From Food Stamps to Six-Figure Flips and Debt-Free On a Teacher’s Salary

Mindy:
Welcome to the BiggerPockets Money Podcast, show number 331, where we interview Skyler and hear how he and his wife use geographic arbitrage and hustle to save 80 to 90% of their teacher salary, invest in real estate, travel the world, adopt two kids. Basically he’s going to make you feel like a total slacker, but it’s such a great story.

Skyler:
As much as I love my profession, there’s a lot of victimhood in it of like, “I’m a teacher. I don’t make enough, so I’m not going to be able to do these things.” And it’s much more of a perspective of you have time. And what are you going to do with that time? How do you ever utilize that? Whether it’s a second job, you’re making things with your hands, you’re doing some type of craft? I don’t know what that is for everybody, but utilizing that hustle and that time to make things happen and to not be afraid to ask questions. They don’t do a great job teaching you about 457s and HSAs. They just kind of throw you in and say, “Here’s your pension.” We have a pension to fall back on too when we retire. And that’s like our safety safety net. And so really asking questions and then utilizing that time that you have is probably the biggest steps.

Mindy:
Hello, hello, hello. My name is Mindy Jensen and with me as always is my total slacker cohost, Scott Trench.

Scott:
Hey, I’m not a total slacker.

Mindy:
Do you save 80 to 90% of your teacher salary, invest in real estate, travel the world and adopt two kids?

Scott:
I do invest in real estate.

Mindy:
With me always as my kind of slacker co-host, Scott Trench. Scott and I are here to make financial independence less scary, less just for somebody else. To introduce you to every money story, because we truly believe financial freedom is attainable for everyone, no matter when or where you are starting.

Scott:
That’s right. Whether you want to retire early and travel the world, go on to make big time investments in assets like real estate, start your own business or achieve financial freedom with a low income job like teaching, we’ll help you reach your financial goals and get money out of the way, so you can launch yourself towards those dreams.

Mindy:
Scott, I am super excited for Skyler to join us today. He has an excellent story that kind of proves me right when I say, “Financial freedom is attainable for everyone, no matter when or where you’re starting.”

Scott:
Yeah, this was a really cool story. I think it’s a testament to Skyler’s hustle, his heart, his creativity, and his willingness to take risks here that I think enabled him to achieve a really incredible economic outcome for himself and his family early in life here, starting as a teacher.

Mindy:
Two teacher salaries, and they’re still crushing it.

Scott:
Absolutely. Well, should we bring him in?

Mindy:
Skyler, welcome to the BiggerPockets Money Podcast. I’m so excited to talk to you today.

Scott:
Yeah, thanks for having me, excited to be here.

Mindy:
Skyler reached out to us to tell us his story, which is a really, really awesome story of basically not earning a ton of money, but still living like he kind of does, because he’s got so many different ways that he is investing his money and allowing it to grow to provide the type of life he wants to have. Skyler, let’s jump into your money story. Where does your journey with money begin?

Skyler:
Yeah, first of all, thanks for having me here. Like I mentioned before, I wish my wife could be here. She’s the partner in all this and definitely keeps us both accountable in a lot of ways, but my money story probably started early on. I was born to teenage parents that were in high school, they were 17 years old. And so their money story was kind of a part of mine. And the struggle of raising a son at such a young age and graduating high school and getting into the workforce. My dad was the kind of guy, or still is the kind of guy that drives a beat-up truck. And as a kid I just remember he would shop for all of his clothes at Goodwill. And that was a really big example for me to learn early on about materials and how to approach life from a cheaper standpoint.
My mom is a very forward person who’s not afraid to ask for deals, even if they’re not labeled. She is very persistent and she’s given me that drive to be able to ask the one more question or to maybe put myself in a situation other people are afraid to put themselves in. I grew up in a small town and I was very lucky that I grew up in that town, because most of my friends had very educated parents that had great careers. So, whereas I came from a young family that kind of struggled in a lot of ways, I got to hang out with kids that had parents that had gotten their doctorates or CEOs, and so I kind of got the best of both worlds in my opinion. That’s kind of where I grew up.

Scott:
Awesome. And how about in the high school years and those types of things? How did you make, earn or save money or did you blow it all? What was your relationship with money before you got into college?

Skyler:
I was very lucky that, I won’t lie, that my grandparents were very spoiling to us. So whereas my parents always were kind of making ends meet and working hard, my grandparents definitely spoiled us and gave me some of the ability to do some of those things with those friends that were able to afford those things. I did not work a lot in the high school years because I was a athlete that played a lot of sports. But growing up I did the whole sell candy bars from Costco in the locker rooms. I used to, when I was in middle school I would go to Goodwill and I’d buy Nintendos that were at Goodwill and I’d refurbish them and sell them on eBay to make a couple extra bucks here and there. So, I kind of hustled my way, but no formative job during those years.

Scott:
Awesome. So what was the position you kind of left high school with and entered college from?

Skyler:
Yeah, so I was a first generation college student, so the path wasn’t really laid out. All of my friends were going to college and I knew it was the thing we were supposed to do. I just wanted to play basketball. So I ended up going to a junior college because I could afford it and I could play basketball. So I did that, and at the time my family, it was 2008, had lost everything. We filed bankruptcy, we lost our home, cars. We actually ended up kind of on food stamps and doing the whole Christmas and Thanksgiving at the food bank. And it was hard, for sure. I have two younger brothers and it was a hard time for us to lose our home that we grew up in since birth. But I guess the flip side, which is the important thing with investing in my opinion, is to look at the silver lining is we qualified for full financial aid, which was a whole process to learn, but ultimately gave me four free years of school.

Mindy:
Okay, so what did you study in college?

Skyler:
I did my general AA, two year degree, mainly because I didn’t know the direction I was going in. And then when you get to that big university, which I transferred to after you, the world is your oyster and you have all these majors. And so I kind of floated around a little bit. I sat through one accounting class taught by a grad assistant for me to realize I hated accounting. So business went out the window pretty quick for me, that one class kind of did it. And I thought about different things. But ultimately, once I realized I wanted to be a teacher, I did the math and the quickest path was for me to get my Bachelor’s in Psychology and then go back and get my Masters in Teaching.

Mindy:
Okay, so you said four years of college was free essentially because you qualified for your loans. Or I’m sorry, you qualified for aid. Was it, that was the first two years in junior college and the second two years in the four year college, or did you get your masters paid for as well?

Skyler:
I got my Pell Grant and my FAFSA grants and my scholarships not only paid for school, but they paid for my living, they paid for my groceries. And my friends and I and my wife found us an apartment on Craigslist, $125 each a month. She wouldn’t stay the night. It had an Oleum flooring in the whole apartment, dingy grungy, but it was 125 bucks a month and we were able to save a ton of money. So I was getting paid at one point, I’d end up with cash at the end of the month from all those grants. So that was my four years completely paid for. Paid for my summers at home, everything. And then my masters I got subsidized loans, but I did have to pay for that.

Scott:
That’s incredible. So Skyler, could you give us a little bit of an idea about how you were able to qualify for all of these grants, or what the major contributors were, or things that allowed you to get all that money and where people can learn more about that?

Skyler:
Yeah, like I said, if you use an accountant particularly, that’s a great resource. Obviously they can get you the numbers and resources you need. A lot of the paperwork is pretty mundane and it takes a long time. So if you Google FAFSA, you’re going to find the financial aid assistance website and there’s lots of resources on there. A lot of it you kind of have to self-teach yourself, but I’d say as a high school teacher, one of your biggest proponents and resources is going to be your high school for your son or daughter student. The counselors there have been through that process with other students. And mine happened post high school because of the financial crisis was right after I graduated. But I would say if you think your son or daughter or yourself may qualify, because it applies to adults as well, your high school counselor and the FAFSA website are great resources.

Scott:
Great. And most people will be familiar with that with FAFSA, F-A-F-S-A. You can Google that and learn more about it.

Mindy:
Okay, so thank you for that. I think that that’s going to be really helpful for people who are looking for more information about that, paying for college. I think that’s great. Good job on living on, did you say $125 a month for rent?

Skyler:
It was ridiculous. It was the nastiest, I don’t, I didn’t meet code, that’s for sure. But my wife found it. We didn’t even see it. We just said, “Take it.” And with the FAFSA too, myself, my brother, my other brother and my mom all went back to school for free. So our whole family went debt free for four years.

Scott:
Awesome.

Skyler:
So it was pretty fascinating.

Mindy:
That’s fantastic.

Skyler:
And no one had ever graduated college in our family. So all of a sudden that opened the door. I mean, it was a crummy situation, but turned it into a silver lining.

Mindy:
Well, but you made, took lemons and made lemonade.

Skyler:
Absolutely.

Mindy:
Okay, let’s look at your college graduation. So you graduated from college with a four year degree and then you went on to grad school to get your master’s degree. What was your financial position when you graduated college? Or I’m sorry, from your grad school program?

Skyler:
Yeah, I had moved back home to my local town, that’s where the private university was at. And I kind of did the math. It was an expensive tuition. It was a one year program for $32,000 and I had to take out subsidized loans on all of that. My FASFA didn’t extend into your masters. It only goes to your four year degree. Past that I just got subsidized loans with a better rate. So, my math was, in our state you get paid about seven to $8,000 more a month if you have your masters, or excuse me, $8,000 more a year if you have your masters. So it was a calculated move to get my masters done in a year so I could get to teaching as quick as I could. And then I just always thought I would pocket that extra money towards paying those loans off each year.

Scott:
Awesome. What year did you graduate from that master’s program?

Skyler:
Yeah, from the master’s program it was 2012 in the spring.

Scott:
Awesome. So, what happens next? You’re $32,000 in debt, do you have any savings? What happens next?

Skyler:
Well, I have a couple thousand dollars in my account that Uncle Sam has given me up to this point, but that’s about it and it usually doesn’t work that way, I know. But at this point I’m already a frugal person, so I’m staying at my grandparents’ house for free. That spring I graduate, that summer I get my first job. So I get a teaching job right out of school, which was difficult during that time. But growing up in that area helped me get a job. And so that first job, with the coaching stipends I was making about $48,000 a year and we can kind start getting the numbers, I guess. So yeah, I was making about 48 grand a year and I ended up moving into my friend’s basement and I paid $500 a month for rent. He was very gracious to allow me to do that. It was a nice little basement setup.
And I was saving, those first few months I was saving about 1500 to $2,000 of my $3,000 paycheck towards my loan. So I just started aggressively. Hammering, had a used car, it was great. I thought it was nice, worked well. And I just started hammering out the debt at that point. Okay, so I’m paying off about 1,500 to $2,000. At this point I knew I wanted to get, coming from a family that had lost everything, home, cars, all this stuff, I was just really scared of debt. It had nothing to do with financial independence at this point. It was just more, I didn’t like to owe anybody anything. That’s kind of my dad’s mantra. You drive a cheap car, you buy your clothes at Goodwill, you don’t owe people things. And so, I was just on a mission to pay off my debt.
And he had taught me, being financially independent, being frugal isn’t in a punishment. It’s an investment in yourself, in your future. And it wasn’t really hard. It was kind of second nature from the, I’d like to say I was really suffering, but I thought I was living pretty good.
So a funny story, I had a parent approach me on the basketball team that I was coaching, And it was a dad and he was kind of dressed in just kind a beat-up sweatshirt, a college sweatshirt and fleece shorts and sandals. And he kind of knew that I was living farther away from the school to be cheaper. And he said, “Hey, I have a unique opportunity to go work in Sacramento. And my son,” his wife has passed away at this point. And he said that his son, he wanted him to stay at his house, but only way to do this is to have an adult home. He’s like, “Would you live in my basement so my son can stay at our home versus putting him in a neighbor’s and it’ll be free?” So I just like, “Sure.” And he was like, “I’ll come check the place out.” So he sent me the address and I was-

Mindy:
“I’ll come check the place out.” Like you’re going to say no.

Skyler:
No, a 100% not going to say no. Yeah, absolutely. And a key point is like, I’ve been dating my wife now since high school, so this entire time we’ve been together. And I get on the phone with my wife and I tell her, “Yeah, I’m just going to drive out there and drop my stuff off and start living there.” And it was in pretty nice part of town. And so I start driving up the hill and the higher up the hill you go, the nicer the houses are. And so I’m driving and I’m driving and I keep driving and I’m starting to get intrigued if I’m going to go over the hill and back down the other side. But I got to the top and I’m in a neighborhood of million dollar homes and it’s a 1,400 square foot basement with a bar, a ping pong table, a movie theater and a bedroom. And this was what was offered to me for free. And I almost said no, because I just was judging a book by its cover. So now I’m living for free in this basically apartment.

Scott:
And what year is this?

Skyler:
This is still 2012, tail end of 2012.

Scott:
So you paid a couple thousand bucks towards your student loan debt moving into, now you’re living for free?

Skyler:
Yeah, so now I’m paying about 2,500 bucks a month towards my student loans, living off 600 bucks, the groceries were included. I mean, the most gracious family. They’ve taken me in, they’re like a family now to me. It was just the perfect setup. So, I guess there is like, don’t say no to opportunities when they don’t look. Maybe not at first you may not like the way they look, you got to check them out. I was going to live in that house, no matter what, but it ended up being an extra bonus that it was nice. And so around this time, it’s turning 2013, I went to Dave Ramsey for my first bit of financial help. Because if you Google try to be debt-free, he’s one of the ones that comes up first. So I had adopted kind of the snowball method at this point.
So, I was taking debts that were two or $300 loans, these smaller loans, 1,500, and I would pay them off gradually. And I remember I would print off the paper that says, “Congratulations, you owe $0,” and so on. And I had a file right next to my desk at school and I’d print it off and I’d put it in that file. And I would just cross it off. And I kept putting these 1,500, $2,000 loans in my file. And it just felt so good to have this little place right next to me that I could see these things slowly stacking. And also, I mean, I know most of us heard of the debt snowball, but it was just so powerful to feel like I was doing something, versus looking at the big picture and, “How am I ever going to get a dent in this thing?” I just slowly accumulated these little letters saying I paid off that loan.

Scott:
And just for folks who are not familiar with the student loans, they come in chunks of a 1,000 bucks. So you have $32,000 in student loans, but you have maybe 10, 15 loans that are all 1,000, 2,000 bucks. And so you’re saying, once you get a receipt from paying those off, it’s like a check, “I could put that away and file it off,” right?

Skyler:
Yeah, and I tried to attack some of the higher interest rates, but they were within four to 6%. And so for me the mental accomplishment of it was worth trying to maybe take one of the bigger 6% loans that would have deflated me. So I just took those small wins and let the singles become home runs.

Mindy:
Yes, okay. There are people who argue with this debt snowball method, and that’s fine, “Oh, you’re not arbitraging the interest rate. You’re not paying down, mathematically it doesn’t make the most sense.” Forget that, you need, some people need the wins and it just keeps them going. What does it matter that you just paid down a 27% interest rate loan over the course of five years versus getting that little win to keep you going and keep you motivated? So yeah, it just all depends on what your mental state is and how you feel about debt. Did you have any sort of emergency fund while you were doing this, or were you throwing literally every dollar you could at your loans?

Skyler:
I didn’t really foresee what emergency could have happened, because I was just like, my car breaks down, I’ll walk to school, I’m staying for free, my groceries are paid for. I probably had a few thousand dollars set aside. Like I said, I wasn’t trying to hedge inflation. I wasn’t looking for the most advantageous place for my investment. I was just trying to not owe anybody anything. So, I probably got lucky, a big life, but I could have dialed back any of those months, that $2,000 input into my student loans and kind of created a balloon for myself there. Because I was voluntarily paying much higher than my obvious my payment was. So I probably didn’t have so much saved up as much as the flexibility to live one more month, put it on a credit card if I need to, if I absolutely had to and then lived to that next, that paycheck.

Scott:
Okay, I have two questions here. What subjects were you teaching?

Skyler:
At the time I was teaching middle school technology, like robotics, things like that, yeah.

Scott:
Awesome. And then most importantly, how did the basketball team do that first season?

Skyler:
Well, that’s so many more podcasts that we don’t have time for. I was a 21-year-old head coach of a very large school. So, I made a lot of mistakes in baptism by fire in that sense. But we, I probably got the job because we weren’t that good that year. We eventually ended up being really good, but those first few years were, it was a learning curve for all of us, let’s just put it that way. Let’s stick to finances.

Scott:
You got to hear about the basketball team’s story in parallel to your finance story over the-

Skyler:
That’s true, that’s true.

Scott:
Okay, so great. So the first year, how much are you able to pay off and how does the journey continue from here?

Skyler:
Yeah, so that first year, I mean, we’re talking, all this happened in a span of me getting my job in September and now we’re in December. So I was, at this point I’d gotten $6,000 of my loans paid off. Because you get paid starting in September as a teacher and you only get it once a month. So we’re not too deep into it, but it starts, like I said, progressively snowballing from here. In 2013 my wife, I believe that year had graduated from her four year degree, just girlfriend at this point, although we’d been together for five years. And she had a really tough decision to make too, kind of going back to college. She could go to a private school near me, and we had been doing long distance for three years, and pay $75,000 more on tuition, or go to a state school six hours away and pay $75,000 less.
And our thing was we knew we were going to get married, but we wanted to financially and have our own independence and identity. So she did what was best for her. She went to the school six hours away, thankful for that. That was a smart decision on her part, and it grew our relationship in different ways. She graduated a little bit later in 2013 and we had gotten an apartment together that was $850 a month. So I moved out of this amazing situation that I had and moved into an apartment with my wife and we’re paying 850 bucks on my salary. So, I kind of dipped into that savings, the ability to pay my loans a touch there.
So in going into 2014 is when our financial story of picks up. So my wife graduated with about $60,000 in debt. So at this point I have roughly 26,000 left on mine. She has 60,000 on hers and because she didn’t have FAFSA, those interest rates were in the sevens. So they were fairly high. In the spring of 2014 I got my real estate license. I had a, yes, I had a mentor who was actually my athletic director who had helped me. He had gained my trust. I told you there was some pitfalls really in coaching when you were 21, he had helped me grow so much as a person. And then as we gotten closer and closer, I realized his name’s on all these real estate sciences and he’s also flipping, he’s our AD, but he is also has his own LLC flipping homes and renting homes. And he pushed me into getting my license. So I studied for that, I got that in the spring of 2014 and I kind of got to work right away.
And I asked him if I could say his name, his name’s Josh Gibson and he’s down here in Southwest Washington and I owe him so much. He works for Berkshire Hathaway. And not only has he been an amazing realtor, but amazing friend and mentor, and I’m very grateful to have him in my corner. So, it’s the spring of 2014. I got my license and then that fall Taryn and I buy our first home. So this is of when it goes from just saving a bunch to investing, I guess. We buy our first home for $175,000, is about 4.7, 5% interest rate. We put down 5% on a conventional loan. I had saved up enough for that at this point. So, that’s where we’re at looking here.

Scott:
And what is your wife’s profession at that point?

Skyler:
Perfect. Yeah, thank you. We both work in the school district. She is a speech therapist, but she works in the school district. So she has the same salary penny for penny and same schedule as me, days off included. So we have from a very early age decided, “Our money’s going together.” I grew up in a house where the finances kind of crumbled and then she grew up in a house that was very, her dad’s a doctor, her mom’s a head nurse. They had a lot of money, but very, very smart with their money. And so I just knew that we both agreed we wanted money together. So, we definitely combined our forces.
And in the summer of 2014, right before buying the house, I’m going to sleep in the doghouse if I don’t say we got married, we got married in 2014. So let’s backtrack a second. And my wife wants me to tell you that our honeymoon was an all inclusive resort in Mexico that I got on Groupon of all places. So, that’s kind of how we roll. So yeah, so Taryn’s making about $44,000 at this point a year, and so am I, plus my $6,000 from coaching. So, we’re making about $96,000 as a couple. And I mean, we feel pretty good about that. The only thing kind of looming over our head is this debt. So at this point our debt, we’re sitting at about $96,000. There was a small car loan that she had to pay off as well. So we can do the student loans in that.

Scott:
Well, great. So we buy the house and is this a house, what kind of investment is this?

Skyler:
So we bought the house. I got my license, so I’m not paying a realtor to represent me. So I was able to negotiate a little bit to get that house at a little bit lower purchase price, just because I didn’t have to pay a buyer’s agent. It’s a two bedroom, one bath, small home. But as I mentioned before, Josh really pushed me to buy in good school districts. We could have bought a bigger house in a different school district and he just swore by buying in the school district, you’re always going to have a positive rental. People are going to always be desiring this neighborhood.
And so we definitely took a smaller home, plenty big enough for us, but we definitely, we’d go around and we would play house hunters on the weekend for entertainment. I had my realtor’s license, so I had the ability to go in homes. So our weekend fun would be going around to these different homes and touring them and seeing what was out there. And we ended up buying this home, two bedroom, one bath 900 square foot, garage. That was a really nice feature in the back and we’re in a good school district, so we just know that it’s a good investment down the road.

Scott:
Awesome.

Skyler:
That fall from spring, getting my license to December, I made about 25 to $30,000 in real estate, having my license on the side. Those were a couple deals that I did myself. Those were some, just showing homes for other realtors that I would get paid to go do, or co-write deals on. But I made about 25, 30 grand. So after taxes that money was put back into our savings account, because we had used that to purchase our first home.

Scott:
Awesome. So at the end of 2014 you’re starting to roll. You’ve got your house, you’re married, you’ve got two incomes. You’ve got 96,000 in debt, but you’re also getting a really good nice side hustle here. How do things progress from there? What do you do once you’ve built your savings?

Skyler:
Yeah, so we bought that home. It was October of 2014. And then in the spring there was a home a mile away that came on the market that I went to show my friend who was looking to buy. And I just knew as soon as I saw it that my wife was going to want it. It was this old 1918 Victorian home, kind of in a little bit of rough shape, perfect place downtown. And I told my friend, I was like, “Hey, I really want to help you with this house, but I hope you don’t like it, because my wife’s going to want it.” And so that money that I had made during real estate on the side had now parlayed into a new down payment.
And so we put an offer in and my wife wanted to cap it at 240. And I was like, “Well, we know there’s multiple offers. Let’s go 242 with the escalation clause.” Hoping that extra little cushion over 240 might be the difference. And sure enough, it was. The next highest offer was 240, which pushed our escalation clause at 242. And we got the call that we are now going to own a second home. So, this is June of 2015, so just seven months after buying our first home.

Scott:
Awesome. And you guys are not working in the summers? Or are you coaching or doing something else during that period of time as well?

Skyler:
No, I was, I’m can’t quite remember that summer. I was fairly new to coaching, so I was very intensive in our summer trainings and all that, trying to build a program. But in the future we travel, we do side things. We enjoy. Part of the story for me is that I have not ever felt like in my entire working life for the last 10 years I have sacrificed a job that I love or time with my family. And those are the two biggest things that if the show ends tomorrow, I don’t feel bad that I penny pinched or did this or that. Because I had time, the most invaluable currency that there is. I had that the whole time and I enjoyed it. And so I’m saving money. My wife’s right there with me alongside this journey. And we’re also traveling to 16 different countries and backpacking through Kauai and doing fun things throughout this time, and making it work.

Mindy:
Did you buy the second house as a rental or as a house to move into?

Skyler:
So we bought the second home for us to move into. It was going to be fixer upper, for sure. First home we’d probably put about $8,000 into it. Mostly cosmetic, mostly outdoor, whether it was curb appeal. I built a deck. I built a fireplace in the back. But the inside was, on that home was essentially it was so small, it was a perfect starter home. It was pretty compact and easy to deal with. This home was four bedrooms. It was 1,900 square feet. It was a 100 years old, it was beat up. And so we were able to qualify for an FHA loan on that. And we did a 3.5% down payment at a 4.25 interest rate for 242.
And so this home, we’d only lived in the other home for seven months, so obviously we’re going to have some capital gains if we sell. The market was still kind of on the rise at the point. And it was kind of easy to see it continuing that trend, especially in that district. So we held it and we rented it. So we rented that home for 1,450 and our monthly mortgage on it was about 1,125. So cash flowing a little bit, and we just put that money right back into savings account for repairs, but holding onto it for the appreciation of it.

Scott:
Awesome. So, now we’ve got our first property. We’ve got maybe a little bit of cash flow, maybe break even-ish, depending on maintenance and all that kind of stuff. And we’ve got a second one that we’re living in and you’re live-in flipping it sounds like?

Skyler:
Yeah. And so that’s kind of started our live-in flip. So we bought the home and we had a trip planned to Europe that summer and we were going to seven or eight, we just put backpacks on and we go and we share rooms and Airbnbs, we do hostels. We just make it work. We’ve camped on the coast of Kauai for $8 a night. We just go and we figure it out, and we try to get, it’s a quantity thing. We try to stay as long as we can for as cheap as we can, using our airline miles, et cetera. All those things and tricks that we’ve learned on BiggerPockets.
But anyways, we bought the home and our flight out was the same day we closed. So we close on the home. We put our stuff down. We never stay a night in the home and we fly to Europe. And the home had quite a bit of issues. We had $20,000 in seller credits to fix the foundation, which was leaking. The radon inspection came back fairly high, so we had to get a radon system put in. And we had the floors redone because they were pretty damaged. So why I say that is because I’m in Europe and we’ve never slept the night in this home and it’s a fixer upper. And at this point we feel pretty leveraged. We have 175,000 loan here, a $242,000 loan here. And we still got about 85 to 90,000 or about 85,000 in student loans at this point. And that wears on me.
So I remember sitting in an airport in Spain and I had this little napkin, and I was [inaudible 00:30:37]. I was just writing all of our debt on this napkin, just scribbling it, scribbling it down and then looking at our payments every month and then looking how much we make every month. And just trying to figure out, I wanted to be debt three by 30, but now we have two homes and it won’t happen until we’re 40 and there’s just no way this math. And I’m just stressed. I’m having nightmares that the house is crumbling at home, this new home that we bought, because there’s foundations getting fixed. So I’m having nightmares this house is crumbling while we’re in Spain. And now we have a home that is worth nothing. So my anxiety had now peaked. We had a good trip, but we felt very leveraged at this point. It works out in a second, but that’s where we’re at.

Mindy:
Spoiler.

Skyler:
Yeah, it does work out. So yeah, the envelope situation was a little chaotic. So we get home and right away I go to town. We still have a month left in summer. So my dad is extremely handy. He worked in HVAC for years. Taryn’s family has lived in old homes, they’re from the East Coast. So my wife’s dad’s helping me. My dad’s helping me. I’m just learning as we go. We’re tearing down walls, we’re redoing floors. We’re fixing this house up slowly. We get it to a point where we can refinance it out of the PMI. So we refinanced, I think it was 315 as a value of the home. So now we’re able to get out of PMI. So our mortgage payment went from 1,850 a month down to 1,400 a month. And that was the goal was to get out of that.

Scott:
Awesome.

Skyler:
Yeah, the refinance was a huge thing for us to get out of that PMI, get it down. So now we’re sitting at 1,400 bucks a month, which is very doable on our salaries. We’re pulling in about 6,500 month a month after tax at this point. And so we feel pretty good about this. We’re still paying off debt, about a 1,000 to $2,000 a month. 2016-

Scott:
How did the basketball team do that year?

Skyler:
Better. We’re getting better. We went to state for the first time in 52 years.

Mindy:
Oh wow.

Skyler:
So-

Scott:
In ’15, 2015?

Skyler:
2015 we were good, but not great, but we were getting better, yeah.

Scott:
All right.

Skyler:
Yeah. Maybe my lack of focus on it and the ability of other things was what led to it. Or I just wasn’t a knucklehead. When I started coaching, I was three years older than the seniors. So there wasn’t a lot of separation. And so you can imagine that was a recipe for some disaster. When we were living in this house and I was working on it, I was coaching. I was teaching. I was doing real estate. And obviously when we bought this new home, again, I didn’t have to have a buyer’s agent commission when I bought this last house. I was also driving Uber on Saturday and Sunday nights. It had just opened up in Portland. This was the beta test when Uber was brand new. And so I signed up, they only allowed a few hundred drivers at first and I was making 200 bucks a night on the weekends driving Uber.
And so that money was strictly kind of my way of making up for maybe having to pay a higher mortgage and not able to put as much money towards my student debt. So, I was driving Uber on the night and then I’d wake up and try to do an open house, try to show some homes with somebody, try to do something and stay involved in real estate. Because having my real estate license, we made some money doing it. At this point in 2016, I made about $45,000 in real estate selling homes. But I also was able to meet people. You rub shoulders with wealthy individuals or smart individuals and guys like Josh. And that was invaluable. Just like learning it.
Because I came from not a very well-off family. So being around these people, surrounding myself with these people, they were my financial circle. They tell you to, I didn’t actually regroup my closest friends, but I had my friend group and then I had my financial friend group, and a lot of them are involved in those real estate. So, I had made a good chunk of change from real estate. I was driving Uber, coaching and teaching, and we were doing pretty well. We decided in 2016 to sell the Weir Street house. And so this was our first real estate deal. We sold it for $240,000. We bought it for 175. I didn’t have to pay for a commission for an agent because I sold it myself. And we had a $50,000 check handed to us. This was after our capital gains. We had $50,000. I paid that right away to our accountant. And we took 50K and we were 27 years old and we had a choice.
We have 50K, we have $42,000 left in our student loans. We have old cars and we just pushed the button on Sallie Mae and hit pay off. And 27 years old, debt free from our college loans. All $96,000 gone. And it was that moment, writing that … A year earlier I was writing a napkin in Spain thinking it was going to take me until I was 40, and it worked out. And that was probably one of the best feelings ever. That was the most gratifying financial thing I may have ever done. And my wife was right there with me. We were toasting with a glass of whiskey and it felt great.

Scott:
That’s awesome. Did you take all of the receipts or whatever that you were talking about and put them on your filing cabinet in one big circ?

Skyler:
We just got one email and I have a screenshot of it, it’s actually. Yeah, I have a screenshot of it on my phone and it’s just one. They don’t really celebrate with you. They don’t like it so much.

Mindy:
Thanks for paying it off. That lift though.

Scott:
That’s a buck.

Mindy:
We paid off my husband’s student loans back when you had to write a check and send it to them in the mail. And writing that last check was so happy. Like, “I’m done. This is the last one. I never want to hear you again. I never want to hear your name again.”

Skyler:
Yeah, we felt great. And right at that same time, so now we have that rental sold, so we just have our current home. I’ve been fixing it up constantly with the help of many people I should probably acknowledge. But we got a roommate that lived in our basement. So our basement was equipped to had a little bedroom and a bathroom and a little TV area. And so we kind of fixed that up a little bit and we had a friend come live with us and he paid 500 bucks a month to live down there. So now our $1,400 payments down to $900. And so now we’re really back to a nice living where we can pay off debt or save. Excuse me, now we’re saving. And we just felt really comfortable. So right now we’re saving it.
We just did this whole, we bought a house, we’re fixing it up. We just had some success. And obviously, if you look at our story in the years it doesn’t take a genius to realize the market was appreciating every year since we’ve owned homes. So, we are very fortunate and lucky. Whereas I also believe if we weren’t found another way to make money or make it work, that’s just kind of who we are, but it would be really naive to not think that the real estate market was on a rise. It wasn’t that hard to sell homes for profits. It was just a matter of taking the risk to get one in the first place and then build off that versus sitting on it.

Scott:
And you fixed up the properties yourself and added a lot of sweat equity it sounds like?

Skyler:
Yeah.

Scott:
We can acknowledge your luck and give you some credit for being very intentional in hustling here for a very long period of time.

Skyler:
Yes. That first home, not as much work, but the second home was, we probably put of our own money 20 to 30 grand into it. And we redid every square inch of the home. It wasn’t left untouched. So, that was a lot of hard work. And without kids, that was a lot easier than where we’re potentially at now. We just kind of cruised. We went on some trips. We did like that Kauai trip where we were backpacking and we got a beach permit for $8 and we just called it our own little resort and we could open up, we literally slept on the beach. And that was just kind of the style, that’s how we vacation, and we had the time to do it.
We’re now 28 and debt free. And I had gone through a lot with coaching and teaching and being in one town and really grinding. And my wife stuck with me through all of that. And so we wanted to change and my wife made it a deal with me that after five years in this town that we would try something different. She wouldn’t marry me unless I committed to leaving this town at some point, just because she’s moved a lot and didn’t want to be stationary. And then sure enough, that fifth year comes around and she looks at me and goes, “You promised me we’d move.” And I was like, “But we got all this going for us. We have this great house. We just finished remodeling.” She goes, “You promised.” So I made a deal that I could explore coaching in college if we would move. So I found a gig coaching at a college as an assistant coach that paid peanuts, but because we’d set ourselves up financially and debt free and she had her job and was getting paid well that we could afford to move to this new town.
I would work for peanuts. We would rent a house, which at first just killed us to our bones. But it made sense for the time being. We rented a home, she worked, she was making it this time, in the State of Washington teachers had renegotiated our contract. So now she’s making around $52,000 a year salary. So we have enough money to rent this house.

Scott:
And this is 2017?

Skyler:
This is 2017. And so before we left we had to decide, do we want to rent this home or do we want to sell this home? And I had redone the home for us to live in. I had done butcher block countertops. I had done tile flooring. I did not build it, custom made vanities. I didn’t build it to be rented. I kind of built it to be lived in, but it looked good. So we decided, “Let’s sell.” And so now we’re selling the second home and we go to list it. And Josh actually helped us list it this time around just because of the chaos of us moving. We kind of split the commission up, but he did me a big solid and put his name on the sign and helped negotiate while we were planning this move. So we list the home for 335. We had just bought it for 242 two years ago. There’s a theme, every two years, we’ve never stayed at home longer than two. Once those capital gains kick out, we leave.
So we list it. And 335, tons of traffic, tons of offers, escalation clauses. And so Sunday rolls around and our highest offer was at 365. We’re stoked. Can’t believe it’s $30,000 over asking. A couple goes, “Hey, can we see the home?” And at this point I’m exhausted. I’m like, “Josh, I just kind want to be done.” He goes, “Let’s let them look at it. What’s it going to hurt? We’ll tell them you’re looking at offers in an hour and they need to put their best foot forward.” And so he does it and they go tour the home. We’re out for a hike and he calls me and he goes, “You’ll never guess what?” And I was like, “What?” He goes, “They just offered you $400,000.” And I was like, “No way.”
And I was like, part of me as a realtor was mad. Because I knew what they were doing. They’re putting their foot in the door to get it, waiting for the appraisal, and then potentially renegotiating back down. So part of me was a little upset because I didn’t think the home would appraise for 400. It was maybe worth 325, 335 anyways. So I was a little frustrated, but also excited. So we, fast forward, the appraiser was from a city nearby, not from our city, from a large metropolitan city. And he counted the basement with no egress. He counted it as a bedroom. So he put a fifth bedroom on the house when it didn’t have one. And messed up, he counted the full square footage of the basement, all these little things that made the home. And so the appraisal came back, $400,000. And so we continued through with that deal and we closed on that house and we made, we netted, obviously we invested some of our money to it. We netted about $132,000.

Mindy:
I’m sorry, I’m sorry. You netted 132,000 tax free dollars?

Skyler:
Correct.

Mindy:
You forgot the tax free.

Skyler:
Yeah, tax free. No, Uncle Sam and I have been best of friends still. We’re still getting along. And so, the importance of this money was that my wife and I have always wanted to adopt. My mom was adopted. Her birth mother had her at 15 and put her up for adoption. My grandparents adopted her. My grandparents were like my saving grace as a child. They were the most kind, sweet people ever. And they’re why I have a good head on my shoulders. And my other set of grandparents had adopted my aunt. And I just have always had a heart for adoption and Taryn and I have been together since high school, so it’s a conversation we had many times. But adoption’s very expensive. And so part of reading be on this podcast was just kind using real estate or other investments to fund your adoption is a message I’d really like to share, because it’s overwhelming. The average of domestic adoption United States is $52,000.

Scott:
Wow.

Skyler:
So a lot of people don’t realize that there’s other ways to adopt. There’s lots of ways, international, domestic, foster care, and there’s lots of kids in need, and all of those, one is not more significant than the other. But we wanted to adopt. And when Josh sent me my net sheet, I said, “If it hits this number, we’re going to use that money to adopt. We don’t need it. Our cars are fine. We’re going to use that money to adopt.” And when the appraisal came back, I said, “How did the appraisal do?” And he sent me a picture of a baby emoji. That’s all he sent. And that’s how we knew that it hit that number.
And it was just like, it just felt like the world had been so good to us. And we paid off our debt. Now we’re here at 28 years old with the funds to adopt, which we were stressed out that we would never be able to start our family through adoption. And I’m going to a new town to start coaching college. So, I thought our financial journey was kind of done. And now we were just going to live this sedentary, normal life. You get your paychecks, you kind of live paycheck to paycheck. I don’t know. I just kind of thought it was done and we’d hit the jackpot.

Scott:
So, we have $130,000 check, we have no debt whatsoever it sounds like in your whole life at this point, and you got the ability to adopt. What happens next with the new town, 2017?

Skyler:
Yeah, going through it quicker. The job at college was fun. Wasn’t the best. I just couldn’t get through it financially that I wasn’t making good money. So we adopted our daughter in 2018. We’d gone through that process and we got our daughter. In 2018, one week we adopted our daughter, we signed on a new home in our new city, and I got a new job coaching and teaching high school in a different town. So, now we’re both back to making money teaching. We have our daughter and we’ve bought a new home, a new fixer upper, another 67-year-old home. We live in this home for two years. During that two years we decide to max out our HSAs. We decide to match out our 457s, and our Roth.
So my whole point with all of that, and I know you guys have covered those with a lot of other guests was we wanted over a $100,000 of net worth protected in assets that if anything went bad, we lost our jobs. Anything happened to one of us that we had access to that. Not only that, we were tax deferring all of our money. So for a year and a half we would come in at about 22,000, $30,000 of actual taxable income because we’d been maxing out all of those accounts.

Scott:
How’d the basketball team do at the new school?

Skyler:
We were pretty good. I got lucky, I got lucky, I got lucky. Or maybe I’m learning how to coach along the way. So at this point I had taken this house down to the studs in most of the rooms and redone them all. I’d fallen into a shop teaching job at this point. So my skills were accumulating being a shop teacher. And 2020, obviously COVID hit. At this point we’d built up the HSA. We’d built up the Roths. We’ve built up our 457s. And we were at home a lot because of COVID, teaching from online. So I sped up the homework and we decided to sell our home that we had just finished building, or sorry, re-flipping. And it hit two year mark. So we got right out of capital gains. We bought that home for $355,000. And then we turned around and sold it for $516,000.
We took that money and we saved a lot of it, and we adopted our son. We paid for that home flip for our second adoption. So now we have our kids, our family, we’re still debt free. We take that and we finally buy a house that we don’t have to fix. And we bought a home in the county with five acres on it for $512,000. Right now my wife and I are getting, on Saturday we are leaving to Indonesia to teach internationally where our money is taxed, is not taxed at all. Our home is paid for. Our children’s daycare is paid for, which is a $3,000 a month expense where we currently live. And we will save 80% savings rate, which will roughly be about $80,000 every year.
We hope to use that money to vest in real estate back in the States while we’re living abroad for those few years. We kept the home that we bought during COVID on five acres. And we are renting that, two friends at cost of mortgage, because we just wanted to know that we had the safety net of coming home from internationally if we wanted to come home.

Scott:
That’s amazing. So we’ve done several flips to this point, or two flips?

Skyler:
Three flips.

Scott:
Three flip, one was the … So you have property number one that you bought for 175 and sold a few years later for two?

Skyler:
240. Yeah, yeah.

Scott:
Okay. And then property number two, which is your prior house. And then property number three, which was a $160,000 gain. That was another live-in flip. And now we have the home five acres and we’re traveling the world sounds like very shortly.

Skyler:
Yeah.

Scott:
Next week, week after?

Mindy:
Two days.

Skyler:
Saturday.

Scott:
Saturday, that’s what it is, yeah. Well, good then we got the podcast there before the move.

Mindy:
How long do you plan on being abroad?

Skyler:
Yeah, so the average family stays eight years. Our contract is two years, but like I said, the savings rate is so high. You’re about an hour from Bali. You get a cook and a cleaner and a driver. And so we’re pretty excited. And I mean, there’s obviously downfalls living abroad, but we are just open to it. We’ll see, our job in the state is held for two years, so we can take two years there and still come back to our jobs here if we want. So, we’re just going to kind of wait and see how we enjoy it.

Scott:
Now, let me ask you this, when I’ve thought about, “Hey, how would a teacher go about achieving financial independence?” I thought, “Yeah, getting your agent license, and then buying a property, fixing it up in the summer, working at school.” It sounds like that was sort of what you did, but it was really more of an all out grind all year round for several years to get to that. What advice would you have for someone who’s getting started as a teacher to repeat some of the things you’ve done?

Skyler:
Yeah, I think that as much as I love my profession, there’s a lot of victimhood in it of like, “I’m a teacher, I don’t make enough. So I’m not going to be able to do these things.” And it’s much more of a perspective of you have time, and what are you going to do with that time? You have time off in the summers and breaks. So how do you ever utilize that? Whether it’s a second job, you’re making things with your hands, you’re doing some type of craft. I don’t know what that is for everybody, but utilizing that hustle and that time to make things happen and to not be afraid to ask questions. They don’t do a great job teaching you about 457s and HSAs. They just kind of throw you it and say, “Here’s your pension.” We have a pension to fall back on too when we retire. And that’s like our safety safety net. And so really asking questions and then utilizing that time that you have is probably the biggest steps.

Scott:
How do you think, you’re a coach in there, and therefore you might have more interaction with at least some parents than maybe other teachers to a certain degree. It seems like you did a really good job of using the network that you could create both as a coach and as a teacher to exploit opportunities? How do you think about that or how someone else could repeat that?

Skyler:
Yeah, I think the school district that you work in is a big choice. The demographics of that school district might lead to different opportunities in the network. And one thing that my wife wanted to be mentioned too, as a teacher is you can have the hack of living in a cheaper area. If you’re priced out of that nice neighborhood and that district that you want, we were lucky to fit into it. But if you teach in that school district, your children can go to that school district. So for a lot of teachers, you might have to live in a more rural area, but if you work in that nice school district, your kids can attend school there. They’re going to network with those kids and their families. And you’re giving them the opportunity to also benefit from being in that school district, even though you may not live in its boundaries

Scott:
Self-education. During this period, are you doing any of that? Are you reading books, learning about money? Is there a background of self-education or an aha moment that’s triggering at any point in that journey from something you read, listened to, or otherwise learned about? Sounds like Josh, for example, was a big influence.

Skyler:
Josh was a big example, but you only have so much time in the day and a mentor wants you to do it on your own a little bit too. So for me it was BiggerPockets Real Estate at the time was the only podcast you guys had. It was just, I’m a big input equals output person. So the more you take in, like I said, 15 to 30 minutes every day of some type of financial input, real estate, whatever, honing your craft, owning your own business. I was listening to podcasts, listening to eBooks, talking to friends, putting myself, in my real estate business I was putting myself in networking circles with mortgage loans and life insurance people. And just figuring out how other people did it, because I was just smart enough to follow the path that was there.

Scott:
Awesome. And then, how did you stay on track with all of this stuff? I think a danger is, “I’m going to drive for Uber. I’m going to get my license. I’m going to buy a property, I’m going to fix it up. I’m going to travel to Europe. I’m going to travel to Kauai.” How did you stay consistent across this long period of time towards these goals?

Skyler:
I would say, obviously I’m a pretty big Excel maniac. So I had a pretty big running tab Excel sheet that kept everything financially for numbers engaged. But I had, my family that had lost everything in 2008 and I just had a burning desire to set a path for my kids like my dad did for me that was better. And so we just had goals. It helped that I had a partner that was so consistent and reliable and I’d been with since high school and we knew each other so well. And like I said, it didn’t feel like a punishment. It was a game. I was an former athlete, so it was a game. How am I going to get there? And I’m just so used to, I’m going to outwork somebody for something. I’m just, I’m not going to lose. I’m just going to work. I’m going to go Uber, okay? Then I’m going to do this, I’m going to do that. And I made it a game and I just wanted to win the game.

Mindy:
I think a lot of people on this path are super competitive and they have to win.

Skyler:
And I would say that there’s flaws with that too, though. If I lose sight of anything, it’s like time with my family, time investing in my own mental and physical health. And so there’s definitely a consequence to being that intense on certain things or impulsive and kind of bouncing around. So, that’s where having a partner that can kind of ground you is really important. And for us traveling grounded us. And that’s why we pursued that and then time together, for sure.

Scott:
Well, what a phenomenal story. Thanks for sharing this with us. I mean, wow. A little of luck, but a lot of hustle and a lot of great moves that you’re able to parlay one after the other into bigger and bigger wins here, until you have this incredible option here, optionality in your life. Would you mind giving us a quick picture of your assets before we go into the famous four? You’ve got the home here and you have some 401(k)s. Do you have a cash reserve or how do you think about your overall financial position today?

Skyler:
Oh, yeah. So for us right now the way we’ve kind of fallen where we’re at is we have our home that is rented. We bought it for 512 right now. We almost sold it when we moved, but we decided to keep it kind of a safety net for our own mental, just have something to come home to. It’s worth about 800,000 right now.

Scott:
Wow.

Skyler:
Yeah, we did really lucky on that. Just the acreage close to town. We have HSA accounts, HSAs, 457s. And then obviously if we wanted to withdraw from our contributions with our Roth, which has always been a safety net in the back of my mind, nothing I want to ever do. Don’t freak out if you’re listening to this, just knowing it’s there. We have about 85,000 there between those accounts. And then we have enough in our savings account to purchase a rental home at about 20% down in our area if we choose to do that in the next few months.
And then obviously we’re heading into this ability to save quite a bit of money over the next few years in Indonesia, which is kind of a cash reserve that will, kind of still playing around with how we want to use that, but debt free. And I’d say the biggest investment of all that is we have two beautiful, amazing children that came into our lives because of this story. One from Florida, one from Nevada. And it’s the most amazing, amazing relationships that we’ve ever had with anyone. Obviously with them and their birth parents, and all of that came from this hustle. And that is the best part of the whole story in my opinion,

Scott:
That is the best part of the story. Well, phenomenal job. I can’t wait to see how things kind of go for you the next couple of years. And look forward to catching up when you get back from Indonesia.

Skyler:
Thank you, guys.

Scott:
We ran a little long today, so we’re going to have to skip most of the famous four, except for the most important question, which is, what is your favorite joke to tell at parties?

Skyler:
I know you guys get this all the time. I had more anxiety about this than the whole podcast. And my kids are young enough that they laugh at anything I say. Did you hear about the kidnapping at school today?

Scott:
I did not.

Skyler:
Yeah, it’s fine. He woke up.

Scott:
Oh.

Mindy:
Oh.

Scott:
Excellent. Use that with your players?

Skyler:
Yeah, and I don’t have good jokes. So if you’re listening home and you cringe, that’s A-okay. I’m more on the pun side of things.

Mindy:
Well, Skyler, thank you so much for sharing your story today. This was a lot of fun. And you’re right, kids really do make it all worthwhile. I’m so excited for you and your family. Your trip sounds amazing. Two years in Indonesia, two years minimum in Indonesia. Sounds fabulous. And I’m going to come visit you.

Skyler:
Deal.

Mindy:
So, shoot me a line. Okay, awesome. Skyler, we will talk to you soon. Thank you. All right, that was Skyler and his super amazing story. Scott, I do feel like a slacker. How about you?

Scott:
Yeah, I mean, it’s just amazing. I will say, when I started my career, I was making $48,000 as an analyst with that, as a financial analyst. And I could see so many parallels in those first couple of years with Skyler’s journey to a certain degree with that. What’s amazing, I think is the way he’s used real estate. In conjunction the networking opportunities that came with his profession to really leverage that those initial results into huge outcomes over the last 10 years. Whereas I had to join a startup, for example, I’m comparing myself. Sometimes you can’t help doing that when you’re thinking about folks who started around the same year on their journeys.

Mindy:
I love that he is taking advantage of the Section 121 tax loophole. I’m doing little air quotes, for those of you who aren’t watching the video, the section 121 tax loophole that says, “If you live in a property as your primary residence and own it for two of the last five years, you pay no capital gains taxes on any gains up to … You pay no taxes on any gains up to $250,000 if you’re single, and up to $500,000 if you are married.” I hope to pay taxes on one of my flips sometime, because that would mean I’m making a lot of money. But this is such a great way to, it’s another way to hack your housing. And look at what he’s doing with his net gains, parlaying it into more properties and being able to fund what he really, really wants, and that is to adopt children.

Scott:
Well, what a wonderful story. Awesome success story. Can’t wait to see how the next couple years go for him, and we’ll have to catch up with him when he returns from Indonesia.

Mindy:
That would be awesome. Okay, Scott, should we get out of here?

Scott:
Let’s do it.

Mindy:
From episode 331 of the BiggerPockets Money Podcast. He is Scott Trench, and I am Mindy Jensen saying, “Until then, penguin.”