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📺 Rather watch? Yesterday's 45-second Louisville market Short: Why Out-of-State Investors Keep Buying Louisville Rentals: The Math

Today's track: Ben Folds, "Fred Jones Part 2"

Fred Jones has worked at the newspaper for 25 years.

It's his last day. He's sitting at his desk with the lights off. Everything he kept there for a quarter of a century fits in a few boxes. A young guy is waiting out in the hall for the desk. And somebody has been sent up to walk Fred downstairs.

That's the whole song. Under four minutes. Ben at the piano, a cello moaning underneath, and a man who gave a place 25 years getting walked out like a visitor.

The part that guts me every time is when Ben sings that Fred has already been forgotten, and he hasn't even left the building yet.

Ben wrote it about a real person, a North Carolina newspaper editor whose writing meant a lot to him, who got pushed into retirement. It's on Rockin' the Suburbs, his first solo record after Ben Folds Five broke up. John McCrea from Cake sings backup on it. The album came out on September 11, 2001. Talk about a day nobody was listening.

I've been obsessed with Ben Folds since fifth grade. Ben Folds was one of the first concerts I ever saw, and I've seen him somewhere between eight and ten times since. When you're in the room with him, you can see the talent. You can feel it. He's just incredible.

But this song has been sitting with me for a different reason lately.

We're at such an interesting spot right now. Jobs are harder to find. And people still give their employers decades.

For what?

We've all been taught the same thing. Get the W-2 job. (A W-2 is the tax form your employer sends you every January. "W-2 income" just means a regular paycheck with taxes already taken out.) Steady income. Health insurance. A 401(k), the retirement account your job offers. That was the safety mechanism.

I was never built for that mold. I've had to go find my own health insurance. I've had to find a great CPA (certified public accountant) on my own. All the stuff that's a little easier when a company hands it to you. I'm not knocking the steadiness. It's real.

But with the world going up and down like it is, I don't know if it's the same safety mechanism it used to be.

The deal already changed. Quietly. A long time ago.

In 1980, about 38% of private-sector workers had a traditional pension. That's a defined benefit plan, the kind that mails you a check every month for the rest of your life. Stay 30 years, get the watch and the check. The company carried the risk of your retirement.

Today about 9% of private-sector workers are in one, and only 14% even have access to one, per the Bureau of Labor Statistics (BLS). Now you carry the risk. The deal changed. The advice didn't.

And almost nobody stays 25 years anymore anyway. The typical worker has been with their current employer 4.1 years, according to the newest BLS numbers. At private companies it's 3.9. Only about 30% of workers 25 and older have been at the same place 10 years or more.

Fred Jones was a unicorn. And look how it ended for the unicorn.

There's a story the writer Nassim Taleb tells in his book The Black Swan that I can't shake. With Thanksgiving three weeks out, it fits.

A turkey gets fed every single day. A thousand days in a row. And every day, the turkey gets a little more proof that the farmer loves him. The evidence keeps piling up. His confidence keeps climbing.

His confidence is at its highest on the Wednesday before Thanksgiving.

That's the thing about steadiness. It feels the safest right before it isn't. Fred's 25 years felt like proof that he was safe. It was the opposite. Every year he stayed, he had more riding on one place.

I know it's talked about a lot, but when you're done, you're done. They don't care anymore. Not because anybody's evil. The desk just needs filling, and there's a young guy waiting in the hall.

I don't want to scare anybody. I want you to see it clearly. Here's where things stand:

A lot of my most intelligent friends are not pushing hard on their kids to go to college right now. I think we should all be thinking about that. Not "never go." New nurses and teachers are doing great, and degree holders still earn more over a lifetime. But it's not automatic anymore. The Federal Reserve Bank of Cleveland says the gap between how easily college and non-college workers find jobs is the smallest it's been since the late 1970s.

Here's the strangest number I found.

LendingTree surveyed about 2,000 Americans in March. Only 33% have a side hustle right now, down from 44% in 2022. The people who have one are making a record $1,242 a month from it on average. And most of them said they'd still rather have one steady paycheck.

Read that again. The extra income pays more than ever, and fewer people want it. That's the safety mechanism talking. We're so wired to want one steady thing that we'll stay in the one thing that can't promise it.

That's the dichotomy. Hard times make people cling tighter. Hard times are exactly when you need a second thing.

We talk about it all the time in here. Build the second thing. Not so you can storm out of your job tomorrow. So you can make decisions differently.

When your W-2 isn't your only oxygen, everything changes. You negotiate a raise differently. You take the better job instead of the safe one. A layoff becomes a hard month instead of a catastrophe. You stop being the turkey.

This is what real estate has been for me and for a lot of my clients. A conduit. A pipe that moves you from one kind of life to another, bit by bit. You get income coming in that's different from your W-2. And you get tax relief your paycheck can't give you.

Here's how it actually works, from the ground up.

1. Your W-2 is your best loan tool. This is the twist. Lenders love two years of steady W-2 income. The paycheck that feels like a cage is also the key. Use the job to buy the asset while you still have the job.

2. House hacking. Buy a duplex, triplex or fourplex, live in one unit and rent out the others. An FHA loan (a mortgage backed by the Federal Housing Administration) lets you buy a two-to-four-unit property with as little as 3.5% down if your credit score is 580 or higher, as long as you live there at least a year. Your tenants help pay your mortgage. Run your own numbers on our house-hacking calculator.

3. Depreciation. The IRS (Internal Revenue Service) lets you deduct the cost of a rental building over 27.5 years, even while the property is going up in value. Simple example: you buy a $250,000 rental, and $50,000 of that is the land. (Land doesn't depreciate.) That's $200,000 divided by 27.5, about $7,270 a year you can deduct. It's a paper expense. No money leaves your pocket. That's how a rental can put cash in your hand while showing little or no taxable income.

4. The catch for W-2 folks. Losses from regular long-term rentals are usually "passive," which means they generally can't wipe out your paycheck income. There's an exception. If you actively help manage the rental, you can deduct up to $25,000 of rental losses against your W-2 when your modified adjusted gross income (your income after certain adjustments) is under $100,000. That shrinks to nothing at $150,000. "Real estate professional" status gets around it, but you need 750 hours a year and more than half your working time in real estate. With a full-time job, that's usually not you.

5. The short-term rental rule. If your rental's average guest stays seven days or less, and you materially participate (one common test is more than 100 hours a year and more than anybody else, including your cleaner), those losses can offset your W-2 income. And the One Big Beautiful Bill Act, signed in July 2025, made 100% bonus depreciation permanent for property bought after January 19, 2025. Pair that with a cost segregation study, where an engineer breaks your building into parts like appliances, flooring and landscaping that can be written off much faster, and the first-year deduction can be big. Louisville has its own short-term rental rules, so run the address through our short-term rental rules checker before you buy anything for that.

I'm not a CPA, and taxes are personal. This is how it works in general, not advice for your situation. Before you do any of it, sit down with a CPA who works with real estate investors. If you need one, I'll introduce you to mine. They are THE BEST!

There are tons of great resources out there to learn about taxes and make sure you don't walk into a bad deal. We built a bunch of them right on the Winner Realty site. No sign-up, no email wall. If you're working a W-2 job and want to start your second thing, here's where I'd start:

Everything else lives on the tools page.

I read Ben's memoir, A Dream About Lightning Bugs. He's been married five times.

What I appreciate about him is that he's never given up on his search for love. Every time, he went back in. Some people would call that failing. I call it not quitting on the thing that matters.

And two weeks ago, Ben Folds Five announced they're getting back together for a tour, their first since 2013. Nine shows in April, starting in Knoxville on April 12 and Chattanooga the next night. (Road trip, anyone?) The band that broke up before Fred Jones Part 2 ever existed is getting back on the bus.

That's the lesson. Don't give up on your search for stability and financial freedom. It's there. These are difficult times, and that's exactly why it's more necessary to be chasing it than ever.

Fred Jones never got a Part 3. You still can.

If you want to start creating income outside your paycheck, come talk to me. We've got plenty of different ways for you to make money: your first rental, a house hack, a fixer-upper, investor deals through OffMarket.deals, commercial property through Winner Commercial. Grab a time on my calendar, or text or email me. Bit by bit is how this works.

Same goes for our Realtors. One source of income is fragile for agents too, so we give ours a lot of ways to serve the community. Residential buyers and sellers. Commercial deals. Investor deals through OffMarket.deals, in front of 70,000+ buyers. Fresh residential and commercial leads in their inbox every morning at 6:30. More ways to help people means more ways to earn, and they appreciate that. It's a big part of why our agents are really happy here.

If you're an agent and that sounds good, grab a time on my calendar. I love talking with agents. And here's more on joining Winner Realty.

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📊 Yesterday's poll: If the power went out tonight for three days, how ready is your house? Here's what Louisville said, plus the first thing to grab for each answer.

Today's poll. Next issue I'll share what Louisville said, plus one next step for each answer.

🏆 The Top Five is ready as always. Five real deals on the Louisville MLS this morning, five ripe for a lowball, and my number on every one. I can't blast other agents' listings to a list, but I can send them to you personally. Reply "FIVE" and they're yours.

Still searching,
Rob Bergeron

Owner–Realtor at Award-Winning Winner Realty
Winner Realty: (502) 305-8915
Winner Realty | OffMarket.deals | Property Partner Data Company

Schedule time to discuss your goals, bottlenecks, or whatever's on your mind — book me here.

The Morning Bergeron daily track playlist

PS: The tired-seller shopping list. A seller who has been sitting a long time, and has already blinked on price, reads your offer differently. Every one of these is clickable, so go be curious.

Find one you like and email me. I'll pull the numbers and tell you what I'd offer.

All Winner Realty listings on the MLS (multiple listing service), in one spot, plus everything on OffMarket.deals, in front of 70,000+ buyers.

PSS: Remember the squirrel? Here's another one. Cyberattacks Hit Supermarket Freezers Across Europe. According to the reports, hackers got into the cooling systems at grocery stores in Sweden, Belgium, Luxembourg, Ireland and Estonia on Monday. The company that runs Delhaize's systems in Belgium told the Belgian news agency the hackers flipped the coolers into defrost mode (the setting that warms everything up to melt the ice), so the food spoiled and got thrown out. Carrefour said 15 Belgian stores were hit. Musgrave said 13 SuperValu stores in Ireland were. Nobody has said who did it.

And it's the second round. Last month about 700 supermarkets in France got hit the same way, per the French government. The company that made that refrigeration software said most of the systems hit were older ones that weren't getting security updates anymore.

That's the point from Tuesday's issue. The system is more fragile than it looks. One squirrel takes out a street. One hack empties the frozen aisle. So build in a little insulation: a full pantry, water, a battery backup on the sump pump, and a second income that doesn't depend on one employer. Same lesson as Fred Jones up top. Don't let one thing be your only oxygen.