Young and Profiting with Hala Taha - Andrea Petersen: Start Investing in Real Estate Today With as Little as $500!! | E215

Episode Date: March 24, 2023

In 2022, Millennials made up just 14% of all homebuying purchases, down from nearly 25% in 2021. Today, many young people are getting pushed out of the market by older wealthy home buyers. Luckily, people like the CEO of School of Whales Andrea Petersen are aiming to change the future state of the real estate market. In this episode, Andrea teaches us all about financial mindfulness and commercial real-estate crowdfunding - a niche industry that has exploded in recent years. She touches on how to navigate the current housing market and the dilemmas that millennials face when buying their first home. Andrea Petersen is a financial expert and real estate investor with a seasoned portfolio of investing experience ranging from commercial real estate to renewable energy, hospitality, banking, and just about everything in between. She is the Chief Financial Officer of The Cooper Precision Companies and the Co-Founder and CEO of School of Whales, a crowdfunding platform for commercial real estate which allows the public to get involved with real-estate projects that were previously inaccessible for as little as $500. In this episode, Hala and Andrea will discuss:  - Why millennials are not buying homes in 2023 - The JOBS Act and what it did for investors - Investing in REITS - School of Whales and its view on accessibility - How to make money with a purpose - What to look for in a crowdfunding source - Financial mindfulness - The comfortable slippers theory - How to teach finances to the younger generation - Good debt vs. bad debt - And other topics… Andrea Petersen is a financial whale with a seasoned portfolio of investing experience ranging from commercial real estate to renewable energy, hospitality, banking, and just about everything in between. After an initial career in banking, Andrea moved on to client relations, real estate credit analysis, and eventually treasury, where she managed substantial investment portfolios with mortgage-backed securities.  In addition to her role as Co-Founder and CEO of School of Whales, Andrea is the Chief Financial Officer of The Cooper Precision Companies, a multi-faceted organization with a focus on renewable energy, real estate, and hospitality. She is now also the Managing Partner of a creative restaurant licensing and operations company known as King Goose, which operates the Miami-staple, Pubbelly Sushi. Resources Mentioned: School of Whales: https://www.schoolofwhales.com/founders/ Andrea’s LinkedIn: https://www.linkedin.com/in/andrea-petersen/ Andrea’s Twitter: https://twitter.com/whalesfund Andrea’s Instagram: https://www.instagram.com/whalesfund/ Andrea’s Facebook: https://www.facebook.com/whalesfund Andrea’s Podcast Financially Blonde: https://www.schoolofwhales.com/podcast/ LinkedIn Secrets Masterclass, Have Job Security For Life: Use code ‘podcast’ for 30% off at yapmedia.io/course. Sponsored By:  Elo Health - Go to elo.health and enter code YAP for 50% off your first month More About Young and Profiting Download Transcripts - youngandprofiting.com   Get Sponsorship Deals - youngandprofiting.com/sponsorships Leave a Review - ratethispodcast.com/yap Watch Videos - youtube.com/c/YoungandProfiting Follow Hala Taha LinkedIn - linkedin.com/in/htaha/ Instagram - instagram.com/yapwithhala/ TikTok - tiktok.com/@yapwithhala Twitter - twitter.com/yapwithhala Learn more about YAP Media Agency Services - yapmedia.io/ Learn more about your ad choices. Visit megaphone.fm/adchoices

This episode of YAP is sponsored in part by Shopify. Shopify simplifies selling online and in-person so you can focus on successfully growing your business. Sign up for a $1 per month trial period at Shopify.com-profiting. Welcome back, young and profitors! I'm so excited for you guys to hear today's episode. I interviewed Andrea Peterson, a financial expert with a seasoned portfolio of investing experience ranging from renewable energy to hospitality. Andrea is the founder and CEO of School of Wales, a commercial real estate crowdfunding platform that allows you to invest a commercial real estate crowdfunding platform

that allows you to invest in big real estate projects starting with as little as $500. In this episode, Andrea and I talk about commercial real estate crowdfunding and how the jobs act of 2012 opened up new investment opportunities for non-accredited investors. Andrea breaks down how school of Wales and other real estate crowdfunding platforms make investing in commercial real estate more accessible than ever before. And lastly, we discussed how to practice financial mindfulness. Commercial real estate crowdfunding is such a hot topic right now, especially amongst millennials. So I know you guys are going to love today's episode. And if you want to start investing in real estate through school of whales, go to SchoolofWales.com

and I've put that link in the show notes. Without further ado, enjoy my conversation with the founder and CEO of School of Wales, Andrea Peterson. Andrea, welcome to Young & Profiting Podcast. Hi, thank you. Thank you for having me. It's such an honor to be on your podcast. I'm a listener, so it's... Can't believe I'm here. Here you are. I'm very excited for this interview because commercial real estate crowd so she is such a hot topic. So yeah, fam, today we are joined by Andrea Peterson. She's a co-founder and CEO of School of Wales. It's a crowdfunding platform for commercial real estate, which allows the public to get involved with real estate projects

that were previously inaccessible for as little as $500 investments. Andrea is a financial expert. She's also a real estate investor with the seasoned portfolio of experience ranging from commercial real estate to renewable energy, hospitality, banking, and just about everything in between. And on top of all of this, Andrea is also the chief financial officer of the Cooper-Position companies. This episode is going to be centered around commercial real estate crowdfunding, its

niche industry that has exploded in the recent years. We're going to learn about the Jobs Act and how enabled regular folks like us to invest in commercial real estate projects that were previously only available for the ultra wealthy. We'll touch on the current housing market and the dilemmas that millennials face when buying their first home. And we'll begin to understand the lesser known opportunities available to diversify our portfolio within the real estate world when buying a home is out of our cards. Lastly, we'll cover financial mindfulness and how we can practice it

in our everyday lives. So Andrea, we have a jam packed agenda. I'm going to get right into it. As you may know, as your listener yourself, most of my listeners are millennials, meaning they're at these ages of 27 between 42. And really, they're in their home, their prime home buying years. And in preparation for the show, it did my due diligence. I did a lot of research. And I found out that millennials are pulling back from buying their first home. There's skyrocketing home prices. There's a housing supply shortage. There's decade high mortgage rates, and that's largely to blame why people are pulling out.

And another factor is just the earning power of our millennial generation is starting to decline. A lot of the wealth right now is being transferred to older generations. And I actually talked about this in detail with Scott Galloway in episode number 197. And the data that I came across when studying for the show backs it up, according to the 2022 profile of home buyers and sellers report from the National Association of Realitters, millennials are no longer the biggest cohort of home buyers as they were in 2020 and 2021. And instead, it's 55 to 74-year-old buyers who are taking the crown that are making up

44% of all home purchases in 2022. And millennials are just making 14% of these home buying purchases. And they used to be the biggest category of people that were buying homes. So I'd love to understand from your perspective, why do you think that millennials are pushing back from buying their first homes? Well, I think if I had to guess there's a few things

going on, right? You might have seen you touched on a couple of them. The mortgage rates lately have skyrocketed. The home prices and that in relation to the earning power of millennials, I think we're in a situation where for a young professional it just seems much more out of reach than it was before. I think also after the last housing crash in 2008, things got a lot tighter. It has just become harder. I also think there might be, and when things settle down, there might also be a priority shift. I think previously, and for older generations, owning a home was kind of the pinnacle of financial security. That may be changing as well. I think it's a mix. And I definitely think people financially

are in a stage of planning that is just different from previous generations. Yeah, and I totally agree with you. That priority point is really important. A lot of people just don't really care about owning a home anymore. It's not as prestigious as it used to be. It doesn't really define us anymore.

A lot of us are comfortable renting for our whole lives and we choose to grow our money faster that way. We might not see living in our own real estate investment as a real investment. And a lot of people say that living in your own home is actually not really an investment. Yeah, absolutely. And I think that can be true.

I think that can be a very smart statement. My only concern is that when you're buying a home and you're paying a mortgage, you're kind of saving and creating wealth without realizing it because you see it as a necessary expense. My only concern is that when you put that into rent, you may not be as cognizant of, well, I still need to save. And I still, I'm a big fan of you're not saving for the sake of saving. You're saving to generate wealth. And that requires active investing and active looking at your money. Buying a home kind of lets you set it and forget it. If people are doing that, that I'm hoping that they're redirecting the energy towards something else,

because otherwise we might have a bigger problem or they might have a bigger problem on their hands. Yeah, that's a really, really good point. So real estate is known to be one of these big wealth generators, like people who have a lot of money, typically they've invested in a lot of real estate to generate this wealth. And the good news is that even though some of us may not be able to afford a down payment for our own home, we can get involved with real estate investments with this new advent of crowdsourcing commercial real estate that's been buzzing lately. And so you're one of the pioneers of this industry right now. You are the CEO of School of Wales. It's a crowd sourcing commercial real estate platform. We're going to learn all about that later today. But let's talk about the traditional

high barriers of entry for this industry. I know that in 2012, everything sort of changed for this industry. The Congress released the Jobs Act. It sort of changed the way that we play the game of real estate. Can you talk to us about the job act, how it changed things, and enabled regular folks like us to invest in commercial real estate?

Sure. And the Jobs Act, it opened up the way how it changed things and enabled regular folks like us to invest in commercial real estate. Sure, and the Jobs Act, it opened up the way so that school whales can do what it's doing, but it was about much more than that, right? So before for companies, any kind of company to raise money, they could only approach what they called accredited investors. And there's a whole definition of what makes an investor accredited, but in general terms,

it's a wealthy individual with experience investing, etc. You couldn't just, as any kind of business, you couldn't just go out and market to the public. There was no way or vehicle to do that. That's what the jobs act really changed. It changed the laws so that you could go out and kind of market your business to the general public. Now, in order to do it, it's not like anybody can just go and do it, you do have to get approved by the SEC, the Securities and Exchange Commission,

but they create the Jobs Act, what it did, and President Obama signed it, was create the mechanism for companies to get approved by the SEC in order to well-to-market and raise money for anybody, regardless of their wealth, income, experience, etc. Yeah, and just to put this in layman terms for my listeners and you can tell me I've have this right. Now we can buy real estate just as we would buy stock in Apple or Facebook. We can basically participate in these deals and buy shares in commercial real estate deals, is that right? Yeah, it depends how the company structured. In our case, you're not buying shares, you're directly investing into the equity of the properties.

But yes, and this is where you also saw these like Kickstarter campaigns where you could like invest in these different companies that weren't public companies, but they were being open to the public. Got it. So the threshold for companies to go out and solicit money just became lower and more accessible. And so I'm assuming that most of my listeners have not dabbled in this space yet.

It is such like a new space. And so don't mind me asking really basic questions to make sure that we've got it all straight. So real estate crowdfunding is one of the hottest new ways to diversify your financial portfolio. And for my understanding, these platforms offer e-reitz. And for all of us newbies here, can you explain what an e-reitz is? So rates are real estate investments, and you can actually invest in rates even through, you know, if you have a Robinhood account or an Ameritrade account, that does work, and it does give you more liquidity, because there you are. Let's say you're buying stock in companies that invest in real estate. It makes it very liquid and just as accessible and you are

diversifying in to real estate, the difference is that you're also subject to market volatility. Because since it does trade the price of what you own, it doesn't only depend on the underlying real estate, but also on how the market is valuing it. Whereas crowdfunding normally, again, it depends on how it's set up. You're investing directly, you're taking ownership of the underlying properties, which is what we offer. And you mentioned asking questions. Honestly, this is for me, I can get on a soapbox about how people don't have enough access or get educated and run fun financial mindfulness and all of that stuff. So I'm, I love talking about this. That's not, not an issue. I work definitely going to get into financial mindfulness later on. I think it's super

zero important. So let's talk about something that you alluded to. You mentioned that you don't need to be an accredited investor anymore to get involved. So basically, does that mean anybody can get involved with crowdsourcing commercial real estate right now? Yeah, and before real estate was something that you had to wear a tie and go to a bank and it was just incredibly, you needed a lot of money. It was an asset class that was moved, that a lot of people were locked out of

because you needed a lot of money to get into it. This, that's exactly right. Now that barrier to entry has been removed. And pretty much anybody, I mean, in the case of school of Wales with just $500, you can own a commercial property that didn't happen before. Yeah, and it's really great because it really opens a door for first time buyers

in this market. So you mentioned school of Wales has a $500 minimum, is that typically what you can expect on these platforms or is that relatively a low entry point? It's usually other some that's a thousand. There's some that already have tiered levels. So depending on how all about accessibility, so we wanted to make it as accessible. And I think that as people, there's something about real estate that some people aren't accustomed to, which is it's a liquid, unless it's a rate, like you mentioned. But it tends to be a liquid, and it tends

to be a longer horizon, which can be a very, very good thing, because you kind of set it and forget it. But a lot of people need to baby steps get a degree of comfort with. All right, I'm putting my money here and I don't touch it. So I think it's a good entry point to have our average investment sits higher than that. There's plenty of people who put it coming with 10,000 or more or whatever, but any starting point is a good starting point. Yeah, just get your toes in the water, right?

And start to get used to it. I feel like that's the hardest part with investing when you're trying something new is just starting to feel comfortable with it. And we're going to ask you a lot of questions in terms of like payouts and how all of that works. So let's talk about school of whales. Tell us about school of whales.

What is your approach? How do you guys differentiate from the other crowdsourcing commercial real estate platforms out there? So there's a few ways, right? First, we're a fund. So our philosophy is that we're opening this up to people who haven't invested in real estate before. We're going to assume that there's going to be people joining who don't have experience or know how to invest. So the first thing we do

differently, some other platforms do it like this, but a lot don't, is that you can't cherry pick the properties. You invest in school with us as a fund, and then we are allowing you to diversify not only into real estate, but within the fund we'll diversify you into different types of properties that are at different stages of development, et cetera. So it's kind of new trust us to take the money with full transparency. We provide monthly reporting. We tell you exactly what's going on, but we select the properties for you. So that's the first thing we do differently. Then the other big one that we talk a lot about is, so when you're going to underwrite a

real estate project, there's a whole set of financial metrics that you're looking at, and that's standard, and anybody would do it, and any investor would do it. But we like to say that we look at profits with a purpose. So if we were to divide the underwriting sheet into to say that we look at profits with a purpose. So if we were to divide the underwriting sheet into two sides, we look at all the how you make a profit, how you measure the risk, all the financial metrics, like I said, and then there's a whole other side where we look at purpose. So we think, and in our experience, you can invest and you can make money with purpose, and money does really make the world go around

and where money goes, things kind of sense of follow. And we found that investing in projects that either, I don't know, they're doing what's best, serving a neighborhood, restoring a historic property, redeveloping for a best use that is serving the needs of everything around it. When a developer has a purpose, you can still make just as much money and also feel really proud about where your money is going. So that's one of the value propositions that

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So it's like purpose driven, real estate opportunities. And this is also, you're like combining two really hot things right now, conscious business, conscious leadership, social responsibility, plus commercial real estate crowds are saying so really cool. I love that.

So school whales is such a unique name. What's in the name? So and this goes back to a little bit something that I touched on earlier. When we actually started talking about this back in 2018, we launched last year because it setting up the business, getting approved by the SEC. It was a huge learning curve creating the website.

I mean, all of these things. And we had two really, really good friends that are designers at the time we're living in Japan doing a master's in design in Japan. And we were talking to them about what we wanted to do and we said can you help us with the branding. And so they went through a whole process, they interviewed us about why we were doing what we liked. And one of the big things that we spoke about was this desire to allow people access to this investment class, but also have them be able to learn about it in the process.

Even having discussions around the importance of financial mindfulness, you know, everybody talks about meditating and eating organic, that all sounds nice, but if you don't have money, it's really hard to sit and meditate. You're going to be really stressed out. So financial mindfulness goes beyond that. So when we told them all of that, they came with a few names, and one of them was School of Wales. I have to give them the full credit because it makes sense but they're the geniuses that came up with it

and they said, listen, a school of fish is a group of fish that swims together and a whale is in the investment world or even in Las Vegas is known as a big gambler or a big investor. So it's like a group of people becoming whales together. And if you look at our logo, it's a whale tail, but if you look at it, it's also like an open book. So the idea is you can come, invest, become a whale, and learn as much as you can in the process. So it's a plan. Funny enough, your company name actually inspired

one of our new core values at Gap Media, one of our new core values is called Just Whales. And it means that the only clients are going after our whales and I got it inspired by hearing your company name. So thank you. Oh my god, I love that. So let's talk about returns. We touched on this earlier. Talk to us about the typical returns that we can expect from these crowd-sourcing commercial real estate opportunities. From my understanding, you typically get a range. Is that what it's like at school of Wales?

Yeah, so it's real estate is a very broad category, right? You can have the apartments that you buy just as they are, maybe, paint them and rent them. And let's say you can make, I don't know, it depends between five and eight percent on that after you pull out all the expenses of everything, and then you can go all the way to what we do,

which is commercial real estate development, where we repurpose properties, or where we take a lot and build a brand new property. So what happens there? It takes a lot more time, the range of time that we're setting out for the fund is three to five years so that you can start seeing some. And again, it's going to depend the first property that we deployed money into is close to completion because we wanted to give our investor something tangible.

But it can, if you're investing in a plot of land, you have to go through planning, zoning, permitting, building, then the permitting to open, etc. And usually, as is with investing, the permitting to open, et cetera. And usually, as is with investing, time and return and risk and return are inverted, right? If you're going to buy a already rented apartment, then maybe you'll get a 5%. But if you're investing in this thing where you have to sink your money and sit and wait

and not see anything for years, you should get a better return the teens or more. So what do we do? Because there's a time factor, and we understand that people are maybe being new to this and everything is that we say, listen, we'll pay you an 8% preferred return, which means if you're investing January 1st of this year, by the end of this year, let's say you invested $100 for simplicity state. You'll have $8 accumulated in your favor. When the properties, the underlying properties start making money,

we'll pay you what we owe you in preferred return first. That 8% annualized. If it's been there for two years and you get $16, anything above that, we split 20% of school of whales. That's like our carrot for having done a good job and 80% of the investor. But we have to make you an 8% annualized return before we get any money. And that gives people a sense of, okay, what I'm shooting for here is at least an 8% annualized. That's great. So I didn't realize that. So there really is a guarantee, basically.

It's sort of safer than putting your money in stocks because a stock could go down to zero or is there, or am I wrong here? It's preferred not guarantee that what what Compensates with real estate as opposed to reach stock things like that is there is an underlying Property that doesn't guarantee because if you know, there's a completion risk if the developer, you know Sinks and sinks money into the building and then it has to go into foreclosure, maybe you don't get the full value of what you invested in, but there's always going to be an underlying asset.

Our job as a fund is to manage those risks, go after developers that have experience, et cetera. And that's why when I say we're mixing the funds to have different types of properties of different stages of completion, it's also to manage that risk. So, prefer means you get paid first, it doesn't mean it's guaranteed.

Yeah. So, let's stick on this topic of risk, because it's really interesting. You are the CEO, co-founder of School of Wales. You've got lots of real estate experience. But at the end of the day, these are software platforms. So, a lot of the people running these platforms

might be software developers, not necessarily people who are skilled at real estate. So what are the ways that we should vet these platforms? What are the things that we should look for when thinking about putting our money with some of these Fintech platforms? So track record, which SEO school of Wales is not a great selling point because we're a new fund. But there are tons out there that have a track record.

And honestly, if you're brand new fund, but there's funds out there that have a track record and honestly if If you're brand new and you know you something with finance if you need to have trust right and One of the ways to trust is track record that this that the company has been delivering results If not then you know the founding team the types of properties are investing into one of the things that we do at school of Wales So if you're one of this big whales that used to go with your tide or a bank and invest in real estate, the developer's going to give you a tour of the property and you're going to go and you're going to see what you're buying. So one of the things that we offer and we're open to anybody anywhere in the world actually, not just Miami, but if you happen to be in Miami or even if you know somebody in Miami,

you're like, hey, these guys are saying that they're investing in this 200 years flaglary and downtown Miami. Can you check it out? We offer investor tours as a group, but we've had a hard, had tours of our projects, we've opened them up, we've let people come and see because that's part of what generates trust. I mean, that's part of due diligence. And I always say invest in things that you understand or that you have a path to understanding because it's your money. And like I said, if you start a conversation with millennials, aren't buying homes, look if you're not going to buy home, which is something you live and understand, put your money somewhere and make sure you're diversifying, understanding it, taking the time to know where it goes.

Yeah, I think that's super, super good advice. Let's get into the pros and cons of investing. So obviously, a pro is that you can build your wealth to get started in the world of property ownership. And you have minimum upfront investments. What are some of the other pros that may not be so obvious? Well, for us, the purpose part is a real pro, right? Feeling pride. One of our properties is soon to open and how cool is it to go have a drink and say these are my tenants. And this is, this is my property. I think that's pretty cool. In terms of investing in real estate, there's diversification. Most people invest in stocks or bonds or their 401k's.

Maybe they have a recomponent, but it helps with diversification. And in investing in general, it's the passive income. I think people don't realize until they start getting a taste of it, you sit and you work all these hours to make money. How cool is it that if you're sitting at the beach, your money is working for you. That's the ultimate goal. And that's why I say you save not to save. You save eventually to generate well. Yeah. That's the difference. There's some other ones that I can think of. So like, you don't have to maintain the property, right? It's not actually yours. You don't need to try to get a mortgage. So traditionally, you would have to like apply for a mortgage. If you have a bad credit, you can still

participate in these types of investments, which to me is pretty interesting. So really cool stuff. In terms of cons, you were talking about liquidity. So what are the things that we need to keep in mind in terms of liquidity? How long typically is our money tied up? Is really the question that I'm wondering. Three to five years. And yes, if you know that in six months, you're going to want to buy a car and what you're trying to save your money until then, this is not the way for you. This is the first $500 you're saving and you don't have an emergency fund set aside,

this is not the place for you. It's mostly that the biggest drawback and I think the thing that we mostly have conversations with our investors about were available on social media, we have an email, et cetera, is getting that comfort around. This is a liquid. This is, it takes time. Real estate is a very, real estate development. It's a very

patient investment. Yeah, it makes sense. And I'm assuming that it's a higher return because your money is being held up for a longer amount of time. So let's talk about debt-based raising money versus equity-based raising money and the differences. Like, basically, what are we actually buying? I know you went over this a little bit, but just for all of us who are new, like if you can make it stick, like what are we actually buying and how do these different platforms raise money

and typically what does they offer that they're offering? Sure. So the actual like dirty behind the scenes, mechanics of how we work is you invest and the money goes into a bank account, which is the school wills, that was a very long name, commercial for the state equity fund bank account, and then we take that money and we actually send it to LLCs that directly own the properties that are the registered owners of the property.

So the fund owns a piece of the equity of the actual property. So by you being an investor in the fund, you literally own a piece of the equity of the actual property. So by you being an investor in the fund, you literally own a piece of the building and of the property and of the project. That's the way when I was saying there's an underlying collateral behind it, that's your collateral. Got it. So you guys do it the equity way. And if there was a platform that did it the debt way, basically what they're doing is raising money for loans, is that right? Yeah, and we actually might in the future do a debt fund because it, I mean're doing is raising money for loans. Is that right? Yeah, and we actually might, in the future, do a debt fund, because it, I mean, it is a good kind of cash efficient, especially with interest rates where they are now.

There's plenty of developers needing debt, needing short-term debt, needing bridge loans, which is a good opportunity to mix the investors and have, give them the opportunity of, all right, you can have some of it in this, like term thing. And then maybe we can do a deck that starts generating cash for you to get the sense of that as well. And then typically with school of whales, like you said, you're not, and we're not investing in one particular property. We're saying, hey, I want to invest $10,000. And then you guys are deciding how to effectively distribute those funds, is that right? Correct. Right now the fund is invested into two properties. There is a third being under written

and will probably be deployed soon and you become owner of those properties that the fund is invested in. Very cool. That's awesome. And you don't need to be a Miami resident. Not at all. You don't even need to be at, you don't even need to be a US resident. We have investors from all over the world. Cool. So how can people get involved with School of Wales? So Schoolofwils.com literally it's a three minute process to sign up and invest. And when you invest one of the steps is you can choose to be a recurring investor. So the minimum initial investment is $500. And then after that you can select an amount even as low as $10 a month to add to your investment every month

It's kind of like a set it and forget it thing, you know for you know what they say for the price of two cups of coffee or whatever it is You can add to your investment and I can tell you we've had people over half of our investors are recurring Choose a recurring investment option and it adds up and I think People don't realize it and then they're pleasantly surprised how they're able to further portfolio. Yeah, that's awesome. And for my understanding, you get dividends, right? So can you explain that piece of how you can actually get dividends participating? When the properties start making money, that's where the 8% preferred return starts getting paid out, where do we? Got it. Quarterly. Okay, very cool. We're doing got it quarterly.

OK, very cool. We'll be right back after a quick break from our sponsors. Hear that sound, young and profitors. You should know that sound by now. But in case you don't, that's the sound of another sale on Shopify. Shopify is the commerce platform that's revolutionizing millions of businesses worldwide.

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Tune into the Kelly Road Show, available on Apple Podcasts, Spotify, or wherever you listen to podcasts. Alright, so let's switch gears. Let's talk about something near-indir-tier, heart-'s switch gears. Let's talk about something near, in dear, tear heart, financial mindfulness. And I'd love to understand how we can become more financially mindful this year. As humans, some of us don't like being challenged. We often feel stupid starting something new. We don't like to feel like we don't know what we're doing at first.

And so then we don't pursue the financial education we need. And one of your mentors calls this the comfortable slippers theory. Can you tell us about this theory and why we need to start practicing financial mindfulness in our everyday lives? So people don't like uncertainty. So when you're normally faced with something that you're not, that you don't know how to handle, the knee jerk of a lot of people will be to look away from it and kind of get back to doing what you know how to do it, it makes you feel good because when we're doing something that we dominate, it makes us feel good.

So when we're feeling bad, we're going to go towards something that makes us feel good and we'll go to that thing and then we won't put effort into the problem. The thing we need to do the most, it's like I have kids. So it's like a kid who's scared of the dark until you don't turn on the light and show them that scary closet, they're going to be imagining all these things. Financial situation for people who are in good with finances and don't turn on the light and show them that scary closet, they're going to be imagining all these things. Financial situation for people who are in good with finances and don't have a degree of comfort with it, it's kind of the same thing. They'll open up their computer, try to open up that budget that Excel or even their back

down, they'll shut it down. I'll deal with this later. And it snowballs and it gets bigger and the bigger it gets, the less they want to look at it. So I say the first rule is, you know, turn on the light, open the closet, look at it, there's no monsters. And anybody, no matter where they're starting off, anybody can grow and improve their ability to manage their finances. And it's just so critical. And it's the base for everything else, you might bring in. So if you are a millennial right now, like I said, most of my listeners are 27 to 42.

If you are in this age range, and let's say, I think the typical things that people have is like a 401k. Maybe they've been investing in some stocks. They've got some sort of savings. What seems healthy to you, I guess, and what recommendations do you have for them in terms of really growing their wealth or baseline metrics they should be trying to hit? Just any sort of guidance you have for millennials and their past towards saving and wealth generation?

Well, starting super basic, make sure you're saving to start. The rule is 20%, but a lot of people say, well, I can't get to 20% because then I can't afford rent or whatever. Okay, fine. If you can only do 10, start with 10. And then don't just stick it in a bank account, especially not now with inflation. If you have $100 in your bank account, it's going to be worth less by the end of the year. So don't leave in your bank account enough to cover three months worth of your worth of your salary. That should, is the rule of thumb for like an emergency fund.

Let's say God forbid, use your job or or break a leg and your insurance doesn't cover whatever, any kind of emergency. Because there's nothing worse than having to break your investments when they're at a low point because you had to pay for someone forcing expense. So that's the theory behind that. And then after you have that three months set, invest, invest. And if you're not, if I honestly, for as much as I like finances and do well at it, I don't have high persophisticated things because I don't have the time to be checking

and I don't pick my stocks and the terrible stock picker. I do ETFs, I invest in the market, I think have a long term horizon, I think the market goes up, and then just invest in simple things with a long-term vision and things that you feel comfortable with. If you can't understand how it works and the most basic sense, stay away from it. I love that. So investing in what you know and what you're willing to learn about, that's really smart. Invest in the market, like you said, I think, unless you believe that the world is going to crumble, the market typically always goes up, right? So, let's talk about kids and their education related to personal finances.

I know you mentioned that you have kids. How do you think financial mindfulness should be taught in schools? I think it should be taught as early as possible to the... I mean, we do a lot of work because we believe in this and we like this and we've actually taught classes to college kids and we've actually taught classes to college kids and we've taught classes to high school kids and last weekend I was teaching a class to third to fifth graders. I mean, each to their level and each to their point of interest, but they, I mean, it's,

I think it's the exposure. I think it's hyper important because then as a grown up, it's less scary. When I was doing, when I was doing my college orientation, there were rows and rows of tables of banks offering kids credit cards, and it's all these 17-year-olds, or 18-year-olds, really seeing they can get a credit card, and they have no idea what to do with it. So starting young, as with everything, I think it just takes away the stigma

and this, some of my smartest friends and most successful friends really have no idea what to do with their finances, and it has nothing to do with being smart. I think it's just exposure. Let's talk about student loan debt a little bit. I have a lot of friends. I'm lucky. I don't have any student loan debt.

I have a lot of really successful friends making like $300, $400,000 a year and they're still carrying like 50K of student loan debt. And in my head, I'm like, why? Why didn't you just pay it off? You're making carrying like 50k of student loan debt. And in my head, I'm like, why? Why didn't you just pay it off? You're making all this money. What's your perspective on like keeping debt or just paying it off? What's your perspective on that? I mean, there's this term, there's good debt and bad debt, right?

And not all debt is bad. Getting a mortgage to the point we're talking isn't necessarily bad if it's helping you accomplish a goal and and create wealth. Bad debt is something that eats into your wealth. If you have friends making $300,000 and they're not paying their student loan and they're just paying the minimum, it may be because their interest rate are low enough where the cash that they're not using to pay the debt generates the more money.

If they have something that's generating them an 8% and their debt is at 3%, guess what? The net balance is that 5% that they're still making. And they might just feel comfortable having that as an expense and it's part of their budget and they're fine with it. If you have a mortgage that you got three years ago, you have a hard case to paying it off right now because it's probably a really low rate. Yeah, it's in that exactly what you said when I, it was actually my boyfriend. I was like, why do you still have this debt? And he's just like, well, he's like, to exactly what you said, I make more money

on the money that I have at hand. And so it's better for me to pay it off over time. So really interesting. Okay, so let's start to wind down this interview. We're both female entrepreneurs, Andrea. I started becoming an entrepreneur because I really wanted to make a big impact. I was working at Disney Streaming Services.

I felt like it was gonna take me 20 years to be as financially secure or to even make the amount of impact that I wanted to make. And so I decided to break free, start my own thing. And my life took off when I made that decision. From my understanding, you had a completely different reason. So tell us why you decided to become an entrepreneur. Yeah, it actually kind of just happened. You know, you meet all these people that they grew up and very entrepreneur families or, you know, they kind of always knew when they can never feel comfortable having a job. I was the opposite. I worked in banking. I did. I never wanted to work in banking. I kind of landed there after college, but I did

really well and I liked my job and I liked the people I worked with and I was growing. And then I had my son and what I found is that I struggled with the lack of flexibility and managing my time and I felt like I was failing everywhere. I felt like I was failing at work and failing at home and failing. So I started looking for things with more flexibility and I landed with who were precision companies and this is a very entrepreneurial environment and through all these series of events, we end up getting involved in hospitality and I started leading that whole branch of the business and that's, I kind of happened onto it and frankly I'm

very driven and I like working and I love being productive and I love seeing the results of effort that you put out there and being able to have an impact. So it kind of just snowballed into me being where I am today but I didn't set out to it. It was more out of not being comfortable where I am today, but I didn't set out to it. It was more out of not being comfortable where I was. So is like the the feeling of that you couldn't be the mom that you wanted to be or the business woman that you wanted to be without having that level of flexibility and freedom. So I know one of your mentors is Norman Cooper. He's actually the president of the Cooper position companies, which are the CFO now, which congratulations. That's

amazing. How did he influence you over your career? What are what are some of the Cooper-Presition Companies, which are the CFO now, which congratulations, that's amazing. How did he influence you over your career? What are some of the main things that he's taught you or influenced you? Everything I know about managing, I mean, about really being a business person and managing employees that learn through him. She's generous to a fault,

and that I've learned from him, and he has a passion for running business and the why of doing things and kind of he just has an energy about him that that robs off and I honestly I wouldn't have had what he's given me the most is the support for me otherwise I wouldn't have been able to have the courage to do other things that I am able to do. That's amazing. When you have somebody in your corner and makes it so much easier, especially with somebody with so much experience and knowledge,

you can support you. So Andrea, we end the show with two questions. The first one is, what is one actionable thing our young and profitors can do today to become more profiting tomorrow? So the first is look and make sure that you're saving, pay yourself first, that you have a set amount that you're saving before you do anything else. And then even if you're already doing that, that you're investing it,

and that you're paying attention to it. Pay attention, you've worked hard to earn your money. Don't just let it sit there. Pay attention to it. I attention. You've worked hard to earn your money. Don't just let it sit there. Pay attention to it. I would say that that's the first thing. Yeah, I love that. And what is your secret to profiting in life? And this can be financially related or relationships. It can be about anything. So the same way I said I have really smart friends who are terrible in finance. Those are the same friends who've always had to give me advice on all kinds of other things. And I think my lesson in the many years that I've like struggled with different things now has been to listen to my gut until I kind of center with myself. And I think with time I've found that my definition of success is being at peace. And that's kind of what I identify listening to my gut with. When I sit with something and I arrive to a decision that makes me feel at peace. And that's kind of what I identify listening to my gut with. When I sit with something and I arrive to a decision that makes me feel at peace, that's how I know what

to do. Even if it's not making me happy necessarily, it's not, but it's making me feel at peace. And it's taken me a really long time to learn that because I've always been very square and I always did exactly what I had to do. And everything looked great on paper. Getting to that point of realizing, got sometimes doesn't look good on paper. And recognizing that has really been useful for me. Oh my gosh, that's so good. I just had an interview with Matt Higgins. He's one of the former sharks on Shark Tank. He just came up with a book, Burn the Boats, and we talk all about following your gut and how sometimes, like you said, the data isn't enough. It's the intersection between the data and your intuition. That's how you make decisions, not just the data. And for a long time,

it was like all about the numbers, all about the numbers, and now more people are realizing, like, hey, there's this grace-based intuition that we need to look at. So I love that. So in terms of school of Wales, what's next for you guys? What are some upcoming cool projects that are going on? Well, what's next for us is to open our first project, which should be soon we've announced a really exciting lineup of tenants that the developer has in the building. I think it's a really cool project. Then I'm very excited to be of our investors who've believed in us since we started something tangible to see and have and actually get a feel for. So I would say that that's what's coming up and I can't wait for that to be able to have investors to their building and actually experience it.

Amazing. And where can our listeners learn more about you and everything that you do? Well, School of Wales has its website, schoolwills.com, Instagram, at Wales Fund or any social media. And honestly, I'm very connected to all of the messaging that we get, whether it's through our email or our social media, if anybody wants to reach out to me, I'm 100% available. Awesome. We'll stick all those links in the show notes. Thank you so much.

I loved learning about commercial real estate crowds sourcing. It was so much fun. It was such a pleasure to meet you. Thank you. Thank you. Well, there you have it, Yap Bam. I love how commercial real estate crowdfunding basically enables people to dip their toes into real estate without putting too much of their own capital on the line.

Now regular folks like us can invest in commercial real estate projects that were previously only available to the ultra-wealthy. And after learning about this topic for the first time, real estate crowdfunding sounds like a great way to diversify and have a balanced portfolio of financial investments in addition to things like stocks, bonds, and other equity holdings. But since this is a new industry with not much of a track record, just make sure you properly vet the platform you choose to invest with and go with a reputable, transparent, and trusted service like School of Wales. Thanks so much for listening to Young & Profiting Podcast. If you listen learned and profited, share this episode with your friends and family, and

take a minute to drop us a 5 star review on Apple. If you like watching your podcast videos, you can find Young & Profiting on YouTube, and you can find me on Instagram at Yap with Hala or LinkedIn by searching my name, it's Hala Taha. Big shout out to my talented Yap production team, you guys rock, everybody from the YouTube team to the audio team, the ad-up team, the research team. I appreciate all that you guys do. You've been crushing it, Lely. This is your host, Halataha, signing off.

Are you looking for ways to be happier, healthier, more productive, and more creative? I'm Gretchen Ruben, the number one best-selling author of the Happiness Project. And every week, we share ideas and practical solutions on the Happier with Gretchen Ruben podcast. My co-host and Happiness Guinea Pig is my sister Elizabeth Kraft. That's me, Elizabeth Kraft, a TV writer and producer in Hollywood. Join us as we explore fresh insights from cutting-edge science, ancient wisdom, pop culture, and our own experiences about cultivating happiness and good habits. Every week we offer a try this at home tip you can use to boost your happiness

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