Today on Investing for Freedom, Mike Ayala is joined by Michael Manthei, a full-time real estate investor from Lancaster, Pennsylvania.
Michael once was in ministry traveling the world but felt lead out of that life and into the real estate investing world. Michael Manthei doesn’t hold back anything in terms of his faith and family. During the episode, Michael shows the ties faith and family have to his business and the decisions it has helped make along the way. Mike and Michael discuss how Michael got to where he is and the importance of being able to switch directions when needed. They also share some advice for the listeners on passive investments and how you can get your start in the investment world!
“If we are always striving, we may either miss our moment or we may not have the resources to jump on it in the way that we should.”
- [0:01] Introducing Our Guest
- [1:12] Show Introduction
- [1:47] Start of the Podcast
- [2:51] A Minute with Michael
- [3:54] Who Has Had the Greatest Impact on Your Life?
- [4:43] What Has Had the Greatest Impact on Your Success?
- [5:13] What is Your Superpower?
- [6:36] Greatest Setback and What Did You Learn from It?
- [7:50] Advice You Find You Share the Most
- [11:41] Rebellious High School Years
- [17:29] Did You See Glimpses of What Would Replace?
- [18:42] 10 Year Period with No Financial Success
- [24:50] Switching Directions
- [35:13] Processes Behind Wanting to Start Investing in Real Estate
- [36:48] A Philosophy or A Specific Number?
- [43:16] Advice for the Listeners
- [44:42] What Is Your Big Why?
- [47:38] Defining Syndication
- [49:38] What Do You Really Want?
- [51:58] Elevate Investing Group
- [54:02] Upcoming Event
- [54:39] Connect with Michael
- [55:24] Outro
FIND | MICHAEL MANTHEI
Elevate Investing Group
Rich Dad Poor Dad | Robert Kiyosaki
Mike Ayala: Today on the investing for freedom podcast, I’ve got a good friend of mine, Michael Manthei in the studio with me. We actually recorded this episode a couple of months ago when Michael was in town and had a lot of fun doing it. One of the things that I have always appreciated about Michael is just how genuine he is. As you’ll see in this episode, he doesn’t hold back anything in regard to his faith and his beliefs. And I just love the way that him and his family tie all that into business and just the way that they make decisions along the way. So I love Michael’s conviction. It’s going to be an interesting story. You’re going to hear about how Michael was actually in the ministry and how he felt led out of that, which was a pretty amazing story and how him and his wife got into real estate investing.
One of my favorite parts of this whole episode is when he tells the story about, Him and his wife going to his in laws and just kind of their take on this piece of property and how they invested. But anyway, I will just let you get into the show. I think you guys are really going to enjoy it and make sure you listen to the end and just hear how you can reach out to Michael and just see what they’ve got going on over at the elevate investing group. Pretty interesting organization that just flourished overnight. So without further ado, here’s Michael Manthei.[Intro]
Are you looking for freedom, freedom from the daily grind and hustle, or just finding a way to live the life you always wanted? Then join us on the investing for freedom podcast. Our host Mike Ayala will help you discover new ways to find freedom with tips, insights, and interviews. You’ll learn the exact systems he’s used to travel the world and live his best life. True success and happiness are all about freedom. And here’s your roadmap on how to find freedom on your own terms. Welcome to the investing for freedom podcast. Here’s your host, Mike Ayala.
Mike Ayala: I am so excited to have Michael Manthei in house today. Michael is with us from?
Michael Manthei: Lancaster, Pennsylvania. Thanks for having me. Mike Ayala: It’s great to have you, Michael. Tell us why you’re in town.
Michael Manthei: We are in town to celebrate a mentor and friends’ wife who passed in December. So Russell Gray with the real estate guys had a beautiful
service yesterday, him and his children put on to honor celebrate and memorialize Sherry Grey’s life. It was powerful.
Mike Ayala: It was powerful. I really walked away from that just realizing, what a blessing it is to be alive and just have those days. But also Sherry was just a, she was such a good human and it makes me realize that every day we get to wake up, we just need to serve more. We need to give more. We need to be more.
Michael Manthei: Totally. Yeah. Her life was beautiful. I mean, that’s what it did for me. I talked to a number of people there and they were all inspired to be better humans. It’s incredible. It was amazing.
Mike Ayala: So, we’ll get into this more obviously throughout the interview, but just give us the two-minute overview of Michael.
Michael Manthei: Wow. You didn’t prep me for that one. Yeah. I have a beautiful wife back home. Two beautiful little girls, Serena and Gabriela. They are the lights of our life and we’ve been having a lot of fun in the real estate investing world. Thanks to rich dad, poor dad all those years ago. It really kind of opened our eyes to all that real estate investing can do for our family and do for our future. And it’s grown from there. Yeah, it’s been a lot of fun.
Mike Ayala: That’s awesome. I’m getting to know you a little better over this trip has been awesome, but over the last couple of years, just being part of the real estate guys and just getting to know you and your family and the extended family. I’m just really excited to get into this story in the background because just watching you guys from a distance and seeing everything you’re doing has been pretty awesome. So I’m pretty excited about it. Before we dive into all that, here’s the four questions. Who has had the greatest impact on your life?
Michael Manthei: Wow. Well, that one’s easy. God has been, I mean, just, I don’t think we’re going to get into this, but in high school I was a drug addict and drug dealer and had a profound, spiritual experience the day before leaving for college and something I wasn’t looking for, wasn’t asking for, that completely revolutionized my life earthly experience and everything good that’s happened since then I give him the credit for. So yeah, that’s my answer on that one.
Mike Ayala: Awesome. I love it. And we may get into that. We’ll see.
So if you could narrow it down to one thing that has had the greatest impact on your success, what would it be?
Michael Manthei: So the first thing that comes to mind is taking action quickly. Not being afraid to jump in and pull the trigger. I feel like there can be so much analyzing and you just never make money analyzing if you don’t pull the trigger after at least taking a look at what you’re about to do.
Mike Ayala: That makes a lot of sense. What is your superpower? This is part of question two. So I’m slipping in a fifth kind.
Michael Manthei: Okay. My superpower. I would say one of them is living in flow, living not from striving. I feel like I have everything that I’ll ever need already and everything that’s working out on the exterior is from a place of fullness and abundance, as opposed to trying to get to fullness sort of abundance. So, living in the of life, the timing of things, there can, I feel like a lot of times in business and success, it’s like drive, drive, drive. But if you can keep yourself in a place of peace, there are certain points where there should be a spike of energy because there’s an opportunity. There’s a moment that came that you have to seize. If we’re always striving, we may either miss that moment. Or we may not have the resources to jump on it in the way that we should. So staying at a place of peace and being able to seize those special moments, I would say it’s been super helpful.
Mike Ayala: That’s awesome. What was your greatest setback and what’d you learn from it?
Michael Manthei: I’m not sure how to answer that. But one thing I will say is before getting into real estate investing, I had about it 10-year period of what on the outside would have looked like zero financial success, but it was a decade of internal development and preparation, character building and leadership development. Through ministry, through traveling all over the world, 20 plus countries. Laid a foundation for then what would come later. But it certainly wouldn’t have looked like, Hey, this person is going to be accessible business-wise or anything that way.
Mike Ayala: Yeah. It gives me a lot of insight. And this is what I love about these initial questions. It gives me a lot of insight because you struggle with your greatest setback and I understand it’s not like your life’s been perfect, but you don’t really look at a lot of this stuff as setbacks necessarily. It was learning opportunities. So, I’m excited to dig into that a little further too. What is the piece of advice you find yourself sharing the most?
Michael Manthei: Probably being deliberate with who you surround yourself with. Your friends circle can make such a big difference. For me, I remember, is it cool to like go into a little bit of a story here? Or are these like rapid fire things? I remember getting involved in real estate, we had like zero properties, then one property, then two properties. Going to all the local meetups that are all beginner, real estate investor based. And then once we figured out a few things in real estate investing from the inside, we bought like 50 units in less than two years. So in a short amount of time, we went from two units to 50 plus. And the people in those groups started to look at me different. So for me, that was not a huge accomplishment, even though it’s super grateful, but for the people in those rooms, it was like, oh my goodness here comes the guy with 50 units, which I did not like the feeling of. I don’t want to be around people that that’s impressive. So I remember praying and just really desiring those next level relationships. And when those came, guys like Dave [09:16 inaudible] guys like some local leader, the biggest landlord in our area, now a good friend. That just changed everything. When you get around people wear what you want, It’s just normal everyday life. It does something to your subconscious where it’s like, okay, this is now not only possible somewhere in the future, but there it is normal. And that can be my normal. So I give a lot of credit to those relationships because that made a huge impact in our trajectory.
Mike Ayala: It’s so interesting about what you just said too. And I think about this a lot, because, you were talking about the people in the room that are like, Oh, there’s that guy with the 50 doors, or however you said it. Mike Ayala: And I understand what you were saying, like, that wasn’t impressive to you. Because you want to get into rooms of higher people, but what’s so interesting. And Kara and I talk about this a lot. You don’t know how amazing you are because you live inside your own head every day. And so that’s what I’m so passionate about here at an investing for freedom. And that’s why I want people like you on my show is because even though you’re, I don’t want to say that you’re not satisfied because I know you’re satisfied as an individual, but you’re always going to be pushing yourself to a higher level, what you know that you can do in life and to really be able to achieve your full potential. So you’re always going to be pushing yourself to more. And from what I know about you too, part of that’s a gift. I mean, the more you have, the more you can give. But I think sometimes what we have to be careful with too, is to just not take the eye off the fact that while we’re not satisfied or happy with where we’re at, we got to pay attention to how much value and giftings we can bring to the world for those people that are looking at the guy with
the 50 doors. It may not seem impressive to you, but to the guy that it has no doors or doesn’t have any passive income, I mean, you’ve got so much to offer that person. And so I understand completely what you were saying, but I’ve just kind of been on this journey lately, too. And again, that’s my passion behind launching investing for freedom. There’s so many people out there that know that there’s more, they want more cash flow in their life, maybe it’s just simply, they need one more vacation per year. And how do we get that?
And when we talk about, I’m not saying let’s not get into this today at all, we absolutely need to, but when we talk about 50 doors, that’s all unreachable to some people. So let’s dig, let’s go backwards a little bit. I want to go all the way back to the high school thing. So let’s get into the drug experience in high school. Cause we’ve got a similar background there. Are we okay with that?
Michael Manthei: Absolutely. Yeah, no, nothing’s off limits. So I can remember as a young person like let’s see, eight, nine years old having experiences with God where I would feel his love around me and I just be very aware of him, but I don’t know why I went so rebellious. But about 12 years old is when I found my brothers stash. I think he’d given me like some chewing tobacco. And I saw where he got that from. And also, I was going to “put it back” quote unquote, to check what else he had in there. So I found some drugs and jumped into that full steam. I’m not really a lukewarm type person it’s either on or off. So 12 to 19 was pretty dark. I mean, there was a couple year period where I don’t think I was sober once. I would wake up first thing in the morning, smoked pot, go to high school, lunch, do the same thing after school, evening, late at night. Yeah, I wouldn’t be sober by the time I woke up the next morning. My tag phrase was sober sucked. That was my experience. People used to call me by my last name, Manthei. That’s how they called me. I used to not even like to hear my last name called because it was so synonymous with the drug persona that I didn’t even want to hear it called. So summer after high school, I started running drugs up from Minneapolis. A small town up in Northern Minnesota where I lived, and I was having a going away party and I was leaving my house to go to this party. And I was leaving the next day. And I had tried to get sober a couple of times. It would last like 24 hours. During one of these 24-hour sober periods. I told my mom, Hey, I’m going to stay clean now, this is how you check and see if I’m back in it, gave her some things to look for. And then 24 hours later, I was back in it.
So I’m leaving my house. My mom says, Hey, are you staying clean? And she’d never asked me that in my life. And I could look her straight in the eye and say, yes, mom, I’m staying clean. She asked me like seven times, and I don’t know why,
well, I do know why I think she was being prompted. So I looked her seven times in the eyes and said, yes, mom, I’m staying clean. And we’d done all kinds of stuff that day. So we go to this party, I’m typically the life of the party. I am empty and depressed when I’m alone. But when I’m around people, you know, at that time I was happy and looked happy. But everything just changed around me. I became, so it wasn’t like I got taken physically out of my body, but in my perspective, I was taken to a third person perspective. I get to this party. Everything’s so different around me. I can’t talk to anybody. I can’t do anything. I go sit in a chair, close my eyes. And in my perspective, it’s like, I’m taken to a third person perspective, shown my life. And it looks like this dark, deep, downward spiral. And I can see that there’s nothing of positive value in any of it. It’s hurting me. It’s hurting my family. Nothing good is coming from it. And I just watched this for about, I don’t know, I’m going to guess five minutes. I don’t recall. And I finally said, this is my party. It’s so awkward for everyone else. They’re literally like reading a cookbook. Like they don’t know what to do. I finally said, guys, I got to go take care of something. I went home. As soon as I stepped over the threshold of our house, I broke apart like a baby. I sobbed and sobbed and sobbed. I prayed, asked God to forgive me. And I didn’t know I was carrying any weight. But It literally felt like a thousand pounds got lifted off of me. I went from being depressed to being truly joyful on the inside. Years of drug addiction that I tried to quit multiple times broke off me. I mean, if I could bottle this stuff and give it to treatment places, I mean, No Cold Turkey, like never had a desire, never had a craving. It just all snapped off of me in one night. And so from there, I kind of, yeah, I wanted to get to know this God that reached out to me when I was, my deliberate thought during that time was God, I don’t want anything to do with you, stay away from me. I want to do what I want to do and have fun. But to me that should have gotten a lightning bolt or trip in front of a bus instead of an intervention like that. So, I am Unbelievably grateful.
Mike Ayala: Did you see, I had a similar experience. Which we won’t get into today. Because this is about you.
Michael Manthei: Well, I’d love to hear it sometime.
Mike Ayala: Yeah. So, in think and grow rich. He says when one desires a thing, that thing presents itself. There’s another phrase, when the student is ready, the master will appear. Do you believe, and there’s no right or wrong in this? I’m just, just wondering, do you obviously there’s a right or wrong. Did you have glimpses of what was going to replace that or did you, were you longing for something more or did you just have this like, you that threshold and melted. Were you beginning
to seek glimpses of another life or was it, or did it just happen? Did God just meet you?
Michael Manthei: It really just happened. From experiences I had younger, some interventions in our family where we had, my brother got a fishhook in his eye and dad prayed for him, and the fishhook, they’ve watched it come out of his eye. He still has a scar, so I knew God was real. And again, there’s no halfway with me. So I was either fully on or fully off. So when I came, I came with everything. But there was nothing conscious thing. Like, I really want to change or anything. It was this intervention. But once I crossed over, it was all guns blazing.
Mike Ayala: Okay. So you said that there was like a 10-year period, like with no real financial success, but you were learning leadership, all that. So let’s dive into that, was that this period of time?
Michael Manthei: Yeah. So from that, I started spending a couple of hours a day just wanting to get to know this God. Again, it’s either going to be real or I’ll go do something else because I don’t need to show up in a certain building on a certain day for a certain couple hours and tell myself, happy clappy, this is what spirituality is. Thankfully he came to me at a party. So you can’t tell me, you need to go to a building to have an experience with God. So just diving into, yeah, I want something real and [19:23 inaudible] substance with this being that loved me enough to intervene in my life. And that actually led me to starting a business. So yeah, I felt in prayer one day that he asked me to start a construction company and I had, I’d been a laborer for nine months. Sometimes ignorance can be a good thing, cause you don’t know how ridiculous what you’re about to do is. So I started a company and I’ve had that for a few years. And right about at the point where I’m going to start making some money, but like, Hey, let’s go do something else. So every day in my company, I felt like a second-class citizens, because anytime I would go to church, they never brought the business leaders up, the investors up and said, Hey, these people are taking a major risk, major step of faith in this new business venture, this new investment. Never saw that, but it was like, Hey, these people are going to [20:26 inaudible] or whatever. So I felt like, unless I was in ministry, I was a second-class citizen from God’s perspective. So when I closed the company and went into the ministry, I traveled 20 some countries all over the world. Saw the most unbelievable things. It was like, Oh, this is the most amazing, this is my dream come true.
And it was a year through that process. And I’m so grateful for it because like I said, that built the foundation of what happened next. But it was a year through that
process that I realized thinking that ministry is more noble than business or investing or anything else is a complete lie. And all any of us can do is be faithful to who we’ve been created to be. And if that’s in business, do you think you’re going to go into ministry and when you’ve been called to business and God’s going to look like, Oh, good job that’s what I wanted you to do or whatever. Faithfulness to who we’ve been created is the most noble thing. So it took a while two kind of get that worked out of me, but once it did, and he started talking to me about going back into business, back into investing, back into the financial world. I could actually do it with my whole heart instead of a quarter of my heart and three quarters feeling like, Oh, this is dirty. Because it’s not.
Mike Ayala: No, it’s totally not. Kara and I were just having a conversation this last week about, the Bible talks about, he gave some to be evangelists, prophets, pastors, teachers, and apostles. So we were talking about that and it’s interesting, even in the business world, like we’re in this mastermind and I’m just sitting here looking at some of the coaches and what they’re doing. And even though they’re outside of, so those are giftings. And I realized that those are specific to like the church and how, things, I don’t mean church, like the building. I’m with you a hundred percent on the, I’m not opposed to a building. But also like there’s giftings. And it’s funny because even in the business realm, like when people are okay with their giftings, we all have different giftings. And you can see a parallel there. Like, I can totally see this guy that I’m in a mastermind with. And this guy is basically like an apostle of this entire movement that just has to do with business. So, it’s kind of interesting when you open your mind to the fact that God gave some to be priests and some to be Kings and just even having, it’s interesting that we’re having a conversation with the successful business guy and we’re okay. Having this spiritual conversation too. Because I think a lot of people don’t want to mix those two conversations. And I mean, that’s part of life. Finances are a part of life. I know just by knowing you that money is not a focus in your life, but you can’t go accomplish whatever you were destined to be without financial resources. And it’s not necessarily the focus, but that’s so interesting that you talk about how you’re grateful for that period of time, because you’ve got to do amazing things, but then when you were ready to go back into business, that you were okay, going full in and knowing that God was behind you a hundred percent too. So you don’t have to be a pastor to be loved by God?
Michael Manthei: Not if you haven’t been called to that. Yeah. There’s no separation. He is everywhere all the time. And he created business just like he created, the priesthood or whatever. He created everything. And if we want to be imitators of him, we have to know which aspects he’s called us to imitate. And then
let his power come through who he’s created us to be, to express that on the earth and that can be finance. That can be business, that can be teaching. That can be health care. That can be ministry. It’s all alignment what you’ve been created to be.
Mike Ayala: I’m not making excuses for you or I, or anybody else that’s out there. You said you don’t do anything halfway. You didn’t say it that way, but you’re an all or nothing kind of guy. So I’m not making excuses for people that are trapped and haven’t gotten rid of their drug addictions or alcohol or anything else. But that being said, do you feel that? Sometimes, like in my life, I’ve gone down the roads that I’ve gone down because I have so much like focus and drive and I just get connected with the wrong thing. So again, you had a straightforward experience with God, I understand that. But then you just did a complete 180, you were ready. That’s kind of why I brought up when the student is ready, the teacher will appear whether it’s God or just a mentor in life. And I think we’re both, we spend time with a lot of mentors and believe that wherever we want to go. So you went all in, you surrendered. You went through this period of time with business and then ministry. So take me, you left the ministry, or you maybe didn’t leave the ministry. That might be a bad way to say it. You changed, you switched directions. Did you got called back to business?
Michael Manthei: Yeah, I felt like he started talking to me about going into the financial arena of life and I thought that meant banking. [25:54 inaudible] different path. But one of the things that changed for me was reading rich dad, poor dad. That book blew my mind and opened me up to concepts that I had no perception of before. Growing up, money wasn’t a real positive topics. So to hear it put in the ways that Robert Kiyosaki did was life changing. So I started reading all kinds of books when I was still in ministry, on real estate and investing. And then when I left ministry, I was in New Zealand at the time, moved back to the States and a couple months with my family. And then moved out to Pennsylvania and get to know this Beautiful young lady.
Mike Ayala: And, who is she?
Michael Manthei: Kristen, my lovely wife. So we got married, we were renting an old farmhouse and, I wanted to get involved with investing. I had zero money. I mean, being on the mission field, there was no capital. My wife on the other hand had lived at home for 10 years, worked hard, gone without a lot that she could had, and it’s saved up $25,000. So we got married. I go out to breakfast with this guy who has 10 rental properties, a friend of her family and awesome guy, I am talking to him, telling him I want to get involved. And he’s like, well, Hey, I have a
foreclosure that the bank has been dragging their feet. It’s been months and months and months, now they’re ready to settle, but I’ve got two other projects I’m in the middle of. I’d love for my real estate agent to still get the commission, how about you step in and buy this property. Okay, how much is it? He said, $25,000. Okay. That’s interesting. So I go back home, and I think you’re probably the same way, but I am hyper focus on learning lessons from other people that I don’t have to make the same mistakes and learn from myself. One of those things was, I’d heard half a dozen times throughout the years, men that I respected say, I wish I would’ve learned years earlier to trust my wife’s intuition. It would have saved me all kinds of headaches. So I had already committed. I don’t need to learn that lesson myself, my wife and I will either be in unity on stuff or we won’t do it. So when I presented it, I didn’t have any emotion on, we needed to do it, but I could see the opportunity. For my wife, it was, okay, you want to take all our life savings and buy a rental property when we’re still living in an old farmhouse renting every month. So, yeah if you put it that way. Yeah. I think it’s a good opportunity. And this is actually going to catapult us forward instead of just leaving that money there.
So she said, well, this is kind of outside everything I’ve ever been taught. Her parents on the other hand from mine had been very successful and had taught her, don’t spend all your money, have stuff for rainy day. Have some cash reserves. So for her, am I going to listen to my new husband who has no experience or my parents. She just, she couldn’t bring those two worlds together. So she finally said, Hey, let’s go talk to my parents. Like, hey, no problem, I don’t have an ego on this. Until I realized on the way over, we’re going to talk to her parents about using her life savings to do something that I think is a good idea. I have no money. I have no experience. So I realized the predicament I’m in. And I decided, I am not going to say anything. I’m going to keep my mouth shut. So we get there and she lays it all out. I think I might’ve given some basic details of the deal, but otherwise I don’t say anything. And her parents basically say sweat heart, when we do our big developments, every single time we lay it all on the line, we put our house up, we do what we need to make a way for the reward of the future. You don’t get anywhere without risks. This seems like a good opportunity. And we think you guys should do it. So I give my wife a lot of credit because as soon as she knew, like, Hey, this wasn’t outside the realm of good wisdom. There’s different counsel for different seasons of life. When you’re a single lady. Yeah, you don’t want to spend everything on the next opportunity. But when you’re building a life together, building a family and a foundation for a successful future, there comes a point where you have to pull the trigger. So she reevaluated and we did that first deal and it’s been amazing. It’s been awesome.
Mike Ayala: I have to give you credit to and I don’t know whether you’ve processed this or not, but that’s really cool that, you didn’t have an ego in that and to let that kind of play out, one of my mentors taught me a long time ago to never fall in love with the property fall in love with the deal. And I’m just reading into this. Cause I mean, obviously who knows what the emotions were and what was that, but you had very little to say in that. And you just kind of let the deal flow. And I appreciate that about you in that situation too, because there’s sometimes like when we’re trying to make things happen, this is where I think people have to really get into that intuition, whether it’s the wife’s intuition or you hearing God or the universe or whatever it is that our listeners believe about. Even just there, you know, inner Jiminy cricket, whatever you want to call it, to get in tune with that. And we’ll dig on this a little bit more, but when you were talking about flow earlier and just getting into that state. Just living life there, I really appreciate just reading between the lines in that, because even at an early age obviously you were probably very excited about getting this deal done and It’s scary, right. You’re about to put your whole life savings on the line, but you’re a risk taker too. And I could see just talking through this, that’s what I so appreciate about my wife and I’s relationship, because there’s balance there.
So I love the way you approached that. And even though like you realized on the way there, like this could maybe not go way. But you just let it flow. I really appreciate that. I think there’s a nugget in there with people, we just can’t be so married to whether it’s a business deal or a relationship. Or, what we see as a certain outcome. I mean, sometimes you just got to step back and just let it be. And I appreciate hearing that.
Michael Manthei: A fruit tree doesn’t expend effort to produce fruit. It stays healthy and the fruit is natural. So if this deal, when it come together, there would have been another one. But keeping peace and health in the situation and relationships. And whether my ego got bruised or what not in the thing didn’t really matter. But keeping a healthy situation will produce the fruit instead of feeling like, Oh, I need that result. I need another building. I need another unit.
Mike Ayala: And that’s such an abundance mindset. And I would just like to make sure that we know dig in on this a little bit, because I mean, just even sitting in this room, like, I feel the abundance with you. And I think that’s one thing that hinders all of us. If we’re not flowing in that and realizing that what I’m hearing you say is that if that deal didn’t work out, there’s another one. There’s plenty of money. There’s plenty of opportunities. There’s plenty of relationships. It has to be right. And you have to let that stuff flow. And so for our listeners that, get maybe wound
up, I just want to make sure that we don’t just wax over that. Because I used to have a guy that, and this is a funny way to say it, but he always said, I don’t have a dog in this hunt. And basically what he was saying is the outcome, I’m going to separate myself from the outcome. Because it doesn’t mean we can just stand by and hope that things come together for us and not do anything. We were having this conversation earlier. Like you can’t just sit by and wait for things to happen to you, which is what most people are doing. You’ve got to go out and make things happen. But at the same time, you’ve got to find that balance of flow. And know when to sit back and just say, okay, you know what? I can’t control certain things and just see how. You couldn’t control what her parents were going to say. And I so appreciate the way you handled that and knowing them, I mean, they’re very wise people.
Michael Manthei: They’re awesome.
Mike Ayala: Yeah. But you didn’t go in trying to control that. And there’s another version of me that might want to be like, okay, so here’s the deal and here’s how it’s structured. And here’s how amazing kind of try to guide that. But what I appreciated about what you said there too was, you might’ve said a few things, but you really didn’t guide them. Cause it was her safe zone. You let that be, and that’s a sign of number one, a mature husband, but also a mature investor. So I applaud you.
Michael Manthei: I appreciate it, man. Thank you. Mike Ayala: And that was a long time ago.Michael Manthei: Yeah. Six years.
Mike Ayala: Cool. So tell me, here at investing for freedom, we’re always talking about, what do you want, why do you want it? What are you going to do to get it? So, first off, tell me just, I hear the background, I hear kind of the journey, and it’s amazing by the way. But when, when you started really looking at this, I know it’s investment opportunity found you, but was it there any kind of thought processes behind why you wanted to start investing in real estate? What was the, was there like some epiphany moments early on where you guys said we needed to build our passive income. We talk a lot about the freedom number. Was there a clear defined moment or?
Michael Manthei: Yeah, I mean, from rich dad poor dad, that concept of when your investment income exceeds your monthly expenses, you are free. That thing got lodged deep in me, deeper than I even realized. So that became, I’d almost say a carrot on a stick that was a motivator for what we built. So I had already looked at real estate. I mean, there’s just so many in a positive aspects of investing in real estate, from the tax benefits to the cashflow, the debt, the appreciation, having something tangible. So there’s incredible benefits, and it just fit with that freedom that was so important to us.
Mike Ayala: When we talk about getting out of the rat race or the freedom number as I call it, did you think about a specific number? Did you guys have a number or was it more of like, just a philosophy?
Michael Manthei: I’d say it was a philosophy. We saw rich dads or Robert, Kiyosaki’s going in his book buying two properties a year. And at the end of 10 years he got 20. So that seemed like a decent goal. We bought our first deal. Then we bought a piece of land to build a house the first year. Second year we built a house and bought another single. And then we got some really great news. My wife was pregnant. And processing that, she said, Hey, I’d love to stay home. I’ve always wanted to be a stay at home mom. I thought, Hey, awesome. That sounds great. She was obviously working at the time. So we started looking for a larger property that could replace her income. So we found one, it was like two apartments, six garages, two small warehouses, like four storage units. You know, it was a bigger deal than we’d done, but it was still pretty modest. And the cashflow from that just barely exceeded her part time income. So we were high fiving and so excited until we got a call one Saturday night from our realtor who said, Hey, just to let you know, we just lost that contract. And there was without going too far into the weeds, the mortgage contingency letter from our bank hadn’t seen the appraisal yet. So they just said, Hey, these are good clients, but we haven’t seen the appraisal. This property was through inner state, so the lawyer for the estate called his agent, Hey, don’t tell the buyers this, but I’m not going to accept this letter as satisfying this condition. We’re going to let this mortgage contingency date come and go, cancel their contract because we have a buyer for 5,000 more that we’ll sell it to. So if they would have told us, we would have done something different, they didn’t. So we lost this contract and I’ll never forget it. I mean, it felt like the provision for my wife to stay at home was being taken from us. I was upset. I was pissed.
Mike Ayala: You had an ego in it now.
Michael Manthei: I mean, this was like… Mike Ayala: No, I get it.
Michael Manthei: This is for my wife. This is not cool. So ego got fired up. So that Saturday night, I woke up Sunday morning and this was just outside of my ability to do, I was completely at peace. And I’ve been paying attention to those feelings for long enough to know what that meant. So I told my wife, said, sweetheart, I know what this looks like, but watch this is going to work to our advantage. God’s got something better for us. I said the same thing to our real estate agent. So the next week we’re out looking at other properties on the market. The only ones we could find on the market were like two units, three units. So I’m thinking I will find a way to buy a few of those. And we’re about to go into one and she checks her phone and she says, Oh, that’s interesting. And I said, what? She said, well, that same state just put another property on the market. And my first response was, we do a deal together and you lack integrity, that’s on you. But if I come around for a second try with the same group that doesn’t have integrity, that’s on me. I have no interest in dealing with these people again. As soon as I said that to her, I just felt something go in my heart. And I was like, wait a minute. This may be the thing that we knew was coming for God to bless us through this. I said, let’s look at it. So it was a 10-unit building, seven apartments, a warehouse,
small office and a grocery store. So long story short, the family for the estate did not know or approve of what their lawyer did and felt bad. Cause they were people of integrity. The family had like 30 properties. It all came down to this. This was the last one, best cash flow property there was. Coming up on the end of the year. They wanted to close the estate, be done with it. So we made them a really low cash offer. I said, there’s no contingencies. We’re not giving any back doors on this thing. So we bought this thing, got a hard money loan for it. We didn’t have the cash to buy it, but we figured out a way to just make a cash offer. Right away, took it to our bank to refinance. It appraised for, I don’t know, 150- 160 more then we bought it for. So bank gave us all the money back for the hard money loan, 10 grand for our pocket and a $75,000 line of credit. And this property cash flowed way more than the other one. It’s been such a blessing to us over the years.
So that whole experience, number one, again, just another experienced with the faithfulness of God. The $75,000, let us go out and keep buying. But the more valuable lesson in that whole thing was knowing that I didn’t have to bring my money to the table. I could figure out a way to creatively finance it, get the property purchase. If I purchase it under market, under value, get it, reappraised, get all the money back and then take that same chunk of equity and do it again and
again and again. So that’s what allowed us to take the concept in that credit line and buy another 40 plus units over the next two years.
Mike Ayala: That’s amazing. We hear these stories, I mean, I have my stories, you have your stories. But for the listeners that are like, okay, that’s great, Michael. You can do that, but I don’t have any experience in real estate. I don’t have any experience in finance. I don’t know how to talk to an attorney about trust planning. What do you say to that person?
Michael Manthei: Well, I would agree with them on the last one. Mike Ayala: Did you have…
Michael Manthei: So I always knew that real estate investing would be different from the inside than it looks from the outside. So you look at anything from the outside and it looks, impossible. I mean, when you don’t know how to do something, it looks impossible. So we’d bought a couple properties. We had two single family houses. We didn’t go for a 10 unit in our first time out of the gate. But getting in the game is the most important thing that anyone can do. All this podcast and events and books, I believe all of it is to give enough self-confidence to pull the trigger. And then the real learning starts. So, I’d say get started with something. You have to build your experience, build your education-base on something. Don’t say, Hey, if I can’t buy a hundred units building by myself or I can’t buy a 10 unit with none of my own cash, I’m not going to do anything.
You’re going to stay in that position but get started with something and you have to educate into those areas.
Mike Ayala: I love it. We’re going to circle back to the educate. Cause you guys have a group that you do, I’m going to circle back to that. So what’s your big why. You already kind of said early on what it was, it was the passive income. Your wife wanted to be a stay at home mom. Wanted to replace her income. Which
is similar to mine and Kara’s story. But let’s go a little deeper on the why, because a lot of times, we talk about the what. For me, it’s manufactured homes and business for you. I’ll let you get into that, but what’s the why? Like why are you doing. You wake up every day and what’s like, what’s your heartbeat?
Michael Manthei: It’s different now than it was then. It’s changed for me. So for a while it was that freedom number. We talked about this earlier, but getting to that point, look, we were so grateful to do it in just a couple of years, but it was honestly for the drive that we had at the time, it was empty. I had built this concept
of retirement, kicking back, more time with the family, more travel. And those are all beautiful things. And when you’re in the grind, it sounds great to relax until you figure out that, chasing comfort and chasing relaxation is such an empty experience. So we got to that point, I left my job and really relaxed for about a week. And I needed to, because I’d been working 60 hours a week and buying and self-managing these units. So I needed to rest. But after about a week, all my energy came back and I said, man, that last thing that I feel okay with is coasting through life on my easy chair. That is not why I’ve been put on this planet, but my expectation at that point was completely blank. Like I had no future to look forward to. It was, off a cliff and, and then retirement. So it was an excellent existential experience to reevaluate everything. And I spent a bunch of time in prayer, a lot of time talking with Kristin to figure out like, okay, we could do anything. What do we want to do? And we realized, Hey, as much fun as this has been buying and making a bunch of money in real estate and investment income and all of that, it would be a whole lot more meaningful, fulfilling to do it with other people. So we changed everything of how we did stuff. Since that time we haven’t bought anything just ourselves. We learned syndication so that we could do it in a group with other people.
Mike Ayala: Explain what syndication is, cause you and I know, but I think that’s a foreign term sometimes.
Michael Manthei: It can be. So syndication is basically, you can look at it like team investing. So somebody identifies a property and creates a legal structure or those that may not have either the time, the experience or the desire to actively participate in real estate investing. You make an opportunity for them to invest alongside. So the same properties that we were buying for ourselves, we started buying with investor partners. So it would create a structure where, if Johnny and Susie wanted to put a hundred grand somewhere, maybe they didn’t trust the stock market, maybe they didn’t, maybe they want to put it in something backed in real estate.
Mike Ayala: Do they get the tax benefits and everything? So for the person that doesn’t want to go out and do real estate on their own, they’re a doctor and they’re making good money. Or even they work at a mechanic shop. They can invest, generally speaking, I’m not saying specifically with you guys. But they can invest and get the benefits of cashflow and owning that real estate and the tax benefits, depreciation, all of that.
Michael Manthei: Totally.
Mike Ayala: Awesome.
Michael Manthei: Yeah. It’s powerful. And you get access to a better-quality team typically. So you get economies of scale, access to a better-quality team. It’s really, I feel like it’s an amazing way for people to get involved without having a lot of experience and learn through that process. So, I wanted to do everything from the ground up, so managed, buying our own buildings, learning each aspect. But I don’t think I’d suggest that for everybody.
Mike Ayala: Well, Michael, I mean, just an amazing, inspiring story. You know, we dug in a little personal stuff there, which I think is awesome. It’s cool to see what you’ve came through and out of and persevered and I have firsthand knowledge of your family and the life you’ve built. So it’s pretty amazing to see the life of freedom that you’ve built. And I appreciate what you said too, about retiring for a week, what you needed. But here’s what I was really excited to hear. You guys said to each other, we could basically do whatever we want. What is it that we actually want to do? And I would just challenge our listeners. It doesn’t matter what stage they’re at. They should be asking that question. Because sometimes, and this is when I say, what do you want? Which is question number one, I say, what do you really want? If you look at that five-part question that I’m always asking, that’s why I throw that really in there. Because a lot of times what we think we want, there was a period of time where, we’d go on vacation and Kara and I would be like, we want to live here. And what I realized is that’s not actually really what we wanted. We wanted the experience; we loved the experience of being out of our normal environment on that vacation. But if we actually lived in that town, it wouldn’t the same experience. It was that vacation. It was that getaway. It was recreation. We had that time where we were down. And so what we really wanted was more opportunities to be a way together and to recreate ourselves, recreation. So I loved what you said there. I mean, you guys found yourself in a position where you could do whatever you want, and you started asking the right
question. But it doesn’t matter where our listeners are at, they should be asking that question today.
It’s not necessarily always a million-dollar financial conversation. Sometimes it’s just an additional vacation every year. How do we get an extra $4,000 or $6,000 to take our family on one more vacation? And I remember, my kids are older now, but even growing up some of their favorite vacations didn’t really cost us that much. So a lot of times what we think we want is not what we really actually want. And I just wanted to dig in on that a little bit because I appreciated what you said
there. When you hit that retirement, it lasted about a week and then you guys really started digging on what you want. So I love everything that you’re doing with community. So let’s kind of wrap this up. What I’ve appreciated watching from the outside you’re doing a lot of what you’re doing because of that community. You can go further faster with people. Talk to us about your group. You’ve got a group called elevate.
Michael Manthei: Yup. Elevate investing group. It’s been an amazing experience to build a community. Our speakers that come in, they just, I’m so proud of the quality of the people that we have, the character of the people that we have. It’s just awesome to see a community growing that values more than just financial success. So often in, you know, some of these business success circles that, it’s pursuing, like you said, an empty goal. So to value family, to value character, to value long- term relationships, to value being healthy in all aspects of life is really what our group is about. So we talk about wealth strategies for inspired living. We want to be the full expression of who we’ve been created to be. And our flavor is, there’s a wealth aspect to this that. It’s really hard to, it’s almost cruel to have a big heart and no capacity to help.
Mike Ayala: That’s interesting.
Michael Manthei: And one of the things that I’ve had an overcome and a lot of our members have, like this concept of, as long as I just have enough to meet my built, I don’t want to be too greedy. How selfish is it to only one enough to cover your built? Yeah. Right. There’s this false humility that is on that, but it’s actually completely selfish. Why don’t we blow the top off this thing and be able to change the world? So we’re honored and excited to be in a community where we inspire each other to have a better future than any of us have had in the past. And a better future because of each other than any of us but have without the other one.
Mike Ayala: Wow. That’s amazing. So you guys have an event coming up in August. How do people find out more about that event?
Michael Manthei: So, August 28 and 29 in Lancaster, Pennsylvania. Last year 250 plus people fly in from all over. Amazing speakers. Robert Helms and Dave’s [54:25 inaudible], Wilson, Dana Samuelson. A lot of amazing speakers. Yeah so if people want to go learn about the event and sign up. Best place is www.investelevate.com.
Mike Ayala: That’s awesome. And where can people find out about you personally? Facebook, Instagram.
Michael Manthei: Facebook is probably the most active for me. So my first name, last name.
Mike Ayala: Michael Manthei. Cool. I’ll put that in the show notes. I really appreciate your transparency and going deep with us because, just having a conversation about real estate investing and money is, it’s fun and it’s interesting. But understanding, where you came from and the fact that you weren’t born with a Mom or dad that was a real estate guru and got you to where you’re at is where the power is. So I appreciate you being transparent and honest and being with us today.
Michael Manthei: Hey, appreciate your love, everything that you guys stand for and are doing and honored to be a part of it today.
Mike Ayala: All right. Thank you for your time. Michael Manthei: Thank you.
Mike Ayala: If you found value in this episode and you know someone who’s wanting to start or move further along in their journey toward investing for freedom, I would be forever grateful if you would share this show with them and help me get this message out to more listeners. Also, if you enjoy what you’ve heard, I would appreciate it if you’d take 30 seconds and leave me a five-star review and share this with your friends and until the next episode, cheers to moving further along in your journey of investing for freedom.