"I didn't really have a signature," the 9-year-old admits. "I just wrote it in cursive."
Kaillin and his older brother, Deklan, 11, are the proud owners of one rental property each, the result of their dad, a HomeVestors franchisee, reading the book "Rich Dad, Poor Dad: What the Rich Teach Their Kids About Money That the Poor and Middle Class Do Not."
"He's (the author) big on education and how poorly our educational system teaches children about finance..." not to mention business, Todd Reid says. "Profit and loss – it's not a fascinating subject for kids, but if it's their profit..."
Deklan, who bought his house when he was 9, finds homeownership "cool." What wasn't cool, however, was when someone broke in and stole the appliances while the house was being rehabbed. "He had to buy new ones and that came out of his profits," his dad says. An expensive lesson in business, as well as life.
How ugly was his house when he bought it? "Pretty ugly," Deklan claims, referring to HomeVestors' tagline, "We buy ugly houses."
On a positive note, the home seller was willing to finance the house, making the transaction less complicated. When it came time for Kaillin to break into the real estate market, he wasn't as fortunate as his big brother. His seller wasn't in a position to make a similar offer. "It's pretty difficult for a 9-year-old to get financing," Reid says, "so I provided the financing for Kaillin. His house may be small, but it's on an acre and in pretty good shape.
Deklan was interested in the financials from the get-go, he claims. Once his house was fixed up and ready to rent, he and his dad went out to dinner – "We like to go places with paper tablecloths you can write on," Reid says – to discuss the deal. Writing on the tablecloth, forgoing the crayons the server provides, the father and son figured out the interest rate, rent and expenses, and built a pro forma covering the time span from that day until Deklan leaves for college. The homes are the boys' college fund.
Reid, who has been a HomeVestors franchisee for the past five years, has around 40 rentals of his own. "The rental market is fantastic right now," he says. "I've never seen a better time. Even a fifth-grader realizes this is a great time." Proving not all of us are smarter than a fifth-grader.
Reid was an IT consultant when he started buying rental properties about 10 years ago and realized he was enjoying his hobby much more than his day job. "I was doing well with the rental properties (and) spending my most productive hours working for someone else," he says. He was one of the lucky ones, he contends, because his wife not only encouraged him to shake off the golden handcuffs of his well-paying corporate job, but asked why it took him so long to figure out they'd all be better off with him working for himself.
Lilian Reed, who was a fashion designer in Colombia before getting married and moving to the U.S., helps with the color schemes and design.
The boys seem to have inherited both parents' entrepreneurial bent. Deklan started a lawn-mowing business. He charges $40 to $50 per lawn, $25 of which goes to pay off the loan from his dad for his lawn mower. And, of course, Deklan didn't buy the cheapest mower out there; he researched his purchase by reading Consumer Reports.
Kaillin may only be 9, but he's ready to start his own business, too – a movie rental "store." He told his dad he didn't want to sell the movies, because then he'd only get the money once. "He wanted to rent and keep getting reoccurring revenue – of course he didn't use that phrase," Reid says, laughing.
Deklan hasn't seen his house for a year, but he does read the financials. Which is what any rich dad would expect of his children.
