And let's be honest. Every deal, something is going to go wrong, right? Like, you bet. And you and I have been investing long enough to know that no deal goes perfectly smooth and never has a challenge that we have to address. And I think this is where the genius of real estate investors are, especially those of us who've been in a long time, is that we understand that.
We know that there's going to be a challenge and we accept that responsibility of the challenge and we know how to navigate and solve those problems.
And I think that's key when you're investing with someone you wouldn't want to invest with someone, for example, who has who just barely started investing in 2020 and and now they're you know, they're three years in because 20, 20, 20, 21, you know, even if they said, oh, we did really great on our investments, it was kind of a, I don't know, a fantasy world that was happening in those couple of years with.
This is ideal, said Wife. Sure. And Amir was thinking about a commercial real estate investor. And today I have a very special guest, my good friend Kamala. Jeff's. Welcome, Kamala. Hey, thanks so much. Being cute. So good to be here with you. Thanks. A little bit about Carmela. She's a founder and CEO of Steady Streams Investment. Kamala is a general partner in over 1500 multifamily units and a 65 part assisted living community.
She has a 20 years of experience investing in real estate, and she holds an MBA and was known as an innovator leader for the tech companies. Kamala is a host of the Quiet Wealth podcast. She's a mother of five amazing children, loves to play soccer and tanners, and Reese farm animals. Today, we'll be discussing passive investing and what could go wrong with Carmella. Once again, welcome, Carmela. I'm excited to dive into this topic because it's a hot topic today, isn't it?
There's a there's a lot of, you know, and settlement happening in the multifamily industry. So let's talk about what happens when it goes wrong. That's true. And especially in today's market with all the market volatility and a lot of things that are happening, people are so uncertain about the future, what's going to happen. A lot of, I would say, fear in the market. Yes, for sure. For sure.
There is a lot of fear and understandably so, because there there's, you know, a lot of things that have happened. I mean, interest rates have gone up like crazy. There is you know, some properties are starting to get into trouble.
And so if you're a passive investor and you get news that I or property the property I invested in is having some trouble, you know, let's talk about like what what can you do and how can you how can you weather the storm and what are your responsibilities versus not your responsibilities? If they come and ask for extra money, for example, I mean, there's a lot of things that we can make you really talk about here. That's awesome. So let's start a little bit briefly with your background.
If you can tell me who you are. How did you get here wherever you are today? Yeah. So I started investing in at the age of 22 and because I well, really on accident. So my husband and I were young, married and broke college students and we we were the only thing we could afford at the time was a garage apartment. Like somebody's converted garage that they converted into an apartment. It was just it was a dump. All right. But fond memories, right?
When you have your first place together with your spouse. Oh, so it was a it was a good place, but also a dump. Well, one day the landlady came around to collect the rent, and I knew she owned several renter rentals in the area. So I just asked her. I said, Are you how do you do that? How do you own several rentals and how did you get to where you are today? And she said, Oh, what you need to do is you need to buy a house. And I was like, No, no, lady, you don't understand. I have no money.
I'm living in your garage apartment, I have no money. And and she's like, No, no. What you do is you buy home that has a basement apartment in it, and then you rent that out, and then your mortgage will be very low or even for free. I was like, Hmm, that's an interesting idea. And that's exactly what we did. So we went from living in a garage apartment to buying a six bedroom home that had a full basement apartment in it, and it had a pool in the backyard.
And we paid less to live there than we did at this nasty garage apartment. So that's what really got me excited about real estate. And I'm like, Yeah, there's something to this real estate thing. And so I started really learning as much as I could. I started reading books because podcast weren't around at that time, so I was just reading as many books as I could and found a book that was called Are You Investing One House at a Time and I was like, This sounds doable for us.
And so that's what we did. So basically every two years we would move out and we would buy a new property and we move into it. We buy a fixer upper and we live in a construction mess and we'd fix it up. And then we'd once it was nice and pretty, we move out so someone else could enjoy it and we live in a dump again and fix up that one. But it was a way for us to build up our portfolio.
So fast forward 15 years of this and we had about 20 units and we were DIY, everything like we were going over and cutting the grass. I was taking all the tenant calls, I was figuring out the marketing strategy, the account and the, you know, every little thing. We were dragging our five kids with us because we had five kids by then and to paint the units and get them, clean them up. And I just got completely burnt out. And I like this is just so hard to do ourselves and it's not scalable.
I couldn't figure out how to get more properties is I couldn't just couldn't physically do the work because I was stuck in DIY mode, do it yourself mode and so then we paused our investing for a little bit. I went back to school, got my MBA. I thought, maybe the corporate world is is where I meant to be. And my got my MBA. Awesome experience. I joined the corporate world. I landed a really great job, you know, six figure income and R with tech companies. I loved it.
And then four or five years into that, I was like, Oh, this is not going to make me a millionaire. Only not going the right path to really build wealth. I mean, it's a it's a good path for, you know, acclaim and for people to pat you on the back and say, hey, you're doing a good job. But also as an h.r. Professional, we were i would study compensation and we tried really hard to not pay people a lot of money, right.
Because we were trying to keep the costs low and and it was rare to give people promotions like there was no way for people to really get ahead. Just working at the same company every year over year to year. Yeah. And and then I also wanted back my time freedom also I'm very creative person and so I had all these ideas about things we could do. And my the answer was always, not that we're just going to do it the way we've always done it because that works. We're not going to try new things.
And so I'm like, this is not fun. So then I just kind of looked around and said, Well, how can I build wealth? Let's go back to real estate, my roots and really get involved. But this time I want to do it different. I want to buy apartments. And so then I started researching apartments. I looked him up on Zillow and stuff and I'm like, Oh, no, apartments cost millions of dollars. Like, I had never bought a property that was over $500,000 up until then. So I'm looking at my bank account.
Nope, not millions of dollars in my bank account. So how do you even buy an apartment? So then I started researching and realized, Oh, you don't buy them on your own, you buy them together in a group. A group of people come together. My mom fell in love with this concept, invested passively into a deal and I was so mad. Yes. That some of the returns I got on that on that investment were better than the returns I got on some of my single family stuff that I had literally done all the work for.
A piece of investing and the power of passive investing was just amazing that, you know, I didn't have to do all of that work. And so that's when I fell in love with it. I launched that Extreme Investments because I know there's thousands of other burnt out landlords like me that needed to know about this way of investing. And so I just started educating people on that.
And from that, I just stepped into your becoming a general partner in in it and, and helping people place their money and bringing them investment opportunities and becoming an expert on passive investing and what that means in the ins and outs and the process and the risks at all, all around. And that's how I got to where I am today. So I did exit my corporate job so I could do this full time. And and I'm loving it. I really love talking to investors and teaching them how to do it.
And I help a lot of new people in in this industry to kind of get out from just doing four one KS and IRAs. And let's hey, let's try something different. Let's let's get into the game and be a real investor rather than just kind of letting, you know, the financial advisor tell you what to do. So that's where I am today. Now, I love your story and I totally resonate with that. I trust me and my God, been there, done that same story.
The problem, the problem that I hear is that we entangle ourselves with our corporate jobs and we ID changes. We are not me anymore, you know, because we are the title in that corporation with whatever corporation that we are working for. Like I'm a president, so and so I do manage or whatever it is, right? So that's your ID, So it's very hard to let go and it can only happen either they let you go or something. Oh yeah, lightning goes, Oh, I was.
I was talking to a friend the other day who was having this identity crisis and he was like, you know, I want to leave. I want to leave my corporate job. So bad, you know? But I really like being a VP. And I said to him, You leave your job, you're going to become the CEO of your own business. I mean, that's a level up, right? He's like, Oh, I didn't think about it that way. Well, there you go. Take on the CEO title. You know.
That's what I'm enjoying My resignation now, actually, CEO of my own company was being a vice president for somebody else. Right? That's right. I mean, that's a big aspect of what most people, you know, because they get to untangle that It's very hard to let go. And for me to it was all the thing that I I'm from India, so when you move countries, there's always this thing in my country that I learned. My parents taught me go to school, get good education, get a good job, get a white collar job.
So it was like white collar job was the number one thing for us. I started in real estate, but 20 years ago to single family. That's a saying I could hear your pain. I dealt with as well as termites, you know, myself. And we were that DIY as well. Like I joke all the time, me and my husband, we didn't even know that property management companies existed at the time because it's not like that.
It was not that it was there, but we wanted to do it ourselves because we wanted to, because we didn't want to pay somebody else, because that's making enough money. That's the reason I'm saying I resonate with this story because we did that same thing. But now we learned the hard way and we are doing much better. So I wanted to understand from you, what are some of the key benefits of passive investing, you know, that we can share with our listeners and how can you create generational wealth?
Because it's very easy to do it. Yes. Yeah. So there's three there's three key benefits. So one is your cash flow, right? And second is appreciation. And the third is tax benefits. So when you invest it, you'll move your money into a real estate investment. I think the the biggest benefit and the most misunderstood one is probably the taxes, taxes. It has been it's been amazing for us to invest in real estate because we get significant losses on on paper. Remember, they're on paper.
I had an investor once to who did panic because they got you know, they did a $50,000 investment and they got a key one that showed a $30,000 loss. And they thought they had lost 30, 30,000 of their 50. And like, no, no, no. This is just a paper loss that you can then write off on your taxes. So that one is a huge benefit, especially for business owners, too, like business owners. And that's what I teach on my podcast quite, quite well because I teach, you know, how to invest and own a business.
You can maximize your tax strategies and really play the game right and win the game. And so though that's a huge benefit, but then, you know, investing passively like you get you get cash flow throughout the deal now depends on the deal, right? Some deals will offer a lot of cash flow and others will offer minimal amount. And then when the deal sells at the end, you get your money back plus some plus extra. Right.
And so one of the one of the a lot of the goals is to you can get much higher returns in real estate and then you can, you know in the in the stock market. Yeah you set it very well. And regarding the tax benefits, it's just like tax deferment, putting the money into different buckets and you can keep on doing life long, you know, and not have to pay taxes. It's not necessarily that you're eliminating the taxes, you're just deferring the taxes.
So but we are not the CPA is really just to get more work. So we're just chatting a little bit. So let's talk about how can somebody start investing in real estate if somebody is a newbie or a beginner, what are some of the key strategies they should be following and also getting to the comfort level that they feel like, Oh, I'm not hesitant anymore, let me try this. And you know, right this way. Well, I'll tell you through my experience, right.
So my story is, is, you know, I started poking around looking for different ways to invest that did not involve my time and muscles and skills and tears right. It's like, well, how can I still invest? Because I believe 100% in real estate. I know, you know, over 90% of the world's billionaires have real estate in their portfolio. And so it's a it's a lucrative investment strategy, and it's one that if you want to become a millionaire or multimillionaire, you need to have some real estate.
So I'm like, okay, well, how do I how do I figure out what to do? So when I figured out that investing in apartments would be a group investment and there was a thing called being a limited partner in this investment, and that sounded, well, simultaneously amazing, but also frightening to me because I was used to being in control of everything. And now this time I was not going to be in control.
Because when you come in as a limited partner, you don't have you don't get a say in when they sell the property. You don't get a say in how many, you know, what they charge for rent and how how fast they accelerate rent or slow or whatever. Right. You're you're literally just there to invest your money. Kind of exactly like the stock market. Right. If you invest your money in Apple, you don't get a say in what products they're going to bring out online.
You know, you're just investing in that company and you're trusting that company to do well with your money. Those same thing as a limited partner. So I said, you know the T word, right, trust. And that's that's a huge thing as a passive investor. And so my story was, you know, when I was trying to figure out who to invest with and what and what to do. Education is huge and it's something I'm very passionate about.
It's steady stream investments is educating people on the ins and outs of passive investing and making sure they understand the risks and making sure they understand the pitfalls, making sure they understand what could happen if it goes wrong, but then also helping them understand what could happen if it all goes right to, you know, and and how they can really make an impact for their own families by investing like this. And so one of the things that I did, of course, was education.
So I started listening to podcasts, as many podcasts as I could find to really understand the process and understand the market and the economy and make sure that it was going to be a smart choice for us. Then I started attending local meetups, and you can do this pretty easily. Just go to Google and search for local multifamily meetup.
If you're interested in investing in multifamily or if you're interested in self-storage or RV parks or all of those things, you can just Google those meetups and then you go at a ten to just start talking to people and talk to them about, you know, who's done it and who hasn't done it and where were the deals are. And then you start networking and learning and finding the people. You can also go to big conferences and, you know, meet the people who speak the speakers on the stage.
There's virtual conference that you can attend weekly. I know you hosted one not not too long ago. Like, those are really great events to get educated. Once you've gotten educated, then you need to start talking to the people who are offering the investment opportunities. So for my business, I have set up a way for you to get on a call with me and we do a 30 minute strategy session where you can learn about we we talk about your experience so far investing.
We talk about your goals and what you're looking for. And then, you know, you can learn about what opportunities that my company provides so that and get on their list. So the suggestion would be to get on multiple lists so that you can see multiple investments and you can understand who's doing what in the industry and get options to to look at and then also talk and find other passive investors.
So other people who are doing it passively and ask them who do they like to invest with and who are the people that they would trust with their with their money. So those are some tips that you can do to get started in investing. Thank you so much for sharing that. That's all really good tips and all of them work. And since you're talking about the trust, I wanted to emphasize that it's very important to trust we are investing with. So you have to like the person. So do not invest with anybody.
If you do not like somebody because you're marrying that person for 3 to 5 years. Because each deal for us, you know, for example, what deals are covered in a way that it lasts 3 to 5 years and that could be three years, could be five years, could be years longer, you know, depending upon the market conditions, you know, So you have to like the person, you have to trust the person in order to invest.
So today, what topic is mainly we're going to be talking about all the negatives because everybody talks about the good stuff he invested me. You'll get tax returns or then. So we're going to talk about what could go wrong in passive investing and what are some of the hesitations that the investors have, because I think that so for thing, because that's the reason they sit on the sidelines, because they do not get the questions answered like I was the elephant in the room.
So let's talk about the elephant in the room that could go with that defense. So you want to start with one obvious misconception that people have. So the yeah, I mean, what can go wrong with with deals? There's there's a lot that could go wrong. And and let's be honest, every deal something is going to go wrong, right? Like, you bet. And you and I have been investing long enough to know that no deal goes perfectly smooth and never has a challenge that we have to address.
And I think this is where the genius of real estate investors are, especially those of us who've been in a long time, is that we understand that. We know that there's going to be a challenge and we accept that responsibility of the challenge and we know how to navigate and solve those problems. And I think that's key. When you're investing with someone you wouldn't want to invest with someone, for example, who has who just barely started investing in 2020.
And and now they're you know, they're three years in because 20, 20, 20, 21, you know, even if they said, oh, we did really great on our investments, it was kind of a, I don't know, a fantasy world that was happening in those couple of years with real estate because things went up so quickly. And so, of course, if you had real estate, if you bought real estate in 2019, 2020, you made a ton of money on your real estate investment. So awesome, great, good job.
But it wasn't because you are a savvy investors, because the economic in the market conditions really gave that wind beneath your beneath your sails. So let's talk about that. We're in 2023 and the interest rates have gone crazy. Crazy. And there's a lot of deals out there that are struggling. I have to I talk daily this morning. I had coffee with a friend and we were both chatting about how some of the deals that we have are struggling and why are they struggling?
Well, I mean, the elephant in the room is the economy, because the interest rates went up so fast and then more than 90% of multifamily properties and over the last year or two were bought using a loan product called a bridge loan. And a bridge loan is just simply if you think of like imagery of a bridge, right? You're just trying to get across the rough water to get to the other side and then you get into a permanent loan, right? Or you sell it. So those are the strategies.
And it was a very normal strategy last year for investors to use the the bridge loan. So now not every property that has a bridge loan is struggling, but a bridge loan is not fixed debt. It is variable interest. And and so what has happened is that last year you bought a property and it was like 3.75% interest. And today you're paying eight or 9% interest because of that variable rate has just shot up so fast.
The other issue is that with the economy, you know, last year when we were underwriting, you know, we felt like we were doing conservative underwriting and we even mapped out, okay, well, what if the interest rates go up to like five or 6%? Because we thought that would be worst case scenario and oh, surprise, Nope. Eight, nine. Here we are right in this in this really high interest rate. So what does that do to a property?
It makes it negatively cashflow other challenges that could that that happened. So that's out of our control, right? There's no way we can control the interest rates. So that's one of the things that's out of the control of the investment of the operators who are running it. Now. What is in their control is how the investment is operated. And so sometimes you hire property management company and things don't work out and you have to fire them and put a new one in.
That's a painful process and it could cause some, you know, dip in cash flow for the property houses that. Yeah, and you know, the occupancy could go down just because the you know, the property management is not going well. Well if you combine that with the interest rate issues, that's why a lot of properties are struggling today is that like not only is the you know, it's hard to pay the mortgage because the cash flow and the cash flow is really low.
So those are kind of a couple of things that can go wrong. And then, of course, there's other things like my friend this morning, she's talking about her property and how a boiler went out and the water got shut off for like seven days, the apartment complex. And they were trying to fix it and they had to like in and out in and a nightmare.
And then like two weeks later, the pipes froze and it was just like this huge disaster that cost them over $700,000 to fix, you know, things like that happened in properties. So let's talk about the passive investor perspective, because I know a lot of your audience are passive investors. So as a passive investor, what happens to you when when these things happen? Well, the first thing that happens is you we aggressively cut costs and also probably stop distribution.
So if you've been in your on dry attributions or cash flow on these properties, sometimes that stops. And because we need to make sure that we can pay the mortgage and have enough money in our reserves to be able to pay the mortgage, that's probably the the least impactful thing that could happen. And so if that has happened to you on some of your deals, don't stress about it too much. Okay.
Step two would be when the operators decide, okay, we're running out of cash too much and we need to do a capital call. So let me explain what a capital call is. A capital call is where they go back out to all of you as passive investors and say, hey, we need some more money to get through, you know, to get over this these these rough waters. We're in rough waters right now and we need some more cash to be able to do that.
We have exhausted all of our reserves with the general partners, have put in money to the deal. So typically that happens as well before it comes out to the passive investors. And and and we need your help to get through the rough waters. I understand that's very unsettling as a passive investor, because now there's a lot of questions that you're probably asking about the property like, well, if I put more money into the property, is it even going to perform right?
Like it feels very unsettling and, and so when if that happens to you as a passive investor, you have some choices. So first off, I would ask a ton of questions and I would really hit the general partnership team with with a bunch of questions and ask for financial modeling and, and things so that you can see a path to positivity. That's what we want to look for.
And how long, how long, how many years is it going to take to get this property back on track If we do invest with you now, the way a capital call works is they go out and they ask everyone to contribute a percentage of your original investment. So the original investment so say you had $100,000 in and they come and say, Hey, we want you to contribute another 30%.
So now you have a choice as a passive investor, you can one, you can, you can either contribute or not contribute, and if you contribute, you maintain your percentage of the shares. If you choose not to contribute, there is a possibility your shares will get diluted. And what does that mean? Well, it means, say, the property they raised 5 million, right? So there's $5 million of investor money into it. You as a passive investor put $100,000 into this. So you own a percentage of that 5 million.
Well, now, if they go out and raise another million, you own a percentage of the 6 million. So if you put in your percentage, you would you would maintain the same percentage. If you don't, then your percentage that you own goes down, which could affect your profits in the end. It doesn't mean your 100,000 went down, right? And now you only have 90,000 invested.
Now you still have your hundred thousand invested into the project, and that's still the amount of capital that the general partners would need to return in the end, But you would affect your profits. So those are the kind of the decision points that you that you have to think about as a passive investor. And, you know, does it make sense for you to put more money into the project?
Do you believe that the project is going to get through this rough time, or are you thinking, you know, my money might be better off elsewhere? Right. But there's risk, too, because there's risk if there's not enough money that comes in to save the property. I mean, I'll be brutally honest, there's a risk of a total loss, right? So a total loss of your capital. So it's a very uncomfortable position and it's happening quite a bit this year.
And I think it's going to happen even more this year just because there's just a lot of properties that are struggling. And so we're going to see a lot of capital calls come out this year. We're going to see some some a little bit of pain in the market with multifamily especially.
But it's going to be interesting to see the operators who are successful coming out of this because those are the ones that you want to stick with, is the ones who are, you know, just are working like crazy to get these deals, turn around and get them going. Yeah, I agree with you. And thanks for sharing all the negatives about investing in the real estate and one thing I wanted to say here is that no deal is a perfect deal to begin with.
You know, somebody comes to you and tells you, okay, this is the best possible deal you can get in this world, but there is no perfect deal is the operator is not perfect or the sponsor is the perfect who are running the deal. You have to trust. Like I always say, you have to trust the jockey, not the horse. You know, jockey is the one who is going to take the horse to the finish line. And that's very, very important to know.
And the other thing you mentioned was about the bridge loan that a lot of people have the bridge loan. So these are all the different kind of products available in the market. And you can take the bridge or you can go to Freddie or Fannie and then you can get those loans too. But there's always some good and bad with everything. You know, let's say if you wanted to be in the deal, your strategies or your business plan is only being in the deal for 3 to 5 years.
So it does not really make sense to go with the agency loan, which is Freddie or Freddie, because there's a little maintenance or there might be some step down cost involved in that that might, you know, dilute your profits at the end when you're trying to exit. And if you are trying to hold on to the property only for 3 to 5 years, it might be a good idea to just get a bridge loan and exit meet your all your business plans that you have out, make your predictions
and exit the property. Year three. That was a good plan. I've just been working for a lot of operators over the years, you know, that's why they've been doing it. I mean, recently we've been seeing due to the inflation and the hike in the interest rate that a lot of operators are, you know, I would say is struggling because they did not plan to try it again. I'm going to come back to my previous point that no deal is perfect.
You make it perfect because if you have a solid business plan, so if they have done their due diligence right, what could go wrong initially? And get enough reserves and have deeper pockets to make that deal get to the finish line? I don't see any issues that many markets.
I think this this is the homework that everybody should be doing as operator, our sponsor, you know, and this is the kind of due diligence that investors should do before investing with somebody, check their track record and see how many cycles they have done, you know, complete cycles, what kind of records they're giving to their investors. And then you talk about the underwriting. I'm going to talk about that a little bit over here.
So the more conservative you are with the underwriting and then you're promising, like I would say, under-promise or would deliver strategy that you have, you're always going to do well on that, too. And then last but not the least, I'm going to talk about working with the property management companies. That's like a really big thing.
And everybody's played working with the property management companies because it's not the property management companies do not deliver, but it could be something wrong with the asset management team too.
If you're not 100% on board, on the asset management perspective, you want be handled and we want to be able to handle the project seamlessly because you're the one who are again, the jockey and the property management is the horse and you can take the horse in whatever direction you want and you can just make it right the way when taken to the completion line, or you can just get stuck and keep on changing.
So I would say that's something that the asset managers or the asset management team needs to sort it out and have put a plan together for themselves. And another the thing you talk about, stop the cash flow and that happens all the time. We have seen that a lot of operators or the sponsor, what they do is they have a catch up because they have the plan for a time. So if you miss on the cash flow, like I'm going to say, we do a catch up right? So you're not missing out on that.
So yes, there's good and bad scores. We want to bring out all the negatives, but we wanted to say, what if that happened? This could happen to to mitigate that issue. I agree with me on that amount. Yes. Yeah, 100%. 100%. Right. Like there there are lots of things built in and and, you know, even though we talked about the negatives today, I we do I still believe in multifamily real estate 100%. Yep absolutely right.
80% of my portfolio is going to stay in apartments and because they're they're just a really steady, strong investment and you just have to make sure you look at the finer details ahead to find the right ones. Yeah. Okay. So let me ask you this question. Know so Hawken investors avoid falling into the trap of blindly following market trends because everybody's, like, super scared and they just feel like everything is such a sketchy, you know? Oh, you're still making money in real estate?
No. No way. So if you comment on that. Yeah. So my strategy is make sure you're buying one asset every year. It doesn't matter what the economy's happening, what's happening in the economy, if it's up, if it's down, if it's all around, or if things are just are going crazy or things are going amazing, buy an asset every year. And and if you don't want to manage it yourself, invest passively every year.
And I have a whole like a ten year plan that I put together that I show my investors that says, if you do this, if you like, put in, even if it's just $50,000 every year for ten years, you're going to have almost $1,000,000 invested into in in you're going to have passive income of about $70,000 a year. And it's all from just doing it like religiously every single year. And so that's always my advice. And then, you know, so you just discipline yourself. You say, okay, I'm going to invest.
I'm not going to I'm not going to watch the news and freak out about the news, but I'm going to, you know, make sure that I'm following the right people and I find the right people to invest with and I'm just going to keep doing this every every year. And you'll thank yourself later. And and really what happens. I was talking to a lady the other day. She's done over 28 passive investments and I said, Well, that's really interesting. You've done so many. And have they all gone well? No. Right.
But she can weather that because she has 28 of them. If you're just invested in one and you're one doesn't do well, you're not diversified enough. Right. And that's why every year you just get another one, another one, another one, another one, so that you have multiple investments so that you can weather all the storms yourself as a passive investor. Great. That's a really good advice. We are out of time. So can I ask you one golden nugget with my Ah, yes, with my audience. Oh, yes, you bet.
One golden nugget. I mean, you did already so much, but another one. Another one. Another one. Okay, I'll to I'll, I'll give you a generational wealth golden nugget. Right. So if you're like me and you have a you have a family and that's it's really important to you to build generational wealth, not only generational wealth, but generational knowledge. One of the things that I love to do is I love to talk about investing and also invest with my family.
And so one of the things that we do is we have the kids go out and they help us. They invest in with our business. And so here's a here's a tip for you have your kids work in your business and then you can pay them for working in your business and you can use an income, a tax strategy called income shifting where you can shift. This year, it's like 13,000 something that you can shift to your children that's tax free, that the kids don't have to pay any taxes on.
Take that money and pull it together and invest into either a passive investment or you can go buy a short term rental or something like that and list the kids as owners. So that is my strategy for building generational wealth for my kids. It's not necessarily that I'm giving them money and I'm going to, you know, I want to build up a $10 million estate that they can have when I die. That's not my goal.
My goal is to help them start investing now today so that they have their own investments when they are young in their twenties and thirties, that they then manage and do. So that's my golden nugget for those of you with children. And I love that. And that way you're teaching them the financial education or giving them the financial education, right. Which we missed when we were growing up because our parents didn't do that. They just told us to go to college, get your degree, get a job.
That's part of it. And it's very important what you're doing with your kids. I love that. This brings us to a rapid fire round. I'm going to ask you five questions. You have to answer that one word or one sentence only. Are you ready? I'm ready. And those first question is, what is one of the most important thing that you have learned in your life and how did it change your life after learning it?
Everything is figure out able, meaning that everything that you approach and things that come, that you can figure it out and you have to have the confidence to do so. It totally changed my life and my view on even like stepping into being an entrepreneur because I didn't know if I could do it. I'm like, Well, I don't know if I can do it. It doesn't matter if you can do it, can you figure it out? Oh, yeah, you can figure it out. And and so you just do it by figuring it out, right?
So you don't have to know anything. You just have to be willing to have I call it infant brain, where, you know, you're you're in that mode of I don't know what I don't know. And so I just have to take one step at a time and fall down a bunch of times. And eventually I'll be able to walk and then run and jump. Low and, oh my God, be a problem solver. Don't be a problem yourself or do not get in tangled. Love it again. What is one best quote that you have read? I recommend to my audience.
So I love. No, I'm looking at my book The Go Giver. The go giver is a really good. Yeah, that's a really good one because. The whatever you want give out more than that. And trust me, you'll get tenfold back. Love that in one word. What does life mean to you? Abundance. Yeah. Yes. High five on that. What is your biggest passion? My biggest passion?
Well, of course, I'm passionate about being a you know, but I'm passionate about blazing a trail for my daughters to be it to, you know, do all the things that that they want do. But I also have a little mini passion for what I have a passion for many animals. And so we have like a little farm that we have with our with a bunch of mini animals on them. We have mini potbellied pigs and mini goats and mini chickens. And it's just really fun. My is that so much energy around you?
So if you could come back in time and talk to your younger self, what would that be and why? You know, I would I would to tell my younger self that don't listen to all of the noise around you about, you know, a woman's.
I think I, I, I was stuck in a woman does this and a man does that and for a really long time and it took me a long time to get out of that and to feel like now, you know, I can I can embrace my intelligence, I can embrace my superpowers and I can embrace being a woman in business and in finance and investing and all of those things. I would do that much earlier than than I did before that. No. No. I love and I say that, too, all the time, believe me. And I don't listen to the noise.
Don't pay attention to the noise around you, because the people who are making the noise, they to become your followers. If you keep on doing whatever you're doing. And that's how the way society works. But thank you so much for being with me today. Camila, I really enjoyed talking to you. Thank you for being here. For Oh, I'm sorry. I forgot one thing. How can people reach out to you? Oh, yeah, please find me on LinkedIn is a really great place to find me on LinkedIn.
You can also go to mean my website Steady stream investments dot com. I have a ton of education there. Or please listen to my podcast. Quiet. Welp, there's a lot of really great episodes on there, including a whole series about investing by age, investing in your twenties, thirties, 4760s, and what considerations you should have. But there's, there's that. Thanks Camila. I really enjoyed our conversation today. Thank you so much.