DIY Investing: An Easy Guide To Investing Your Own Money
02.12.2023We’re back with a brand new season of Whiteboard Friday episodes for your viewing pleasure. First up: SEO expert Cyrus Shepard shares his top 22 tips for successful Google SEO in 2022. Watch to find out what to prioritize and what to look out for in the year ahead! Click on the whiteboard image above to open a high resolution version in a new tab! Video Transcription Howdy, Moz fans. Welcome to another edition of Whiteboard Friday, a very special edition, our annual SEO tips of the year edition. This year it is 22 smart SEO tips for 2022. I’m going to be talking about some of the most talked about things in the SEO industry over the past year plus a few tips from last year that we wanted to pull over because they were just that important. Because we’ve got 22 of them and we don’t want this video to take forever, we’re going to be going through these pretty quick, but for you we’ve linked to some resources in the transcript below so you can explore all of these topics further if you want. All right. Without further ado, let’s get started. On-page SEO tips for 2022 1. A/B testing I’m going to start with some on-page topics. Tip number one, A/B testing or simply testing. We’ve seen a lot more testing tools pop up in the last couple of years, which is awesome because SEO is not make a decision and implement it and you’re done. SEO is implement, evaluate, and then make decisions or sometimes course corrections. Is this something we need to pull back? Did C perform better than D? Which one would we choose? All the tips we’re talking about today can apply to this testing mentality. SEO is incredibly complex, and the old-school idea of best practices just doesn’t cut it anymore. So in ’22, develop a testing mentality with your SEO. 2. Author pages Number two, author pages. I really love this because Google this year updated some of their advice around author pages and their schema markup. It’s an important part of my strategy and a lot of websites that I use. A good quality author page helps Google evaluate your authors, which can be used for E-A-T and other things, and helps link them with their expertise. So linking your articles to a good author page usually includes links to other websites, author profiles, links to the articles they wrote, some biographical information. It can help establish your authors as expertise in a certain space. So take a look at your author pages and try to improve them and make this a task. 3. Google title rewrites Google title rewrites, number three. I don’t think there is any topic more discussed in 2022 than Google rewriting titles. A lot of studies, including one I did, showing Google rewriting 60%, 70% or 80% of a site’s titles. It can be frustrating. But what we’re finding is a lot of people aren’t evaluating those Google title rewrites. When you do, you can learn a lot about your own titles. Why is Google rewriting it? Is my title too long? Am I missing important keywords? Do I have fluff in there that Google doesn’t like? Or in some cases you can go back and try to correct the title that Google rewrote if they’re doing just a terrible job. So Google title rewriting, do an audit of those Google titles and learn what you can do. 4. Nuke the «fluff» Speaking of fluff, this may be the year that you want to nuke the SEO fluff. You know what I’m talking about with SEO fluff. It’s those flowery keywords. It’s those descriptions and it’s recipe pages. «Oh, I was walking along the Irish countryside thinking about my bread and biscuits.» That is your fluff. We’re finding that it may not be necessary, and it may even be detrimental to your SEO. Glenn Gabe wrote a great case study where they reduced a lot of their fluff on category descriptions and they actually saw an increase. Google is removing fluff from title tags. So this marketing, flowery, SEO writing stuff, it may not be helping you, and, in fact, it may be hurting you. Today Google is rewarding sites or seems to be rewarding sites that provide quick answers and more direct engagement. Better engagement, it’s usually better for your customers as well. So experiment with losing the fluff in 2022. 5. FAQ schema Number five, FAQ schema. So last year we talked a lot about different schema types, how-to schema, FAQ scheme, different things. If there was a clear winner in 2022, it was FAQ. The reason FAQ is the winner is because so many sites can qualify for it, it’s easy to implement, and if you win a FAQ schema in SERPs, you can gain a lot of Google real estate. So there are a lot of articles that talk about how to optimize for FAQs. You can get links, deep links in FAQs. There are a lot of things you can do. We’ll link to those in the transcript below. But take a look at your FAQ schema if you’re not currently using it: How to Optimize Your FAQ Schema to Maximize Positive OutcomesWhat Google’s FAQ Schema Update Means For Your SEO Strategy6. Tabbed content Last year we talked about tabbed content, bringing your content that is in tabs, in navigation and bringing it out. This year, we’re getting a little more advanced. Our friends at Merj did a study about types of tabbed content and how easily Google can extract and render and index different tabbed content. So if you still have content in tabs, it doesn’t necessarily mean you have to take everything out, but you should research if Google is able to index and rank those appropriately. There are better resources this year to try to do that. So take a look at your tabbed content. 7. Faceted navigation Along the same lines, faceted navigation. We’ve been talking about faceted navigation for years, but this is the year to get a little more strategic with it. In certain ways, faceted navigation has always been like a set of rules, like if it has green dress, we are not going to index this or crawl it, but if it is size 12 or higher, we will index it. Today, smart SEOs are getting a lot more savvy about what they index, don’t index, and crawl with faceted navigation, and these tools are becoming increasingly available for sites like WordPress and things like that, where you can actually look at the traffic each page receives and index, crawl, faceted navigation on a page by page level, and these broad rules aren’t necessarily as necessary. You can get down to the nitty-gritty and increase your traffic that way, with fine-grained tools. So both tabbed content and faceted navigation, old-school concepts, but we’re getting much more sophisticated with them in 2022. Link building tips for 2022 All right, let’s talk about everybody’s favorite subject, links, because you need links to rank in SEO. But what a lot of smart SEOs know and talk about is you need links to rank in SEO, but you probably don’t need as many as you think. 8. Internal link optimization If you only have a few good external links, one of the best ways to leverage that is optimize your internal link optimization. We’ve seen a number of new tools and processes talking about internal link optimization. We’re talking about pages that have too few links, under optimized anchor text, pages that have great opportunities that aren’t ranking that should. So if you haven’t done an internal link optimization audit in a while, this is the year to do it and this is the way to leverage those internal links that you’re getting. 9. Deep linking Speaking of which, deep linking. In the old days, if you linked to a page, you just linked to the URL. But we’re seeing an increase in deep linking, linking to specific passages, text fragments, things like that, navigation, jump links. This is increasingly becoming a popular strategy to get people deeper into the page and give Google and other search engines signals about very specific parts of pages. This seems relevant as Google has recently introduced passage ranking, where they’re not just evaluating the whole page. They can understand individual passages as well. So making deep linking part of your strategy, as opposed to just linking to the URL, seems to be a great way of moving forward. 10. High ROI link building High ROI link building. I watched a great presentation from Ross Simmonds this year, the Coolest Cool, on link building with assets and determining the ROI of each of them, because everything you build links with, whether it be a tool, a blog post, a free PDF, it has a cost and that cost has an ROI. Ross found that certain things have higher ROIs than others. Tools have an incredibly high ROI, but they’re also expensive to create. Pages with stats on them, not that expensive to create, but also a really high ROI. I’m going to link to that video. It might be a paid subscription. I apologize about that. But it’s awesome. It was voted number one at MozCon. If you do link building, it’s definitely worth watching and definitely worth the cost. High ROI link building, know the cost of everything you’re producing and how much value you’re getting out of it. 11. Reduce redirects Let’s go old school again. Our friend Nick LeRoy tweeted not too long ago about reducing redirects. This is really old school, but a lot of people are forgetting it these days. If you have a large site and you have thousands or millions of redirects all sending confusing signals, 301 jumps to a 302 jumps to a 404, what is that? Looking at your redirect chains and reducing them to a single redirect with a clear directive can help reduce canonicalization errors. It can improve crawling efficiency, and at scale it can influence your rankings. So if you have a large site or even a small site with a lot of redirects, this is the year you want to do a redirect audit. Get on it. Audit, on it. 12. SEO for affiliate links How about SEO for affiliate links? We don’t talk a lot about affiliate links here at Moz, and Google traditionally hasn’t talked a lot about it either. But this year we saw Google introduce specific guidance for affiliate sites, which is something they really haven’t done before. Specifically for review sites, Google talking about what a good review looks like, talking about the good and the bad part of the product, the fact that you should link to multiple merchants so consumers have a choice. We haven’t seen this from Google before. So if you do SEO for affiliate sites, you do review sites, this is the year to review those Google documentations and make sure you’re creating sites that Google rewards and actually following Google’s guidance on it, which is something in past years I didn’t think I would be able to say about that. So it’s awesome to see. Google SEO tips for 2022 13. Reputation research All right, moving on to different topics, reputation research. My friend Lily Ray talks about reputation research a lot in terms of E-A-T. The idea that Google can evaluate your site based on what other people say about you. So if you’re Dr. Mercola and an anti-vaxxer and everybody is saying all these terrible things about you on other websites, Google can disappear you from search. Reviews, what are other websites saying about you in terms of reviews? Google quality raters often look at other websites to get reputation research, and it’s supposedly believed that Google can do the same thing algorithmically. So making reputation research part of your SEO audit process, what are other sites saying about you, is it incredibly positive, is it incredibly negative, this is especially important for your money or your life sites, sites that are going to be more impacted by E-A-T algorithms. So if you sell things or dispense medical advice, reputation research is a little bit more important for those sites. 14. Core Web Vitals — minimums Boy, last year we talked about Core Web Vitals a lot. One of my happiest things is that we are talking about it much less. Google announced a big update. It was a big hooplala. It didn’t quite work out the way Google kind of explained that it might. What happened was Google released Core Web Vitals, and some sites saw a boost, other sites saw a decrease, but it wasn’t as intense as we thought it might be. A lot of sites did improve. But we’re finding in 2022 maybe we don’t need to worry about it as much as we thought. My colleague Tom Capper did a study that showed that slow sites were still ranking and fast sites were ranking even higher, but the effect wasn’t as much. The one thing Tom did find though, that was important, was sites that failed all three Core Web Vital requirements were definitely in the dumps. So we should optimize for speed always, but perhaps in 2022 we don’t need to obsess over it as much as possible, based on Google advice. Speed is awesome. You should make your sites as fast as you can. But Core Web Vitals, don’t sweat it as much as we were in 2021. 15. Ditch AMP? Other things we might want to consider not sweating, AMP. 2021 was the year that we’ve seen a lot sites start to ditch their AMP. This is because Google no longer requires it as a ranking factor in their top stories. It does provide some speed benefits. It’s kind of a neat technology. We know people who work on it. It’s really cool. But a lot of companies were stressing out trying to maintain two different versions of their website to get that ranking boost. A lot of sites are starting to like, «Well, we don’t want to have two different versions. It’s a lot of overhead. It’s a lot of engineers. What if we just got rid of it?» They’re finding it really doesn’t make a difference. They can just work with one platform and still get as much rankings as they want. So if your company is struggling with AMP, this might be a year to experiment with ditching it. Or keep it if you like. It’s great, but a lot of people seem to be walking away. 16. Google Discover On the flipside, a lot of people are flocking to Google Discover. Google Discover is interesting. It’s not traditional SEO traffic, where you research a keyword and people are converting. It’s a little bit more like social media traffic. In fact, social media sharing seems to be one of the ranking factors that can influence how much traffic you get from Google Discover. But what we’ve seen in the last year is some publishers are optimizing for Google Discover, publishing those stories, and seeing huge amounts of traffic for that. Great for like news sites, blogs, popular things, things that talk about popular topics. We’ve gotten some Google Discover traffic here at Moz. We’re going to link to a couple of articles to show you how to optimize for Google Discover. But if you haven’t tried it yet, it may be a channel for you to explore in 2022. 17. Local SEO GBP categories We’ve got to squeeze in one local SEO tip. We’re doing this for our friend Darren Shaw, who publishes the Local Search SEO Ranking Factors every year, doing an awesome job at it. If you have a local site and you just have five minutes to do one thing, the number one SEO tip for 2022, get your GBP categories in order. Ranking factors studies show that it is the number one thing that can influence rankings. Do an audit of your Google Business Profile categories. Darren has a lot of tips over there with that Local SEO Ranking Factors. I would encourage you to look at it. Also Joy Hawkins is doing a lot with experimentations. I’d encourage you to look at her site as well. 18. Favicon review My tip, the tip that I’m going to die on this hill — favicon optimization. Why favicon optimization? I talked about this last year, but I don’t think people took me seriously enough. Over 50% of search results take place on a mobile phone where your favicon shows, and people are not optimizing those favicons. A good favicon can draw attention. It can zero you in on a very busy SERP, and it does it with just a few pixels. A good favicon can raise your click-through conversion rate one or two percent, which is awesome. How does it work? What do you notice on this screen? You notice the tip with a favicon. A good favicon is usually bright, it’s usually high contrast, and it draws your attention to your search results. So optimize your favicon, folks. I’m dying on that hill. SEO career tips for 2022 All right. So I want to spend a few tips on talking about your SEO career, because I don’t think we talk about this enough. What should you be learning this year, aside from Python because everybody loves Python? 19. Learn GA4 This might be the year that you want to finally familiarize yourself with GA4. GA4 is the product that’s replacing traditional Google Analytics. You’re going to see it in a lot more client accounts. It can be a little confusing to people. Some of the metrics aren’t there. It’s got some cool things in it admittedly, like they basically got rid of bounce rate and replaced it with engagement metrics, which is great because a lot of SEOs are a little too focused on bounce rate and engagement may be more representative, a holistic way that Google views your website. Our friend Dana DiTomaso has a course on LinkedIn that you can check out. But familiarize yourself with GA4 so you can walk into those meetings and you can present those reports and know what you are talking about. 20. Attend virtual conferences Conferences. COVID moved a lot of conferences virtually online. People attended them. A lot of people are getting burnt out on virtual conferences. But looking back at all the virtual conferences of 2021, there’s some great value there. Here at Moz, we had MozCon. We had some tremendous speeches. It also makes it more affordable for people all over the world. Traditional conferences, you pay $1,000 to $2,000 just to attend the conference plus travel and all that. But with virtual conferences, oftentimes they’re free or just $100 or $200. You can attend virtually and focus on the content and the learning and advance your career, and do the networking, reach out to the speakers. There are lots of opportunities there. So I would commit in 2022 to attending two or three virtual conferences and make that part of your career advancement. 21. Charge more Finally, the last tip on the career, charge more. 2022 is the year to charge more for your SEO services. Our friend John Doherty at Get Credo publishes his annual salary report or agency fee report. If you’re an independent consultant or agent, you can check to see what you’re charging compared to your peers. But, in general, SEO services are in high demand all over the world, especially high-quality SEO services. The power is in your hands to charge what you are worth, not undermining yourself. If you’re working in-house, it might be time to evaluate your salary and make sure you’re getting paid what you deserve, especially if you’re not getting paid as much as your colleagues or you’re part of an underrepresented group. Charge more in 2022. Make more money. And finally… 22. Be the last click Final tip of 2022, this was the final tip of 2021. It’s my favorite SEO tip of all time. Be the last click. That means satisfy your users. When someone is searching Google or any other search engine and they’re presented with a list of results, they’re clicking around, looking for what they want to be, make sure you are the last site that they click. Why? Because when they clicked to your site, they found what they were looking for. You satisfied them so much that when they see your site again, you’re going to be the first one that they click on because you gave them the answer. Provide awesome experiences for your users. Think of them first. Give them everything they want. Give Google no excuse not to rank you number one in the search result. All right, 22 tips for 2022. That’s all I’ve got. I would love to hear your tips. Please leave them in the comments below. Reach out to me on social media. If you liked this video, please share it. Thanks, everybody. It’s been fun. Video transcription by Speechpad.com
02.12.2023[ad_1]
All any of us want is an opportunity to try and succeed. We don’t want handouts. We just want the opportunity to try. Unfortunately, opportunities don’t come evenly.
I realized the other day that all my tenants are white. I’d never thought about my tenants’ racial makeup until I read an article by Washington Post journalist, Michelle Singletary, entitled, “The Legacy Of Slavery Made My Grandmother Fear Investing.”
Michelle writes how discriminatory policies of the past shaped the way her grandmother approached investing. Her series of articles provides an interesting personal perspective on why there is a racial income and wealth gap today.
Here are some passages from her article that stood out:
When my first employer introduced a 401(k) retirement plan, I sought advice from Big Mama. But she actively discouraged me from “gambling” in the stock market.
“That’s for White folks,” Big Mama said. “They can afford to lose money.”
“The legacies of slavery, Jim Crow, and the New Deal — as well as the limited funding and scope of anti-discrimination agencies — are some of the biggest contributors to inequality in America,” says a 2019 report by the Center for American Progress
So, yes, it’s going to take more than a financial workshop to overcome the anxiety my grandmother lived with all her life and passed on to me.
There was only one investment that Big Mama trusted: her home.
The last line about Big Mama trusting only one investment, her home, really resonated with me.
This article will share some of the following insights:
- Why there are so many Asian landlords and small business owners
- Why real estate and small businesses are so highly valued among many minorities
- How the lack of equal opportunity changes behavior
- Where the belief of not depending on anyone but yourself comes from
Why Real Estate Is So Valuable To Minorities
I’ve made plenty of objective arguments as to why I prefer owning real estate over stocks. Further, the more children you have, the more valuable real estate becomes.
But Michelle and her grandmother made me realize there may be an important racial component to my desire to own real estate as well.
Owning real estate and rental properties provides a fundamental feeling of security we all crave. The more turbulence you and your ancestors have experienced, the more you will value your home.
I’ve shared some of my racial encounters growing up in Virginia during high school and college. They were all unpleasant.
But at least these experiences motivated me to study more, earn more, and save aggressively. I felt that as an Asian person in America, education was my main way to ascend.
Once you get your living expenses under control, life becomes much easier. Your other expenses such as food and clothing are relatively inexpensive.
Health care is more affordable if you have a job or earn below 400% of the Federal Poverty Limit. Children can be as expensive or as reasonable as you want them to cost.
But here’s the thing about owning rental property. It not only provides shelter, it also provides income that you might not be able to earn because of who you are.
Real Estate Is A Hedge Against A Lack Of Opportunity
If you are a minority, there is a greater chance you will have fewer opportunities compared to if you are a majority.
It is simply human nature to accept, hire, promote, and pay people who are more similar to themselves. Human nature is why so many company leaders of almost any company tend to all look alike.
We also know based on simple math that majority rules. When you have a majority, whether it’s at your HOA board meeting or voting on a presidential candidate, the majority always wins.
The minority could make up 49.9% of the population and get run over because we have a winner-take-all system. Therefore, as a minority, you are consistently at a disadvantage when it comes to the numbers.
Pay careful attention to company organizational structures. Take note of the similarities between guests on podcast shows and the host. Observe the makeup of judges and award winners. Society takes care of their own. We love echo chambers.
I don’t blame people for wanting to hang out or take care of people with similar backgrounds. It’s natural to want to be with people who believe and amplify what you believe. I just accept that’s just the way things are and try to adapt.
By owning real estate, as a minority, you hedge against a lack of strong income-generating opportunities. The most common lack of opportunity is getting a great job.
My Three Sets Of White Tenants
In all, I have three rental properties as part of my passive income retirement portfolio. My goal as a landlord is to find the best tenants possible. I do not care about race.
During my screening process, I focus on financials, length of work, length at previous residence, references, and character. As diverse as San Francisco is, the thought of race never comes up. It just so happens that all three sets of tenants are White.
As a personal finance writer, I’m always fascinated by people’s financial backgrounds. To protect my tenants’ privacy, let me share some rough details about them.
- Tenant #1: Two individuals making a combined $28,000 a month gross, 780+ credit score. One is a VP in HR, another works for a mid-size tech company.
- Tenant #2: A couple making $27,000 a month gross, 800+ credit score. One is a pediatrician, one is a software engineer.
- Tenant #3: A couple making $50,000 a month gross, 800+ credit score. One works at big tech, another is a C-level executive.
All of my tenants have stable jobs that pay well. They could also all be prototypical Financial Samurai readers who follow my housing expense guideline of not spending more than 20% of household income on rent.
Here’s the kicker.
There’s only a small chance I would ever be able to get any of my tenants’ jobs. I know because I’ve tried.
Real Estate Is A Hedge Against Rejection
In early 2012, before I left finance, I submitted dozens of resumes to various tech companies like Airbnb, Google, Facebook, and Apple. I either didn’t get a response or got rejected by all of them.
After I left finance, as part of the unemployment benefits and severance process, I was required to apply to several jobs once a week and record my efforts.
Below is one rejection e-mail example from Airbnb. At the time, I knew Airbnb would be a winner. I even went to Airbnb’s Friday happy hours. Alas, no luck in getting a job.
Objectively speaking, I wasn’t an excellent job seeker. While I would have entertained potential job offers had there been a great fit, at the time, my main focus was on traveling and taking a break.
That said, I still followed the job application process. After applying to over 100 jobs online, I didn’t get any nibbles.
Rejected From A Journalism Fellowship
After giving up on my job search, in 2013, I applied for a journalism fellowship and got rejected. This was a disappointment because I had visited the school twice and talked to multiple professors. I also thought I had something unique to offer after creating my own platform from scratch.
Earning $75,000 a year to essentially go to school and meet new people would have been a blast! Alas, it was not meant to be.
Related: You Will Always Get Screwed: Accept And Move On
Rejected By Startup Incubators
In 2015, I applied to a couple of startup incubators. One was a straight-up rejection and another had me go pitch my idea. I ended up getting rejected by that one too.
Only one of the six startups that eventually got accepted by the incubator is still around today. And I’ve seen a couple of different companies execute on my initial idea with great success.
Darn. I could have made everyone rich, including myself! Oh well. Just gotta keep on trying.
Rejected To Consult For A Potential Affiliate Partner
In 2016, I got to the final job interview round of a Series A startup. They even took me for a team pastrami sandwich and beer lunch. The opportunity came about because the company was looking for affiliate partners and was in the personal finance space.
Always one to explore opportunities, I drove 35 minutes to meet all of the founders and employees in the marketing department several times. There are so many startups in the SF Bay Area that you never know which one might hit it big.
My hope was to get an official offer and then ask them if they’d be willing to let me consult from home part-time. The arrangement would hopefully be similar to when I consulted for Personal Capital back in 2014-2015 and got stock options that turned out very well once the company got sold in 2020 for $850M+.
Alas, I never got the chance to ask because they didn’t extend an offer. The startup, however, did ask if Financial Samurai could become an affiliate partner, but I decided to pass.
The startup is now a public company in the personal lending space and is up more than 10X the valuation when I first applied!
Real Estate Is A Hedge Against Less Desirable Traits
I don’t think being a minority was a reason for me being rejected by so many places. My lack of experience or too much experience were the main reasons. Or maybe, I simply didn’t give off the true enthusiasm of a typical job seeker.
However, let’s be brutally honest. My lack of intelligence (or competence, as one reader commented) probably played a big role in getting rejected. The people who landed these fellowships, incubators, and jobs are all extremely smart with glowing resumes. Whereas I’m objectively average. The only above-average trait I possess is high endurance.
Owning real estate is a hedge against being born with below-average intelligence that hinders you from landing more opportunities. It doesn’t take a genius to properly analyze a real estate investment opportunity.
Real estate can also be a hedge against less desirable traits that can prevent you from landing a job or raising funds for your company.
Some of these less desirable traits include: poor social skills, a boring personality, a lack of charisma, a lack of confidence, and mental or physical illnesses or disabilities.
Roughly 15% of the world’s population has some type of disability. This is a significant minority population we should strive to help out the most.
We can all work on improving our social skills. However, it’s much harder to improve upon genetic traits such as high anxiety or sweaty palms!
Your Connections Matter For Income Opportunities
A lot about getting a job and getting ahead is about who you know. And if there are more people who look like you in power, the easier it will be for you to get ahead.
My White tenants all work at high-caliber companies. Once you’ve worked at a place like Facebook, you can easily job hop to a Google, Apple, Palantir and so forth.
Then, of course, it’s much easier for your siblings, friends, and relatives to get into these companies as well due to referrals and legacy admissions. Although nepotism is frowned upon, it still happens all the time.
But for most, there is simply no way to get in. Check out the latest employee racial profile at Facebook, a company that pays at the top-end of the range. We’re talking ~$150,000 compensation packages for new college graduates.
If you are a Black or Hispanic person wanting to join Facebook, you may look at the percentages and feel you have little hope of getting in. With no connections, you might not bother applying. There’s simply nobody pulling for you.
Representation matters to give those who are underrepresented hope for even trying.
Even if you do land a job at Facebook, you might not enjoy the environment due to the lack of diversity.
Overrepresentation Matters Too
As an Asian person, you might look at the percentages at Facebook and think you’ve got a decent shot at landing a job. However, you might also look at the figures and feel dread.
Due to the overrepresentation of Asians at Facebook and other big tech companies, there’s a feeling the competition is too fierce to get in. Unless you’ve invented a new algorithm that will save the company millions, forget about even applying. These companies are focusing on diversifying their workforce, not concentrating their workforce further.
Unfortunately, instead of thinking people like me have a great chance of getting a job at a big tech company, I’ve adopted the latter attitude of competition being too fierce due to my constant rejections.
When you are shut out from opportunities or feel like you are shut out from opportunities, you tend to make your own opportunities instead.
Real Estate Feels Like A Security Blanket
Real estate is a way to participate in a booming economy that doesn’t quite permeate throughout all members of society.
We know that the rich have gotten much richer during the pandemic. Whereas tens of millions of others are struggling to get by. This is called a K-shaped recovery.
By owning real estate, even if you can’t get a good job, you can still benefit from rising rents and property values due to a strengthening economy.
Even if you can’t join a promising company that plans to go public, real estate should benefit from the unleashing of new liquidity in the local economy.
At long last, I look forward to thousands of Airbnb employees upgrading to nicer homes once their IPO lockup period is over. My baby needs new shoes every three months!
Yes, it is a little ironic that a minority who couldn’t land a job at any of his tenant’s companies is their landlord.
However, in 2005, I made a conscious decision to build a rental property portfolio in case my future income opportunities dried up. I knew opportunities would dry up eventually because I was already tired of work at age 28.
Seeking Security For Your Family
It’s important to predict way out into the future because it’s not just your opportunities that are at risk. Your children’s opportunities may be at risk as well. It is unlikely your children’s intelligence and traits will differ largely from your own.
Over the last two years, we got rejected by six preschools.
One reason for the rejections was due to tremendous competition for a limited amount of spaces. Another reason is because my family has no status. Another reason may be because we haven’t explicitly said we would donate money. The final reason may be because my son simply wasn’t skillful enough at playing blocks during his playdate interviews.
Who knows for sure why we got rejected. However, the classroom makeup of all the preschools we got rejected to is majority White, even though minorities are the majority in San Francisco.
Finding An Education Solution
What we do know is that pre-pandemic, my son was almost shutout. Thankfully, one preschool accepted him and has a spot waiting for him if we decide to send him back. In the meantime, my wife and I will homeschool.
Due to our preschool rejection experience, the cycle of lost opportunities will likely repeat for my children. Rejection is not unique to us or other minorities. It is a sad inevitability.
Owning a real estate portfolio provides me some comfort that no matter how many times my children get rejected, they won’t starve. Worst case, they can earn a living as property managers.
Funny enough, as I’m updating this post, our son was offered admissions to one of the most selective preschools in the city. We now have to decide whether to forfeit the enrollment deposit of his current planned school. Maybe everything does work out in the end.
A Permission-less Business
Security for your family is also why you see so many minority-owned restaurants, nail salons, and retail stores. All of these businesses are permission-less businesses. Only a perfunctory use of English is needed. If you have the capital, you can start a business without any gatekeepers.
Once you own a business, you will likely succeed if you put out a great service or fantastic product. Race doesn’t matter. At least it shouldn’t. This is one of the reasons why we need to preserve the stepped-up basis. So my minorities and immigrants are small business owners. Their children will be hurt if they have to pay massive capital gains tax upon inheriting their family businesses.
While building your business, you can put your kids to work washing dishes, serving food, cleaning, and more. With earned income, you can open a Roth IRA for each child.
Who knows, with a strong enough work ethic and solid investment returns, your kids might become millionaires at a young age. Breaking the cycle of poverty takes a tremendous amount of parental guidance, among many other factors.
And just in case things don’t go well for your kids on their own, they can always come back and work at the family business.
The Freedom To Operate How I See Fit
I love running Financial Samurai because nobody tells me what to do. I can write about whatever I want when I want. Further, there’s no need to work with businesses partners I don’t find valuable.
If my children ever ask me to teach them about online entrepreneurship, I’ll be more than happy to share what I’ve learned.
When the system is stacked against you, not feeling like your future will be determined by someone else is huge.
Depend Only On Yourself To Survive
Do not rely on society to help you. Do not dependent on the government to save you. If you adopt this Asian American mentality, I’m confident you will build more wealth than the average person.
I even reached out to Michelle Singletary from The Washington Post to say that I shared her story and appreciate her work, but received no feedback. This is even though we follow each other on Twitter too.
I doubt America will fight for equal opportunity for Asians as much as it does for other minorities. After all, Asians only make up ~6% of the U.S. population. This is despite many Asian small business owners facing racism and hate crimes during the pandemic.
I was ordering cookies on Uber Eats from my favorite place, Anthony’s Cookies. Anthony has the best toffee cookies in San Francisco. For cookie lovers, also check out Insomnia cookies downtown.
As I was ordering, I noticed at the end of the description it said “Black-owned.” Cool! I knew Anthony was Black because I have met him many times before.
I was happy Uber Eats was trying to do more to support Black-owned restaurants. At the same time, I started thinking about all the Asian-owned restaurants who are suffering during this pandemic as well.
Will there ever be a “Bhutanese-owned” descriptor in any of the food delivery apps to support Asian-owned restaurants? Unlikely, because we seem to be the wrong minority worth fighting for.
But I still have hope Asian Americans will gain more support from the community. It may just take another generation.
Making Academic Opportunities More Difficult
Then I started wondering will there ever be a school admissions policy that helps under-represented Asians or poor Asians get in? Doubtful, if you look at what’s going on with Lowell High School and Thomas Jefferson High School doing away with entrance exams and Harvard University revealing its entrance formula.
Therefore, instead of spending all our energy fighting for equal opportunity, it’s logical to use our energy to focus on what we can control. Complaining about a suboptimal situation gets us nowhere!
This culture of focusing on what we can control and non-confrontation is why the voice against racism isn’t as loud from the Asian community. Further, the last thing Asians want to do is take away opportunities from other minorities.
Competition is fierce for all races. Hopefully, this article has shed some light on why there are so many Asian landlords and Asian small business owners. Again, I don’t fault people for wanting to provide more opportunities for people most similar to themselves. It’s just the way things will always be.
The desire to feel secure is what all of us want. By owning real estate or a small business, some of that security for you and your children can be achieved. My children are what drives me to keep Financial Samurai running for the next 20 years.
Achieve Financial Freedom Through Real Estate
As a minority, real estate is my favorite way to achieving financial freedom. Real estate is a tangible asset that is less volatile, provides utility, and generates income. Real estate currently generate roughly $150,000 a year in semi-passive and passive income to help provide fo my family.
Given interest rates have come way down, the value of rental income has gone way up. It now takes a lot more capital to generate the same amount of risk-adjusted income. Further, the demand for real estate is increasing due to positive demographic trends.
Take a look at my two favorite real estate crowdfunding platforms. Both are free to sign up and explore.
Fundrise: A way for accredited and non-accredited investors to diversify into real estate through private eREITs. Fundrise has been around since 2012 and has consistently generated steady returns, no matter what the stock market is doing. Investing in a diversified real estate fund is the easiest way to gain exposure.
CrowdStreet: A way for accredited investors to invest in individual real estate opportunities mostly in 18-hour cities. 18-hour cities are secondary cities with lower valuations, higher rental yields, and potentially higher growth due to job growth and demographic trends. If you have a good amount of capital, you can build your own select real estate fund.
Investing is the one of the best ways to equalize opportunities for ourselves and for our children over time. There are obviously risks too investing. But over time, investing in real estate, stocks, and other classes have proven to build wealth.
Three White Tenants One Asian Landlord is a Financial Samurai original post. For more nuanced personal finance content, join 100,000 others and sign up for the free Financial Samurai newsletter.
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