Today’s guest needs no lengthy introduction. A name familiar to many, Sharon Lechter is an American accountant, author, and businesswoman. She is most known for being the co-author of Rich Dad Poor Dad, and the Founder and CEO of Pay Your Family First, a financial education organization. Sharon joins Monick Halm on the show to share how she got started in her real estate investing career, the lessons she learned from it, and how she’s helping people create their best life and put themselves in a position of greatest potential.
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Create Your Financial Freedom With Sharon Lechter
When did you start writing?
My eighth grade English teacher told me I was going to be a famous speaker and writer. I thought she was crazy. She wants to serve in public accounting. I helped them write training manuals. I was always involved in nonprofits helping them bridge along, teaching and volunteer. It was been always part of me. I started a woman’s magazine, I did some writing and I built the talking children’s books. When I got into the financial education arena, that’s when I got serious about writing. Twenty-five books later, here we are.
I probably say that you’re pretty serious at this point. Your eighth-grade teacher knew it and she saw it coming.
She did. I was math-oriented and she said, “No, you’ve got more going on than just math.”
How did you get started in real estate investing?
If I think back when I was a little kid, I lived in a little tiny house between my mom’s beauty shop and my dad’s used-car lot. He had rental properties and I had to scrub out rental properties in between tenants. I swore I would never invest in real estate or never be an entrepreneur. That’s when I started my career as a CPA. I got my degree in Accounting and became up becoming in a Big 8 accounting firm at the time. At about the ripe old age of 25, I was like, “I’m working for someone else. I’m working long hours.” That was when I started my entrepreneurial journey, which includes businesses as well as real estate because almost all wealthy individuals preserve their wealth through real estate. It’s something that I’ve been involved in a long time. My first investment property, I bought when I was about 35. I’ve always had invested in REITs and that type of real estate. When we talk about diversification, a lot of personal financial planners talk about diversification through different types of paper assets. When I teach diversification, it’s across all assets, businesses, real estate, paper, intellectual property. That’s how you can best protect yourself from economic downturns.
I’m excited to talk to you because many of your books, the ones in your own name or that you have ghostwritten, Think and Grow Rich. Probably 8 out of 10 women I interviewed on this show who are successful real estate investors, I go, “What made you start investing in real estate?” Often, “I got this little purple book and I start reading it. That completely shifted my paradigm, then I thought this is something I need to do so I started getting into real estate investing.” Much of what you’ve written about has shifted people’s paradigms. One of those things you were talking about were not taught yet, which is diversification. As you said, it’s all amongst stocks or bonds, which isn’t truly diversified. Can you share a little bit more about that? A lot of people were never taught about that so they don’t understand.
What you do for your paycheck and what you do with your paycheck determines your future and your success. School teaches us to exchange time for money, to be an employee or self-employed individual. That’s not where true wealth comes from because there are only so many hours in a day, so many days in a week. True wealth comes from buying, building, or creating assets. Asset is my favorite word on earth. Assets are sexy because the older you get the sexier they are. That’s become economic engines that generate income for you. I always want people to think about where are you in building assets? Most of us are only asset. If we don’t get out of bed and go to work, we don’t get paid. I want to change that paradigm to think, instead of spending your time for money, let’s invest your time and don’t chase the money, chase the asset. Buy building or create income-producing assets. Once it starts rolling, it’s continuing to give you money. It’s important for people to be realistic with where they are financially and then set the course.
There are a lot of us out there that want to support you in finding how to invest in real estate, how to build a business and create long-term success that can be generational wealth. A lot of people have a successful business but if they don’t understand how to make that sustainable and scalable, then you can’t have a salable to create generational wealth. Real estate is a wonderful way, particularly with what’s happening in the world. There’s going to be a real upturn in residential rental prices. It’s the time to get in low-interest rates. There’s never been a better time to get involved in real estate than that.
I love that real estate is a business. You’ve got to get in both depending on how you invest in it, but it can be an investment and a business. What are your current investments?
I have a lot of different investments. If you read the CASHFLOW Quadrant book that I wrote in Rich Dad’s series, on the left side is as an employee or self-employment person, on the right side is businesses and investments. We’ve made far more money on the right side. We have multiple investments, both personally and as investors and other people’s businesses and other real estates. We have tons of different investments. We have companies that we are partial owners. We own eleven companies of our own. Every time we buy a piece of real estate, it becomes an asset and we want to make sure that it’s continuing to work for us. We own a ranch called Cherry Creek Lodge in Young Arizona, three hours outside Phoenix. My husband wanted to have a survival property, we bought it and I said, “We have to make it an asset. We have cattle. People see cows, I see assets. We have a lodge that people can come and stay. They can do business retreats. We have horseback riding and ATV. We walk the talk, everything we create becomes income-producing.
Let them focus on making it so that everything you own is an asset. My mission is to help one million women create financial freedom through real estate investing. I’d talk to women and they go, “Yes, I want to invest in real estate. I’m working on buying my own home.” I go, “That’s not an asset. Assets put money into your pocket. Your home takes money out of your pocket unless you’re using it as Airbnb or rental or you’re house hacking, you have people renting out.”
We got a lot of pushback on that when we wrote Rich Dad Poor Dad because assets feed you, liabilities eat you. Your house is not an asset. Too many people buy a big house and then they have to continue to work hard. If they lose their job, they end up losing the house. You have a house that they can enjoy. That extra money you get in that bonus or that raise, buy rental properties and then you can buy the bigger house and let those rental properties pay for your house. That’s the idea.
What’s your thought on buying a house first before you focus on assets?
The answer is it depends on what your circumstances are and what your future is. If you know you’re going to be in an area for the long-term and you can find a good deal on a house, there’s no reason not to buy a house because if it depreciates, you’re going to get the value. Rent just goes away. You have to evaluate too and say, which is better? The issue most people find themselves in is they buy the big house right away. It becomes a noose around their neck. It holds them back because so much money is being poured into the house that they can’t use additional funds to do investments. Always have money that goes into an investment account. There’s nothing wrong with owning your own home. You end up with the appreciation, the interest rates are very low. The issue is getting too big of a house. Pay attention to what you’re doing.
You want to have enough house. If it would otherwise be going to rent, at least if it’s coming to you, then you’re growing something, but not so much that you’re stuck servicing the house that you can’t invest in anything else. I know a lot of people refinance and they put more money back into their house. They refinance and they build up their kitchens and bathrooms. It goes back into that liability. Let me ask you a question that I ask all my guests. This is my favorite question because I get the most gold from it. What was your biggest mistake in your real estate investing career and what did you learn from it?
Napoleon Hill said, “Out of every adversity comes a seed of an equal or greater benefit.” I don’t consider making mistakes. I have learning opportunities. When the 2007 and 2008 crash happened, we were lucky we had sold apartment complexes. We were in good shape there. We had investment and commercial property that we ended up losing $1 million by selling them. At the same time, when you look at the lifetime of when we held it, we made probably $5 million or $6 million from it. I look at it and say, it’s not very fun to lose $1 million on one property, but it was not a mistake to buy that property. You always have to look at it and make sure that you’re making the right decisions.
You’re doing your due diligence. You’re paying attention. Don’t over-extend yourself. At the end of the day, you want to be able to put your head on the pillow at night and not be worried about where you are financially. I’m doing a podcast, Women Investing Network. It’s related to real estate. I want people, particularly women to be more confident and find the tools and the right education. I’m glad that you’re doing this, Monick, because you have the opportunity to help people understand what they need to do to invest in real estate. It’s a perfect time to get into real estate investing. If you want to be recession-proof, residential rental real estate is the way to go because a lot of people are losing their homes. A lot of people are losing their jobs, but they need somewhere to live. Make sure you’re in a landlord-friendly state. That’s always the second issue they need to think about.
I live in California. It’s not so landlord-friendly. I don’t invest in California just because of that.Assets feed you; liabilities eat you. Click To Tweet
Texas and Florida are great. You want to make sure you find states that are going to be landlord-friendly.
Can I ask you a little bit more about the learning opportunity that you had with this commercial property where you lost $1 million? What would you have done differently if you had to do it again?
There wasn’t much we could have done differently. We did everything that I teach and we had a long-term government tenant, and they broke the lease. It was a very large property. We never missed a payment, but because we ended up hitting the loan-to-value ratio because of the crash, they called the loan. That’s where we could have lost the property instead we did a short sale on it with an organization that was willing to pick it up. We were able to save the situation, but you have to be prepared for things that are outside your control. We had everything the way that we teach it long-term, Grade-A client, government long-term lease, yet it disappeared overnight at a point in time when we couldn’t find another tenant because of what was happening in the economy.
Sometimes things like 2008 or what’s happening now will happen and you can’t predict that.
There was a commercial property, it’s an office building. We are not investing in anything commercial and I’m thrilled. I thank myself. I thank the stars every night because commercial property is going to be tough. A lot of the big box stores and big malls are going to turn into being fulfillment centers. There’s a big question mark on where commercial properties are going. A lot of office buildings are losing tenants because people are working virtually from home, but long-term residential rental is definitely going to remain strong.
We have some industrial property and that’s doing well.
Industrial property is great because we’re bringing a lot of manufacturing back from international. We’re bringing it back to the US. Industrial is strong. The retail is more of my concern. Even residential rental properties, if it’s student housing, I wouldn’t get it because we don’t know what’s happening with all the universities. Every market niche, you have to pay attention and be aware of what’s happening in the economy.
You’ve done so much in your life. What are you most proud of?
I’m most proud of the next phone call that I get, or the fact that you started our conversation about how grateful you are for the things that I wrote and the impact that it had. Your comment is what I’m grateful for. I grew up with a father who asked me every night, “Sharon, have you added value to someone’s life today?” When I go to bed, I still ask myself that question. When I go to bed, I’m going to remember that you said that to me.
You should be proud of that. I know you’ve changed millions and millions of lives with the books that you’ve written, mine included. I think I said it before we started that I feel like 90% of the women that I interviewed on the show, when I asked them how did they get started, they mentioned Rich Dad Poor Dad.
I did not ghostwrite that. I own the company and I was the co-author on fifteen of the books in the Rich Dad’s series. I have never been a ghostwriter and never will. My name is always on the books. After I left the company a few years ago, he reprinted the books and took my name off of them, but I was never a ghostwriter. I was definitely on there.
Your book, Rich Dad Poor Dad has changed many people’s lives, mine included. Many of the women that I interview on this show can directly point to that book as changing their lives, being why they’re here and they’re successful. We’re grateful for that. You should be proud of that.
Hopefully, you’ll recommend that they read Think and Grow Rich for Women because it truly is a book that can support them in finding and realizing that they’re not alone. Successful women everywhere want to help other people. I highlight over 300 women in Think and Grow Rich for Women.
I’ve read that book. That’s a wonderful one, and the other one that I just read is Outwitting the Devil.
That is a life-changing book. It was written by Napoleon Hill in 1938, but the title scared his wife to death. She worked for the Presbyterian College. She locked that in the vault for 72 years. The foundation called me and said, “We have this manuscript. We don’t know what to do with it.” It was life-changing for me. I was thrilled to bring it out because even though it was written in 1938, it was written for what’s happening in the world now. On page 61, when the devil was being interrogated, he says “At some point in your life, I’m going to be using the fear of death and the fear of poverty to bring people to their knees.”
What is happening in 2020, people are scared to death of this pandemic. They’re scared to death of the economy and what’s happening. We are living it now. In the book, Outwitting the Devil, we talk about how you can turn that fear into focus and into fuel to drive forward and create success. Many of today’s most successful companies were started in the Great Depression. We are there again. This is the time to solve a problem or serve a need. That’s what makes a successful company. We have the opportunity. Instead of being frozen and paralyzed by the fear, get motivated, and turn that fear into fuel and create the opportunity so you’ll be the success story we’ll be talking about in 2021.
That was golden. It’s good and that’s such a powerful book. It’s brilliant. It is life-changing and so are many other ones. Sharon, to what do you attribute your success?
My definition of success is not just money in the bank. You can be successful that way, but success is how you feel about yourself when you look in the mirror and it has nothing to do with your reflection. Success is where do you want to be in life? Are you making a contribution? Are you living a life of significance? I think success comes from significance. You can be successful, have a lot of money and have a black heart. I want to be successful, have a lot of money so I can give a lot of it away and help other people. I want to have a heart that’s full, a family that’s happy to be able to feel good about myself when I go to bed at night. That’s what success is.
My goal is to help as many other people. One of my greatest joys are the people that I mentor. Most of my career was doing one to many, writing, speaking because that’s the right side of the quadrant. The left side of the quadrant is one-to-one mentoring. I have the opportunity at this point in my life to help people one-on-one, help step into their business, create the world that they desire, open doors for them and make introductions. I have a client in real estate. She has several hundred million dollars’ worth of property. She bought a private island in BVI. I was thrilled for her. She’s in her 30s. I have another client who just signed a deal with a major Fortune 500 company. That’s because they have the courage. You guys can go to PersonalSuccessEquation.com. It’s about your passion and your talent. Most of us stop there.The definition of worry is to pray for what you do not want. Click To Tweet
Times A is power of association. Who’s on your team? Who’s your mentor? Do you have people on your team that are weak where you are strong or where you are weak and they are strong? Times A is taking action. Many times, we know what we’re supposed to do but we just don’t do it. The last element is plus F, faith. To many of us, that F is the sphere that holds us back. That power of association and faith is where I help women step up, stand into their power, take that next step, find the association that’s going to help them go to the next level. Passion plus talent, it’s all about you, times association, it’s all about your environment and who you’re around, taking the right action and having faith. When you have the right people around you and the right associations, your self-confidence soars. That’s the essence of what I’m doing. Far too many women on businesses and only 4.2% make over $1 million a year, whether you’re on real estate or regular business. I’m on a mission to make that go 10x. We’ve got to get your women business owners up there to where they’re generating more than $1 million a year.
Generally, you have success in all of that. You gave a wonderful definition that you were talking about. It’s not just money in the bank, but contribution, family, feeling every day that you love what you see in the mirror. Would you say that’s the formula that you follow that has attributed to your success?
That is exactly what I live in my life. Every one of my mentoring clients, that’s where we start. That’s why it’s important. That’s why I created a free resource, a guide on PersonalSuccessEquation.com for people. It’s a guide for helping you walk through your passion and your talents. Your passion can be something you love or it can be something that you’re mad about. I was angry they weren’t teaching kids about money. In December of 1992, I made the commitment that the rest of my career was going to be on financial education, financial empowerment, and giving people the tools to create financial confidence on the way to financial freedom. A lot of people are talking about financial freedom. Let’s be confident first. Let’s be in control of our money instead of having your money control us. Every step of the way, you feel a little taller and have those little wins.
What advice do you have for a woman who’s just starting out and about to invest in real estate?
It’s one step at a time. You’re going to learn a lot with your first deal, but make sure you also pay attention to who you’re listening to. It’s important. There are many people out there now that are doing online courses and mentoring. You need to make sure that the person or whoever you’re listening to and learning from walks the talk, and that they are there to support you. Don’t hold back. Take one step at a time. The nice thing about residential real estate properties is that you own 100% of it. You get 100% of the appreciation. You only have to put 20% in, sometimes even less, and the bank gives you the money. Now when interest rates are so low, there’s never been a better time to get out there and put your stake in the ground and say, “One property at a time.” Make sure you’re doing the due diligence. Don’t do it alone. Get involved in a mastermind related to real estate or a local group where you have resources and people to ask.
When you were starting out and maybe you were at that first CPA job, what do you wish you’d known at the beginning that you now know?
I get asked that question a lot. I finally figured out how I want to answer that because to think that way means to live in regret and I refuse to live in regret. There are a lot of things in my life I wish I’d done differently, but then I wouldn’t be who I am now. There’s a concept of the word worry. I happen to be a champion worrier and I realized that when you worry, you’re wasting precious time today about something that happened yesterday or something that may or may not happen tomorrow. In the book Think and Grow Rich for Women, I added a chapter called One Big Life. Instead of worrying, catch yourself because the definition of worry is to pray for what you do not want. You’re concentrating on negative outcomes. The Law of Attraction tells us what you think about you bring about. I still worry, it’s part of my nature. My mother was the queen of worry.
I catch myself and go, “Sharon, instead of thinking about what I don’t want to have happened, let’s reprogram my mind and let’s focus on what I do want to have happened,” because that changes your mental attitude. Instead of your brain being focused on negative outcomes, it’s focused on the positive and it’s magical. What are you feeding your mind? What are you feeding your brain? Are you focusing on the negative or are you focusing on the positive? With this pandemic and so many people were paralyzed in fear, I launched a daily motivational tip called The Daily ATM Deposit, Abundance Tips and Mentorship. I make it an $8 a month because I want people to have that daily injection of positivity thinking about it. It is important to have that steady diet of positive injection every single day. It’s helping you to see the world, see the opportunities. Too many of us have these blinders. We don’t even recognize the opportunities that are right in front of us. I want to blast those blinders away so people can create the best life and put themselves in a position of greatest potential.
What would you say is the best place that people can go to find out more about you and what you do?
I invite you to join me on Instagram it’s @SharonLechter. LinkedIn, Sharon Lechter. Author Sharon Lechter is my Facebook page. I do a weekly broadcast. A few years ago, I realized people are playing too small so I launched the Play Big Movement. It’s a private Facebook group, but we welcome all of you to join it. I do a weekly broadcast there every Thursday morning. On Wednesday morning, I do a broadcast on my Author Sharon Lechter page. I’m continuing to try and add value and to make people think about things they can do in their life today to make tomorrow better. I’d say come to Author Sharon Lechter, go to the Play Big Movement private Facebook group, and follow me on Instagram because we’re out there supporting people constantly. If somebody has a specific question, they can reach out to [email protected]. That’s an email that comes to the office. Visit my website, it’s SharonLechter.com.
It is time now for our famed end of show trinity, which is a brag, gratitude and a desire. What is one thing you’re celebrating now? What is your brag?
During this pandemic, I’ve been busier than ever. My brag is that I truly have been able to support people finding the light at the end of the tunnel. I go, “Instead of looking for the light at the end of the tunnel, I want you to become the beacon of light and feel better about yourself. Be your own knight in shining armor. Stand in your own power.” My brag is that I’m creating positivity for people in their lives. A lot of us do that ATM thing, but it’s also offering inexpensive classes to help people take control of their finances. That’s why I’m working harder than ever, but I feel so good about the fact that people’s lives are being changed for the better.
What is one thing you were grateful for?
I am grateful for my family, my friends, my associations who’ve come together to unite. My husband and I had been married for many years. I have wonderful children and incredible grandchildren. The only reason I have kids is to have grandchildren. I’m grateful for my family and my beautiful grandchildren. They make everything joyful for me.
Last but not least, what is one thing you desire?
My desire is that I continue to have the health and the opportunity to positively impact the world around us. Every single day, many of us as women, we judge ourselves by the roles we play. We put ourselves last and I was good at that. As I’ve gotten older, I share with people, “Be the best you.” I know that if I’m a better Sharon, then I’m a better mother, I’m better in those roles that I play. I want to focus on continuing to spread that word and also to get myself to the highest level of health possible.
So shall your desires be or so much better than you can imagine under grace and in perfect ways.
This is one of my favorite all-time episodes. I love connecting with you. I appreciate everything you’ve shared now and over the years through all of your writing, your courses, everything that you create, and continue to create for us. You can connect with SharonLechter.com, Sharon Lechter on Instagram, Author Sharon Lechter on Facebook, Play Big Movement on Facebook. Connect with me at REIGoddesses.com to find out about our events, our trainings and our community of women who are crushing it in real estate investing. Join us next time for another episode. Thank you.
- Think and Grow Rich
- CASHFLOW Quadrant
- Rich Dad Poor Dad
- Think and Grow Rich for Women
- Outwitting the Devil
- @SharonLechter – Instagram
- Sharon Lechter – LinkedIn
- Author Sharon Lechter – Facebook
- Play Big Movement – Facebook group
- [email protected]
About Sharon Lechter
Sharon Lechter is a keynote speaker and as a business strategist and mentor, is an elite entrepreneur. She is a bestselling author, philanthropist, business strategist mentor, licensed CPA for 35 years, and a mother and grandmother. A life-long education advocate, she is the founder and CEO of Pay Your Family First, a financial education organization.
In 1997 Sharon co-authored the international bestseller Rich Dad Poor Dad, along with 14 other books in the Rich Dad series. Over 10 years as CEO she led the Rich Dad Company and brand into an international powerhouse. In 2008 she was asked by the Napoleon Hill Foundation to help re-energize the powerful teachings of Napoleon Hill just as the international economy was faltering. She has released three bestselling books in cooperation with the Foundation, including Think and Grow Rich-Three Feet from Gold, Outwitting the Devil, Think and Grow Rich for Women and Success and Something Greater.
In 2008 Sharon was appointed to the first President of the United States Advisory Council on Financial Literacy. The Council served both President Bush and President Obama advising them on the need for financial literacy education.
In 2002, Childhelp honored Sharon and her husband, Michael, as recipients of the Spirit of the Children Award. In 2004, Sharon and Michael were recognized as an Arizona “Power Couple,” and Sharon was also named as a 2005 Woman of Distinction by the Crohn’s & Colitis Foundation of America. She was honored with a 2012 Positively Powerful Women award for Philanthropic Leadership, by the Phoenix Business Journal as one of 2013’s 25 Dynamic Women in Business, and most recently honored by National Bank of Arizona with the 2013 Woman of the Year award and Arizona Business Magazine as one of the 50 most Influential Women in Arizona Business.
For more information, please visit www.sharonlechter.com.
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