Mindy Jensen]

That wraps up this episode of the BiggerPockets Money podcast. He is Scott Trench. I am Mindy Jensen saying Take care Polar Bear. You say you'll never join the Navy, that living on a submarine would be too hard. You'd never power a whole ship with nuclear energy, never bring a patient back to life or play the national anthem for a soldier. Holdout crowd Joining the Navy sounds crazy. Saying never actually is. Start your [e-mail] America's Navy forged by.

[Scott Trench]

The Sea Support for this podcast and the following message comes from America's Navy the Navy offers new graduates hands on training and experience in careers like computer science, aviation and medicine, plus education and sign on bonuses. Parents help your grads start their career [e-mail].