you're listening to ramsy everyday millionaires where we talk retirement building wealth and outrageous generosity

Teddy is with us in New York City. Hi Teddy how are you? Hey Dave how are you?

Better than I deserve. What's up? Thank you for having me on the show again. I called you last year to get a little guidance in terms of my career and what not

especially financially and just kind of remind you you told me to potentially hold up on my master's. I'm going to be pursuing that due to the fact that I just got engaged over the summer and my sia and say I have one more year in the same

school. So we're just going to finish up our degrees her undergraduate grad school and then head to the beautiful state of Florida.

My goal long term is to have a good career and more importantly to have financial stability ideally in the aspect of real estate, passive income and what not.

I have no real guidance in that regard so I'd love to get your take on it. What's your master's in?

Mechanical engineering and what career are you pursuing after this? Mechanical engineering.

Okay do you have a job already lined up? I had a couple for this cup for this year but like I said I decided to just get my master's. It just didn't seem reasonable to take a job for one year and then head to a different state.

Okay and in addition to that my master's degree only costs less than the important case of the whole program and I'm currently debt free as well. So it's something that I can reasonably pay off while I'm in school.

That's awesome how did you pay for your education predominantly through scholarships and some financial aid. I'm in New York so there's a lot of that.

That's awesome. I'm all for you buying about buying some real estate but when idiots on the internet say real estate is passive income.

That means they've never owned any.

Because there's nothing passive about dealing with renters and heat and air that goes out and roofs that leak and a coach department shows up and wants to shut you down because somebody across the street cut a sewer line.

There's nothing passive about managing real estate. Nothing whatsoever. You want passive buying mutual fund they'll just put the check in your mailbox and you want them thinking about it.

But real estate ain't passive. It's very active. Even if you're managing the managing company they've still got to call you and approve the $8400 new heating and air system that blew up or the other day I had a $26,000 one go out on one of our commercial buildings.

Didn't feel passive to me at all.

Anyway, I love real estate but please enjoy the idea that this is going to be some hassle factor that other investments don't have. It does give you a better rate of return that other investments don't have.

But when I hear someone say passive income and real estate in the same sentence it means they've been on get rich quick websites.

Because they make it sound like oh well the renters will just pay for it. Nope, you're going to pay for it. Maybe the renters pay you. That's how it works in the real world.

So go buy you some real estate after you get your life started and pay cash for it after you get your home paid off and after you get your 401k's and other stuff started.

But this idea that you're going to build a portfolio of heavily debt written real estate and the renters are all going to make you rich is so freaking laughable that it makes my head spin.

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