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“Think about your time.” With Jason Hartman & Charlie Evans

Time is also an investment in yourself so think about time invested at a job. If your values do not align with the company’s mission or you dislike colleagues, it is time to move on. The pandemic has shown us that companies have no trouble laying people off at the first sign of trouble therefore […]

Time is also an investment in yourself so think about time invested at a job. If your values do not align with the company’s mission or you dislike colleagues, it is time to move on. The pandemic has shown us that companies have no trouble laying people off at the first sign of trouble therefore time invested in loyalty and tenure at a job is not considered an important factor today.


As a part of my series about “Investing During The Pandemic”, I had the pleasure of interviewing Charlie Evans, founder of Rent the Mortgage. Charlie started Rent the Mortgage in 2019 to begin documenting his financial lessons with the intent of inspiring others to start their FIRE journey through real estate. He bought his first home at age 31 during a mortgage crisis in 2010 and has included real estate in his financial portfolio ever since.


Thank you for doing this with us! Before we dig in, our readers would like to learn a bit more about you. Can you tell us the “backstory” about what brought you to the finance industry?

Igrew up a baseball fan was listening to Oakland Athletics games on the radio was my favorite pastime during the 1980s. It eventually led to my hobby of collecting baseball cards where I started to become fascinated with the statistics and analytics printed on the back. My fascination with analytics continued with my dad who taught me how to read stock market financials from the newspaper and helped me open my Roth IRA account where I bought my first stock. I officially became a first time homeowner in 2010 buying a couple of distressed properties during the subprime mortgage crisis. Today I am building my blog called RenttheMortgage.com to help document my financial lessons for others to learn from.

Can you share with our readers the most interesting or amusing story that occurred to you in your career so far? Can you share the lesson or take away you took out of that story?

Living in California jaded my perspective of ever becoming a homeowner due to skyrocketing home values happening all around me before the 2008 subprime mortgage crisis. While living safe and sound in my wife’s home in Chicago, I watched my stock portfolio almost vanish before I sold off everything in a panic. During this moment in my life, I was in a very stressful state of mind that I shared with most of the general public except for my wife. My wife likes to remind me that, “Rent money is paying a mortgage for somebody else in the game of Monopoly except in-real-life (IRL).” She suggested that we take what remaining cash we had left in that stock portfolio and buy some distressed properties. The subprime mortgage crisis had created a unique once in a lifetime opportunity to buy homes at discounted prices.

Looking for distressed properties to buy is not like when you attend open houses that are staged with nice furniture and smell of apple pie coming from the kitchen. Instead, you are walking into unlivable condition homes where kitchen appliances are stolen and bathroom pipes are missing. We finally found this quaint foreclosed 2-bedroom 2-bath condominium in an abandoned apartment complex. In order to buy a distressed property, we had to hire a lawyer to verify that there were no liens against the deed. Interestingly, the lawyer we had hired had some concerns for us when he found out that our unit was located in an abandoned complex building. He immediately warned us if we understood the risk we were about to take on and actually advised against us moving forward. We ignored his advice because the low price for the condominium was a once in a lifetime opportunity. My wife and I rehabbed that condominium and rented it to a great tenant over the next 6-years. The rent money essentially recovered 100% of our rehab cost and when the tenant moved out we decided to finally sell it for 150% ROI.

The main take away from this story is we would have had a radically different outcome had we listened to our lawyer’s advice to walk away. In fact, the outcome would be that nothing at all would have happened. I am a very risk-averse person but I do know that there are times in life where learning from the experience is probably worth the risk.

Are you working on any exciting new projects now? How do you think that will help people?

Yes. Currently, I am building my blog RenttheMortgage.com to help document my financial lessons for others to learn from. The timing of coronavirus now amplifies the need for me to write more articles quicker to help people get defensive with their investments. For example, now is a fantastic time to start building a portfolio of dividend-paying stocks that are thriving during this pandemic. Brands that will forever be part of our lives such as Walmart (WMT), Coke (KO), Procter & Gamble (PG), Johnson & Johnson (JNJ) are now all on sale due to the dramatic pullback in the stock market due to coronavirus fears.

None of us are able to achieve success without some help along the way. Is there a particular person who you are grateful towards who helped get you to where you are? Can you share a story about that?

Two people come to mind that has influenced the way I think about finances, my wife, and my dad. Both had a hand in shaping each half of the way I manage my own financial portfolio.

My wife was a homeowner before we started dating. She diligently saved and purchased a home after university all on her own. As for being a landlord, she started managing tenants for her own landlord as a favor and eventually became a landlord for herself. I was always a stock investor and never imagined myself as a homeowner until I met her. My wife purchased her first home in 2004 and we were married in 2008. In 2010, I purchased a foreclosed 2-bedroom 2-bath condominium in an abandoned complex. In 2011, I purchased a short-sale townhome that was desperate for a buyer after a failed deal. Both of these properties had hidden equity where my wife and I have been fortunate to unlock. Owning the properties have not only created the rental income stream we were looking for but also increased our overall net worth.

My dad showed me the power of stocks very early when I was 11 years old. He taught me how to read stock prices from the newspaper. It is where I first learned about all the strange acronyms such as P/E ratio (price to earnings ratio) and Div Yield (dividend divided by stock price). He helped me open my Roth IRA where I made my very first stock purchase. Another result from his teachings is that I have always maxed my 401k contributions every year that I have worked since 2001. The sum of all the 401k limits between 2001 and 2020 is $319,000. With the power of compound interest and some luck, my lifetime 401k ROI sits around 144%. I expect to pass the pinnacle of $1,000,000 before 2025 when I turn 47 years old.

Let’s shift a bit to what is happening today in the broader world. Many people have become anxious from the dramatic jolts of the news cycle. The fears related to the coronavirus pandemic have understandably heightened a sense of uncertainty and loneliness. From your experience, what are a few ideas that we can use to effectively offer support to our families and loved ones who are feeling anxious? Can you explain?

With the shelter-in-place orders being enacted, now is a good time to reach out to family members and friends with the many technologies available. Long distance phone calls are no longer an obstacle with messenger services like Slack and video conferencing with Zoom. Social media companies are now being leaned on to help connect people and create a sense of normality while we are all safe at home. Take a funny photo or make silly videos with your kids to share with loved ones to keep your energy moving in a positive direction. Even playing video games where co-op play is necessary such as Call of Duty and Fortnite are good tools to stay connected with people.

Ok. Thanks for all that. Let’s now jump to the main core of our interview. As you know the stock market and the economy in general have become extremely volatile and uncertain. Many people “dollar cost average” and put aside a monthly sum into a long term savings plan for retirement, college, or a home purchase. If a loved one or a client came to you and said, “I have been saving and investing $500 every month in an S&P 500 index fund. Over the next few months until the dust settles, should I be doing something else with my money?”, what would you say to them?

Of course, every person should evaluate their own financial situation. If your financial situation has been affected by coronavirus layoffs or furloughs, then it would make sense to instead use the $500 per month towards essentials such as rent and food. If you are fortunate enough to still have money to invest, I would advise prioritizing your emergency fund where I recommend about 6-months worth of expenses to be saved. For example, if you need $4,000 to survive per month then you should have $24,000 saved for an emergency. As for the S&P 500 index, I think it will take a few months before we really start to see the negative ripple effects coronavirus will have on the economy. Ripple effects caused by hiring freezes, layoffs, furloughs, business shut-downs, bankruptcies, missed rent, unemployment claims, and insolvent homeowners after forbearance. With unemployment levels already at 17,000,000 with more filings still to come, when the shelter-in-place orders are lifted, it will take some time for those unemployed workers to find jobs again. Therefore I would advise holding off on investing in the S&P 500 index fund until a vaccine has been FDA approved which could take 12-months or longer.

Eventually the economy will recover and rebound. Certain sectors, like travel and hospitality might be hurting for a while. But other sectors, like technology and healthcare, might do very well. If someone wanted to prepare today to take advantage of the future recovery, what would you suggest they do?

Most companies will announce Q1 earnings in March/April that have or will mostly exclude the effects from coronavirus. The Q2 earnings in June/July is where Wall Street will finally be able to measure the negative ripple effects coronavirus is having on the economy. Of course nobody can tell the future of what the stock market will do exactly but my strategy would be to at least wait until after Q2 earnings.

The sectors that I would suggest are also where I will concentrate my investments into while having a defensive mindset. Building a “Pandemic Proof Portfolio” of dividend paying stocks will consist of brands that are related to sector essentials such as grocery retail, food, consumer goods, and healthcare. Brands that will forever be part of our lives such as Walmart (WMT), Coke (KO), Procter & Gamble (PG), Johnson & Johnson (JNJ) are now all on sale due to the dramatic pullback in the stock market due to coronavirus fears.

Are there sectors that provide exciting and lucrative investment opportunities today, specifically because of the volatility and uncertainty?

The coronavirus outbreak has created many ripples in the global economy. Federal interest rates have fallen back to the lowest level. As a result, mortgage interest rates have also fallen to record lows particularly for the 30-year fixed. I believe there will be buying opportunities in real estate if conditions continue to deteriorate as a result of the shelter-in-place orders. The following scenarios are already happening such as contractors are unable to work, permit inspections are on hold, appraisal visits cannot be completed, open houses will sit empty with no buyers. Homeowner sellers will likely start getting desperate, especially those that may have been impacted by layoffs or furloughs. Even rentals are not safe because mortgage payments still need to be made but renters may not have the money to pay. If enough of these scenarios continue to play out over a longer period of time like 4 to 8 months, I believe the asking prices for houses will start to drop. The irony of it all is I never thought we would see another housing opportunity like the subprime mortgage crisis so I hope to be wrong about this.

Are there alternative investments that you think more people should look more deeply at?

I am pretty risk-averse when it comes to investments so I would never recommend looking at alternative investments such as cryptocurrency. Instead, I would recommend opening a high-interest savings account that offers an interest rate as high as 1.7% APY which are outperforming US treasury yield returns at the moment. Probably not the alternative people are looking for but a savings account is safe. Just make sure the bank is FDIC insured which protects your balance up to $250,000 per individual.

If a person in their thirties and forties came to you today and said that they have $10,000 that they want to put away today for a long term investment what would you advise them to do with it?

Time is on your side if you are still in your thirties and forties. Sectors that have been hit hard by the coronavirus pause in the economy such as travel and leisure are likely a good bet to return to some form of normality in 3 to 5 years. Travel related companies such as United Airlines (UA), Hertz (HRI), and Marriott (MAR) should all see a steady flow of business return over the next few years. Safer bets would come from brands that offer a strong dividend yield and sell essential products like health, food, and hygiene products. The long lines outside of Costco (COST), Starbucks (SBUX), Wholefoods (AMZN), Walmart (WMT) should have given us a strong indication about where people are willing to spend their hard earned cash.

Ok, thank you! Here is a more general finance question. You are a “finance insider”. If you had to advise your adult child about 5 non intuitive essentials for smart investing what would you say? Can you please give a story or an example for each?

  1. Stay away from investing in non-essential businesses or companies that provide services that cater to those with disposable income. Many pre-IPO business valuations were inflated due to market momentum and therefore never had a fundamental business plan in place to reach profitability. Start-up companies in Silicon Valley disguise themselves as essential businesses but during a pandemic, we quickly saw that nobody was standing in line for avocado toast.
  2. Time is also an investment in yourself so think about time invested at a job. If your values do not align with the company’s mission or you dislike colleagues, it is time to move on. The pandemic has shown us that companies have no trouble laying people off at the first sign of trouble therefore time invested in loyalty and tenure at a job is not considered an important factor today.
  3. Invest in your education but make sure to learn finance. The job market is competitive especially in Silicon Valley where some of the role qualifications contradict each other and are downright ridiculous. For example, this was copied directly from a job description for a tech company, “Entry level position. Master’s, PhD degree, further education preferred. 4 years of relevant work experience”. The future will have more opportunities for those with skills that cannot be replaced easily with artificial intelligence. Work opportunities related to medicine, economics, and financial related majors will continue to be in demand while programming, manufacturing, and engineering will be commoditized from automation.
  4. Investing is playing the long game. Before ever committing money to an investment, think into the future about 5 to 10 years where you envision the investment ROI to be. Stay away from get-rich-quick investments and exotic financial derivatives where Warren Buffet once described them as “financial weapons of mass destruction”.
  5. Investment opportunities can take place over a long period and do not happen all at once. Spread your money out across different investments as you see opportunities during your life. I opened my Roth IRA at age 11 because I had saved a lot of birthday money. I contributed my first dollar to my 401k at age 21 because I had a full-time job. I purchased my first home at age 31 and my second home at age 32 because I had the cash from selling stock and home prices were cheap due to the subprime mortgage crisis.

Can you please give us your favorite “Life Lesson Quote”? Can you share how that was relevant to you in your life?

My favorite quote is from Warren Buffet when he said, “Be fearful when others are greedy. Be greedy when others are fearful.” I decided to become a first time homeowner right in the middle of the subprime mortgage crisis with a depleted stock portfolio in 2010. Taking a calculated risk during that time in my life really paid off for me in setting up my family’s financial future.

You are a person of enormous influence. If you could inspire a movement that would bring the most amount of good to the greatest amount of people, what would that be? You never know what your idea can trigger. 🙂

I only recently discovered the FIRE movement which stands for Financial Independence, Retire Early. The general idea is to reduce your spend and set up your financial portfolio in such a way that you could live off the generated income without having to work a full-time job. Most people feel trapped in their 9-to-5 job like they are in a rat race. The rat race has no winner and is a metaphor to running inside a pet wheel that is going nowhere even if you work harder. There are variations of FIRE too such as Barista FIRE which is where I mostly define my lifestyle. I am not sure who coined the term first but I believe it came from Starbucks baristas who are given health insurance which is expensive without a job. Employers such as Starbucks, Walmart, Costco, and Apple Store will provide health insurance for hourly part-time employees but the idea is you work these jobs because it is fun and not because it financially supports your lifestyle. I still enjoy my job working in Silicon Valley tech so that is why I consider myself Barista FIRE even though my spend is mostly covered from my FIRE portfolio. I hope to inspire and teach more people to join the FIRE movement which is why I started my blog RenttheMortgage.com in the first place.

Thank you for the interview. We wish you only continued success!

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