Building Generational Wealth with Whitney Elkins-Hutten

george grombacher 0:02
Winnie Elkins Hudson is a financial mentor. She’s a real estate investor. She is the author of money for tomorrow how to build and protect generational wealth. She’s the director of Investor Education at passive investing.com. And she is back on lifeblood. Welcome back. Whitney.

Whitney Elkins-Hutten 0:19
Thank you so much. Sure. It’s just such a pleasure to be back.

george grombacher 0:22
Yeah, excited to have you on refresh our memory. Tell us a little about your personal life’s more about your work and why you do what you do? Well,

Whitney Elkins-Hutten 0:29
I’m the director of Investor Education and passive investing.com. And I spend majority of my time helping investors understand how to invest in real estate and maximize the highest and best use of their time. My journey in real estate kicks off in 2002, completely by accident, I got into living flipping and house hacking did great there, built up buckets of equity, but it didn’t have my time back. And then I jumped into single family rental investing and scaled up a 36 rental portfolio and then decided, hey, going bigger is better, let’s do multifamily. But all this time, I was trying to figure out how do I get those five freedom in life, financial freedom, time, freedom, choice, freedom, freedom to make an impact freedom to travel the world. And that’s where I really doubled down and scaled our passive side of our real estate portfolio, as well as into business and other assets. And you know, where I’m at today, my husband and I, we have over 6500 residential units 22 under self storage units, that’s our portfolio. But you know, we are super excited to help other investors scale similarly.

george grombacher 1:38
So I appreciate all that highest and best use of time and money. That is that is a worthwhile endeavor to try to find those things. And you’ve mastered certain areas and then pivoted to the next and then pivoted to the next. Do you like learning? Or is it out of necessity? Is it somewhere in the middle?

Whitney Elkins-Hutten 1:58
Oh, yes. Yes, about I love learning. You know, I’ve always been, you know, a curious mind. I’ve always, I guess, like my parents just cultivated and I don’t know how I’m still trying to crack that code, like the immense amount of drive. However, you know, it’s been out of necessity to try to, you know, put that knowledge to use, because it’s not so much gaining the knowledge of financial independence and how money works and how investing works, but really putting it into action, building the capability, the ability, the processes and the systems in order to execute, and scale and get the return that you need from your portfolio. And so, you know, it hasn’t been a smooth trajectory. You know, I always laugh when people say, teach me what you do. And I’m like, Guys, that 22 year journey, I will try my best to collapse time for you. And that’s one of the reasons why I bought the book the book money for tomorrow.

george grombacher 2:55
That’s just it, right? It’s like, okay, how do I? How do I actually learn from the experience and mistakes of others? How do I actually do that? Take an apply what, what, what, what they’ve done? So do you feel you did that with the book?

Whitney Elkins-Hutten 3:12
It’s very hard. I mean, I’ve mastered some concepts, learning from other investors can do some big names out there. But also, I’ve gone out and created my own mistakes. And really what the book what I’m trying to help people do is to really understand how money works, how you actually should, the lens of what you should be looking through how you create money. Right now, in this market cycle, what are the six main ways that you can optimize your portfolio in order to keep as much as possible, because if you can keep as much as possible, now you got, you know, you can master the seven ways in order to make it grow, whether the market goes up, down or sideways, that’s part right there. I think that’s where a lot of investors spend most of their time on, and probably may commit the most mistakes, I will say most of my mistakes been made in that arena. But that those are all three different muscles, skill sets. And we as investors, you have to learn how to master all three areas, you can’t just master one or two and be successful you the people that truly pass on generational wealth, master all three of those areas, as well as passing on wealth. And so yeah, I’ve learned from the mistakes of others I’ve learned from the knowledge of others and I’ve made my own and I really hope you know, with the book that I’ve helped people unraveled white why some of those mistakes have happened. That way they can honestly go make their own.

george grombacher 4:35
It certainly does make sense that as we are trying to figure out how something works that there’s going to be the other side of it. It’s like I just figured out how to make a lot of money but so much of it is coming out the other side and I’m not holding on to it and then it’s okay. Oh my goodness. Now I need to figure this out. What were the three areas keep as much grow as much? Yeah,

Whitney Elkins-Hutten 4:57
so if we back up like the whole objective is generational wealth. And so in order to meet that, that objective, you have to master four areas create wealth, ideally in your sleep. That’s why a lot of us love real estate investing, because we get tuned in into this passive income. Right? You know, how can we leverage our time or actually remove our time completely by how much money we make? How can we keep wealth? Right, as real estate investors, we’re super focused on taxes, like, you know, in order to maximize the velocity of our money, how can we, you know, save that and reinvest. But we also need to take a look, take a look at you know, how are you using debt wisely? How are you using insurance? How are you? Have you reduced all the fees you possibly can in your portfolio, and that in those three areas, right there can help save hundreds of 1000s of dollars over the course of your investing lifetime? This totally outweighs you know, cutting the cord on your cable or like reducing, you know, how much you travel or, you know, right? We’re looking to really move a lever, not just push a needle. And then you know, number three, how do we grow that wealth? What are the how do like the Rothschilds do it? How did the Kearney keys do it? Like what are those? You know, how does Ray Dalio do it? What are those principles they’re focusing on when they look at any investment, we’re not looking at the 100 point due diligence list, we want to know what that due diligence list measures as measures how to preserve capital, how to create cash flow, how to build equity, how to maximize tenant, you know, tax benefits, and then a few other things. And then we want to master how to pass that wealth on planning for incapacity. We also want to have are the correct legal documents in place? Those are two maneuvers that I think most investors are keen into. But now what are the rural rocks that we need to have in place in order to prepare the next generation to take what we have built in steward it and grow upon it?

george grombacher 7:03
There it is, create wealth, keep wealth, grow wealth, and pass it on? Working to optimize find the highest and best use for your time and resources. As life has gotten so much more expensive, and interest rates have gone up? Has that changed your thinking about any of this? Or do is are the principles still sound just you need to pay a little closer attention? Well,

Whitney Elkins-Hutten 7:30
I, I think it was shift my focus, it hasn’t changed what I’m doing in my portfolio, you know, when the when the money’s flowing in, you know, if I’m working with our high net worth investor, you know, the money’s coming in there, they’re able to place investments, but when the that kind of spigot turns off or becomes a little bit more challenging, or they can be able to exit their stock options. Now they’re like, oh, where how am I going to pay the kids tuition, college tuition? You know, you know, I did have like, hundreds of 1000s of dollars coming in from my investment every single year. But now like, that’s cut in half, like now, what do I do? Well, we just need to pivot our attention back to like, how do we keep the money? So I think we’re constantly in this intention of how do we grow and keep growing, keep growing keep. And, you know, I heard the term we called it one time, it’s like build a fortress balance sheet, if you put the systems in place to maximize how much money you’re keeping, meaning you’re paying attention to every year how you’re optimizing your debt, and renegotiating all your insurances, getting all of those fees out of your portfolio, sidestepping provisional income sidestepping like retirement fees, you know, now you’re going to be able to, you know, maximize and you can on your taxes, now, you’re going to create, like a bucket of cash, that in down years, or in challenging years, like we’re in right now you’re going to, you know, be able to piece together like 40 50,000 60,000 $100,000, at the end of every year, then appears, you’re gonna be able to, you know, set aside and create velocity with hundreds of 1000s of dollars to move forward into your next investment.

george grombacher 9:05
I love it. I think that that makes sense of the of the three of the four areas. I’m sure that you talk about all of them all the time. And so not that it gets boring. But what is the most exciting thing for you right now? What are the topics or the ideas or concepts that you really get most lit up by?

Whitney Elkins-Hutten 9:24
Well, I think it’s not so much about what I get lit up by but what people really need to hear right now. And so the two areas that I’m really focusing on with investors is one, how do you make sure that you are looking at every investment in your portfolio and then abides by as many as you are those Seven Pillars of Wealth as you possibly can? Does? This is a great time to optimize the portfolio, because as investments start cycling out and they start re performing here in two or three years, you now have you You have essentially re interviewed that operator or re interviewed that investment. And now you can make some pivotal changes as you move into the next phase of your investing career. So really, I love helping people understand this seven pillars, one of those investments right now in this market cycle that I’m super excited about is debt investing. Because where we are in this market cycle, you know, banks have, you know, tighten their belt on how much they lend, especially in real estate, and it’s created a vacuum for the average investor to step into, and, you know, essentially provide that solution. Now, a lot of people are like, Why real estate? Like, isn’t real estate you having challenging moment right now? Well, not in single family residential real estate, it’s not, you know, quite frankly, it’s continues to outperform inflation, it continues to outperform the stock stock market on 10 years rolling 20 years rolling bases here, and we’re under supplied in what did we just do? What did the Fed just do? Any prayer that we had at New continuing to boost starts to close that gap in the next five to six years, that under supply gap has evaporated. And so it’s created a unique opportunity in today’s market, if we can continue this supply, redevelopment, even even just development moving forward? You know, again, that’s a unique, unique area that us as investors get to solve, and take advantage of,

george grombacher 11:29
I like it, I think it makes so much sense to be focusing on constantly optimizing but the opportunity of the debt investing. So you probably already told me this, but how do you actually do that? What are some really practical ways that you’re able to do that?

Whitney Elkins-Hutten 11:46
Yeah, so I like investing in real estate dot funds, when we have one here at passive investing.com. They mean, that’s, you know, you know, I’d encourage anybody to take a look at our fund. But really, I want to be as conservative as possible, even in this environment, because just because you’re dead, just because you’re as low as you possibly can technically be in the capital stack doesn’t mean that it’s actually conservative. I see so many debt funds out there that have leverage on them, that are blending single family and commercial and multifamily and development altogether, which is not wrong, I want to make sure that I caveat that it is not wrong. It is just not the most conservative way to invest in debt right now in this market cycle. And so if you’re an investor that is like, hey, I want to take my money out of the bank, but I want to put it in the next conservative investment. Yeah, I feel like this new type of debt fund is probably right, there it is, you know, single family fix and flip in the Carolinas, we have over 40 years of experience ourselves, our team in fixing flipping in that area. And we work with borrowers. Repeat borrowers, we have 85% Repeat borrower rate.

george grombacher 13:00
Awesome. Nice. Okay. Perfect. So in terms of of the book, what are you hoping that somebody gets when they pick it up and read it?

Whitney Elkins-Hutten 13:11
Well, you know, it, there’s really two kind of camps of people that are, you know, probably going to get the most out mileage out of the book. One, it’s the new investor. And so somebody who’s really just started off, like, you know, heard about this thing, passive investing. I heard that about the same financial freedom, like, how do I even start putting together the plan to make it happen? Yeah. And that’s what the book is, is that in the end plan that I wish I had, when I first started investing? It’s the plan that I wrote for my daughter, like, if something happened to me, like she could pick up that book. And essentially, it teaches her all the mechanics and we’re gonna move forward. Now, I said, it was for two camps, you know, the unit, you’re more seasoned investor. With out a doubt, I have, I have yet to run into a seasoned investor who wasn’t missing one of those foundational rules that they didn’t have buttoned up. And usually it’s in that area of like, six, you’d see their tracking area, like how are they creating income appropriately? Are they tracking everything? Did they know where their money’s going? Or it’s in that keeping area? Do they usually have some sort of like, you know, what I call a failed moat, around their castle, there’s a way that they’re just leaking out 10s or hundreds of $1,000 in their investment portfolio. And so even that person could go back and while it might take them through some of the basic mechanics, they’re gonna pick up the two or three key points they needed to have in place in order to make them feel shored up unstoppable and solid in this today’s environment. Nice.

george grombacher 14:51
I appreciate that. As you are it’s interesting that really, no matter who you talk to, there’s still some opportunity or people missing something, what is what is one of the mistakes that you find that that’s kind of the most common? They’re like up there, they’re there, they’re doing that thing again,

Whitney Elkins-Hutten 15:11
too. Um, first mistake is, especially if they’re a seasoned investor, they lose sight that they need to be, they need to understand why their due diligence checklist is crafted the way it is, you know, heart, that checklist is to measure certain key areas, capital preservation, cash flow, equity growth, tax benefits, the performance of the operator is leverage being used wisely. And how is this asset going to help me inflate hedge inflation? Okay, if they can take an asset and their checklist and reorganize everything, to make sure that their questions fit in the seven key areas, and then they analyze an asset moving forward, they’re just gonna be in that much better spot, because they’re gonna be able to lay check the box, like, hey, it hits all seven of these pillars. But even looking backwards, they look at their review their current portfolio they’re invested in, they’re gonna realize, oh, that’s why I am not getting the returns that I thought I was gonna get in today’s environment, that’s the exit that asset that I need to exit as soon as I can, or hot, you know, ideally, this is why this asset is performing. So well, this is why it doesn’t cause me any stress, I need to do more of this. The second area is just really tracking, tracking your income tracking your expenses, tracking your portfolio, data is power, knowledge is power. And it doesn’t get you to the end in and of itself, you still have to be able to make moves off of that data. But if you don’t have the data at your fingertips to begin with, like how can you begin to make an intelligent decision?

george grombacher 16:56
Almost impossible, I would imagine. And particularly when we’re talking about holding on to the money and, you know, once you realize, oh, 1% does make a big deal. One, two, and three, and four and 5%. That’s what you’re talking about. So making sure that you’re optimizing, love it.

Whitney Elkins-Hutten 17:12
I have one investor, you know, one client that I’ve been working with, I mean, she came to me and she was like, Okay, this is project 15,000 I need to find 15,000 Every adult every month, I know it’s there. I just don’t know how I’m like, Okay, show me your income and expenses. And she was like, Excuse me. I was like, Okay, here we go live like in sometimes we just need that nudge, right, like I coach kids soccer. And we always bring it back to basics. We open up every practice. We get the legs warmed up, we’ve run around and what do we do we pass and then we shoot. We dribble we practice the basics all the time. It is no different with investing.

george grombacher 17:58
I love it the blocking and tackling the past in the kick kick in the shooting all of it. Well, Whitney, thank you so much for coming back on where can people learn more about you? And where can they get their copy of money for tomorrow?

Whitney Elkins-Hutten 18:11
Yeah, you can reach out to me at passive investing with whitney.com. There I’ve got some free goodies. You can also get access to my calendar, we can talk all things passive real estate, and then also money for tomorrow. If that sounds like something that could help you out and your investing journey you can find that at bigger pockets.com Ford slash money for tomorrow or on Amazon.

george grombacher 18:35
Excellent. Well, if you enjoyed as much as I did, show your appreciation, share today’s show with a friend who also appreciates good ideas, go to passive investing with whitney.com and grab some time on our calendar. Learn a little bit more about everything we’ve been talking about. Pick up your copy of money for tomorrow on Amazon or at bigger pockets.com/money for tomorrow. Yes. Excellent. Well, thanks again. Whitney.

Whitney Elkins-Hutten 19:01
Thank you again, George.

george grombacher 19:03
Till next time, remember, do your part by doing your best

george grombacher 16:00
So if I want my iPhone, and my Tesla and my Bitcoin to work, we need to get the metal out of the ground.

Pierre Leveille 16:07
Absolutely. Without it, we cannot do it.

george grombacher 16:13
Why? Why is there a Why has production been going down.

Pierre Leveille 16:21
Because the large mines that are producing most of the copper in the world, the grades are going down slowly they’re going there, they’re arriving near the end of life. So and of life of mines in general means less production. And in the past, at least 15 years, the exploration expenditure for copper were pretty low, because the price of copper was low. And when the price is low, companies are tending to not invest more so much in exploration, which is what we see today. It’s it’s, it’s not the way to look at it. Because nobody 15 years ago was able to predict that there would be a so massive shortage, or it’s so massive demand coming. But in the past five years, or let’s say since the since 10 years, we have seen that more and more coming. And then the by the time you react start exploring and there’s more money than then ever that is putting in put it in expression at the moment for copper at least. And what we see is that the it takes time, it could take up to 2025 years between the time you find a deposit that it gets in production. So but but the year the time is counted. So it’s it’s very important to so you will see company reopening old mines, what it will push also, which is not bad, it will force to two, it will force to find a it will force to find ways of recalibrating customer, you know the metals, that will be more and more important.

george grombacher 18:07
So finding, okay, so for lack of a better term recycling metals that are just sitting around somewhere extremely important. Yeah. And then going and going back to historic minds that maybe for lack of technology, or just lack of will or reasons, but maybe now because there’s such a demand, there’s an appetite to go back to those.

Pierre Leveille 18:33
Yes, but there will be a lot of failures into that for many reasons. But the ones that will be in that will resume mining it’s just going to be a short term temporary solution. No it’s it’s not going to be you need to find deposit that will that will operate 50 years you know at least it’s 25 to 50 years at least and an old mind that you do in production in general it’s less than 10 years.

george grombacher 19:03
Got it. Oh there we go. Up here. People are ready for your difference making tip What do you have for them

Pierre Leveille 19:14
You mean an investment or

george grombacher 19:17
whatever you’re into, you’ve got so much life experience with raising a family and doing business all over the world and having your kids go to school in Africa so a tip on copper or whatever you’re into.

Pierre Leveille 19:34
But there’s two things I like to see and I was telling my children many times and I always said you know don’t focus on what will bring you specifically money don’t think of Getting Rich. Think of doing what you what you like, what you feel your your your your your, you know you have been born to do so use your most you skills, do what you like, do what you wet well, and good things will happen to you. And I can see them grow in their life. And I can tell you that this is what happens. And sometimes you have setback like I had recently. But if we do things properly, if we do things that we like, and we liked that project, we were very passionate about that project, not only me, all my team, and if we do things properly, if we do things correctly, good things will happen. And we will probably get the project back had to go forward or we will find another big project that will be the launch of a new era. So that’s my most important tip in life. Do what you like, do it with your best scale and do it well and good things will happen.

george grombacher 20:49
Pierre Leveille 21:03
Thank you. I was happy to be with you to today.

george grombacher 21:06
Damn, tell us the websites and where where people can connect and find you.

Pierre Leveille 21:13
The it’s Deep South resources.com. So pretty simple.

george grombacher 21:18
Perfect. Well, if you enjoyed this as much as I did show up here your appreciation and share today’s show with a friend who also appreciate good ideas, go to deep south resources, calm and learn all about what they’re working on and track their progress.

Pierre Leveille 21:32
Thanks. Thanks, have a nice day.

george grombacher 21:36
And until next time, keep fighting the good fight. We’re all in this together.