Fred was like most investors and entrepreneurs and had no idea that mobile homes could be a good investment and a great source of income. And the little he’d heard about mobile homes wasn’t very flattering. But Fred read a book called Deals On Wheels on how to make money with them and he called me for more information. He wanted to know if he could visit me sometime, buy lunch and see firsthand what he was up to. One morning at 9 o’clock, Fred showed up at my door and we went on a tour of the park.

At the first park we drove through, I pointed to a mobile home and said, “Fred, take a look at that mobile home and tell me what you see.” This was a 15-year-old, single-wide house. The paint was ugly, a section of the skirting was missing, a window pane was smashed, a dog was tied to the steps, and the garden would never win Garden of the Month. I could sense that Fred wasn’t really impressed by what he was seeing. He seemed a bit puzzled and said, “I see an old mobile home.” And to the untrained eye, that’s what it looked like. There was nothing wrong with Fred’s sight, he saw exactly what I just described. But what he didn’t realize was that he was looking at money disguised to look like an ugly old mobile home. Then I told Fred the history of this house.

Approximately two years earlier, he had purchased this house for $2,700. I spent another $341 on advertising and minor repairs. My total cost on that house was $3,041. In less than two weeks, I sold it for $6,950 to a young couple who needed an affordable place to live. This couple, like many couples, would never save enough to buy what they wanted, but could make one payment every month for life. They paid $750 down and I withdrew a 12.75% interest promissory note (industry standard) payable at $191.07 per month for 40 months. Now, let’s do the numbers and see how I did.

We had $3,041 invested, received $750 down, leaving $2,291 in the deal. We now have a promissory note for $6,200 and will receive $191.07 over 40 months. If I pushed the right buttons, that’s 95% performance. After 40 months, we will have raised $7,642. And besides, it will only take 12 payments to recover the $2,291 we have left on the note. As you can see, this little deal provides a very high return, with minimal risk, and was done in a very short time.

Note: If you don’t know how to use a financial calculator or don’t understand how to punch in numbers to get these numbers, I recommend my book Taking the Mystery Out of Money. It has a chapter that explains in detail the use of a financial calculator for most financial transactions.

Now let me explain what I have actually done with just a few hours of work. Some people will think that I just put together a little deal and made a nice profit…which I have. But I have done much more than that. What some people don’t realize is that I spent a few hours of work creating a note that now obliges someone to send me a check every month for the next 40 months. Once the deal is made, what else do I have to do to get paid? Nothing more than waiting for the postman to bring the checks. I don’t even have to leave the house to get paid, but that cute couple that lives in that mobile home has to go to work every day so they can send me a check. And they get to do it 40 times. And it was done in an ugly old mobile home that most investors wouldn’t consider to be of any value or warranty.

After explaining all this to Fred, I asked him to take another look at that motor home and tell me what he saw. What he saw the first time was something he looked ugly, but now he realized that he had been suffering from an optical illusion. It could be said that Fred’s vision had shown a remarkable improvement in a very short time. Now he could clearly see the money. I then asked Fred to calculate how many small mobile home payments like this he would need each month to equal the checks he received from his job. I explained to him that if he only did one small deal a month, it wouldn’t be that many months before someone else sent him more money than he paid for his full-time job. And if he still enjoyed having a “job” when he got to that point, he could keep the job as a hobby.

Now, I’d like to elaborate a bit more on this little deal to show how a little education and knowledge can make a world of difference in a person’s life. Before I learned how to put my money to work, I was doing all the work. I was so ignorant back then that I thought the answer to financial freedom was to work two jobs. And that’s what I did for many years. Eventually, I realized that there were not enough hours in a day and that I couldn’t work enough hours in a month to achieve financial security. There had to be a better way, and I started looking for that way. When I realized that education and knowledge were the answer, I decided to study. You see, until then all I had was some “education”. Now I realized that I needed some education.

So I started to learn who were the people who were successful and doing what I wanted to do. I started attending seminars given by these people. I paid money that I couldn’t afford to go to those seminars. I took a break from work that I couldn’t afford to take. I bought books, tapes, and courses that I couldn’t afford. I spent many hours listening to those tapes and reading the books, when I could have been watching ball games on TV or fishing, as many people did. I was doing all the things I couldn’t afford to do, so that one day I could afford to do all the things I wanted to do. And I soon learned that it wasn’t a question of whether I could afford to attend seminars, I realized that I couldn’t afford not to.

Now I can look back and see that I didn’t do all the easy things and all the fun things like many people were doing, but I did do all the right things. And today, we enjoy financial security and financial freedom and we can do what we want to do, and we can do it when we want to do it. While some of our friends are still working “jobs” in search of financial security they will never know. They had the same opportunity to make decisions that I had…they just made the wrong decisions. They all had “schooling” but did not have the necessary education that financial freedom provides. Now they tell me how lucky I am.

The best investment you can make is in yourself. So be willing to pay for your education now, or be prepared to pay a much higher price for your lack of education later. The decisions you make today will determine your financial future. Make sure you make the right choice, because you will have to live with the results of that choice.

Fred paid for lunch that day, which was a hamburger and fries. (I think I’m working too cheap.) Next time, Fred, it’ll be ribs and good wine.

Update: Fred no longer has a “job”. He now he has done over 50 “Lonnie’s Deals” and is part owner of a mobile home park. How sweet it is, Fred. Congratulations.

for your success,

lonnie scruggs