I don’t remember much of what I learned in grade 5.
I forget long division and can’t recall the mating habits of Sockeye Salmon. However, I do remember a lesson I learned during recess. It’s a key skill that still serves me well today: namely, that if you have money, people will be happy to give you more money.
During recess, my friends Cruise and Mark and I would slip away from our teachers’ surveillance to the gas station across the road. Dodging traffic and bullies, we felt like Indiana Jones on the prowl for lost riches. Our treasure was the elusive Slushy and its unbeatable sugar high. However, I had a problem. My allowance was $5 a week, which wasn’t enough for a daily fix. Cruise and Mark had bigger allowances, but always forgot to carry cash — and it wasn’t like we had Visas.
Everyday they’d ask to borrow a Toonie from me. I got tired of giving away my cash, hard earned as a paper-route slave. I cunningly decided to charge them $1-a-day for the service, and my loan shark business was born. Soon enough more clients approached me desperate for quick cash. Eventually there were so many boys borrowing from me that I needed a list of accounts. I ‘hired’ two grade six bodyguards to ensure payments were prompt. In two weeks, I could afford all the slushies I wanted. I made $40 in interest alone that year, making me the richest kid in the grade. I also learned that people wanted to borrow from me and they were happy to pay for the service.
Now I’m 24 and doing the same thing on a different scale. I’m not a loan shark anymore, but I do own three rental properties, which each make nearly $5000 a year after paying all my costs. After serving with the Canadian Army in Afghanistan in 2009, I saved everything I made to put a down payment on my first property. I did the math to ensure that the rent covered all my costs such as mortgage, taxes, strata and repair. I spent months reading books like “Real Estate Investing in Canada” so that I’d have a handle on what I was doing.
I found the perfect rental and began my new side job as a landlord. I’ve used the same principle that I learned in grade 5. Instead of working for money, I get my money to work for me. I still have to make sacrifices, but I’m well on my way to being in a position where I can buy all the slushies I want. My modern version of slushies is freedom: I want to travel and be free to work in Africa building orphanages. I also want to be able to spend time with my family and have adventures with my friends. Here’s my advice on how to get to the same point I’m at.
#1 Develop a strategy. 
Pretend you’re a General and your money is your army. How healthy is your military? Evaluate your situation, talk to someone you can trust who knows how to set up your finances. Read books like I Will Teach You to Be Rich and The Total Money Makeover. Are you willing to deplete your forces by taking that lease on a new car? Or should you hold back and patiently build a massive army, which you can use to secure a new position in a rental property or another good investment? My personal strategy is go away and work really hard for a time. I try to save at least $20,000 for my next investment and then figure out how I will use it.
#2 Build a Business Plan
Every good business has a business plan. It covers every part of aspect of its operation. Where it plans to go, its threats and weaknesses, how it will market itself and so on. If you want to succeed financially then you are a business, plan like you are.
#3 Educate Yourself
The first investment property I bought with my brother at the peak of the Real Estate hype in 2007. One year later we’d lost $25,000 in value because of the crash. However I learned so much that I wouldn’t trade that experience for the world. I recognize that you must have book smarts and street smarts to succeed and they will both be expensive, the investment you make in getting experience can never decrease in value because of a market crash.
#4 Understand your purpose.
In order to succeed at anything you must know the purpose of what you are striving for. My purpose is to serve God to the best of my ability and love my family by giving them my time and attention. Jesus says a man cannot have two masters. I believe that if you are in crushing consumer debt (meaning the debt you racked up buying lots of shiny stuff) and you have to work slave-like hours at a low wage to pay for it, then money has become your master. If your money is invested wisely and stewarded well then you are free to give God all your time and attention and ensure that instead, He is your Master.
Flickr photo by Grant McDonald
