Yeah, I missed that. I know a LOT of travelling welders. They can make good money, no doubt but they are also working in an atmosphere that I wouldn't want my son to be working in.

Before I make this next statement, everybody recognize I'm NOT TALKING ABOUT ALL WELDERS WHO TRAVEL.

A whole lot of those guys get strung out on various types of drugs. Meth is a big one. There are many crews around here that travel and weld all weekend while plants are down. Most of them TIG weld stainless. Most of them make about $15-$18 per hour not including per diem.

How many and where do they work?

EDIT: $70K per year is $33.65 per hour.

I agree that the construction life takes its toll on some people. Some of them are nothing short of pure roughnecks when it comes drugs. If they are welding pipe and only making in the %15-$18 range: 1) They're not much of a welder. 2) They need to drag up and go somewhere else. Pipe Welders in the Decatur area along the river make anywhere from $23-$26

It really depends on if you're talking about just making a decent living and also planning for a future nest egg, or if your just talking about having a job where you can make good money and fulfill a desire to serve the community like a dentist or a pharmacist. This is what I mean...If I was 18-19 again and know what I know now, and I was just looking at just dollars and cents, here are two hypothetical but realistic options:

1. Become a dentist

- 8 years of college to become a dentist - Average debt around 200k in student loans to pay back. Most likely no extra income during this time due to the demands of school. Age when I get out into the workforce putting my degree to work would be approximately 27.

- Start working at 27 with an average salary for dentist being around 150k per year. Depending on the route I take there will be considerable expenses in opening a practice, carrying malpractice insurance and then of course there are those nagging student loans to payback. Not sure what my remaining cash flow would be, but you get the point it wouldn't be anywhere near $150k until I was well established, which would probably take several years.

Second scenario
2. Go to trade school to become a welder (just example could be one of many trades) for 1 year - cost approximately 4-6k.
- Average salary 40k (much higher if willing to travel). Since this is a what I would do if I was 19, I would be willing to travel for a few years to get ahead then settle down. This scenario would put me in the 60-80k range when you include the per diem. I use this example because one of my sons best friends did this very thing, and was actually making over 80k, so I feel I'm being conservative.

- Making 70k per year at 20, would have approximately 50k after taxes. Live off of half and invest half.

- Buy a entry level (single wide mobile) rental that I can rent for $500 per month = $6k per yr - 25-30% expenses (includes a management fee since I'm on the road)= 4k per year cash flow. I am now 21 years old

- Replicate the last step in year 3 = another 4k per year cash flow. Now 22 years old.

- Replicated the last couple of years but now I can reinvest the profits from the last couple of years and buy a nice rental which will rent for $600 per month leaving me an extra $5400 per year cash flow. Now 23 years old.

- By the way these real estate investments will also allow me to reduce my taxable income due to the depreciation associated with these investments so by now I'm probably only paying 15k in taxes giving me an additional 5k per year to invest. Which is a total of $18,400 just from investments plus 25k of my salary for a total of $43,400 to buy another rental that can rent for $600 bringing in another $5400 cash flow. I'm now 24 (in the 1st scenario I'm almost 1/2 way through college).

- Continue to do this every year only buy a little nicer rental each year, which will rent just a little higher. At this point probably increasing rent by $1200 per year on the new ones.

- Fast forward to 27 I now have 7 rentals (all paid for) bringing in a total of $47,000 per year cash flow after expenses (including a management fee). In scenario 1 I'm just graduating college with 200k in debt. In this scenario I'm making $47k per year whether I work or not (putting my money to work for me, rather than me working for my money) plus I'm still making $70k per year at my welding job.

- At this point I can decide if I want to settle down and make less money per year welding by not traveling. Or I can continue to work a few more years and buy enough rentals to completely replace me income and retire at 30.

I'm not knocking becoming a dentist or a pharmacists, my point of this post is to show that sometimes we teach our kids that college is the end all be all to success. Truth is a dream with a clear vision of what your goals are, a strategy of how to get there, discipline to stick to it, a hard work ethic, and a never give up attitude are the ingredients to reaching those goals.


P.S. These numbers aren't pulled out of the air. I have bought several properties in the last couple of years in the $20k to $30k range that are bringing in more per month than the figures I used above. I only wish that I had understood these concepts at 19. I was traveling as a contract cable splicer in the telecommunications industry at that age and was making very good money, but had no idea of what if meant to invest it wisely. If I would of had these goals and understood these concepts, I would have been retired years ago. Unfortunately my strategy at the time was, I'm young enjoy my money now, I can keep making this kind of money for years to come, so I will do my investing later on...wrong answer. The industry changed, it got more competitive and prices went down. I moved back home and took a job with a local Telco making much less money than I was used to. But it's never too late to get started...just wish I had known it at 19.

I agree that the construction life takes its toll on some people. Some of them are nothing short of pure roughnecks when it comes drugs. If they are welding pipe and only making in the %15-$18 range: 1) They're not much of a welder. 2) They need to drag up and go somewhere else. Pipe Welders in the Decatur area along the river make anywhere from $23-$26

You may be missing the point of my post. We can debate whether welding is the best trade or not. The point I was making is that if you're 19, and you're weighing your options and setting goals for your life. Then you can go off to college and spend several years and most likely acquire debt doing it. Or you can learn a good trade in a much shorter time frame with little to no debt and hit the road while your young and make some good money. I did it with telecommunications as a contract cable splicer. There are many options and fields that pay as much or more than kids getting out of college. The other point I was making that when you look at the time value of money, the kid that goes the trade route can begin investing his money right away and be way ahead of the guys coming out of college in most cases. Don't get me wrong, I'm not knocking those who want to go to college, but we've got to quit telling our kids all their lives they've got to go to college to be successful.

A really smart businessman told me something 20 years ago that has stuck with me. He said, when you work for someone else, you're only going to make as much as money as they'll let you make. That sucks, but that's just the way it is.

Not trying to be a jerk but $23-$26 per hour is not $70K unless they are working a lot of overtime. $26 per hour is $54,080 per year in a 2080 hour work year. Pipe fitters make good money, and boiler makers make better money but both usually travel 90% of the time. I know there are some guys at Nucor that make really good money welding and other places like that, but they are the one in a 1000 guys.

Here's the cold hard truth about working in a trade job. You're most likely gonna top out at $20 or less per year. If you work up be a foreman, add $5 to that.

A really smart businessman told me something 20 years ago that has stuck with me. He said, when you work for someone else, you're only going to make as much as money as they'll let you make. That sucks, but that's just the way it is.

I worked for somebody else for 19 years after college. Then the Good Lord smiled on me and my brother and I were able to buy our business. The guys at my shop that have been there for more than a year make good money. I know we pay a good bit more than the average for our area. We've got some good guys and we take care of them.

I pay myself the same dang thing I made when I worked in the chicken business. LOL But I love every minute of it.

Those "cash flow" figures are a little presumptuous. However real easte investing in both short term and long term capitalization is no doubt a great way to spend your money and is the career path I chose at very early age.

Like I stated in my post I didn't pull those numbers out of the sky. I have been fortunate to be able to do a little of this myself. A couple of investments that I've recently made are cash flowing more than the numbers I used, so I felt I was being conservative.

Example, I bought a property for 20k that I had about 25k into with closing costs and upgrades. It's cash flowing $587 per month. Another property I have 16K into and it brings in $390 per month. Another I have $35k into and it's brings in almost 700 per month. All the numbers I used in my scenario where more in up front cost and less in cash flows, so these numbers are very realistic.

Don't take this wrong, I'm still a working man and I have not reached my goals of retiring and living off of these investments, but if I had known the time value of money at 19 I would be way ahead of the game now. But it's never too late to start, and my goal is to retire at 56.

Those are fantastic deals! The avg property around here rents for about 1% of the total purchase each month, a gross rent multiple of around 8. On avg......

The more properties you buy you'll find that there are always a couple underperforming, constant maintenance / problems of some sort. Diversity and volume help provide consistancy and predictability.

The term "cash flow" can be misleading depending on the time line you take your cash flow measurement. Big ticket maintenance items happen, changeover expenses are expected. 11 months out of the yr I'm in the black, December im always gonna be way in the red. Aside from running 200' of new water line and painting 4 apartments today I also tallyed my business personal property tax, I'm taxed on every stove, dishwasher, refrigerator, microwave, blind, advertisement sign, desk, computer, filling cabinet, and on hand supplies annually! I'm mad thinking about it!

Best way to do it is to start breaking everything out on a spreadsheet in excel with him sitting there:
Start with income, then start taking things away from that money. Work on a monthly basis, because people can understand payments on a monthly basis.

Income = _____________
FICA
State Income Tax
Medical Insurance
Dental Insurance
Take Home = _____________/yr then __________/month (This is where you start)

-------- (start subtracting)
Food _____/month
Dinner out = 50$
Truck/Car = ______month payment + $0.55 per mile you plan to drive
Rent/Mortgage
electric
gas
water
cell phone
TV
computer
internet
cable TV
go to football game/movie/night out
medications
clothing
hunting
fishing
boat
boots
furniture
travel
401k/savings
gonna have a hospital stay at some point

Baby..... (20 doc visits by mom / vitamins, etc)
Daycare = $125/month until 2yrs old
car seat
meds
food
etc

teenager.....
car
college
another phone

What daycare you using???!!! Try $125/WEEK

How many and where do they work?

EDIT: $70K per year is $33.65 per hour.

Those are fantastic deals! The avg property around here rents for about 1% of the total purchase each month, a gross rent multiple of around 8. On avg......

The more properties you buy you'll find that there are always a couple underperforming, constant maintenance / problems of some sort. Diversity and volume help provide consistancy and predictability.

The term "cash flow" can be misleading depending on the time line you take your cash flow measurement. Big ticket maintenance items happen, changeover expenses are expected. 11 months out of the yr I'm in the black, December im always gonna be way in the red. Aside from running 200' of new water line and painting 4 apartments today I also tallyed my business personal property tax, I'm taxed on every stove, dishwasher, refrigerator, microwave, blind, advertisement sign, desk, computer, filling cabinet, and on hand supplies annually! I'm mad thinking about it!

The problem is if a person makes $100k, they want a $250k house. If they make $200k, they want a $450k house. Like the old saying, the more you make the more you spend.