091 | Rich Carey Real Estate | Building a Rental Real Estate Snowball Machine without Debt

Frugality

Rich Carey's journey towards financial independence was significantly influenced by his frugal lifestyle, a trait he attributes to his wife, Eileen. Her pragmatic approach to finances, such as avoiding unnecessary expenses on vacations and gifts, helped them focus on paying off debts and saving for the future. Rich recalls an early experience where Eileen's reaction to his $32,000 student debt prompted a shift in his financial mindset, leading them to pay off their mortgage in just seven years 1.

I remember early on in our marriage, I'm in the military, so I was in Guam, which in some island in the middle of nowhere, I had to be gone for our first Valentine's together. And so I thought I would do something that any smart husband would do. When I was gone, I had a dozen roses sent to the house, and then I called her, I think, the next day. Did you get the roses. And she's like, how much did those roses cost? I think they cost a lot. $200. She's like, are you crazy? $200. She's like, never do that again. And so I actually never do that again. I haven't sent her flowers since. To her, it's a waste of money. She'd rather put the money in the bank.

--- Rich Carey

This frugal mindset became a cornerstone of their financial strategy, emphasizing the importance of aligning financial goals with personal values 2.

   

Savings

Rich's approach to savings and investment was heavily influenced by his grandmother's real estate ventures. Inspired by her success with a fourplex in Los Angeles, he pursued real estate as a means to build wealth. This generational influence led him to purchase a townhouse in Alexandria, Virginia, which he aggressively paid off in seven years, achieving a high savings rate of up to 60% 3.

I was doing, like, everything I could, fully focused on paying off this property as fast as I could. And then once it was paid off, which I think was 2009, the rent was coming in from that. Instead of just having a cash flow of $100 a month, now I've got almost the full $2,000 of cash flow coming in. That just increases our savings rate that much more.

--- Rich Carey

His strategy included funneling all windfalls and additional income towards mortgage repayment, while still contributing to retirement accounts like Roth IRAs and TSP 4.

   

Influences

Key influences in Rich's life, particularly his wife Eileen and his grandmother, played pivotal roles in shaping his financial journey. Eileen's financial acumen and frugality prompted a rapid transformation in Rich's mindset, steering him away from a lifestyle of debt and towards financial prudence. He credits her with helping him realize the importance of managing money wisely 5.

I think when I married her and I realized that I was wrong about money and she was right, I sort of adjusted my attitude real quick because I knew that that was the right thing to do.

--- Rich Carey

Additionally, his grandmother's bold decision to invest in real estate as a single mother served as a lasting inspiration, demonstrating the power of strategic financial decisions across generations 6.