I’m Adrienne Green, and in this episode I sat down with Ana Garcia, a real estate investor and CPA who works exclusively with clients in the real estate space. Ana’s journey started in an unlikely place: a senior auditor handed her a copy of Rich Dad Poor Dad during her very first job out of college, and she’s been building wealth through real estate ever since. Today she and her husband hold fifteen doors across Miami and Broward County, spanning short-term, long-term, and midterm rentals. In this conversation, Anna pulls back the curtain on the accounting side of real estate investing that so many landlords ignore until tax season blindsides them. We talk about why cash flow, not appreciation, should drive every buying decision, the exact financial habits she recommends tracking every month, how to know when it’s time to hire help with your books, and why “more doors” doesn’t automatically mean more wealth. If you’ve ever felt overwhelmed by your bookkeeping or surprised by your tax bill, this episode is packed with practical, proactive strategies you can start using today.
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I’m Adrienne Green and today we’re with Ana Garcia. Here we focus on how real estate entrepreneurs break free of the grind and get the freedom they wanted at the start. Ana’s awesome because she is an investor herself and a CPA who works with those in the real estate space. So Anna, thank you so much for joining us today.
Adrienne, so glad to be here with you.
Now for people who don’t know you, can you give us an idea what your real estate portfolio looks like today?
Right now we have fifteen doors. I say we because I own one apartment with my sister, and the rest of the fourteen doors is with my husband. So total of fifteen.
Awesome. And I’d love to hear your story of how you went from CPA to investor.
So I had just graduated college and was starting to work at one of the big accounting firms. It was my first job out of college and I was auditing, and my senior, the way these firms assign the jobs is you go to the clients and it’s the staff, usually one or two, and then you have a senior, a manager, and the partner. So we had the senior on site, it was me and him, and one day he starts telling me about Rich Dad Poor Dad. Have you read it? And I said, what is that? I have no clue. I was going to be a CPA my whole life, I was just starting my career, and he said you have to go read it. So that’s how I got so lucky. I feel very blessed because I was able to start my real estate journey very early on.
I love that, and it’s so funny because, like we were saying before we started recording, I’m in Lima, Peru right now, and we visit bookstores a lot because my kids love to look at bookstores. Here we saw Rich Dad Poor Dad. It’s one of the books that when we go into bookstores around the world, we see it pretty often. It’s pretty distinctive and you can identify the name in any language. It’s crazy that you got introduced to it at your W-2 job, and that became the start of your real estate investing journey.
Yeah. Rich Dad Poor Dad is the one book that most investors say got them started into real estate.
Yes, it’s been pivotal for sure. Now you got started after reading Rich Dad Poor Dad, and you have a property with your sister. Was that your first one?
It was. It was actually when I first read the book, this was 2007 or 2008, just when the economy was going down. So it was a perfect time for us to start. I wish I would have bought more. I wish she and I would have gotten more investment properties, but we just got that one apartment. We got it for, I mean, it’s Miami, we got it for almost free, I would say. We paid $49,000 for this two bedroom, one bath. We did have to make a few repairs here and there, but it was awesome. I think it’s valued now probably at $300,000, if not $280,000.
That’s awesome. And then you continued doing the investing with your husband over the years.
Right. So we first acquired a studio, then we went for a fourplex, and then finally got an eightplex. So we’re looking for our next investment now, actually.
And you focus in the Miami area with long-term rentals, or tell me a little bit about your niche.
We’ve done it all, I would say. We’ve done short-term rental, that was how we would begin the investments, and then we would convert it into long-term. So we’ve done short-term, long-term, and the studio we have is actually midterm, three months at a time.
So you focus locally, Miami-specific, for your niche?
Yes. We started in Miami, but Miami has gotten very expensive. Even these days that we see some more inventory out there, Miami has kept a lot of its value. It’s decreased a little bit, but it’s an area that’s very pricey. So we have also moved to Broward, which is the next county.
Yeah, I will say Miami, when I read the national real estate news, Miami’s up there. It’s hot right now. Everybody’s talking about it. So I’m glad you’ve got some nearby areas that continue to work for you in terms of investment.
Alright, so you’ve invested for a long time. A lot of real estate investors have not been investing since 2007, 2008. I imagine you have some lessons learned for our listeners from that experience. What are a couple things that you would say you wish you knew when you first got started?
I remember reading that when you start investing, you don’t go for appreciation, you go for cash flow. Your investment has to give you cash flow, not necessarily be in an area where it’s going to grow. We were lucky to invest when times were still picking up, but still not at the level they’re at these days. I would say, with the fourplex that we bought, the units are huge, they’re big, and we thought, my husband also works in construction, so he has that background, he said we can even convert this from a fourplex to an eightplex. But then looking back we realized it only has one bathroom. So to convert it, we’re going to have to add another bathroom. So we learned that lesson: if it’s something we want to convert, let’s make sure it already has what it needs to be able to grow into a bigger building. That’s one thing. And then cash flowing is very important, just to buy. We bought that fourplex in a very good area, but it hasn’t cash flowed since we bought it. At the end of the day we haven’t lost money, but I think going forward we want to make sure it actually gives us a return, the actual cash flow.
Right, and that’s a really good point to make. So many investors get into it and they don’t get the cash flow they were expecting. It’s fine if you’re okay with buying something purely for the appreciation, the challenge is a lot of people think they’re going to get cash flow and then are surprised when they don’t. So good to point out that that’s something to really measure.
Now since we’re talking about the numbers, let’s talk about taxes, because that’s your jam.
The fun stuff.
You know what, the funny thing is taxes are boring to 99% of the population, but you get in a group of real estate investors and we’re so excited to talk to a CPA or talk about taxes. It’s kind of funny. Now, most investors think about taxes once a year in a panic, they’re behind, their books are not up to date, they’re always extending because they don’t even have their numbers done at year end. What if we instead treated tax strategy as an ongoing part of running the business instead of just a season, what would that look like for investors?
That would change their lives, their investment journey, their wealth, everything going forward. What happens is taxpayers are used to fighting their taxes at the end of the year, but the end of the year is actually March or April, the year that you’re fighting for has already ended. A lot of the strategies, and remember, real estate investors love to talk about taxes because the IRS has all these opportunities tax-wise that we can take advantage of, so if you as a real estate investor are not looking proactively at your accounting, proactively at your tax situation, how are you even going to mitigate and really use all those strategies that are out there to lower your taxes? So with our clients, we work proactively, we meet with our clients throughout the year, we go through their financials, we tell them how much taxes they’re going to pay in the year and how we’re going to mitigate that together. It’s about knowing their books, knowing their cash flow, knowing what expenses are really affecting their bottom line, and what strategies we can implement to make sure that’s actually mitigated. And another thing, as real estate investors, we’re always buying, selling, these are big decisions, and taxes are going to get impacted. When you know what options you have out there to pay zero taxes, some of our clients pay zero taxes, that’s really important. That’s why it’s important to be proactive.
This resonates so much, because as an investor and a business owner, it was so transformational when I brought on one of my VAs to start doing the bookkeeping and accounting. Every Friday, all of our transactions had been categorized in QuickBooks, and I had an exact tally of where we stood every Friday, what the net income was, what money I was expecting to have come in, what outflow I had with credit cards and everything. Being able to really know where we stood financially every Friday was huge. It was amazing.
So that’s really where it needs to start, right? For you to have these productive meetings with clients, they have to have up-to-date books to start off with. So what do you recommend for investors who feel overwhelmed with their bookkeeping and accounting and are like, “I don’t even know where to start, I hate doing it, I time block time to do it every week but then I never do it because emergencies and fires pop up”? What are your tips for clients in that situation?
A few things. The first tip I would give is, anything relating to expenses, any statements, create a folder, and it could be something physical, and also on your computer, depending on what kind of documentation you have, and just put everything in there. That’s tip number one: keep everything in one place, organized. The second thing is, we’re investors, we love real estate, but we may not necessarily like and love the accounting. Accounting is very technical too. It may be easy for you to classify something like eating out, you know that’s meals, but what about the balance sheet accounts you don’t know, like equity? All these things are like French to us. So at that point you need to hire help, it could be a VA. There are a lot of virtual assistants out there that do an amazing job with the books. So subcontract that work. If you don’t feel comfortable, because I know it’s your financial situation, maybe you don’t know if the person’s good, at the beginning you have to kind of be on top of it, but once they get the hang of it, once you trust that person, it changes your world. Looking at your financial information on a monthly basis changes your world and your peace of mind.
Fabulous. So let’s say somebody gets the help that they need because they’re not doing it well themselves. What do they need to track now? What financial habits do you recommend people have, or what numbers should an investor be tracking and viewing monthly if they really want to get a handle on their real estate business’s finances?
Number one, cash flow. Again, we invest to have more money, more wealth, so cash flow. Make sure you’re tracking what your expenses are, what your biggest expenses are, and can you even lower those? Insurance is one big one that increased over the past few years, and now it seems to be getting a little adjusted, maybe we can get those lowered. So make sure you’re tracking your cash flow, not just how much rent you’re getting. That’s number one. You should always have some reserves, things can happen. For capital expenditures sometimes, even though we have insurance, we do need to have a reserve on the side for any expense you weren’t counting on. So those are the two things. If the properties are cash flowing, you’re in a healthy position.
Okay, so if I was an investor listening and accounting is a foreign language to me, I could make an appointment with myself, or my VA, or my bookkeeper, whoever I’m using, go in every month into QuickBooks or whatever software I’m using, look at the statement of cash flows, make sure it’s positive at the end, and look at those expenses at the bottom and ask, is this what I was expecting, or are any of these a surprise because they’re larger? Is that accurate?
Correct. Yes.
And then I want to look at my balance sheet and make sure I’ve got some reserves, some assets in that balance sheet that I could use if an emergency popped up.
Exactly, exactly. When you’re looking, also not just the cash flow statement, you can also look at your income statement. And if you use QuickBooks, you can choose if you want to see it on a cash basis, so it’s everything that came in, everything that went out. That’s an easy review. You can also compare this year to last year and see what changed, what improved, what expenses are getting higher. So yes, definitely that’s the way to review it.
And I love that aspect in QuickBooks, how easy it is, you just click a button to compare it to last year. That’s actually in the SOP for my executive assistant, every month they do that for all my investment properties, and if it’s over a certain margin, they flag it for my attention. That way I’m not doing the routine check, but if something’s atypical, they bring it to my attention. Love that, it’s been really helpful.
That’s awesome. Yeah.
Okay, now let’s talk about your own CPA firm, because that is a business as well. You’ve had to build it up as an entrepreneur in the same way that real estate investors are doing with their real estate business. How have you grown and systemized your own firm so that you have the time to do your investing and your business and life? Because that’s always a challenge for people in the real estate space.
I’ll tell you, I have three kids, and that’s like another full-time job, another business on its own. I think you have three kids too, right?
Yes, yes.
So it is difficult when you’re juggling so many things. As a woman, I think we carry a lot on our shoulders, so we have to make sure that we’re efficient, and this is when help comes in. For my CPA business, just like for my real estate business, I have help, we cannot do it on our own. My husband works too, so we have to make sure we’re systematizing things. The way I’ve done it in my CPA firm is: first, I’ve hired a team of experts that get the work done, and I just keep the relationship with the clients and keep the tax strategy at the higher level. Everything else has to be done by the team to make sure things are running smoothly, that no client is left behind. We’ve also worked with QuickBooks for a long time, we’ve just kept it that way. Any clients that come in usually already have QuickBooks, or we integrate them into QuickBooks. And the people we work with, the sponsors who help our clients do the different strategies, like 1031 exchanges or cost segregation, are also vetted already. So we know that whenever we send a client to these sponsors, these vendors, they’re in good hands. That’s the way we’ve gotten to feel relieved, and the fact that we’ve specialized in real estate also makes it a lot easier, we work with real estate investors or anybody wanting to invest in real estate, starting their real estate journey, and that makes it easier too. It’s a system, we already know what we’re dealing with. Accounting and taxes are not easy. Depending on the industry you’re working with, there are different strategies, different rules. So by focusing on real estate, everything flows in an easier way.
Awesome. There are two gems there that I really want to dig into further. The first is how you’ve leveraged a team. That resonates with me, if you think of the cash flow quadrant from Rich Dad Poor Dad, we often start as an employee, we move to self-employed, but the way to get from self-employed to business owner is to have people working for you. That’s a really tough jump for a lot of real estate investors. It’s a tough jump mentally, it’s all a mental game of trusting other people to do the work. What worked for you? What did you have to tell yourself to make that jump?
At the beginning, I did not want to let go. I was refusing to hire anybody, I would do everything myself. I said I’ll just have a few clients and I’ll do everything myself, I don’t want to have employees. This was at the firm, actually, because in the real estate side we always had a manager. But it was really difficult to let go until I kept going to trainings and they kept saying you need an assistant, you need some help. So I hired my assistant, that was my first help, and then I saw the difference. I saw that when I wasn’t at my desk, things were working. My clients were being served. I was not stressing out about something that was pending. So then I hired my second person, I actually promoted my assistant and hired a new assistant. And that’s how it becomes almost like, you really need it. I think you always have to think about what is that 20% that only you can do, and then subcontract the other 80%. Make sure that data entry, we have experts, and you have to know what kind of role, what kind of person, what kind of experience you need for the different roles. For example, in the firm we have our CPA who helps with strategies and reviews the tax returns, she has that accounting expertise. And then we have our bookkeeping team, there are experts in bookkeeping. We have our tax team, experts in taxes. And then we have the admin people keeping the clients connected with everyone and the work flowing. So you need to know when to hire a professional, and that’s how we’ve done it. But it’s worked out so greatly. I highly recommend it. Start with a VA, if you don’t have anyone, start with a VA, definitely.
Love that, and I appreciate that you shared how it was tough at first, but you had to just do it anyway, and then you saw the benefits. I think that’s often how it goes. Now the second thing you hit on for your CPA firm that I’ve seen myself is your niching down. That’s the challenge, as a CPA you think, I can help anybody who does taxes, every American is filing taxes. And in the real estate space too, it can feel like everything is real estate, there are five million ways to invest in real estate. So talk to us more about this niching down you did as a CPA and how that could inspire real estate investors to niche with their investing.
I think this comes from the book The Pumpkin Plan too, fantastic book, I recommend it. There’s a saying that when you’re chasing two rabbits, you’ll catch none. You have to stay focused on one thing. If you’re investing in real estate and you want to do short-term rental, but then you want to do long-term rental, but then you’re buying multifamily, when you niche and you know, okay, I’m going to stick with single family homes, you see people being successful in so many different asset types. It’s so important, it makes things easier, you understand how things work, you can create more economies of scale, when you know the problems that exist in that particular niche. It’s a lot easier to handle and it’s more efficient at the end of the day.
Yeah, and I think that’s exactly right. You can be more efficient and really focus. You said that so well.
Now you sit across from a lot of investors at moments when real money is on the line. You see the ones who can make clear decisions, who can move forward, and the ones who freeze or react emotionally and don’t make progress. What separates those two people?
The people who make the clear decisions are the people who know their numbers. There’s no doubt about it. And with that comes moving faster in the deals. When you’re going to sell a property, you’re going to pay capital gains tax, there are different options. When you have a team of experts behind you, and you already know the consequences of each possible outcome, you can make a better decision. You’re clearer on what the next step is. That’s what’s different between someone who’s prepared and someone who’s not. The one who’s not prepared doesn’t have books on time, doesn’t have their financials ready, many times doesn’t have their taxes ready. So how are you going to proceed with something if you don’t even know if you’re going to be able to work with a lender? You can make better decisions when you’re prepared, especially when you know your numbers.
That’s so true, so true. I love that. And it’s not just, part of it is that lenders want to see that latest tax return. And even before that, you don’t even know if you should be buying that property, if that’s a smart financial decision, if you don’t have your numbers done. I love it.
Alright, now Anna, there’s this belief in the real estate investing space that the more doors you have, the more volume, then that’s more wealth and more prestige. Tell me the truth on that, does more doors automatically mean you’re better or wealthier?
Not at all. We’ve seen clients who continue to buy and continue to buy, but at the end of the day they’re having to get a second job because they need to pay for a lot of expenses. A lot of these properties, if they’re old, if they have a lot of problems and you didn’t consider that and take it into account when you were making your offer, then you’re getting into a problem, and instead of giving you money back and cash flowing and adding value to your life, it’s really draining you financially and emotionally. So having more doors doesn’t mean more wealth. We have to be savvy investors when we’re buying real estate, we have to make sure we’re looking at every aspect of the deal. And another thing too, we see clients just going to buy real estate for tax purposes. That shouldn’t be your number one reason. The tax benefit is the icing on top, but at the end of the day you want to make sure you’re buying a good deal that’s going to work for you.
Very good, I love that. Well, Anna, if somebody would like to connect further and learn about your CPA services or follow up with a specific question, what’s the best way for them to connect?
They could visit our website: annagarciacpa.com.
Perfect, and we’ll have that in the show notes for you to grab. Thank you so much, Anna, for sharing all of this as an investor yourself, and as a CPA who works with investors. Very, very helpful for people to think big picture and to motivate them to get their books in order if they’re not already.
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