Optimal Finance Daily: Episode 3467

Title: “How Many Toilets Do You Own” by Joel of 5AM Joel on Hidden Costs
Host: Diania Merriam
Guest Blogger: Joel (5AMJoel.com)
Air Date: February 22, 2026

Episode Overview

In this engaging and humor-laced episode, host Diania Merriam narrates Joel’s tongue-in-cheek yet eye-opening essay from 5AM Joel, “How Many Toilets Do You Own?” The core theme: behind the glamor of real estate investing lurk gritty realities—hidden costs, ongoing hassles, and the ‘unglamorous’ side of being a property owner (namely, toilets). Through vivid anecdotes, Joel demystifies what it’s really like to own rental properties, dispelling common myths about easy profits and careless scaling. Diania closes with her own thoughtful reflections, reinforcing the importance of due diligence and self-awareness in investment choices.

Key Discussion Points & Insights

1. Toilets as a Metaphor for Rental Properties

• Joel opens with a punchy visual:
  • “I own 22 toilets. Somewhere in Texas there are 22 toilets that I own right now and throughout the day people are shtting in them, flushing them, clogging them, abusing them… And I'm the lucky landlord that gets to fix them and pay maintenance.”* (01:26)
• This sets the tone: rental property ownership is often romanticized while its messy realities are overlooked.
• Purpose:
  • Expose rental properties for what they are: assets, not dream-makers.
  • De-romanticize real estate investing—focus on numbers, not emotions.
  • Infuse humor as a reality check.

2. The Rent Collection Reality Check

• Many new investors expect a passive, hands-off profit stream:
  • Joel lampoons this:
    “First, my property manager goes around and collects all the rent. Next, she puts all the money into a big bag at her office. Then she invites everyone from the neighborhood to come over and stick their hand in that bag. One by one, they each grab a handful of money, and my property manager also grabs a large chunk herself. If there's anything left over at the end, I get to keep that amount.” (03:00)
• Key Insight:
  • Landlords get paid last. Profit is what remains after a parade of costs—interest, taxes, insurance, maintenance, and unforeseen expenses.
  • Joel breaks down per-flush costs:
    “I pay approximately $1.07 to bank interest, 60 cents for taxes, 18 cents for insurance, and about $1.14 in miscellaneous maintenance every time someone flushes one of my toilets… That’s a total of $2.99 per flush.” (04:05)
• Takeaway:
  • Underestimating expenses or overestimating profit is a rookie mistake. Landlords must budget for all contingencies—or risk ending every rent cycle empty-handed.

3. Debunking ‘More is Better’ in Real Estate

• The illusion: more properties = more profit.
• Joel points out:
  • “Four small toilets are not better than one big toilet. Quality will always trump quantity.” (05:10)
• He recounts early mistakes:
  • Chasing “cheap and easy” properties or aiming for arbitrary goals like owning 100 properties often leads to more headaches (and “skid marks”).
  • Over time, he learned to prioritize quality over quantity and selective investing.

4. The Fix-and-Flip TV Mirage

• Aspiring investors often look to TV for “get-rich-quick” inspiration.
• Joel satirizes:
  • “There’s a perception that fix and flip investments are quick, easy and always profitable. Some people even think fixing ugly houses is a fun couples activity that magically improves their relationship with their spouse.” (06:00)
• Harsh truth:
  • The reality of flipping is far less glamorous, with steep learning curves and high risk.
  • “92% of people lose money on their first flip. I made the statistic up, but trust me, it's a very high number.” (06:58)
• Joel recommends education before action, pointing to books, blogs, and podcasts by real experts.

5. Encouragement with Caution

• Joel clarifies his motive is not to scare off new investors:
  • “Writing harsh truths is just my way of helping people get their head out of the clouds. I'm hoping to shorten the learning curve and save folks from making rookie mistakes.” (07:25)
• He promises to balance the cautionary tales (“crappy stories”) with more positive experiences in the future.

Notable Quotes & Memorable Moments

• On Hidden Realities:
  “From the outside, real estate investing can sound so sexy and cool, but the truth is that the term rental property is covered with glitter. Owning a rental property comes along with a whole lot of shit. Literally.” (01:36) — Joel

• On Rent Collection:
  “If you underestimate expenses, there will be no money left in the bag for you at the end of each rent cycle.” (04:49) — Joel

• On Scaling Up with Cheap Properties:
  “Just remember, cheap and easy toilets come with more skid marks.” (05:50) — Joel

• On TV Glamour:
  “All that smiling, laughing and picking out paint colors you see on TV is just Hollywood trickery. Behind the scenes, it’s a much different story. TV is for entertainment, not investment advice.” (06:21) — Joel

• On Helping Beginners:
  “Everybody starts out as a beginner. In many respects, I’m still a newbie.” (07:19) — Joel

Diania Merriam’s Closing Thoughts [09:57]

• Diania praises Joel’s humor and honesty, tying the lesson back to foundational investing wisdom:
  • “This article reminded me of the common advice to not invest in something you don’t understand, so I appreciate Joel’s urging to approach real estate investing with eyes wide open.”
  • She shares her own perspective—she’s considering real estate, but only after thorough research and self-examination.
  • Final takeaway:
    “It’s important to remember that all investing comes with risk, so aligning your investment strategy with your unique set of skills, preferences and circumstances is key.”

Important Timestamps

• 01:11 – Joel’s irreverent introduction & the “toilet” metaphor
• 03:00 – Rent collection process de-mythologized
• 04:05 – Breakdown of costs per flush
• 05:10 – Lesson: Quality over quantity in property selection
• 06:00 – The myth of easy profits from fix-and-flipping
• 06:58 – Made-up (but probably accurate) statistic on first-time flippers losing money
• 07:25 – Joel’s reason for “tough love” with new investors
• 09:57 – Diania’s commentary and personal reflection

Summary Takeaways

• Real estate can be a solid investment, but it’s messier and less romantic than novices might imagine.
• Profit is not as straightforward as “income minus mortgage.” Hidden costs and maintenance can eat through returns.
• Quality investments > Quantity. Don’t get distracted by cheap deals or the illusion of easy money.
• TV shows and social media often oversimplify or glamorize real estate. Education and due diligence are essential.
• Align your investment choices with your appetite for mess, hassle, and risk—whether you’re investing in toilets or stocks.

For anyone dreaming of rental riches: Joel’s honest—and hilarious—post is the reality check you need. And as Diania reminds us, invest only after you’ve wiped away all the false glitter and done your homework.