Real Estate Cash Flow Strategy: Stop Reinvesting Everything and Build Long-Term Wealth

Amanda@livecounterflow.com (00:00)

Yeah, so I first was introduced to this concept in 2013. And at that point, I thought I knew everything there was to know about money. I followed the big gurus. We had started a business, right? All the things. And I was actually kind of angry that no one had told me this stuff before. Because, you know, like, I lived through the great financial crisis. I hate banks too, right? Like, I want to take that banking function into my own life. And so when we talk about

cash flow management, taking profitability off the table, generational wealth planning. I haven’t found anything that does all three of those the same way that infinite banking or bank on yourself does.

Dylan Silver (02:10)

Hey folks, welcome back to the show. Today we’re joined by Amanda Neely, a CFP professional author and CEO of Counterflow, where she helps real estate investors, business owners and families create financial clarity through values based financial planning, whole life insurance strategies and long term wealth building. Amanda, thanks for joining us today.

Amanda@livecounterflow.com (02:32)

Great to be here Dylan, thanks for having me.

Dylan Silver (02:34)

Now, a lot of real estate investors seem to be great at making money, but still, in many cases, find themselves feeling financially stressed. Why do you think that happens?

Amanda@livecounterflow.com (02:48)

Yeah, so real estate’s a great analogy. If you were building a house, you know exactly where to start with the foundation. You plan, and then you build the foundation first. You build the roof first. A lot of real estate investors focus on the house part of it, the bricks and mortar, the things you can see, the income that they generate, all those things.

they don’t set up the foundation first. And so they end up with a very shaky foundation if they have one at all.

Dylan Silver (03:17)

You know, when we talk about foundational layers, the things that come to mind immediately are, you know, emergency funds and, you know, having enough money to balance your bills for the month. But on a base layer, maybe without giving away all the gold, Amanda, but just a nugget here for us, what are some foundational things that all investors, all real estate investors should have in place?

Amanda@livecounterflow.com (03:40)

Yeah, so it’s cash flow, right? Money always is flowing. How are you directing its flow? Do you have principles in place, ways that you’re going to manage that cash flow to make sure it works? Different than budgeting, cash flow management principles, that kind of thing. taking profit off the table. So many real estate investors will just reinvest all their profit into the next property or to pay off the mortgage that they took or whatever it might be.

the next indication, who knows? Well, what if you took some off the table to build wealth outside of real estate beyond just emergency funds or contingency funds, right? Those kind of things. But where you’re building wealth that can be redeployed into real estate more strategically rather than just kind of every single month you’re doing that reinvesting or a deal every few months or every year. And then finally,

the thinking long term and what that foundation looks like in three or four generations, not just the next month or the next deal.

Dylan Silver (04:49)

You know, I had someone tell me recently that you need to look at your scope of what you consider your finances differently. So most people may have an emergency fund, you know, their money for the month and, you know, an investment account, a 401k, a Roth, something like this, you know, and then you add in a rental property, right?

Well, then you start to say, okay, well, where’s the money for the next property gonna come from? So now you have to budget aside, hey, I wanna have a down payment for my next investment ready so that I’m not pulling it from something else. Because when something comes across your desk as an investor, that’s maybe a truly, know, once in a blue moon opportunity. If you don’t have that capital ready to deploy, you’re just gonna miss out on that opportunity.

Amanda@livecounterflow.com (06:24)

Yeah. it’s also the patience for that opportunity, not just taking whatever comes your way, but having the patience for the really good one or the one that only happens once in a decade. You’re not 100 % deploying everything every single time.

Dylan Silver (06:43)

I do want to ask you about the IBC, infinite banking concept. Whenever I have people in the insurance space on, I always try to get their feedback on this because my position personally has changed over time on how I feel about it. And then also I understand that this is such a great opportunity for folks, even if you took the insurance out of it potentially.

you substitute another product with the same type of benefits people would be saying you have to go do X. What’s your feedback on this infinite banking concept?

Amanda@livecounterflow.com (07:18)

Yeah, so I first was introduced to this concept in 2013. And at that point, I thought I knew everything there was to know about money. I followed the big gurus. We had started a business, right? All the things. And I was actually kind of angry that no one had told me this stuff before. Because, you know, like, I lived through the great financial crisis. I hate banks too, right? Like, I want to take that banking function into my own life. And so when we talk about

cash flow management, taking profitability off the table, generational wealth planning. I haven’t found anything that does all three of those the same way that infinite banking or bank on yourself does.

So it’s been a big game changer for me. It’s how I do my real estate investing. Everything goes through a policy first. So I get my money doing two things at once. I only talk about it because of the difference it’s made in my life.

And I find that a lot of people, when they truly understand it and they see that difference that it could make in their lives, it totally changes their perspective on it. But it is a mindset shift very much so more than anything else.

Dylan Silver (08:24)

you to explain this and as layman’s terms as possible because it is difficult to explain. I think that this is pretty pretty challenging but if you had to say you know what is the infinite banking concept and how does it work on a granular level give it your best shot.

Amanda@livecounterflow.com (08:40)

Yeah. So on top of the shoulders of Nelson Nash and the infinite banking concept is something called Bank On Yourself. And I’m also a Bank On Yourself professional, great website at bankonyourself.com. And what I love how they explain this concept, that it’s not just about the products, but it’s about the philosophy. And the philosophy is personal responsibility, taking ownership of your future.

making pre-decisions about cash flow, profitability, generational wealth, and owning that for yourself, not passing it off to some financial advisor, not counting on a bank to handle it for you, but really taking that on and making strategic choices in that regard. And I don’t know that many people would disagree with that philosophy. So then it’s how do we implement that?

And if the product makes sense, great. If a different product actually makes sense, then let’s do that. One of the things I find really hard is when people just, the only thing they can do is life insurance. That’s part of why I’m a certified financial planner. That’s not the only thing I do. But if it’s the right thing for you, if it’s in your best interest, I have a fiduciary duty to tell you about it. And if it’s not, it’s not. But let’s agree on the philosophy first.

Dylan Silver (10:32)

here, Amanda, you’re in Cincinnati, Ohio, we were talking in the green room. There’s a lot of great cities in Ohio, Cincinnati is one of them. And you were mentioning that there’s actually some affordable housing, that not just housing that’s zoned affordable housing, but that the housing as a whole can be generally affordable. That’s a breath of fresh air.

Amanda@livecounterflow.com (10:35)

Yeah.

Yeah, mean, it depends on who you ask, right? But Cincinnati back to 2019 pre-pandemic was listed as one of the best places for a young professional on an early career salary to be able to afford to live here. We don’t have taxes on our groceries, for instance. It’s a pretty affordable city, which also makes it really good for young people to move here. They’re often renting, not buying. So there’s a lot of rental properties here.

there’s competition, right? There’s people working together which tend to bring prices down, but also makes buying the properties and getting them going and getting them rented a lot easier too. So there’s, I’ve met tons of real estate investors here, people from outside investing in this city and I encourage it. I think it’s really great for all of us.

Dylan Silver (11:40)

Now, when folks are looking to evaluate what the right segment or niche of real estate is for them, I haven’t asked this question actually to financial planners that I’m aware of. know, a lot of times people will go to what they see online or they may just go to a year to year lease because that’s what’s common or what they’ve heard of.

What’s your feedback to folks who are considering, you know, fix and flip, a short-term rental, a year-to-year lease, corporate housing, you know, should I hire a property manager? And they’re just trying to wade their way through this.

Amanda@livecounterflow.com (12:14)

Yeah, so I’ve actually done a ton of thinking about this because it’s a question I’ve gotten more than once. And partly with the power of AI that I could finally do this, I actually created a financial personality assessment that has nine different responses or results that you can get. And based on that, it’ll say, OK, here’s the kind of real estate that matches with your personality that would actually

not cause you a ton of stress, but would be something you might really enjoy. And here’s the ones to totally avoid. And it’s based on the things that maybe in life in general or with money have already brought you satisfaction, the values that you have, all of those go. It’s a 54 question assessment that I created that then gives those ideas and things to think through to then bring to financial planners, bring to mentors and coaches in real estate and make sure you’re on the right direction.

Dylan Silver (13:08)

You know, you mentioned meshing with your personality. That’s so critical because if you think about like being a STR short-term rental host, if you don’t actually like to host people, even though you’re not, you know, with them in person, you’re still coordinating and cleaners and communication. If that’s not something that you enjoy doing and you don’t get some type of, you know, satisfaction from that, it’s going to become a headache because you’re going to have change over

You’re gonna have people getting locked out and hey, what’s the code to the Wi-Fi? That might not be for you if you don’t enjoy hosting people, right?

Amanda@livecounterflow.com (13:45)

Yeah.

Or if you’re like overly generous, you love helping people, you get into long-term rentals and you undercharge the rent and you get stuck with, I’m so loyal to these people. They’ve been renting from me for years. I’ve never raised the rent on them. And you’re not that profitable. That happens a lot with people who have kind of a very generous personality. Maybe they shouldn’t be in long-term rentals.

Dylan Silver (14:07)

Yeah, that’s a great point.

Hey, it’s not for it’s really not for everybody. And you have to think of, you know, if you’re not the person who likes to say, hey, we’re going to increase your rents, you know, maybe a property manager would be worth it for you if you can find someone cost effective. Bonus question here for you. As someone who’s in the Cincinnati area, do you see a lot of folks who are investing in Cincinnati from Cincinnati? Are you seeing a lot of investors from outside of the

the area and out of the state investing, what’s the market that you see out there?

Amanda@livecounterflow.com (14:44)

Yeah,

both. I definitely see both. There’s plenty of opportunity here and continues to be. And then not too far away in Columbus, Ohio, there’s a lot of opportunity there. And people are kind of in that, the whole southwestern corner and central Ohio doing lots of stuff from both inside and outside.

Dylan Silver (15:01)

Do you see a lot of, this is kind of selfishly me asking this, do you see a lot of new construction happening out there or is it already developed beyond any need for new construction?

Amanda@livecounterflow.com (15:07)

Yeah.

Yeah,

a lot of both. Yeah, I actually pass a bunch of new construction between my office and my home as a ten minute drive. It’s really fun to see the city having this opportunity that not all cities are. It’s a very friendly state for real

Dylan Silver (16:04)

Is it a lot, do see a lot of multifamily or commercial residential high rises, that type of thing? Are you seeing subdivisions of single family homes? What are you seeing?

Amanda@livecounterflow.com (16:12)

Yeah,

I’m in a neighborhood, so there’s a lot of townhomes coming. There’s some more like condo, but like multifamily in the terms that it’s not a high rise, it’s more like spread out a little bit. We’ve got enough land here. then for sure, there’s so like Procter & Gamble has their headquarters here close to their office. There’s been a ton of development.

And then in between where their office is, kind of in the suburbs and downtown, there’s another area that’s had a lot of development and is attracting new businesses to come in. And they’re doing more of like the townhome or the like, maybe it’s three or four stories with condos, know, three or two, three bedroom condos throughout that kind of thing.

Dylan Silver (16:54)

I’m a big fan of townhomes. was just

shooting a video at a townhome this weekend. I think that, especially if you’re able to get the price of these townhomes down, they’re able to offer a two-car garage and a small yard and all the same amenities that you would get, in many cases more so, if they’re coming with appliances. I think it’s a great way to get onto the on-ramp of home ownership. And you may realize, you know, I don’t…

I don’t need all that extra space and a big yard and it’s so well maintained and this type of thing. And then I also think that they’re gonna hold their value very, very well. I’m in Texas, so we’re seeing a lot of all types of construction, but townhomes is certainly one of them. We are coming up on time here though, Amanda. Any new projects that you’re working on and then also anything you’d like to say directly to our audience.

Amanda@livecounterflow.com (17:36)

Yeah.

Yeah,

I’m having a lot of fun with, you know, creating new tools and resources to help people that because we have the power of AI, we can do that now. So things like that assessment that I created. So then I call the cash confidence roadmap that walks through, you know, cash flow, profitability, generational wealth, plenty, whichever one you’re working on and helps give those like small micro adjustments to move forward. Because that’s the other thing that causes lots of stress is just the overwhelm.

And so these are like tools I’ve created, parameters there, like it won’t tell you to go buy cryptocurrency or a meme stock or something. It will very much walk through. Here’s the time tested, true ways to make that happen. Come find out all about it at livecounterflow.com

Dylan Silver (18:29)

Amanda, thank you so much for joining us today. Thanks for your time.

Amanda@livecounterflow.com (18:32)

My pleasure.