Aileen (00:00):

Thank you, everyone for joining today’s episode of the, How Did They Do It? Real Estate podcasts. We are your hosts, Seyla and Aileen, and today our guest is Holly Williams. Keep more.com is the online home of Holly Williams. The hidden investing expert, Holly has special expertise in multi-family syndications, private lending, and active real estate investing and shares her knowledge and access so that others can keep more of all that as good. Holly is committed to improving the financial literacy of all Americans. And it’s the author of hidden investing. What the wealthiest 1% know that we don’t Holly lives in New York City with her husband and their amazing teenage daughter, Mary Quinn. So we know today we’re going to have a very interesting conversation with you. So thank you for joining our show today. Holly. Welcome.

Holly Williams (00:45):

Thank you for having me. It’s wonderful to be here.

Aileen (00:49):

Can we get started by first talking about your background and how did you get started in real estate?

Holly Williams (00:55):

You know, my background’s just middle-class Houston grew up in Texas and, you know, and just did what you’re supposed to do. I was in the band and I landed in New York City for a job. I worked in Dallas for three years out of school and I got a job offer in New York City and it was only supposed to be for a year and they’re going to move me back down to Dallas. And I landed in New York City and I looked around and I said, oh my God, it wasn’t me. That was 30 years ago. And I’m still here. So, so yeah, you know, in Texas everybody’s got the hair and everything and you know, I was just always out a little different. So, so I landed in New York City and did the whole, you’re supposed to what you’re supposed to do. You put all your, everything you can in a 401k, you bought a Manhattan apartment early in the first couple of years, you know, I read rich dad, poor dad, and that opened my mind on things. I bought a couple of single family homes, you know, in Houston, but all of that is a lot of work. And if you have a full-time career and that you really, I mean, I really didn’t dislike advertising. I mean, I was, I was like I said, and I was having a really good time in New York and a nice life. And it’s still an, I was still a nice life. And I’m on the board of the Texas tech school of media and communication where I went to school back in the day. And you know, here I am, I had gotten to a decent point in my career. I had done what you’re supposed to do. I, you know, we had real estate, we were fairly ha you know, comfortable, you know, comfortable.

Holly Williams (02:46):

Wasn’t, weren’t wealthy, but rural. Okay. And, but I’ve found myself paying 50% of everything I made in taxes and you’d reach a certain in the corporate world and there’s really not that much more to do. Right. And there’s really not much more money you can make, you know, so I found my taxes going up and I was still making, you know, having a good life, but I was making less and less money and paying more and more in taxes. And this is just ridiculous. And so along about that time, my parents started getting old as, as we all do. And, you know, I watched their savings disappear because we have we’re told and taught all of these things that are just not the whole truth. And one of those is that you’re a need for income and therefore your tax bracket, when you retire goes down and that’s absurd. It doesn’t, I mean, it does, I guess, if you want to downsize to a teeny apartment and never go anywhere, but that’s not the kind of retirement that my parents envisioned or that most people envision. And so you’re going to need more money or at least the same amount of money as you make now. And actually more because inflation is going to happen. And so if you’re going to have these golden years, you better not plan to go drop down to tax brackets. And by the time we all get there, it’s going to be, you know, the bottom tax bracket is going to be as bad as this at the rate we’re going. So, so there’s that. And I watched them just buy into the whole thing and it didn’t work and I’ve watched over and over now, people that do that, and it just doesn’t work because the system is designed for us to die, broke.

Holly Williams (04:47):

Every it’s not designed for us to, they don’t want us to build generational wealth. And that’s why we don’t learn in school, how to build generational wealth. We’re also educated. And I went to business school with the rest of them, and then we never learned anything, but the stock market, I had no idea that this existed. So that happened. I got my $65,000, 10 99. You know how you get your, as you grow up, you know, you get these things from the bank. And my advisor, my financial advisor had me in these mutual funds and you get these things and it says, congratulations, you’ve made $5,000. So you’ve made $10,000 and you go, Oh, aren’t I doing great. And you just hand it over to your accountant and that’s that? Well, when it’s $65,000 and Oh, by the way, you owe $30,000 in cat taxes. I was like, what? There are children watching and maybe you’re listening. And so we don’t want to say what I really said, but so that happened. And then along in this despair, three or four years, and then a friend of mine from Texas started investing in apartment complex, call me. And he said he started an apartment complex. And I found this thing and he was looking for investors. And so I had done angel investing a little bit. I had done some things I didn’t even know, even then what an accredited investor was like. I was an accredited investor for like a long time. I no idea. I remember checking off the boxes about how much money, but I didn’t really get that. It was like any big deal.

Aileen (06:27):

What is an accredited investor? Holly, can you elaborate a little bit?

Holly Williams (06:31):

Sure because people probably don’t know it’s you have to, I think its $200,000 income or 300,000, if you’re married or something like that. And, or you have to have a million dollars in net worth, you know, after, besides your primary residence or whatever, you know, frankly, I was like 50. I mean, if you’re really over like, Oh three, five, maybe three, and you’re little do you live in New York city in anything but a third floor walk-up with three roommates. You’re probably at a credited investor. It’s not that you know, but you know, we, it’s so amazing, you know, laws, so many laws, our government makes these laws and they’re designed theoretically to protect us. But what it does is it creates yet another hurdle and, and you can go buy a sock and watch it just go down and nothing. And you don’t have to do anything, be anything, but you know, so you really have to know somebody to get access to really good necessarily. So the more so I invested with him, I learned how multifamily syndication works. And I learned that you could, you know, have all the benefits of rental property, which are many, but you could have, you know, you could have all the depreciation and all of those things that helped so much in taxes and make real estate such a great investment, but you don’t have to have, you don’t have to do the work. And that was appealing to me because I, you know, you tell me, you don’t have to do the work. That’s good. So I became more and more. The more I learned about it, the more I was like, this is crazy. And the more I started talking to my colleagues, I mean, people that my net worth is a square root of their net worth. Right? And they’re like, Oh, I left. I lost money in a real estate deal a few years ago. I don’t know anything about real estate when it’s super simple.

Holly Williams (08:34):

I mean, the tenant pays rent and you pay the expenses and what’s left is the profit, right? And instead of giving a lot of it to Wall Street, which you do, if you buy into like a publicly traded real estate investment trust or something like that, we all share as friends and family, basically we all share the profits. And you know, there’s a reason why a mutual fund, the stock market returns 10% a year, you know, average or whatever. Why are mutual funds, average five or six? Well, why, you know, there’s just some questions that I started really. Once I started really investigating this stuff, I started asking him some questions that really we don’t ask in America when I ask people, why is it that the average mutual fund returns five or six, you can even ask them, what’s the average stock market return. What’s the average mutual fund return? And then you go there’s adult to there. What is why? And they’re like, they never find it because we’re not conditioned to think that way. Right. I went through this journey over the last seven years. Now, the more I realized that this doesn’t have anything to do with how intelligent you are. This doesn’t have anything to do with, you know, even how sophisticated you are of an investor or anything. What it has to do with is how you grow up and how you think about money. So I didn’t think about money when you first hear some of the things that you can, that multifamily is some of the benefits of real estate investing. You’re like, there’s no way, there’s no way because we’re conditioned to think about things one way. And we have the stuff in our head, you know, that 401k, we, we say it grows.

Holly Williams (10:39):

Tax-Free right. Well, what does that really mean? Well, that really means is that, yeah, you’re not going to get a $65,000, 10 99, but you’re going to pay those taxes when you take it out. And when you’re going to pay full boat income, like there’s not even capital gains. If you put it in a stock in the stock market, when you’re 20 years old, you take it out of the stock market. When you’re 60 years old, you at least play it pay at least today. Hey, the capital gains rate. And you’re in no tax bracket when you’re 20, I wasn’t, I filled out the 10 40 easy, right. And you’re in a big tax bracket when you’re 60. And so really you’re putting it in when you’re not having to pay too much tax because you’re filling out the 10 40 easy you’re taking it out when you’re in the biggest tax bracket. And you’re not even taxed at the capital gains rate. You’re taxed at the full boat, like regular income. So people think tax, Oh, it grows tax free. And they say they go off and do their own thing. And they don’t think about this stuff. And that’s why I have it on my parents. And then you go up and down and up and down and I’ll shut up now. So that’s the story is then you’ll see that you’ll see that large

Aileen (11:58):

As you’re monitoring your 401ks and everything like that. But I don’t realize what’s going to happen after you take it out. That balance, that larger balance will now be reduced by, you know, a huge chunk that doesn’t [Inaudible]

Holly Williams (12:10):

Well, that’s exactly right. You’re so right. And you know, they even make you take it out. Let’s say that, you know, they make you take it out. The government wants their tax dollars. And so that’s what this is all about. And you know, it’s interesting because since I wrote the book, there are many people now in Wall Street that are not happy that this is that there are all these private investing opportunities. Because if you listen to the media, it’s all we hear is like Bernie Madoff. We hear about all the people that, but you know, there’s a lot of, there are private funds. There are, I’m getting into this infinite banking based on life insurance. And it’s really how the super wealthy build generational wealth, any retirement calculator. The first question it asks you is how long do you expect to be retired? So you can sit there and watch your, you know, the whole idea is to die with zero. That’s what the whole plan is about. And so once I really realized that, and I knew it as the truth, I was like, okay, this is something that everybody in America needs to sort of thinking about, because it really is the truth. That’s what happens. So,

Seyla (13:28):

And Holly’s in your book, you debunk some of the investing meats. Will you be able to go over some of those that we have been taught going up?

Holly Williams (13:39):

Sure. And I just did. There’s a Cub. One of the myths is your 401k is not going to get you through your golden years. Another one is, you know, I was around during 9/11 and here in New York City. And you know, I remember when Christy Whitman came out of the EPA head of the environmental protection, he came out and said, the air is safe. We can all breathe. You know, it’s all, okay. We’ve done all these tests and it’s safe. And as it happens, we’re all going to funerals everywhere because it’s not, it wasn’t safe. And so they just don’t know. I don’t know. I don’t, I would hate to believe that. And so I choose not to, I choose to leave. That’s what they really thought. Right. And we see it now, do you wear a mask? Do you not wear a mask? Do you sit on a plane? Now? I heard something. Can’t get COVID-19 on an airplane. Why are the gyms closed? I mean, I just sent out this makes any sense to me. So, so I just don’t think that there we’re all human beings. And I just really don’t think that anybody even listening this to this should take my word for it. You should go and investigate it yourself. And then I’ll talk to you later because you know, it’s really true. The experts don’t always know, not because they’re bad, they just don’t know either. So I can go on another one is the first part of it. And the biggest part of it, it’s just really getting over the mind-set of the brainwashing that we’ve grown up with. I mean, that’s the, that’s really the, what the book talks about in the very beginning, because you’ve got to really understand some of the things that I’m talking about. And some of the ways that we, this is ingrained in us because we don’t learn it in school. And it’s a number of reasons why we don’t learn it in school. But the biggest one is that nobody else knows it. Because there I didn’t learn it. So, but the wealthy families in America know it. So,

Seyla (15:39):

And Holly’s in your book, you also mentioned about what the top 1% knows that 99% of us don’t would you be able to share with our listeners what that is?

Holly Williams (15:50):

The real truth of the matter is that well, three things and I just wrote an article about it just today, actually three things. You know, the first thing is that you for your tax returns are going to say, tell you your net worth. There’s no tax return. This is going to tell you a year now tell anybody you’re net worth that. There’s if you have a $300,000 house, think about yourself, right? If you have a $300,000 house and you have a hundred thousand dollars in equity in that house, and you owe $200,000 to the bank, is your net worth nothing? No, you’re not worth this a hundred thousand dollars, right? It’s so, because it’s an asset it’s and there’s this thing called leverage. And that $200,000, isn’t just a loan that we don’t know how the hell you’re going to ever pay it back. Basically the bank already owns the house, right? You don’t really own the house. The bank owns the house and they feel comfortable owning the house because the house is worth $300,000 and they can take in there. They got the whole house for 200. So theoretically they could take the whole house. And it’s a good thing for them. If you think about that, and that’s just how the math works and I’m not even a math person. And I understand it’s not a real hard thing because everybody’s got a house, you get it. And the other thing is that there’s this thing. When you buy a piece of investment property, you have tax incentives and they’re not a loophole. It’s, it’s really not. It’s there. Just go look at the tax code. It’s not like this big secret. It’s just that it’s hidden because you have to look at it, but there’s this thing called depreciation.

Holly Williams (17:36):

And you go, and there’s all the things that cost, you know, stoves and paint and, you know, parking lots and all kinds of things you can depreciate. Well, most of the time that depreciation between that and writing off the mortgage and stuff, those deductions are greater than the rents coming in, but you’re not like actually paying those deductions like right now, it’s depreciating, right? And you get a bonus to push. You can take it out early. You can accelerate that. There’s lots of things. They looked at the guff, the tax code, which is the law of the land you’re following the law allows you to do so. A lot of times, most of the time, those deductions can offset that income. So you may make $10,000, but you may have $50,000 in depreciation and I’ve seen it happen. And so on your tax return, you’re going to show that you lost $40,000. And that is just how it works. The problem. If you have a problem with it, the problem is the system. It’s not, it’s not real estate investors. You know, there’s contractors, there’s security people for the buildings. There’s plumbers and all kinds of good jobs are created by buying real estate. And that’s what, that’s why the real, the real estate entity itself pays taxes. Plus there’s property taxes. So the city gets property taxes and the schools is how we pay for our schools. So it’s not that no one’s paying taxes, right. And anybody out there, if I’m wrong, please call me. I’m not a professional. I’m not a CPA. I’m not a, none of this is investment advice. All of that stuff. I don’t want it. I’m not completely sharing my experience and what I’ve learned through this journey, through my CPA. So then I absolutely did not know. And clearly, most of the country doesn’t either

Seyla (19:43):

Holly, from your real estate investing CUNY, you mentioned that you started out as an LP where one of your friends from Texas, and then how did you transition from being a passive investor to now as an active general partner?

Holly Williams (19:57):

Well, once I invested in a couple of these, I really wanted to get more involved. And so, and I also have, you know, at the end of the day, too, this is a business. This is executing a business plan. And I have about 30 years of business experience, right. Of running P and L’s and managing people and those sorts of things that you do in the corporate world. Right. And so that was very, those are good skills to have if you’re going to get into this. And so I discovered that I’m a pretty decent writer too, and you have to communicate a lot with investors and with brokers, with everybody. Right. And so, so I kind of found lots of good ways to be of use. And so more and more people actually started just asking me if I would help them. And I started getting more involved in it.

Holly Williams (20:54):

And I sort of learned along with, you know, some of the pioneers in entrepreneurialism syndication, right? Because this kind of thing is new. I mean, in everybody’s defines, you really couldn’t do this 20 years ago. And, but it really has been the privy been, but people with 30, 40, $50 million and up net worth’s, they’ve always known about this. It’s just that instead of institutions, instead of institutional hedge funds, this was the thing. We were entrepreneurs that are buying these apartments and that’s who we’re buying them from. And we can make a much bigger difference than the hedge fund up there appear in New York, you know, who the spreadsheet, we can make a bigger difference in people’s lives by giving them a really better place to live because we’re there and we know more about what’s going on. And so it’s a win-win for everybody.

Seyla (21:53):

Yep. That makes sense. What has been the most difficult challenge that you have faced in scaling up your business?

Holly Williams (22:00):

No, I think, yeah. I mean, that’s one thing we all have, limiting beliefs, if you will, that, of how things are supposed to be and how, you know, putting yourself out there is not the ease. I, it seems like it’s easy for me, but it’s not, you know, it’s not, when you’re not supposed to do that. I remember the day I quit, my job was like, I could hear my parents, you know, in my head going, you’re not, I hire a coach to help me quit my job. And I didn’t even like, it was stupid if you put it the whole thing down, it was stupid for me to be working at this job. But, but I had to get help to even get over that hurdle just because our belief system, the first line in my book is our belief systems run deep. And this is very difficult to do, to think about money in a different way. You know, I’m just, I just began learning about infinite banking a couple of years ago and I, for a year, a year, I didn’t, I mean, its life insurance. You got to be kidding me. What a scan know to buy life insurance, come on, get out of it. But it’s a way to use life insurance differently. Right? You don’t sit and wait to die. It’s using it differently. And when you use it differently, you’re like, Oh my God, how could I have lived this long and not known that this existed? Well, this is how Mitt Romney buys everything. He’s talked about it, but you see, it’s not a secret. He’s talked about it, but I didn’t hear it. I didn’t know what he was talking about.

Aileen (23:46):

It’s kind of hard to when the mainstream media and everybody that you talk to has a different way of thinking things. So when you hear about a different perspective, it kind of goes in one ear and out the other until finally one day the light bulb just clicks. And then you realize, and you go back, you’re like, oh, that’s what they’re talking about.

Holly Williams (24:05):

Yes, exactly. And, and so I think that’s been the hardest part is just really getting over the fact that, you know, when you see something and the kind of the returns are twice as much as you’ve ever made it, any kind of investment you’ve ever done in your whole life, except for maybe in the height of the first internet thing. Like if you’d invested in like Amazon, when it was when Jeff Bezos was in his garage, he probably would have done better than a syndication. But, you know, it’s like aside from the stock that you just happened to basically look into, because that’s what it is, you know, it’s crazy. And so, so that’s the, you know, it’s just, it can’t be true if no one knows about it and it’s better than anything I’ve ever done. And everybody’s talking about taxes and cheating the government and all this kind of stuff.

Holly Williams (25:00):

When I talked to groups, the very first thing I asked is who here agrees that we should follow the law, the laws of the United States of America and be law abiding citizens. And everybody raises their hand. Right? I mean, I don’t want to break the law. I really don’t. If anybody in law enforcement is listening, I really do. But you don’t, that’s fine. That’s what our tax code is about. So why not just learn what they’re doing? And so that’s what the book is all about is here’s what they’re doing. And this is how they’re thinking. And it’s an easy read because it’s a very simple thing. I’m a simple person, it’s all just sharing what I’ve experienced. And again, nobody’s recommending any investments. Nobody is selling securities. Nobody here. I have no idea what I’m talking about. You need to go do your own thing, but just, I’m just sharing my experience here. That’s all.

Seyla (25:58):

Yup. That makes sense. Thank you for sharing Holly. So since you invested in real estate, how has the real estate investing impacted your life so far?

Holly Williams (26:07):

Well, there’s this such thing as passive income, you have to get the income from somewhere, and this is a lot of work, the whole multifamily syndicate. If you’re going to buy an apartment complex and be responsible for, you know, investors’ money and running a bit, you’re running a business. So, you know, there’s no such thing as passive income, but what I particularly is so gratifying to me is number one, I’ve been able to impact. So my brother knew nothing about this and his lie. He’s like, oh my God. You know? And so I’ve been able to help him just by, you know, and I’m his sister and he didn’t even take me seriously till three years into this. Right. And so I’ve been able to, and some friends that I really care about and that kind of thing. And so that’s been really cool.

Holly Williams (27:03):

And then to go in and see an a apart, like the first deal that we did was in Houston, where I’m from, and it was in a good school district, but you know, the people were just a hedge fund or whatever that owned it and didn’t really care. So we’re able to do they’ll the soccer field for the kids and build this, that, and the other thing. And so three years later, it’s such a great, such a better place to live. And, you know, so we’re able to, and we haven’t raped and pillaged the land. Right. You know, it’s like, you don’t go in and raise the rent. You want the tenants to be happy. So you can do things that a big corporation might not do and make things better for neighbourhoods and for people in general. And so that’s been, particularly the people in the people I’ve been able to work with. So

Seyla (27:57):

You have to investing in real estate to impact people’s lives and providing the affordable housing to the community and make the community better. So what is one thing that, you know now about real estate that you wish you knew when you first started?

Holly Williams (28:14):

I just wish I knew all of this. You know, I just think that, yeah. I mean, I wouldn’t have done too many things differently just because there’s no passive income. Right, right. You had to make it somewhere. And I think that, you know, I don’t know, again, I don’t think we could have done this, how we’re doing it 20 years ago, 30 years ago. I think it could have happened, but I do, you know, I do wish that I had been a little more open minded before that, but I was really never presented with an opportunity to do this. No, you don’t, but now you know where to look, see there’s Google now. Right. You can begin to learn about these opportunities that we never had the opportunity. We never, we’re never able to learn about before. And I think that this whole thing is scaring. A lot of people too. I really do. And it’s been quite interesting, you know, it’s not the norm. We’re bucking the trend here. So especially dial, everybody’s kind of looking at alternative investing opportunities. So, you know, we don’t really need a bank. I mean, they’re really, I mean, I’m learning how to, I’ve done some hardened, they call it private lending and you don’t really need a really doubt. You’ve really down. I mean, there’s people say, if you quit your job, you can’t get a mortgage. Well, okay.

Holly Williams (29:43):

Okay. We can get a mortgage, we’ll figure it out. But you know, it’s like those kinds of things and people just don’t, they would never think of doing that. But, but once I’ve gotten into this, there’s a lot, I mean, I’m sure there are people that will, you have to be careful. You have to get your, you know, the people you’re working with, you have to put, you also have to know the bank to the bank. I mean, they’re not, you need to know your financial advisor too. And there’s just as much of that going on. And I don’t know in our little group, I mean, I think everybody, you got to find like-minded people, you know, and, and get to know them. So that’s been really rewarding to do that.

Speaker 4 (30:25):

So if someone wanted to start in the real estate investing business, what is the one thing that set them apart?

Holly Williams (30:32):

I think that you need, I’m a big believer. I see there was a website called bigger pockets. There was a lot of grit and I love, they’re fine. They’re very mellow out of great people and learned a lot. There are people in there you don’t need a college degree, you know, don’t go, we don’t, you don’t need to do this. You need to just like you don’t need, I don’t know. I’ve found it invaluable. There’s no way that I could be doing this. If I, because I can go in and I can talk to a broker, I can talk to an investor, a very successful, I could talk to a multimillionaire business person and I can explain the business plan and what we’re going to do and how we’re going to make this thing work. I could have never done that. Had I not had some business experience gone to school? I’m a big believer in school. They’re brainwashing the heck out of us, but she needed to play the game. Yeah. You don’t know if you’re brainwashed, you got kids. You’re brainwashed. Just know that your brain, you know, you just like I tell my daughter, you know, you got to think critically in that schools aren’t as good as they, you know, they’re not all that good. They weren’t good. When I was growing up too, to think they got, they only, they teach you the way to do it. Right. And so that’s good. You know, the Beatles music major in college. Yeah. You know, the Beatles broke all the rules. You got to know the music is math, right. Music is like, there are rules, but the great musicians break the rules. And so, so, but you have to know what those rules are before you can deviate and find a better way. So that’s what I would tell people that want to get into this. I don’t think there’s anything wrong with buying a house or two, you know, just, I think you got to get some, a lot of schools have real estate programs now, which is great. You can go to law school. That’s good too. I mean, so there’s, he said he need some, you need some business experience. But if I see a lot of very young people, they want to, I’ve one kid called these two years dropped out of college. Well, what you know, okay. Then what’d you do well, he’s had six jobs since then, and he’s not, she knows he wants to do multifamily syndication because he’s, he is passionate about it. That’s what he said. I said, well, why are you passionate about it? You know? So you can’t, you know, you have to really know your why and know what your, and so all of that is just critical to being successful in this. Otherwise you’re just going to go with the next thing and you have to, yeah,

Seyla (33:21):

That makes sense. That makes sense. But what tools or techniques have you used to improve the efficiency of your business or personal life?

Holly Williams (33:32):

Well, I just hired somebody to do all my internet marketing. Then we’re going to really launch this book. So, so, you know, I think that probably knowing what you’re good at and knowing what you’re not good at is probably a way to get, you know, a good thing. It’s just, it’s just, yeah. So that’s, and I’m not good at a whole lot. So I had a farm it out, have a good team around you.

Aileen (34:01):

Yep. And if our listeners wanted to find out more about you I’m worth, can they go? Sure. So they can go to keep more.com.

Holly Williams (34:09):

I’m Holly at [inaudible] dot com and got a website and all that. And you can find out a lot of information there. You can also get a hidden investing.com and I’ve got a free little thing about the mistakes I made. Right. And then you can get a hidden investing.com. There’s a link there to buy the book so you can reach me at all, all those, the number of places. And I’m sure on your website and call you guys and you can probably find me.

Aileen (34:38):

Yes. We’ll definitely add those all to the show notes so people can easily find it. Thank you so much, Holly. We really had a lot of fun with you today on today’s episode.

Holly Williams (34:46):

A lot of fun, right? Thank you. Thank you so much.