I love hearing stories about physicians doing amazing things outside of medicine. I hope you do as well!
Today’s guest on True Doctor Stories is Kenji Asakura and Letizia Alto, the dual physician couple behind one of my favorite blogs, Semi-Retired MD. They're also the creators of the amazing course, Zero to Freedom Through Cashflowing Rentals. (Special bonus for those enrolling through my exclusive link. See below!)
1) Why did you start investing in real estate?
Kenji and I started investing in real estate together in early 2015, just after we were married. The triggering event was a road trip we took across New Zealand in a campervan.
Because we had a lot of time together in the evenings (without phone access or TV access!), we started reading Robert Kiyosaki’s Rich Dad, Poor Dad together out loud.
Kenji had read the book previously, but this was my first time through it – and it totally changed my mindset. Though I must say, reading the book again also affected his mindset because Kenji had previously been investing in appreciation plays such as raw land, expensive condos and got caught in the 2008 crash. He realized he had been gambling by buying what Kiyosaki would consider to be liabilities (things that take money out of your pocket each month.)
Suddenly, we both understood that cashflowing rentals were the answer to creating the life we wanted– a life on our terms.
Because we read the book out loud to each other, we were able to stop frequently and discuss the implications of what we were reading. By the time we had finished, we had both decided we were going to put all our focus and all of our money into investing in cashflowing rentals, properties that put money into our pocket each month.
Prior to reading that book, Kenji and I had actually been trying to find ourselves a primary residence in Seattle. We had lost out on several bidding wars – which, reflecting back on it, was incredibly lucky. We didn't have a primary residence, but we had the downpayment we planned to use for it sitting in our bank.
We spent the rest of our trip in New Zealand reading books on how to build a real estate empire (The Millionaire Real Estate Investor by Gary Keller and Start Your Own Corporation by Garrett Sutton), so by the time we came back to Seattle and told our real estate agent we were becoming real estate investors and were no longer interested in owning a primary residence, we knew the fundamentals of what we were going to do.
There was a steep learning curve. About eight months later, we really had put together the components of our unique investing system, something we call Fast FIRE today.
2) How did you get started?
One of our early errors trying to turn our regular residential real estate agent into an investor agent.
When we came back from New Zealand, we sat down with our agent, and said something to the extent, “We're real estate investors now. We don't want to invest in Seattle. We want cashflowing properties only, so we'll need to look for multi-family properties outside of the city.”
Unfortunately, he was a residential agent focusing on Seattle. He didn't know about cash-on-cash. He didn't know anything about how to recognize an investment property. So we spent a bit of time trying to teach him what we had learned in reading a couple of books (and what Kenji already knew from investing himself in appreciation plays). Not surprisingly, we didn't make a lot of progress for the first couple of months.
Fortunately, we ended up locating an investor agent who actually owned properties herself and who was able to help teach us some of what she knew, including sharing some of her network. And, we just took off from there. We bought a total of 11 units that first year.
Over time, we were able to put together the Fast FIRE system by adding in things like harvesting tax savings and figuring out how to tap hidden value and force appreciation. Once we got our system down, we were on fire (pun intended).
3) What does your portfolio look like today and what impact has it had on your life / family life?
Our portfolio has gone through some major changes this year. By the end of this month, we'll be up to 61 doors. It's a mix of mostly small multifamily properties.
We're currently tackling a development project and buying a 32-unit property, which is going to be our biggest purchase by far.
Our bread and butter are still small cashflowing multifamily properties, but I see this shifting to larger buildings over time because of the huge tax advantages of investing in larger properties.
The impact on our family has been incredible. When we first started, both Kenji and I were working more than full-time jobs. Now, I'm a half-time hospitalist and he moonlights.
We've been really involved in our children's lives because of the freedom that real estate investing has provided. With the exception of occasional babysitting, Kenji and I mostly took care of both our young kids for the first year of their lives.
We even took a year off to travel in 2017. We continue to travel a lot now, too, with our kids. In fact, our daughter has been to 26 countries and 27 states!
Finally, the cashflow gave us the time to develop our blog, Semi-Retired MD, and build an introductory course, Zero to Freedom Through Cashflowing Rentals, that teaches physicians how to invest in real estate using our Fast FIRE approach (the same approach we used to build our portfolio). And that has been the most fulfilling thing that either of us has done in our lives.
The Semi-Retired Physicians Community is simply phenomenal and watching their victories has been incredibly rewarding. I cannot tell you how much joy seeing our students find success has brought us.
I'm sure some people look at us and see the things we don't have– like a primary residence or fancy cars or whatever.
But, honestly, we're living the life we want. We have the freedom to live the lives we want to live, on our terms. We enjoy our real estate investing; we love taking any money we get and putting it into properties instead of buying a primary residence. We love our blog and the way we've been able to impact and help our readers.
Ultimately, it is the cashflow from our portfolio that has allowed us to make our lives the way they are today.
4) Why did you start Semi-Retired MD?
We started Semi-Retired MD to reach more people.
We've been helping other physicians invest in real estate literally since we came back from our trip to New Zealand. Anyone who knows us well knows that when we get excited about something, we tell everyone!
So, what we did from 2015 until 2018, when we started our blog, is just talk to our friends and colleagues about investing and sharing our resources. Some of them became really successful as a result (many of our friends have been featured in our investor spotlight series).
But, as you can imagine, it was inefficient. We'd answer the same questions over and over. And, they didn't get all the information they needed from us in one sitting. So, they'd still run into problems, stumbling blocks, or make mistakes even 6 months or a year out because we hadn't shared everything we learned in a really organized way.
Over the years, we've had several people suggest starting a blog to demonstrate what we were doing and how we were living our lives traveling, spending time together. Finally, after the birth of our son, we got motivated and decided to try it.
Once we got connected to the awesome physician online community, we were hooked.
5) What have been the biggest challenges with both real estate investing as well as the blog?
The biggest challenge for us is time management.
Kenji and I are incredibly involved in our online communities. We write our own blog articles. We try to respond to everyone's questions in our Facebook groups. We have helped countless students through their deals. As you can imagine, the blog takes a lot of time!
And then we have our own real estate portfolio, our kids, our other hobbies, like hiking, cooking and traveling.
We also signed up for Tony Robbins’ Platinum Partnership and travel about two weeks of every month to attend his conferences.
We must get better at offloading lower-value work and the work that we don't enjoy doing. And that's something we've been working at for the last six months. There's still A LOT of progress to be made though!
6) How do you balance it all with being physicians and with your personal life?
One thing that's really helped me (Leti) is realizing that being overwhelmed or stressed or frazzled is simply a choice. It's a matter of what you focus on.
Kenji and I have done a lot of work this year changing the things we focus on. Things fall through the cracks. Not everything we want to get done gets done. But we also are allowing ourselves some grace, meaning that we're not expecting things to be perfect (this has been a learning curve for me especially).
I'm definitely not going to say we have this all worked out. But I will say that we are having a lot of fun. We feel fulfilled. We are happy. Our children are happy. So we're doing something right despite everything we're juggling (and dropping!).
7) Are you still practicing medicine and in what capacity?
Yes, I still work half-time as a hospitalist, which is approximately 7 shifts a month. Kenji works occasionally (rarely) as a moonlighter.
8) What does your typical work week look like?
When I'm working at the hospital, I'm gone most of the day. So, Kenji handles most of the real estate and blog-related work.
When I'm home, we spend most of our day working on the blog, our course or helping our students.
Because we are traveling two weeks out of every month, most of our time in Seattle is directed towards catching up on real estate and the blog.
When we travel, we mostly focus on spending time working on ourselves and our businesses in conferences, visiting with our friends, meeting up with our blog readers in meet-ups, and spending time with our kids. We often take days on either end of our Tony Robbins’ conferences to spend some time in the cities we're visiting.
9) What piece of advice do you have for physicians who are considering pursuing other sources of income?
Surround yourself with the right people.
One thing Kenji and I (and I think Peter) really learned this year is the power of proximity. When you're around people who are thinking differently, who are aiming bigger, who are building businesses, you step up to another level just because you are around that type of culture. You adopt the standards of your peers.
One of the best things that has happened to us this year is to be part of an amazing group of physician bloggers and business owners. These are the people who help us think differently, help us navigate through issues and are our biggest cheerleaders.
Ultimately, there are enough people around who will drag you down, try to poke holes in your dreams or try to discourage you. Why not surround yourself with people who will support you, lift you up and help you become the best version of you instead?
10) Let's talk about the course, why did you decide to create it?
We created the course, Zero To Freedom, to help other physicians build the real estate empires that will fund their dreams.
As I explained earlier, real estate investing has made a huge difference in the quality of our lives. Because we know the power of investing, we are really passionate about helping other physicians (and other professionals!) achieve financial freedom too.
It's our mission both because we love seeing physicians be able to live the lives they want but also because we believe that a cohort of financially-free physicians, who are not beholden to the medical system, will have more power to create systematic change.
11) What will people achieve by taking your course?
I'll answer this question by giving you a few examples from our last class.
We have a student from our summer 2019 class who went from knowing nothing about real estate investing to being under contract for 40 units. We have a physician couple who also had no real estate experience prior to taking our class currently buying a 28 unit.
We had one student who put in 8 offers while taking our class. A fair number of students are going to achieve real estate professional status (REPS) this year. We even created a new hashtag for it #REPS2020!
But the story of our last cohort of students really transcends the number of properties they've bought. Our true measure of success is their transformation and who they have become because of the experience of taking our course.
Our students are confident that they have the knowledge they need to make solid purchase decisions. They know they have a community of like-minded investors who have their backs, who they can lean on to give good advice whether they're evaluating a deal or trying to tap hidden value. But most important of all, they believe in their abilities to shape their futures and achieve the lives that they want.
There is nothing more we could wish for for our students than that.
[Editor]: For those that are interested, their course, Zero To Freedom Through Cashflowing Rentals is open for enrollment for a short period. I've taken it personally and it helped me double the number of units in my personal portfolio and the tax savings alone will help save me 6 figures in taxes. Yes, I'll be creating a post on it soon!
SPECIAL BONUS: Enroll in the course through my exclusive link here and you will get a FREE VIRTUAL PASS to the soon to be released conference video for PIMDCON19 otherwise known as Financial Freedom Through Real Estate Conference 2019, held this past year.
- Creating financial freedom through rental properties
- Passive Income Through Passive Real Estate Opportunities
- Tax and Asset Protection Strategies for Physicians & High Income Professionals
- Mistakes Real Estate investors make
- and much more…
The link again to check out the course >> Zero To Freedom <<