It’s important to think about why we invest. Is it all about that number on the bottom line? About our growing portfolio?
Or is that number only a tool to get us the things we think will make us happy: travel, art, food, nice wine, good schools for our kids... or time to do what we want, to read, to give, to spend time with family.
About ten years ago I had over half a million dollars in personal debt. Today, I spend my time sharing my path to success and helping people make smart investment decisions completely free of charge.
Ten years ago, I was five hundred thousand dollars in debt.
And I got it trying to be rich.
$500,000 is just over 25 times the national average consumer debt.
Paying $2,000 a month it would have taken my just over 44 years to pay it off.
It’s almost 80,000 Netflix subscriptions, or one subscription that lasts for 6,000 years.
I grew up working at my parent’s furniture store. They aren’t your stereotypical asian parents -they never pushed me to be a doctor or a lawyer - but they did always tell me to invest in myself. To them, the greatest thing you could be was an entrepreneur. And I took my parents’ advice to heart. I desperately wanted to run my own business.
After I graduated university in 2002, I thought the internet would totally kill brick and mortar retail. So, in deciding what type of business woman I wanted to be, I searched for something I thought the internet couldn’t replace.
And what I came up with was: Human touch. The internet was never going to be able to give you a hug, a handshake, or a massage.
So my business partner, my sister and I decided to open a spa. We knew nothing about running a business, or spas in general, so we were very studious. We spent tons of time online researching: textiles, decor, music to play, nail polish colours, the importance of scent… literally everything but the success rate of spas.
80% fail within the first two years.
I also had no idea how to run a business. Things like overhead, ROI, cost per person, etc… were foreign to me. I didn’t have a clue what to look for and strive for in my own spa.
And it’s so funny - I was so sure I was going to be successful. I had planned out this fabulous life for myself, I would be running a business that would eventually run itself, live in a gorgeous downtown loft, eat in posh restaurants, and live happily ever after. I would be happy, I thought, when I was rich. I bought a condo. I was ready for life to begin.
For five years, it was hell. I worked 12-16 hour days. I did nails, facials, paid my employees, rent, taxes, and made exactly nothing.
By the end of our first five years in business, I had about $200,000 on a credit card
a line of credit of $260,000 and outstanding payables to linen stores, etc. of $40,000
And I was making absolutely nothing. But instead of living this fabulous life I had so poorly laid out for myself, I was just running myself into the ground.
I got through the day by drinking. A lot. I would take shots first thing in the morning so I didn’t have to go through my day sober. I was ignoring calls from creditors, debtors. I owed everybody money, and I couldn’t face them.
Eventually, we sold the spa. We made back about $200,000 from the sale of the business.
It was rock bottom. I couldn’t afford my condo anymore. But the penalty for breaking my mortgage was just around $45,000. Forty-five thousand dollars. My only option was to rent out the condo, move back to the suburbs and return to my teenage job working at my parent’s furniture store. I was completely and utterly humiliated. But as it turned out, I had accidentally stumbled upon a success:
After five years of running my own business I had dug myself into $500,000 worth of debt.
After 5 years of basically doing nothing with my condo I had made $160,000.
It was enough to pay off a good chunk of the debt - and give me a new lease on life. No more drinking to get through the day. No more pretending to love what I was doing. I didn’t have to keep up appearances anymore. And I only owed a fraction of what I might have.
I learned three important lessons that year:
Lesson Number 1: It’s Better to Work Smart than Hard
Turns out that this is really what my parents had meant when they wanted me to become and entrepreneur. It didn’t really have anything to do with owning my own business - what they really wanted me to do was to build something that would work for me. The best entrepreneurs do this naturally, they build a business, they hire the right people to run it, they sell the business, rinse and repeat.
But it’s that concept that makes entrepreneurship so appealing - the idea of passive income. I realized that I had accidentally been running two business: the spa in which I worked incredibly hard, but not particularly smart, and renting my condo, for which I did almost no work, and saw a huge reward. With the condo, I hadn’t actually worked smart, I had been lucky but it made very clear to me that hard work doesn’t equal success.
Lesson Number 2: Don’t Dream
At least, don’t just dream.
Following your dreams can be like navigating without a map to a place that’s nowhere in particular. It’s unsustainable.
Chasing the spa business was one of those dreams - without a road map, there was no getting there. Once I finally admitted that it was a disaster, I was able to see the opportunity that the condo had been all along.
When you’re focused too far in front of you, you can’t see the shiny thing out of the corner of your eye.
So my advice is this: Get started - and edit as you go along. Doggedly pursue short-term goals. Be micro-ambitious. Eventually, with an open mind, you’ll wind up where you’re supposed to be.
Lesson Number 3: Run with it!
Investing, making money, and life in general is all about jumping on opportunity. That shiny thing I saw out of the corner of my eye was that no one, at the time, was selling condominiums as an investment.
Realtors all seemed to be selling the trappings - the floorplan, the size, the view, the countertops, the location. But nobody treated real estate like stocks or bonds. And there’s huge value in that - over the past 15 years the average condo in the GTA has steadily outperformed the Toronto Stock Exchange. I realized I could take my own failures, my own mistakes and teach people about what I did wrong - and what I eventually got right.
Ten years and lots and learning later, I’ve honed my investing strategy and replicated that first accidental success - not just for myself, but for the individuals and families I coach. Investing in pre-construction takes very little time and money, and it can earn a passive income - with a little help.
What I do now, the only part of the equation left, is help my clients pick the right projects for them. Choosing the right projects in the right neighbourhoods with the right builders, and then getting the best deal possible - that’s my passion. I do all the research, look over all the contracts, negotiate with the builder. There’s absolutely no cost to the investor.
Even if you don’t invest with me, pre-construction can be a simple, smart, and time-saving investment. You can read more about pre-construction investment strategy here.
As an investment coach, I definitely can’t - and definitely won’t - say that every pre-construction condo is a good investment. We have to leverage your savings and strategize for the best possible property. Strategically customizing a purchase to your situation is the only guaranteed best solution.
Ten years later? Let’s just say I’m no longer $500,000 in debt. I’d like to think I’ve found happiness, because I get to help amazing people, like all of you, make smart investments, and nothing makes me happier.