WEBVTT 1 00:00:00.000 --> 00:00:05.400 If you don't get in the game of home ownership and you rent in your 20s and you rent in your 30s 2 00:00:05.400 --> 00:00:09.920 You're gonna turn around in your 40s and having not built any network and in fact 3 00:00:09.920 --> 00:00:12.920 Homer's America are worth 40 times 4 00:00:13.560 --> 00:00:19.360 More than renters and I'm talking about ordinary Americans, but that doesn't mean that buying a home made them rich right? 5 00:00:19.360 --> 00:00:25.480 It actually does and I'm gonna go through that. I might not better off renting and investing in the stock market 6 00:00:25.480 --> 00:00:32.040 I want to bless this myth because I have spent the last 33 years of my life helping millions of people with 7 00:00:32.280 --> 00:00:37.440 Ordinary incomes become financially free including nine years as a financial advisor at Morgan Stanley 8 00:00:37.440 --> 00:00:41.520 And I got to see you first to help everyone who came into my office with an ordinary income built well 9 00:00:41.520 --> 00:00:47.120 And there's a formula to getting rich, but there's also a system that how you put your financial life on 10 00:00:47.560 --> 00:00:51.360 Autopilot and less than 10 minutes and it doesn't require 11 00:00:51.360 --> 00:00:55.400 Discipline budget and you don't have to make a lot of money to get started 12 00:00:55.400 --> 00:00:58.360 But unless your financial plan is automatic it will fail 13 00:00:58.560 --> 00:01:02.720 But more importantly, I believe the next 10 years will be the greatest opportunity to build well in our lifetime 14 00:01:02.720 --> 00:01:08.840 And yet seven out of 10 people right now are living paycheck to paycheck more than 50% of Americans don't have savings and most people 15 00:01:08.840 --> 00:01:13.520 Don't know where the money goes and in fact when we ask people how much money would it take to totally change your life? 16 00:01:13.520 --> 00:01:19.200 They say $10,000 now how much money do you need to spend a day to blow $10,000 a year? 17 00:01:19.760 --> 00:01:25.760 $27.40 a day if you invested that a day for 40 years we'd have over four million 18 00:01:26.400 --> 00:01:29.200 $424,000 that would be life-changing 19 00:01:29.200 --> 00:01:34.080 But just before we get into all of the specifics and the strategies do you have any specific advice to people that are currently 20 00:01:34.080 --> 00:01:40.000 Strabbled with debt absolutely there's a very simple formula to getting out of debt called don't I tell you to 21 00:01:41.680 --> 00:01:43.680 Just give me 30 seconds of your time 22 00:01:44.160 --> 00:01:48.800 Two things I wanted to say the first thing is a huge thank you for listening and tuning into the show 23 00:01:49.120 --> 00:01:55.360 Week after week means the world to all of us and this really is a dream that we absolutely never had and couldn't have imagined getting to this place 24 00:01:56.000 --> 00:01:59.280 But secondly, it's a dream where we feel like we're only just getting started 25 00:01:59.840 --> 00:02:01.520 And if you enjoy what we do here 26 00:02:01.520 --> 00:02:07.360 Please join the 24% of people that listen to this podcast regularly and follow us on this app 27 00:02:07.680 --> 00:02:13.040 Here's a promise I'm gonna make to you. I'm gonna do everything in my power to make this show as good as I can 28 00:02:13.440 --> 00:02:20.480 Now and into the future. We're gonna deliver the guests that you want me to speak to and we're gonna continue to keep doing all of the things you love about the show 29 00:02:21.520 --> 00:02:23.520 Thank you 30 00:02:29.760 --> 00:02:40.000 David what has your mission been for the last three decades? I have spent the last 30 years of my life helping ordinary people 31 00:02:40.960 --> 00:02:44.160 People the ordinary incomes become financially free 32 00:02:44.960 --> 00:02:48.400 And the last 20 years I spent helping people become automatic millionaires 33 00:02:48.640 --> 00:02:56.240 So I love to teach anyone at any income level minimum wage living paycheck to paycheck. You might be in debt. You might be struggling 34 00:02:56.960 --> 00:03:02.080 I've taught millions of people how they can improve their life financially 35 00:03:02.320 --> 00:03:06.480 That's where I've been dedicated to and I spent 33 years total in the financial service industry 36 00:03:06.960 --> 00:03:12.400 And is this conversation just for people that are in their 20s or is it applicable to everybody every age 37 00:03:13.200 --> 00:03:17.040 It's applicable to everybody every age because what every rage is you know, it's looks 38 00:03:17.120 --> 00:03:19.680 Even so many people are living paycheck to paycheck right now 39 00:03:20.240 --> 00:03:22.240 In this country what's happening right now is it 40 00:03:23.040 --> 00:03:28.400 7 out of 10 people are being left behind financially 7 out of 10 people right now are living paycheck to paycheck 41 00:03:29.120 --> 00:03:32.320 When you go into looking at finances in America today 42 00:03:33.280 --> 00:03:38.480 Half of Americans can't get their hands on a thousand dollars in case emergency purposes 43 00:03:39.040 --> 00:03:45.520 And my biggest fear why I updated this book and why I decided to come back out one more time into another financial literacy campaign 44 00:03:46.080 --> 00:03:48.320 Is I'm afraid people are being left behind 45 00:03:49.280 --> 00:03:55.920 I think what they are right now the next 10 years would be the greatest opportunity to build wealth in our lifetime 46 00:03:57.200 --> 00:04:00.720 That's the good news the bad news is a lot of people being left behind 47 00:04:01.280 --> 00:04:03.280 My goal today next hour is very simple 48 00:04:03.280 --> 00:04:08.320 I want to give you the system on how to become an automatic millionaire at any age level at any income level 49 00:04:08.880 --> 00:04:12.720 What I'm going to teach you is how to put your financial life on autopilot 50 00:04:13.280 --> 00:04:15.280 In less than 10 minutes 51 00:04:15.280 --> 00:04:18.080 Because when your financial life is automatic 52 00:04:18.640 --> 00:04:23.760 Your habits work automatically and an automatic financial life 53 00:04:24.560 --> 00:04:28.560 Doesn't require discipline doesn't require a budget 54 00:04:29.120 --> 00:04:31.360 And you don't have to make a lot of money to get started 55 00:04:32.080 --> 00:04:36.960 Why should people be taking advice from you on this subject matter? What's what have you done in those that three years? 56 00:04:37.520 --> 00:04:40.880 I've been doing this my entire life right so if you go all the way back 57 00:04:41.520 --> 00:04:43.520 I started investing at the age of seven 58 00:04:43.920 --> 00:04:48.000 And how that happened is I had a grandmother amazing grandmother name was grandma rose 59 00:04:48.720 --> 00:04:52.160 At 30 she made a decision that changed the whole destiny of our family 60 00:04:52.560 --> 00:04:58.400 And the decision she made was she won't be pouring more and at 30 on a very cold day on her birthday 61 00:04:58.720 --> 00:05:01.920 She turned to my grandfather and she said we don't have any money 62 00:05:02.320 --> 00:05:05.680 We're living paycheck to paycheck and I don't want to retire here 63 00:05:05.840 --> 00:05:08.800 I want to go to California. I want to be where it's warm 64 00:05:09.360 --> 00:05:11.440 And my grandfather said well, what do you want to do about it? 65 00:05:11.680 --> 00:05:15.040 And she's like we need to change what we're doing or nothing will change 66 00:05:15.680 --> 00:05:20.400 And so my grandmother started saving 50 cents a week out of her paycheck 67 00:05:20.480 --> 00:05:25.520 So 50 cents each because they were like middle-class people right didn't have a college education 68 00:05:26.000 --> 00:05:29.600 My grandfather worked in a plant my grandmother worked in retail 69 00:05:30.560 --> 00:05:37.440 But she started saving small amounts of money and over her lifetime she became an investor and she became a self-made millionaire 70 00:05:38.000 --> 00:05:41.760 My first book which you have sitting over here was a book called smart women finish rich 71 00:05:41.840 --> 00:05:44.000 It was the lessons that my grandmother taught me 72 00:05:44.560 --> 00:05:50.000 So at seven my grandmother took me to McDonald's and she taught me a lesson that would change my life 73 00:05:51.040 --> 00:05:56.080 She said David you're sitting here eating McDonald's and cheeseburgers and your french fries and your milkshake 74 00:05:56.960 --> 00:06:00.400 She said I'm gonna teach you today how to be rich for real you like to play monopoly 75 00:06:01.200 --> 00:06:04.320 Here's my lesson today. She said there's three types of people 76 00:06:04.960 --> 00:06:08.800 Those like you who are here eating right now you're what's called a consumer 77 00:06:09.440 --> 00:06:13.440 She said the people over there who have been working they're called employees 78 00:06:14.000 --> 00:06:16.000 And they've been working for minimum wage 79 00:06:16.960 --> 00:06:20.880 And that's a very hard way to live she's they make eight at the time they made 85 cents an hour 80 00:06:21.600 --> 00:06:25.200 And she said the third type of person is the person who owns this place 81 00:06:25.840 --> 00:06:27.840 They're called an investor 82 00:06:27.840 --> 00:06:30.960 She said today. I'm gonna teach you how to buy stock in McDonald's 83 00:06:31.440 --> 00:06:36.400 So that when you come to McDonald's you'll make money from everybody who's here when your friends come to McDonald's 84 00:06:36.400 --> 00:06:40.560 You'll make money from them and you'll be an owner of McDonald's 85 00:06:41.200 --> 00:06:43.200 She took me down to a brokerage firm 86 00:06:43.760 --> 00:06:46.080 Help me buy my first share of stock in McDonald's 87 00:06:47.120 --> 00:06:53.360 That moment changed my life because what she made me realize is like everything that we do I'm seven years old 88 00:06:53.600 --> 00:06:55.600 everything that we do 89 00:06:55.600 --> 00:07:01.440 There's an opportunity to be an investor and own that so like at nine years old I'm at Disney. I'm like hey Mickey Mouse 90 00:07:01.440 --> 00:07:03.120 Are you public? 91 00:07:03.120 --> 00:07:08.000 So I was like a not a normal kid in that way because I started investing at a young age 92 00:07:08.400 --> 00:07:14.480 But then I made a lot of mistakes then I went to college then I got myself in credit card debt 93 00:07:15.360 --> 00:07:19.360 Then I believed all the myths that young people often believe I believed 94 00:07:20.160 --> 00:07:24.880 I couldn't really invest a lot until I made a lot of money so my early 20s 95 00:07:25.760 --> 00:07:32.160 I was making money, but spending everything so I was went from making nothing to making $50,000 a year 96 00:07:33.360 --> 00:07:37.760 And I'm still broke. I'm like well, it's not enough money. So I went to $75,000 a year 97 00:07:38.320 --> 00:07:44.400 Still broke spending more then I got to a hundred thousand dollars a year in income a lot of money, right in my 20s 98 00:07:44.560 --> 00:07:51.280 Oh my god, I'm rich. No, I was still spending more than I was making at that point. I was a financial advisor 99 00:07:52.000 --> 00:07:55.440 And all that was my job. I was working at Morgan Stanley 100 00:07:55.920 --> 00:08:00.000 Helping people plan for retirement teaching retirement seminars 101 00:08:00.480 --> 00:08:04.720 And I met this ordinary couple that came into my office the age of 52 102 00:08:05.360 --> 00:08:06.640 Jim and Sue McIntyre 103 00:08:07.280 --> 00:08:11.520 They had an ordinary job that year they had made a little over $53,000 104 00:08:12.640 --> 00:08:17.840 Their average income over their lifetime was $40,000 and at 52 Jim 105 00:08:18.640 --> 00:08:21.200 Put out all statements on a table in front of me 106 00:08:21.840 --> 00:08:26.000 I sat there and added them up and they had a net worth of $1.8 million 107 00:08:27.040 --> 00:08:29.760 And I sat back at a table just like this and said 108 00:08:31.120 --> 00:08:33.120 How did you do this? 109 00:08:33.440 --> 00:08:35.840 And they had just been in my class for four weeks like David 110 00:08:35.840 --> 00:08:37.600 We did a lot of what you talked about 111 00:08:37.600 --> 00:08:42.960 But we didn't have a budget because budgets don't work and they talked about why budgeting didn't work for them 112 00:08:43.360 --> 00:08:48.400 They said we put everything on autopilot. We saved money automatically for everything 113 00:08:49.680 --> 00:08:53.920 And that was the moment that changed my life. I realized that day 114 00:08:54.880 --> 00:08:58.160 As somebody who's living paycheck to paycheck with a high income 115 00:08:58.800 --> 00:09:03.280 These people had half the income that I did and they were able to retire at 52 116 00:09:04.000 --> 00:09:09.520 I was in my mid 20s and I realized that if I didn't start saving and investing 117 00:09:10.320 --> 00:09:12.720 I didn't change nothing was going to change 118 00:09:13.280 --> 00:09:16.080 And I would never have the financial freedom that they had 119 00:09:16.560 --> 00:09:18.560 And so I went home that day 120 00:09:19.200 --> 00:09:24.400 And I changed everything in my life now. I had a lot about habits. So I had a lot of things that need to be changed 121 00:09:25.040 --> 00:09:29.440 You were the senior vice president at Morgan Stanley when you stepped down and you 122 00:09:30.080 --> 00:09:36.240 Soon after wrote this book called smart women finish rich. It begs the question. What are the differences that you saw 123 00:09:37.040 --> 00:09:41.440 Through your process of financial education that women face versus man 124 00:09:42.240 --> 00:09:46.000 I started I was in business my father and we had a lot of older clients 125 00:09:46.480 --> 00:09:49.760 And I would sit in our meetings one after another with widows 126 00:09:50.080 --> 00:09:51.840 So in the first month of my career 127 00:09:52.480 --> 00:09:57.200 I sat in three meetings with three widows where the husband had dropped dead suddenly 128 00:09:57.360 --> 00:10:02.080 And my dad at the time was teaching these women how to read the broker statements 129 00:10:02.320 --> 00:10:05.440 How to write checks and how to know if they would have enough money 130 00:10:06.320 --> 00:10:07.920 And I thought 131 00:10:07.920 --> 00:10:12.400 This is crazy. I said to my dad for the third appointment dad. What he what what's going on here? 132 00:10:12.480 --> 00:10:16.560 He's like, what do you mean? I go well you're teaching these women when their husband has just died 133 00:10:17.200 --> 00:10:20.080 How to handle their finances and he said David 134 00:10:20.880 --> 00:10:23.840 Not all women are like your grandmother your grandmother was a rarity 135 00:10:24.480 --> 00:10:28.160 And I said dad, that's crazy. I'm gonna go out and teach a class for rent and money 136 00:10:28.880 --> 00:10:32.880 And when I started teaching class for money. Here's what I learned here 137 00:10:32.880 --> 00:10:35.520 The things that make women different than men comes to money 138 00:10:36.240 --> 00:10:38.240 Women first of all live longer than men 139 00:10:38.720 --> 00:10:45.280 Which means they need more money than men do the average age of widowhood in America when I wrote that book originally was 140 00:10:45.360 --> 00:10:47.200 57 Steven 141 00:10:47.200 --> 00:10:49.200 Now it's 59 142 00:10:49.600 --> 00:10:53.840 Okay, you do all these shows on longevity. It seems like everybody's living forever. They're not 143 00:10:54.400 --> 00:10:57.840 Okay, the average age of widowhood in America is 59 years old when you say widow 144 00:10:57.840 --> 00:11:02.480 Had you mean the age in which a woman becomes a widow exactly? They're married and they lose their husband 145 00:11:02.640 --> 00:11:06.720 Okay, okay, so so women are often wiped out when that happens financially 146 00:11:07.120 --> 00:11:10.560 Second thing is that women are hurt more than men when it comes to divorce 147 00:11:11.200 --> 00:11:12.400 The 148 00:11:12.400 --> 00:11:16.080 Third thing that affects women is that they work fewer years 149 00:11:16.480 --> 00:11:19.280 I'm like these are just the statistical realities 150 00:11:19.760 --> 00:11:21.920 Women work fewer years than men because they have children 151 00:11:22.400 --> 00:11:28.160 So that's an average of somewhere between 7 to 11 years less and that's less money going into sole security 152 00:11:28.720 --> 00:11:32.400 Retirement accounts and it affects their earnings and often they earn less 153 00:11:33.040 --> 00:11:37.280 So what I have taught for third nearly 30 years now is as a woman 154 00:11:37.360 --> 00:11:40.720 I don't care what your situation is. I don't care if you're an entrepreneur 155 00:11:40.720 --> 00:11:44.720 I don't care if you're a state-owned mother. I don't care if you're married to the local bank president 156 00:11:45.040 --> 00:11:48.560 I don't care if you're married singled widow divorced as a woman 157 00:11:49.200 --> 00:11:53.680 You have to be in charge of your finances period drop them like 158 00:11:54.960 --> 00:12:01.440 End of discussion you can't delegate your financial well-being to anyone else you have to be in charge 159 00:12:02.320 --> 00:12:05.600 Now I will also tell you Steven that women make better investors than men 160 00:12:06.560 --> 00:12:10.720 They they make better investors than men because often women don't trade like men do 161 00:12:11.760 --> 00:12:16.480 And they are they do more research before they invest and their performance is better 162 00:12:16.960 --> 00:12:19.920 They're way better at long-term investment than men are 163 00:12:20.480 --> 00:12:22.480 I heard some stats once upon a time that men are 164 00:12:23.680 --> 00:12:25.680 With the majority of the gambling addicts 165 00:12:26.160 --> 00:12:31.120 Well, I'm sure they're the majority of the gambling addicts and also when you look at trading because trading's become a very big thing 166 00:12:31.120 --> 00:12:35.440 But trading's always been a thing trading meaning trading like trading stocks buying and selling stocks 167 00:12:35.440 --> 00:12:37.200 Now it's buying and selling crypto currency 168 00:12:37.680 --> 00:12:41.760 Well, I can do it selling options all of these things are primarily men doing it 169 00:12:42.320 --> 00:12:49.840 And they don't make money because the bulk of people who trade lose money day in day out and you're out 170 00:12:50.320 --> 00:12:54.960 I teach a philosophy which is this your money and your investments should be boring 171 00:12:55.840 --> 00:12:59.120 Your life should be interesting your investments should be boring 172 00:12:59.120 --> 00:13:02.160 If someone's coming to a cocktail party talking about their investments 173 00:13:02.880 --> 00:13:05.200 And it's exciting something's wrong with it 174 00:13:06.400 --> 00:13:07.440 Why? 175 00:13:07.600 --> 00:13:11.920 Because sexy is how you go broke when it comes to money 176 00:13:12.880 --> 00:13:16.160 Boring is beautiful when it becomes when it's about you well 177 00:13:16.480 --> 00:13:21.040 So even driving over here my son was just like dad why don't you trading Tesla stock? 178 00:13:21.120 --> 00:13:24.640 I'm like you know why I'm not trading Tesla stock because you can't make money trading 179 00:13:24.640 --> 00:13:26.640 You got a fair of when to buy when to sell 180 00:13:27.280 --> 00:13:32.000 I want my kids investing in index funds. I have my clients investing in index funds 181 00:13:32.960 --> 00:13:35.440 Boring is beautiful when it comes to money 182 00:13:36.720 --> 00:13:40.720 Before we get into the real specifics and the tactical strategies and 183 00:13:41.600 --> 00:13:46.480 We think about a bunch of the sort of things you said about debt and credit cards and saving and getting out of debt 184 00:13:46.480 --> 00:13:49.840 And how to become wealthy in an automatic millionaire is there anything 185 00:13:50.400 --> 00:13:53.840 We should discuss as it relates to the broader context of what's going on in the world 186 00:13:54.080 --> 00:13:58.240 Whether it's wealth inequality whether it's the amount of people that are living paycheck to paycheck 187 00:13:58.240 --> 00:14:02.560 What I'm trying to get a picture on what the the state of financial wealth looks like in the western world 188 00:14:02.720 --> 00:14:08.240 Yeah, well, so let's talk you know when people talk about economies here's here's the economy that matters in my opinion 189 00:14:08.960 --> 00:14:14.000 Your economy meaning the person is listening the economy that you're in control of is yours 190 00:14:14.480 --> 00:14:17.920 You're not in control over what's going to happen with interest rates 191 00:14:18.080 --> 00:14:24.560 What's going to happen with geopolitical things what's going to happen with AI the only economy that you can control is yours 192 00:14:25.120 --> 00:14:27.120 Now here's the question 193 00:14:28.080 --> 00:14:31.440 Are you working most cases the answers yes 194 00:14:32.160 --> 00:14:35.680 The average person will work 90,000 hours over their lifetime 195 00:14:36.240 --> 00:14:43.840 So if you are a dual income household you're going to work somewhere between 90 to 200,000 hours the two of you 196 00:14:44.560 --> 00:14:46.320 Over your lifetime 197 00:14:46.320 --> 00:14:50.320 You're going to actually make millions of dollars over your lifetime 198 00:14:50.960 --> 00:14:55.920 The question is with your own economy. Are you going to keep any of the money? 199 00:14:57.200 --> 00:15:00.080 And the sad thing for many people is that they're not 200 00:15:00.800 --> 00:15:04.560 I say most people have what I call a no plan plan money comes in 201 00:15:05.360 --> 00:15:09.200 Money goes out and they say well, I don't know where the money all went and I go 202 00:15:09.760 --> 00:15:15.680 That's called a no plan plan a person who's an automatic millionaire the moment money comes in they have a plan 203 00:15:16.400 --> 00:15:19.760 For exactly where it's going to go and that starts with paying themselves first 204 00:15:20.480 --> 00:15:22.480 automatically 205 00:15:22.480 --> 00:15:26.640 A lot of people listen to this if I go back if I go back just over 10 years in my life 206 00:15:26.880 --> 00:15:29.360 I would have been sat listening to this conversation in 207 00:15:29.920 --> 00:15:35.520 7,000 pounds of debt and I would have thought god like becoming a millionaire. That's a that's a million miles away 208 00:15:36.160 --> 00:15:42.960 No pun intended. I want to come a millionaire. I'm going to have to earn so much more money and at the time I was working in call centers 209 00:15:43.680 --> 00:15:50.560 It really just felt so far away and I say you know people struggling to feed their children let alone become a millionaire 210 00:15:51.360 --> 00:15:54.080 It is it far away for the average person 211 00:15:54.800 --> 00:15:58.640 It's far away if you don't know the strategy. There's a strategy to getting out of debt 212 00:15:58.880 --> 00:16:01.600 There's a strategy building well. There's a system 213 00:16:02.080 --> 00:16:06.080 How much of it is just earning more money because when I have these conversations on my show 214 00:16:06.560 --> 00:16:14.080 I think the surprisingly untouched territory is we don't teach people how to become more valuable 215 00:16:14.480 --> 00:16:18.240 So that they can earn more money a lot of it's about like index phones or savings whatever 216 00:16:18.560 --> 00:16:20.560 But how much of it is just like 217 00:16:20.800 --> 00:16:22.560 I need to get 218 00:16:22.640 --> 00:16:24.640 high-evalued skills in the market 219 00:16:25.680 --> 00:16:28.480 We know for a fact that making more money doesn't make you rich 220 00:16:28.880 --> 00:16:34.880 So so people can go as I told you earlier like from a hundred thousand dollars thinking go from 50,000 to 100,000 221 00:16:34.960 --> 00:16:38.800 And still be broke. They can go from 100,000 to 200,000 a year and still be broke 222 00:16:38.960 --> 00:16:41.280 They can go from 200,000 to 300,000 and still be broke 223 00:16:42.000 --> 00:16:48.480 In the US when you take households that make a hundred and fifty thousand dollars a year one out of three of them are still broke 224 00:16:49.200 --> 00:16:53.840 When you peel back the curtain and you ask why is that well, we know things cost more 225 00:16:54.160 --> 00:17:00.240 But we also know there's massive lifestyle creep right you get you get around other people who are making more money 226 00:17:00.320 --> 00:17:06.160 And then you spend more money and the reality is these phones are designed to get you to spend everything 227 00:17:06.640 --> 00:17:10.080 Right today with the algorithms there's better technology today 228 00:17:10.080 --> 00:17:12.240 And there's ever been to get you to spend more money 229 00:17:12.960 --> 00:17:18.080 And nobody wants to spend money once they want you spend money for a lifetime right to lifetime to have a customer 230 00:17:18.560 --> 00:17:21.520 So if there's a battle for our income 231 00:17:22.560 --> 00:17:28.480 And everyone wants a piece of it starts with a government like you go to work and you go to work at nine 232 00:17:29.040 --> 00:17:32.400 And you actually work from nine o'clock to twelve for taxes 233 00:17:33.040 --> 00:17:37.840 Now this is an important lesson actually the government doesn't ask you to budget 234 00:17:38.400 --> 00:17:40.080 To pay taxes 235 00:17:40.080 --> 00:17:42.800 They take your taxes from you automatically 236 00:17:43.280 --> 00:17:48.480 They take Social Security from you automatically they take the money from you automatically because they know 237 00:17:49.120 --> 00:17:52.000 You won't have anything to give if they don't take it from you 238 00:17:52.560 --> 00:17:55.600 Then people work from twelve to about three o'clock for housing 239 00:17:56.160 --> 00:18:00.960 And food and then from three o'clock to five o'clock for all the rest are all the rest of things 240 00:18:02.480 --> 00:18:07.440 The people who build wealth in America and really all over the world they do something different 241 00:18:08.080 --> 00:18:10.080 They keep the first hour day of their income 242 00:18:10.640 --> 00:18:11.680 What do you mean by that? 243 00:18:11.680 --> 00:18:13.680 So what that means is whatever you earn 244 00:18:14.640 --> 00:18:19.840 You can be what making minimum wage you can be making twenty dollars an hour thirty dollars an hour forty dollars an hour 245 00:18:20.240 --> 00:18:24.560 Whatever you earn the first hour day of your income has to go to you 246 00:18:25.280 --> 00:18:30.400 You're the first person to get paid and you mean you have to save it invest it you have to invest it 247 00:18:30.560 --> 00:18:33.840 So how do you invest the first hour of your day 248 00:18:34.960 --> 00:18:40.720 Without paying taxes the answer is you pay yourself first using a 401k plan 249 00:18:40.720 --> 00:18:46.480 So if you have a job with a retirement account 401k plan you sign up and you use that plan 250 00:18:47.120 --> 00:18:52.320 Now I can't just stop right there right because it because it sounds so simple like okay. I use my plan 251 00:18:52.880 --> 00:18:56.640 No, you have to know the formula to using your plan to be rich 252 00:18:57.280 --> 00:19:02.240 We know after 40 years now exactly what you need to do if you want to be a millionaire 253 00:19:02.480 --> 00:19:07.520 I can tell you how to become a millionaire starting your 20s so that you're done by the time you're in your mid 50s 254 00:19:08.080 --> 00:19:12.880 You save a little one hour day of your income is 12 and a half percent of your gross revenue 255 00:19:13.600 --> 00:19:18.320 I went on online today to look at what's the latest statistics with 401k millionaires 256 00:19:18.800 --> 00:19:21.040 The new stats had just came out from fidelity 257 00:19:21.600 --> 00:19:28.080 There are 654,000 people in fidelity 401k plans that are now millionaires 258 00:19:28.240 --> 00:19:31.920 What is a 401k? Okay, because you know, we've got a lot of global listeners. Yeah, yeah 259 00:19:32.000 --> 00:19:33.920 There's different types of 401k in every 260 00:19:34.560 --> 00:19:38.480 Country so in the US a 401k plan is a retirement account 261 00:19:38.720 --> 00:19:41.280 It is a retirement account that the company has set up 262 00:19:41.840 --> 00:19:47.600 Right, and it allows you to put money away tax deductible they call it pre-tax 263 00:19:48.400 --> 00:19:51.600 In most countries you have a deductible retirement account 264 00:19:52.080 --> 00:19:54.880 But it depends on the country too right like in Canada 265 00:19:54.960 --> 00:19:59.440 It's a different type of plan than it is in Australia than it is in Italy than it is here in the UK 266 00:20:00.400 --> 00:20:07.920 Almost every country though has some form of retirement account and has the ability to put money away automatically 267 00:20:08.560 --> 00:20:10.560 Here's the problem 268 00:20:10.560 --> 00:20:15.520 I'll use the US specifically because it's where I do most of my work in the US 269 00:20:16.160 --> 00:20:18.320 Those who have a 401k plan 270 00:20:19.680 --> 00:20:25.920 The ones that are millionaires what they did here's the formula the exact formula they saved 14% of their gross income 271 00:20:26.960 --> 00:20:29.600 And their employer had a small match on top of that 272 00:20:30.640 --> 00:20:36.240 And then how they invested the money is key because it's not enough to just put money in these 401k plans 273 00:20:36.720 --> 00:20:40.720 You have to be invested for growth and growth means stocks 274 00:20:41.360 --> 00:20:47.360 Right, so you'd have to have and and the actual specific allocation in these 401k millionaires 275 00:20:47.360 --> 00:20:52.080 I just talked about was about 70% stock and 30% bonds 276 00:20:53.120 --> 00:20:56.560 Okay, now what are people doing that aren't achieving this? 277 00:20:56.560 --> 00:21:01.200 Well the average American saving maybe three or four percent maybe five percent 278 00:21:02.080 --> 00:21:07.120 If they have a 401k plan people who don't have 401k plans in many cases aren't even doing this 279 00:21:07.120 --> 00:21:09.120 They can they can open up an IRA account 280 00:21:09.520 --> 00:21:13.200 But in most cases they're not doing that so the whole secret is 281 00:21:14.560 --> 00:21:16.080 Not budgeting 282 00:21:16.080 --> 00:21:20.080 Not using discipline having the money move right from your paycheck 283 00:21:20.960 --> 00:21:22.960 Paycheck it's deposited automatically 284 00:21:23.440 --> 00:21:28.960 And then it moves the date hits your bank account automatically first for retirement 285 00:21:29.600 --> 00:21:33.280 Then later we'll talk about building a security account building a dream account 286 00:21:34.240 --> 00:21:37.760 The key is that the money moves automatically 287 00:21:38.720 --> 00:21:42.880 So in the United States now there's by the way 24 million millionaires now 288 00:21:43.040 --> 00:21:49.200 So we've seen an increase of 8 million millionaires to 24 millionaires in the US in just 20 years 289 00:21:50.160 --> 00:21:51.840 How did they do that? 290 00:21:51.840 --> 00:21:57.440 There's two primary escalators to wealth that is stocks and real estate 291 00:21:58.000 --> 00:22:02.720 And if you're not in stocks and you're not in real estate you are being left behind 292 00:22:04.080 --> 00:22:07.600 When you say real estate does that mean having a mortgage and have owning a hat home 293 00:22:08.480 --> 00:22:11.280 It's owning a home or owning reads 294 00:22:11.920 --> 00:22:18.080 Reats reads real estate equity investment trust. So that's another way to buy real estate without actually having to own the home 295 00:22:18.400 --> 00:22:23.440 But you don't get the same level of returns. I mean this is um this is one of the hot topics of conversation 296 00:22:23.440 --> 00:22:28.240 We've had on this show several times is many of my guests that are sort of financial advisors 297 00:22:28.720 --> 00:22:31.040 Say that owning a home is a bad investment 298 00:22:31.760 --> 00:22:35.760 I think from what I understood from the research and from reading your books that you feel differently 299 00:22:36.560 --> 00:22:44.000 About that. Yeah, I mean, I couldn't feel more different when we look at where is wealth created in the United States 300 00:22:44.080 --> 00:22:45.760 And also abroad 301 00:22:45.760 --> 00:22:50.080 It's in two places. It's in home equity and it's in the stock market 302 00:22:50.560 --> 00:22:52.560 So when you look at housing 303 00:22:52.720 --> 00:22:56.720 And you take someone who owns a home and we'll talk about I know it's hard to buy homes right now 304 00:22:57.840 --> 00:23:00.720 But when you look at people who own a home versus people who rent 305 00:23:01.760 --> 00:23:07.840 Home or is America fall this for one second home or is America worth 40 times 306 00:23:08.640 --> 00:23:10.640 More than renters 307 00:23:10.640 --> 00:23:16.720 So the average homeowner in America today is worth over four hundred thousand dollars 308 00:23:16.880 --> 00:23:21.440 But this doesn't establish causation. I that doesn't mean that buying a home make made them rich, right? 309 00:23:21.920 --> 00:23:27.040 It actually does and I'm gonna go through that here. So the average renters worth ten thousand dollars 310 00:23:27.680 --> 00:23:34.720 Right, so why why does buying a home build wealth and how much wealth the United States is now in home equity 311 00:23:35.040 --> 00:23:38.160 Wall Street troll just ran an article on this came out two days ago 312 00:23:38.720 --> 00:23:43.840 There's 34 trillion dollars now in home equity in America 313 00:23:44.400 --> 00:23:46.240 This number has gone up 314 00:23:46.240 --> 00:23:48.240 90% since before COVID 315 00:23:50.160 --> 00:23:55.360 The other money is in retirement accounts, which is 60 70% in stocks 316 00:23:56.000 --> 00:24:00.160 There's 45 trillion dollars now in retirement accounts 317 00:24:00.560 --> 00:24:06.080 So those two things alone equal 80 trillion dollars, right like when you want to go like 318 00:24:07.200 --> 00:24:09.520 Where the bread crumbs? Where's wealth being created? 319 00:24:10.560 --> 00:24:15.200 It's right in front of us now the problem that we have in the United States 320 00:24:15.200 --> 00:24:20.240 But also look we're here in London right now problem we have in so many cities is that real estate keeps going 321 00:24:20.640 --> 00:24:27.760 Higher and higher and higher and people's incomes are not keeping pace with the cost of buying a home 322 00:24:28.480 --> 00:24:32.240 So when someone comes on a show like this and says look you don't have to buy a home 323 00:24:33.120 --> 00:24:37.440 It's cost more to have a house and rent you know, I watched one of the shows 324 00:24:37.440 --> 00:24:41.440 I won't say who it was it doesn't matter. They all say the same thing don't buy a house 325 00:24:42.080 --> 00:24:49.600 You'll be trapped you'll have to pay you have to pay real estate taxes and you'll have to pay insurance and things break 326 00:24:50.240 --> 00:24:56.400 They go through all these expenses and it makes it sound like oh yeah if I rent it'll be cheaper 327 00:24:57.120 --> 00:25:01.040 So who do you think pays these expenses when you rent? 328 00:25:02.560 --> 00:25:09.200 You do the landlord passes the cost of these expenses on to the renter 329 00:25:09.280 --> 00:25:15.440 Ultimately why do they do this because people who buy real estate buy it for an investment 330 00:25:15.840 --> 00:25:19.680 They buy it for an investment. They're not they're not subsidizing these costs 331 00:25:20.560 --> 00:25:27.040 So it's a hard thing to hear and especially when you're young like I have a son who's 22 is in Chicago 332 00:25:27.600 --> 00:25:28.880 He's gonna move to New York City 333 00:25:29.680 --> 00:25:34.320 It'll be extremely hard for him to buy a place in New York when he starts working right away 334 00:25:34.800 --> 00:25:37.840 Just will be probably won't for two or three years 335 00:25:38.080 --> 00:25:41.440 Lot of young people when they moved to a major city they can't afford to buy right away 336 00:25:41.920 --> 00:25:45.040 When I came out of college like you I was in credit card debt 337 00:25:45.680 --> 00:25:47.840 I had $12,000 in credit card debt 338 00:25:47.920 --> 00:25:51.200 I remember opening up my bills and having the room spin 339 00:25:51.840 --> 00:25:55.200 And thinking I'm never going down to credit card debt. How am I going to buy a house 340 00:25:56.320 --> 00:26:00.640 But I did and in fact I didn't buy a home when I was young by myself 341 00:26:01.680 --> 00:26:07.040 I bought a home with a best friend. So how did I get my first house first house we bought was a quarter of a million dollars 342 00:26:07.440 --> 00:26:12.880 We put 10% down and my best friend and I Andrew we split that down payment 343 00:26:12.880 --> 00:26:16.560 So we each put 12,500 dollars down. This is how we scraped it together 344 00:26:17.120 --> 00:26:18.960 House was a complete fixer upper 345 00:26:19.840 --> 00:26:23.040 And we didn't have enough money to make the mortgage payments so we rented out bedrooms 346 00:26:23.440 --> 00:26:27.040 And we had friends rent bedrooms and that helped us cover our mortgage 347 00:26:27.520 --> 00:26:32.560 We scraped it together and that's what a lot of people do when you're young 348 00:26:33.440 --> 00:26:39.280 But if you don't get in the game of home ownership and you rent in your 20s and you rent in your 30s 349 00:26:39.600 --> 00:26:43.680 You're going to turn around in your 40s and having not been built any net worth 350 00:26:44.400 --> 00:26:46.720 When I wrote the automatic millionaire 20 years ago 351 00:26:47.840 --> 00:26:49.840 Two things have happened since then 352 00:26:50.640 --> 00:26:54.160 The stock market has gone up in 20 years 353 00:26:54.960 --> 00:26:56.560 600% 354 00:26:57.120 --> 00:26:59.120 Okay, so if you had a 355 00:26:59.600 --> 00:27:02.400 $100,000 just that is gone to $600,000 356 00:27:04.080 --> 00:27:07.840 If you bought a house the house has gone up 400% 357 00:27:08.800 --> 00:27:13.120 So when you read this book with all these there's a whole chapter of updated success stories 358 00:27:13.920 --> 00:27:18.800 There are a lot of ordinary people that started saving 5, 10, 15, 20 dollars a day 359 00:27:19.600 --> 00:27:22.320 bought a starter house and today they're millionaires 360 00:27:22.400 --> 00:27:23.680 so 361 00:27:23.680 --> 00:27:26.560 Am I not better off renting and 362 00:27:27.440 --> 00:27:29.440 investing in the stock market 363 00:27:30.320 --> 00:27:32.320 versus buying a house 364 00:27:32.800 --> 00:27:37.600 Because obviously when I when I buy a house I'm paying a premium on the house so that I can get a mortgage 365 00:27:38.480 --> 00:27:42.480 I want to bless this myth because what happens is people come on they go the stock look 366 00:27:42.480 --> 00:27:46.560 I can tell you right now the stock market over the last 20 years is average over 10% annually 367 00:27:47.120 --> 00:27:50.160 People go the returns are better in the stock market than the real estate 368 00:27:50.960 --> 00:27:54.240 Yeah, but that's not apples to apple comparison why 369 00:27:55.600 --> 00:27:58.400 When you buy a piece of real estate when you buy a home 370 00:27:59.200 --> 00:28:01.760 People don't typically pay cash for their first house 371 00:28:02.480 --> 00:28:06.400 They put down 20% and they borrow the other 80% 372 00:28:07.040 --> 00:28:10.560 So you take like an example of a take a $200,000 home 373 00:28:11.280 --> 00:28:16.480 $200,000 home you put 40 grand in home goes from $200,000 to $400,000 374 00:28:17.120 --> 00:28:22.080 In 10 years, this has happened to so many people in the last five years since covid 375 00:28:22.640 --> 00:28:27.200 There are markets all over the US where housing prices have gone up 100 to 200% 376 00:28:27.360 --> 00:28:31.360 So person buys a $200,000 home. They borrowed 80% 377 00:28:31.920 --> 00:28:35.120 It's doubled. So they've made 200,000 in profit 378 00:28:36.080 --> 00:28:38.720 They didn't put in 200,000 they put in 40 379 00:28:39.360 --> 00:28:42.000 So they got a five times return on their down payment 380 00:28:42.640 --> 00:28:44.640 They go to sell their house 381 00:28:45.360 --> 00:28:47.360 They don't pay taxes on the game 382 00:28:47.520 --> 00:28:51.760 Because when you own a home at least in the United States you own a home for over two years if you're single 383 00:28:52.240 --> 00:28:55.040 You get $250,000 in tax regains 384 00:28:55.120 --> 00:28:58.240 If you're married you get over a half a million dollars in tax regains 385 00:28:58.320 --> 00:29:00.480 You get tax deductions on the mortgages 386 00:29:01.040 --> 00:29:02.240 so 387 00:29:02.240 --> 00:29:06.800 What happens is people come here and they go you know what you shouldn't be you shouldn't be tied down 388 00:29:07.360 --> 00:29:09.360 You need to be flexible when you're young 389 00:29:09.920 --> 00:29:11.920 You don't want to have the responsibility 390 00:29:13.040 --> 00:29:15.920 And you should take the extra money and you should put it in a mutual fund 391 00:29:16.320 --> 00:29:19.440 And you know what happens in the real world Stephen people don't do that 392 00:29:20.160 --> 00:29:22.880 They rent an apartment that's nesters and what they can afford 393 00:29:23.360 --> 00:29:27.520 And they spend all their money and then they turn around in their mid-30s 394 00:29:27.840 --> 00:29:30.720 And they have no equity because they haven't bought anything 395 00:29:31.280 --> 00:29:32.880 And they also haven't saved money 396 00:29:34.080 --> 00:29:36.800 It is an absolute fricking myth 397 00:29:37.840 --> 00:29:41.600 That people take this extra money that they could have used to buy a house 398 00:29:42.080 --> 00:29:44.960 And they're going to put it in the stock market. They don't do that 399 00:29:45.600 --> 00:29:47.600 And that's why also by the way 400 00:29:48.560 --> 00:29:53.840 Corporate America got into the game of buying up real estate all over America 401 00:29:54.800 --> 00:30:01.280 Houses and building apartments to rent to an entire generation hoping 402 00:30:02.080 --> 00:30:04.080 These people never buy 403 00:30:05.840 --> 00:30:12.560 This like 10 days ago Trump came out and basically said he wants the institutions out of buying up all the homes in America 404 00:30:13.360 --> 00:30:16.320 Why does he want to do that because he because he recognizes 405 00:30:17.840 --> 00:30:23.520 How serious of a problem it is to have a generation of Americans who are renters 406 00:30:24.320 --> 00:30:27.200 I'm telling you when you look at average Americans average 407 00:30:27.200 --> 00:30:30.400 I'm talking about ordinary Americans when you look at where their wealth is 408 00:30:30.480 --> 00:30:34.560 It's in home equity and it's in the stock market and this is the last thing I'll say 409 00:30:36.240 --> 00:30:38.640 Generational wealth is created 410 00:30:39.600 --> 00:30:41.840 For better or worse through home equity 411 00:30:42.800 --> 00:30:46.400 So when you look at what you know you asked the question about causation 412 00:30:47.680 --> 00:30:49.600 If a family doesn't buy a home 413 00:30:50.560 --> 00:30:54.400 The likelihood the next generation can buy a home is very low 414 00:30:55.600 --> 00:30:57.840 Because it's when the someone dies 415 00:30:58.960 --> 00:31:08.080 The money that is in the house that home equity is often what transfer transfers to the next generation helps the next generation by house 416 00:31:08.800 --> 00:31:12.000 I was looking at some stats here because I want to what I want I wish I could sit 417 00:31:12.800 --> 00:31:15.760 Sit down all of the gas that I've been on my show that have had a difference of 418 00:31:16.000 --> 00:31:20.880 And I've said that buying a house is bad. It could be a really interesting conversation right it would be a really interesting conversation 419 00:31:21.200 --> 00:31:24.880 What I've done as an alternative to that approach is I've pulled up what they've said 420 00:31:25.360 --> 00:31:29.920 And I'm going to give you some of the things they've said just so you can rebuttal them and have your say on them 421 00:31:30.160 --> 00:31:38.640 One of the things that they often say is that long-term real inflation adjusted home price appreciation in the US is about 1% annually 422 00:31:39.200 --> 00:31:42.320 And one of my guests cited Robert Schiller as the evidence of that 423 00:31:43.040 --> 00:31:44.720 After maintenance 424 00:31:44.720 --> 00:31:51.680 And which usually equals 1 to 2% and property taxes which equals about 1% insurance and transaction costs the net real returns approach 425 00:31:52.240 --> 00:31:54.240 Roughly zero on average 426 00:31:54.320 --> 00:32:03.280 So when you say housing is a great investment are you referencing the gross appreciation which is the the total appreciation or the net returns after taxes maintenance insurance and selling costs 427 00:32:04.400 --> 00:32:06.800 So when you dig into these kind of numbers like this 428 00:32:07.200 --> 00:32:15.440 What they are is their numbers, but they're not real world right so like when you when you talk to someone who owns a home today and they've owned it for 20 years 429 00:32:16.320 --> 00:32:18.000 And you ask them 430 00:32:18.000 --> 00:32:21.440 How much of your net worth is now in the equity in your house 431 00:32:23.200 --> 00:32:25.440 Over 50% of their net worth is in their house 432 00:32:26.160 --> 00:32:30.240 You will see people on your YouTube channel that literally if you read the comments 433 00:32:30.240 --> 00:32:33.680 I'm sure you do where people say it's not true 434 00:32:33.760 --> 00:32:37.760 There was a I read comment yesterday on your YouTube page all I know is 435 00:32:38.800 --> 00:32:42.880 I bought a house and it's gone up in value three and a half times 436 00:32:43.520 --> 00:32:48.640 And the rent when I bought the house was $1,200 and they're rent today to buy that if I had that house 437 00:32:49.280 --> 00:32:51.760 If I was renting it would be $4,000 438 00:32:52.320 --> 00:32:54.320 So the thing is you have to understand 439 00:32:55.440 --> 00:33:01.280 Is that rents always go up Steven like I live in New York City for 18 years 440 00:33:02.080 --> 00:33:05.600 When I moved in New York City in 2001 441 00:33:06.880 --> 00:33:08.880 A really nice apartment 442 00:33:09.600 --> 00:33:11.920 A nice apartment was like $6,000 a month 443 00:33:12.960 --> 00:33:18.160 When I left New York that same apartment was $25,000 a month 444 00:33:19.120 --> 00:33:23.680 Follow the insanity of that math now that apartment went from being 445 00:33:24.880 --> 00:33:27.920 $2,000,000 apartment to a $5,000,000 apartment 446 00:33:28.400 --> 00:33:31.520 So I could have been renting it but in my case I owned it 447 00:33:32.320 --> 00:33:34.320 And it went up in value $3,000,000 448 00:33:35.280 --> 00:33:38.480 So I have friends who have been renting in New York for 20 years 449 00:33:38.480 --> 00:33:40.320 They have built no net worth 450 00:33:40.320 --> 00:33:42.320 I have no vested interest in this conversation 451 00:33:42.320 --> 00:33:44.720 Meaning I don't sell real estate 452 00:33:44.720 --> 00:33:46.720 I'm not a real estate agent 453 00:33:46.720 --> 00:33:48.240 I'm not selling real estate 454 00:33:49.120 --> 00:33:52.720 I've just seen in the real world how people have built wealth 455 00:33:52.720 --> 00:33:56.480 The the the mac and tires in this book the automatic millionaire 456 00:33:56.480 --> 00:34:00.240 When they came into my office and they were worth $1.8 million 457 00:34:00.240 --> 00:34:03.200 And he was 52 and able to retire 458 00:34:03.200 --> 00:34:05.840 Having earned an average of $40,000 a year 459 00:34:07.280 --> 00:34:09.200 All their money wasn't in the stock market 460 00:34:09.200 --> 00:34:12.320 They had bought a home in San Leandro, California 461 00:34:12.320 --> 00:34:14.880 What he what they called a middle-class neighborhood 462 00:34:15.600 --> 00:34:18.480 Their home at the time was worth about $300,000 463 00:34:19.440 --> 00:34:21.280 They had paid their mortgage off 464 00:34:21.280 --> 00:34:23.760 And they had bought one more house on their street 465 00:34:23.760 --> 00:34:25.520 They rented the first house 466 00:34:25.520 --> 00:34:27.280 They bought a second house on their street 467 00:34:27.280 --> 00:34:28.560 They paid that mortgage off 468 00:34:29.440 --> 00:34:31.920 And so they owned two homes, Frank Claire 469 00:34:31.920 --> 00:34:33.840 One house they got income from 470 00:34:33.840 --> 00:34:35.760 One house they lived in with no debt 471 00:34:35.760 --> 00:34:37.920 And then they had saved money in their 401k plan 472 00:34:38.880 --> 00:34:40.960 So if I was a young person 473 00:34:40.960 --> 00:34:42.160 Or like the young person 474 00:34:42.160 --> 00:34:43.360 I'm a aged and older person 475 00:34:44.000 --> 00:34:47.120 Who took my down payment that I was going to pay into the house 476 00:34:47.120 --> 00:34:48.160 If let's say it was 477 00:34:48.160 --> 00:34:50.160 See my down payment was $20,000 478 00:34:50.160 --> 00:34:52.400 And I put that into the S&P 500 instead 479 00:34:53.120 --> 00:34:54.560 Over the long run 480 00:34:54.560 --> 00:34:56.240 Won't that grow larger 481 00:34:56.240 --> 00:34:58.080 Than the total home equity potentially 482 00:34:59.040 --> 00:35:01.840 Here's why the index fund theory doesn't work 483 00:35:04.000 --> 00:35:06.240 You can't live inside an index fund 484 00:35:07.920 --> 00:35:09.680 You can't live inside a mutual fund 485 00:35:09.680 --> 00:35:12.160 You have to live somewhere as long as you're alive 486 00:35:12.160 --> 00:35:13.600 Here's what people should do 487 00:35:15.440 --> 00:35:17.280 Take a look at what you're paying in rent 488 00:35:18.720 --> 00:35:20.400 Now ask yourself a question 489 00:35:21.360 --> 00:35:24.480 If I am paying 5,000 a month in rent 490 00:35:24.960 --> 00:35:26.960 Which lots of people are right 491 00:35:26.960 --> 00:35:28.720 Do you know people paying 5,000 a month in rent? 492 00:35:28.720 --> 00:35:29.200 Yes 493 00:35:29.200 --> 00:35:30.880 Okay, so they're paying 60,000 a year 494 00:35:30.880 --> 00:35:31.680 Let's take that number 495 00:35:32.480 --> 00:35:35.920 So over 10 years there's going to spend $600,000 in rent 496 00:35:36.800 --> 00:35:38.000 Yeah 497 00:35:38.000 --> 00:35:39.200 If the rent doesn't go up 498 00:35:39.200 --> 00:35:40.160 Yeah 499 00:35:40.160 --> 00:35:43.040 In 20 years they're going to spend 1.2 million in rent 500 00:35:43.840 --> 00:35:45.040 If the rent doesn't go up 501 00:35:45.840 --> 00:35:47.600 In 30 years they will have spent 502 00:35:48.480 --> 00:35:51.040 $2 million in rent if the rent doesn't go up 503 00:35:51.040 --> 00:35:52.320 But the rent does go up 504 00:35:53.280 --> 00:35:55.120 So the question you just have to ask yourself 505 00:35:55.120 --> 00:35:57.840 Is am I going to take all this money that I'm spending on rent 506 00:35:57.840 --> 00:35:59.280 And never build anything 507 00:36:01.360 --> 00:36:04.720 And if you really believe that renting is better than owning 508 00:36:05.440 --> 00:36:08.080 Then you should still consider the idea of buying something 509 00:36:08.080 --> 00:36:09.280 Than that somebody else rents 510 00:36:10.240 --> 00:36:11.360 Because I promise you 511 00:36:11.360 --> 00:36:13.280 Somebody's getting rich in the transaction 512 00:36:13.920 --> 00:36:15.040 If you're the renter 513 00:36:15.120 --> 00:36:18.000 You're not the one who's getting rich in the transaction of renting 514 00:36:18.560 --> 00:36:21.360 It is a great short term solution renting 515 00:36:22.320 --> 00:36:25.120 It is not a great term long term wealth building solution 516 00:36:25.760 --> 00:36:27.200 The other thing that people often talk about 517 00:36:27.200 --> 00:36:31.120 And you cited earlier is the mobility that renting gives you 518 00:36:31.120 --> 00:36:31.360 Yeah 519 00:36:32.480 --> 00:36:34.080 Your son was here a second ago 520 00:36:34.080 --> 00:36:35.120 He's 16 years old 521 00:36:35.760 --> 00:36:38.400 Soon he'll be at the age where he's got his own place 522 00:36:38.400 --> 00:36:40.720 And he's thinking about different career opportunities 523 00:36:40.720 --> 00:36:42.000 And when I got AIs this big thing 524 00:36:42.000 --> 00:36:43.520 So he might want to go to San Francisco 525 00:36:43.520 --> 00:36:46.400 Then he might want to go live in Florence and wherever else 526 00:36:46.400 --> 00:36:48.080 If he's bought a place 527 00:36:48.640 --> 00:36:50.800 There is an interesting sort of psychological 528 00:36:50.800 --> 00:36:53.120 But also financial component to the fact that 529 00:36:53.120 --> 00:36:55.680 It makes it harder for you to move with the opportunity of life 530 00:36:55.680 --> 00:36:56.240 And if we are 531 00:36:56.960 --> 00:36:59.360 If what people say about the future of work is true 532 00:36:59.360 --> 00:37:01.120 That we're going to have many more careers 533 00:37:01.120 --> 00:37:02.640 In our lives than we did in the past 534 00:37:03.280 --> 00:37:05.760 One might assume that we're also going to be more mobile 535 00:37:05.760 --> 00:37:06.240 And so 536 00:37:06.960 --> 00:37:08.800 Is there an argument to say that 537 00:37:08.800 --> 00:37:12.640 Buying a house might hurt my professional opportunities 538 00:37:12.720 --> 00:37:15.200 My ability to pursue professional opportunities 539 00:37:15.200 --> 00:37:16.640 The answer is possibly 540 00:37:16.640 --> 00:37:17.200 Right 541 00:37:17.200 --> 00:37:18.480 But here's the thing about rent 542 00:37:19.040 --> 00:37:19.440 Rent's 543 00:37:20.240 --> 00:37:21.200 Interestingly enough 544 00:37:22.240 --> 00:37:23.840 In major obligation 545 00:37:23.840 --> 00:37:26.000 Right usually when you go and you do a lease 546 00:37:26.720 --> 00:37:28.880 You lock yourself into a one year lease 547 00:37:29.600 --> 00:37:31.840 Sometimes you lock yourself into a two year lease 548 00:37:33.200 --> 00:37:34.640 When you buy something 549 00:37:35.520 --> 00:37:38.320 And this is assuming that you have the money to buy something Steven 550 00:37:40.000 --> 00:37:40.640 Look up 551 00:37:40.640 --> 00:37:42.320 Because you've got all the data your fingertips 552 00:37:42.320 --> 00:37:46.160 Look what the average length of time it takes to sell a home in the United States 553 00:37:46.800 --> 00:37:48.320 Just just Google that right now 554 00:37:48.800 --> 00:37:50.960 Because what I will tell you is in certain markets 555 00:37:51.520 --> 00:37:54.480 You can put your home on the market and you can sell it in less than 90 days 556 00:37:55.120 --> 00:37:57.920 Now some markets you can sell your home in less than 30 days 557 00:37:57.920 --> 00:37:59.040 In many cases 558 00:38:00.080 --> 00:38:03.680 You actually have more flexibility when you own something than when you rent 559 00:38:03.680 --> 00:38:05.440 And that's if you want to sell it 560 00:38:05.920 --> 00:38:09.600 It says the average time from listing to sale 561 00:38:10.640 --> 00:38:13.680 Is about 47 to 62 days 562 00:38:13.680 --> 00:38:15.680 From listing to closing in 2025 563 00:38:15.680 --> 00:38:17.680 Including 16 days on the market 564 00:38:17.680 --> 00:38:20.240 And 30 to 45 days to close 565 00:38:20.240 --> 00:38:21.600 That's called less than two months 566 00:38:22.320 --> 00:38:23.280 Even in hot markets 567 00:38:23.280 --> 00:38:24.720 The process from putting a house on the market 568 00:38:24.720 --> 00:38:27.760 To legally selling it can take 1.5 to 3 months 569 00:38:27.760 --> 00:38:28.640 Meaning home equity 570 00:38:28.640 --> 00:38:31.360 Isn't a quickly accessible investment 571 00:38:31.360 --> 00:38:33.840 Yeah, but do you think that's pretty quick 90 days 572 00:38:33.840 --> 00:38:34.320 No it is 573 00:38:34.320 --> 00:38:36.560 I mean it takes you that much time to get out of the lease 574 00:38:36.560 --> 00:38:37.200 Exactly 575 00:38:37.760 --> 00:38:39.760 So here you've got a piece of property that you can turn around 576 00:38:39.760 --> 00:38:40.720 Sell in less than 90 days 577 00:38:40.720 --> 00:38:41.680 Now this is the US 578 00:38:41.680 --> 00:38:43.280 You can't do that like for this I live in Italy 579 00:38:43.280 --> 00:38:45.200 That could be very hard to do that in Italy 580 00:38:45.200 --> 00:38:47.520 But in the US you've got something that's in a good market 581 00:38:47.520 --> 00:38:48.480 It's liquid 582 00:38:48.480 --> 00:38:49.920 The other thing is 583 00:38:49.920 --> 00:38:51.680 You can rent it 584 00:38:51.680 --> 00:38:52.320 Right 585 00:38:52.320 --> 00:38:54.240 You're actually not trapped 586 00:38:54.240 --> 00:38:56.080 If you start to build equity in your home 587 00:38:56.080 --> 00:38:58.080 And you pay your mortgage down slightly 588 00:38:58.080 --> 00:39:00.160 Next thing you know you're able to rent that property 589 00:39:00.160 --> 00:39:01.520 And you can still move 590 00:39:01.520 --> 00:39:03.040 Today people are taking their homes 591 00:39:03.040 --> 00:39:04.720 And they're air being being them 592 00:39:04.800 --> 00:39:06.800 What I really want for people 593 00:39:06.800 --> 00:39:08.640 Is the chance to be financially free 594 00:39:09.440 --> 00:39:12.000 There's also an age at which it doesn't matter if you own 595 00:39:12.000 --> 00:39:13.520 You know once you start to get older 596 00:39:13.520 --> 00:39:15.040 And you've built financial security 597 00:39:15.040 --> 00:39:16.960 You're getting your 50s or 60s or 70s 598 00:39:16.960 --> 00:39:17.920 And you just want to travel 599 00:39:17.920 --> 00:39:19.360 And you don't want to own anything 600 00:39:19.360 --> 00:39:20.880 That's a different stage of life 601 00:39:21.520 --> 00:39:23.200 So the question just becomes 602 00:39:24.240 --> 00:39:25.360 The money that you make 603 00:39:25.360 --> 00:39:27.760 I go back to the 90,000 hour comment 604 00:39:27.760 --> 00:39:31.200 When you work 90,000 hours over your lifetime 605 00:39:31.840 --> 00:39:34.880 What's your plan to keep some of this money 606 00:39:34.880 --> 00:39:38.960 You have to have a pay yourself first plan 607 00:39:38.960 --> 00:39:41.360 That has to be your number one priority 608 00:39:41.360 --> 00:39:42.960 Is that when you earn money 609 00:39:42.960 --> 00:39:45.200 The first person who you're going to pay is you 610 00:39:45.200 --> 00:39:46.400 If you say you know what 611 00:39:46.400 --> 00:39:48.240 I watch Stephen and I saw David 612 00:39:48.240 --> 00:39:50.240 And I've seen a bunch of other people on his show 613 00:39:50.240 --> 00:39:52.480 And I'm not going to buy a house 614 00:39:52.480 --> 00:39:53.440 Okay 615 00:39:53.440 --> 00:39:54.640 Then 616 00:39:54.640 --> 00:39:57.680 You have to pay yourself first more 617 00:39:57.680 --> 00:39:59.680 Now I go around the world 618 00:40:00.160 --> 00:40:02.320 For the last 30 years 619 00:40:02.320 --> 00:40:04.240 Starting with Oprah with the automatic millionaire 620 00:40:04.240 --> 00:40:05.440 I launched this book on Oprah 621 00:40:05.440 --> 00:40:06.640 And I talked about 622 00:40:06.640 --> 00:40:09.040 You have to save one hour day of your income 623 00:40:09.040 --> 00:40:11.760 And people will get on these social media boards 624 00:40:11.760 --> 00:40:12.560 And be like 625 00:40:12.560 --> 00:40:14.400 I can't save 10% of my income 626 00:40:15.840 --> 00:40:18.160 I can't live off 90% of my income 627 00:40:18.160 --> 00:40:20.160 It's not possible I have to spend all of it 628 00:40:21.120 --> 00:40:21.840 Right 629 00:40:21.840 --> 00:40:23.360 Well then that person 630 00:40:23.360 --> 00:40:25.120 Who's renting 631 00:40:25.120 --> 00:40:26.160 And not buying a house 632 00:40:26.160 --> 00:40:28.160 Which is four savings 633 00:40:28.160 --> 00:40:30.480 Is clearly never going to save 634 00:40:30.480 --> 00:40:32.160 So the other thing about buying a house 635 00:40:32.160 --> 00:40:34.320 Is it does require 636 00:40:34.320 --> 00:40:35.760 Four savings because when you use 637 00:40:35.760 --> 00:40:36.640 Have a mortgage payment 638 00:40:36.640 --> 00:40:38.640 Part of that mortgage payment is paying down your debt 639 00:40:38.640 --> 00:40:41.760 And I teach you how to use a bi-weekly mortgage payment plan 640 00:40:41.760 --> 00:40:42.960 So you take a 30-year mortgage 641 00:40:42.960 --> 00:40:45.120 And you pay it off five years earlier 642 00:40:45.120 --> 00:40:46.640 And doing that can save you 643 00:40:46.640 --> 00:40:47.600 Depends on size at home 644 00:40:47.600 --> 00:40:49.520 Can save you 50, 200,000 dollars 645 00:40:49.520 --> 00:40:50.720 Just the interest payments 646 00:40:50.720 --> 00:40:52.880 You talk about having a savings mindset 647 00:40:54.880 --> 00:40:56.720 What is a savings mindset 648 00:40:56.720 --> 00:40:57.920 And how does one go about saving 649 00:40:57.920 --> 00:40:59.200 If they are one of those people that says 650 00:40:59.200 --> 00:41:01.600 Listen, I'm barely getting buys it is David 651 00:41:01.600 --> 00:41:02.160 Yeah 652 00:41:02.160 --> 00:41:04.160 How the hell am I going to save money 653 00:41:04.160 --> 00:41:05.600 When I'm actually 654 00:41:05.600 --> 00:41:07.760 Increasingly getting into more debt right now 655 00:41:08.400 --> 00:41:10.480 So the first thing is you have to find your money 656 00:41:11.200 --> 00:41:13.600 Right so what I find Steve is when I talk to people 657 00:41:13.600 --> 00:41:15.200 Most people don't know where their money goes 658 00:41:16.000 --> 00:41:16.800 Literally they don't know 659 00:41:16.800 --> 00:41:18.480 They're like how much money do you spend a month 660 00:41:18.480 --> 00:41:19.440 Well I'm not really sure 661 00:41:19.440 --> 00:41:20.320 Which money do you spend a year 662 00:41:20.320 --> 00:41:21.200 Well I'm not really sure 663 00:41:21.920 --> 00:41:22.960 You need to be sure 664 00:41:22.960 --> 00:41:26.160 So you should be doing something to track where your money goes 665 00:41:26.720 --> 00:41:28.800 Now you can be sophisticated you can use an app 666 00:41:28.800 --> 00:41:30.240 So it will track where your money goes 667 00:41:31.360 --> 00:41:32.960 You can also take out a pad of paper 668 00:41:33.440 --> 00:41:35.600 And I give people a seven day financial challenge 669 00:41:36.080 --> 00:41:39.280 For seven days just bring a little pad of paper with you 670 00:41:39.520 --> 00:41:41.600 And write down every single day where your money goes 671 00:41:42.480 --> 00:41:44.400 Now why do I want people to do that 672 00:41:44.960 --> 00:41:48.640 Because most people today are spending money unconsciously 673 00:41:48.640 --> 00:41:49.920 I go back to these phones 674 00:41:50.640 --> 00:41:52.880 The fact that I don't even have to carry a wall anymore 675 00:41:52.880 --> 00:41:54.800 Right it's just click click click and pay for things 676 00:41:55.440 --> 00:41:57.680 We've lost touch with spending money 677 00:41:58.240 --> 00:42:00.720 So when people start to see what they're really spending 678 00:42:00.720 --> 00:42:01.840 It's a wake-up call 679 00:42:02.400 --> 00:42:04.320 The biggest thing I've been sharing lately 680 00:42:04.320 --> 00:42:06.080 Is what does it take to blow 681 00:42:06.400 --> 00:42:07.680 $10,000 a year 682 00:42:08.400 --> 00:42:09.840 per day in terms of spending 683 00:42:10.480 --> 00:42:13.280 How much money do you need to spend a day to blow $10,000 684 00:42:13.280 --> 00:42:14.640 Now show us the product 685 00:42:14.640 --> 00:42:15.440 Here 686 00:42:15.440 --> 00:42:18.000 Now we happen to have these or we have pounds today 687 00:42:18.000 --> 00:42:18.480 Right so 688 00:42:20.480 --> 00:42:24.080 So I'm holding Steve and right now I'm holding what is known as a brick 689 00:42:25.600 --> 00:42:28.160 So I don't know if your staff told you how much I'm holding here 690 00:42:28.160 --> 00:42:30.080 You know what what you guess I'm holding 691 00:42:30.720 --> 00:42:32.880 It looks like maybe $5,000 692 00:42:32.880 --> 00:42:35.120 Okay, so this is a life-changing amount of money 693 00:42:35.120 --> 00:42:37.040 Steve and this this is $10,000 right 694 00:42:38.080 --> 00:42:43.680 And was it take to blow $10,000 in a year per day 695 00:42:43.680 --> 00:42:47.760 How much money have to spend per day to go through $10,000 696 00:42:47.760 --> 00:42:48.960 I'll make it easy for you 697 00:42:49.920 --> 00:42:53.280 The answer is $27.40 a day 698 00:42:54.240 --> 00:42:56.160 $27.40 a day 699 00:42:56.720 --> 00:42:57.360 adds up 700 00:42:57.840 --> 00:43:00.480 Equalling $10,000 over the year 701 00:43:00.480 --> 00:43:03.840 Now before we go through where do you where do you spend this money 702 00:43:03.840 --> 00:43:06.480 And how do you waste $27.40 a day 703 00:43:06.800 --> 00:43:10.800 The question becomes if you didn't waste $27.40 a day 704 00:43:11.360 --> 00:43:15.440 And you were able to get yourself to invest $10,000 a year 705 00:43:16.480 --> 00:43:19.760 What could this be worth over time 706 00:43:20.720 --> 00:43:23.280 And the answer is in 40 years 707 00:43:23.840 --> 00:43:27.200 If this was in the S&P 500 fund which you quoted earlier 708 00:43:27.200 --> 00:43:30.000 And you earned 10% annually with reinvested dividends 709 00:43:31.440 --> 00:43:34.480 That stack there would grow to $4,000,000 710 00:43:35.360 --> 00:43:37.440 Over $4,000,000 $400,000 711 00:43:38.240 --> 00:43:41.440 If you invested $27.40 a day 712 00:43:41.440 --> 00:43:42.640 Pass me this big brick 713 00:43:42.640 --> 00:43:42.880 Yeah 714 00:43:42.880 --> 00:43:43.920 So if I save 715 00:43:45.200 --> 00:43:46.160 Half of this a day 716 00:43:47.120 --> 00:43:48.960 Then in did you say 40 years 717 00:43:49.040 --> 00:43:49.760 In 40 years 718 00:43:49.760 --> 00:43:52.720 So let me give you the math on a couple different ways of doing this 719 00:43:52.720 --> 00:43:55.120 Okay, so what would happen if you invested 720 00:43:55.120 --> 00:43:56.720 Roughly half of this a day 721 00:43:56.720 --> 00:43:59.600 The number I use is $27.40 on today 722 00:43:59.600 --> 00:44:00.640 It's the magic number 723 00:44:01.280 --> 00:44:03.120 That equals $10,000 a year 724 00:44:03.840 --> 00:44:06.480 If you invested that a day for 40 years 725 00:44:06.480 --> 00:44:08.560 You'd have over $4,000,000 726 00:44:08.560 --> 00:44:10.800 $424,000 727 00:44:11.520 --> 00:44:13.280 If I invest $27 a day 728 00:44:13.280 --> 00:44:16.160 In 40 years I'll have $4,000,000 729 00:44:16.160 --> 00:44:17.360 Over $4,000,000 730 00:44:18.160 --> 00:44:20.080 Let's go through the Yabbats now 731 00:44:20.080 --> 00:44:21.280 Because people are going to hear this 732 00:44:21.280 --> 00:44:22.960 Some people are going to go wait what 733 00:44:22.960 --> 00:44:26.000 And then we'll talk about where you find $27.40 a day 734 00:44:27.760 --> 00:44:29.360 Yeah, but 735 00:44:29.360 --> 00:44:31.760 $4,000,000 736 00:44:31.760 --> 00:44:33.760 Won't be worth a lot of money in 40 years 737 00:44:35.120 --> 00:44:36.720 With inflation it won't be worth that much 738 00:44:36.720 --> 00:44:37.920 Won't have the same purchasing power 739 00:44:39.120 --> 00:44:40.080 My answer would be 740 00:44:40.080 --> 00:44:41.920 It's worth a whole lot more than zero 741 00:44:42.560 --> 00:44:42.880 Right 742 00:44:42.880 --> 00:44:44.000 If you're not saving any money 743 00:44:44.000 --> 00:44:46.160 If you can't save $27.40 a day 744 00:44:47.120 --> 00:44:49.200 You won't have $4,000,000 745 00:44:50.080 --> 00:44:54.320 Yeah, but with taxes, you know, it won't grow that much 746 00:44:54.320 --> 00:44:56.400 Well, it could if it was in a retirement account 747 00:44:56.400 --> 00:44:57.920 You wouldn't be paying taxes on the money 748 00:44:58.640 --> 00:45:01.680 Yeah, but it's not possible to earn 10% on my money 749 00:45:02.240 --> 00:45:07.760 Well, the stock market for over 100 years has averaged over 10% annually 750 00:45:07.760 --> 00:45:09.040 With reinvested dividends 751 00:45:09.840 --> 00:45:12.320 Yeah, but the stock market's risky and complicated 752 00:45:12.320 --> 00:45:13.120 Well, no, it's not 753 00:45:13.120 --> 00:45:14.240 If you bought an index fund 754 00:45:14.240 --> 00:45:16.160 It's actually not that risky and complicated 755 00:45:17.520 --> 00:45:19.760 Yeah, but I don't know. I don't know how to get started 756 00:45:19.760 --> 00:45:21.200 Well, you could start really easily 757 00:45:21.200 --> 00:45:23.760 You could open up a brokerage account 758 00:45:23.760 --> 00:45:25.120 You could go to a 759 00:45:25.120 --> 00:45:26.320 Charles Schwab 760 00:45:26.320 --> 00:45:26.960 Fidelity 761 00:45:27.760 --> 00:45:29.120 I mean, I'm literally going to go through them all 762 00:45:29.120 --> 00:45:30.400 Vanguard 763 00:45:30.400 --> 00:45:31.920 Robin Hood 764 00:45:31.920 --> 00:45:33.440 Coinbase 765 00:45:33.440 --> 00:45:34.160 Acorns 766 00:45:34.880 --> 00:45:36.880 And in less than 10 minutes 767 00:45:36.880 --> 00:45:38.560 You could open up an account 768 00:45:38.560 --> 00:45:40.480 And be saving pick a dollar amount 769 00:45:40.480 --> 00:45:41.440 $5 a day 770 00:45:41.440 --> 00:45:42.480 $10 a day 771 00:45:42.480 --> 00:45:44.000 $27 a day 772 00:45:44.000 --> 00:45:45.520 And that could change your life 773 00:45:45.520 --> 00:45:47.760 Now, why is $10,000 Steve 774 00:45:47.760 --> 00:45:49.120 Is such an important dollar amount? 775 00:45:50.000 --> 00:45:51.040 Here's what I can tell you 776 00:45:51.040 --> 00:45:52.320 Having done this for 30 years 777 00:45:54.000 --> 00:45:55.280 This dollar amount right here 778 00:45:56.320 --> 00:45:58.320 First of all, this is 779 00:45:59.360 --> 00:46:02.880 One in two Americans don't have $1,000 in a bank account right now 780 00:46:03.520 --> 00:46:06.560 So this is 10 times what one out of two Americans have 781 00:46:07.120 --> 00:46:10.160 But more importantly, $10,000 when we do surveys 782 00:46:11.120 --> 00:46:14.240 And we ask people how much money would it take to totally change your life 783 00:46:14.960 --> 00:46:16.320 The answer is not a million dollars 784 00:46:16.960 --> 00:46:18.480 The answer is not a hundred thousand dollars 785 00:46:19.600 --> 00:46:21.200 The answer is actually 10,000 786 00:46:22.240 --> 00:46:24.400 And the question is why is it 10,000 787 00:46:24.880 --> 00:46:28.720 And the reason is that's about what the average person has in credit card debt 788 00:46:29.680 --> 00:46:32.560 And they feel like they're drowning like you talked about earlier 789 00:46:33.440 --> 00:46:35.600 And they know that that could pay off their credit card debt 790 00:46:36.240 --> 00:46:36.560 Or 791 00:46:37.520 --> 00:46:38.800 They have a job they don't like 792 00:46:39.600 --> 00:46:40.400 And they 793 00:46:41.520 --> 00:46:43.200 New that if they had $10,000 794 00:46:44.000 --> 00:46:44.960 In a savings account 795 00:46:45.680 --> 00:46:47.520 They quit that job and they'd be free 796 00:46:47.520 --> 00:46:49.040 They'd have to go find another job 797 00:46:49.040 --> 00:46:50.800 We'll start a business, we'll start a business 798 00:46:51.520 --> 00:46:52.000 Or 799 00:46:52.400 --> 00:46:55.040 God forbid they're an abusive relationship and they can't leave 800 00:46:55.280 --> 00:46:57.280 But if they had $10,000, they'd leave 801 00:46:58.400 --> 00:46:58.880 So 802 00:46:59.760 --> 00:47:02.560 You know, a lot of people go David just make this all too simple 803 00:47:02.560 --> 00:47:03.760 And it's true 804 00:47:04.160 --> 00:47:07.280 I do because when it's simple people take action on it 805 00:47:07.760 --> 00:47:11.920 So for years I have taught this concept called the latte factor 806 00:47:12.960 --> 00:47:14.480 A lot of people love me for it 807 00:47:14.480 --> 00:47:16.000 Now I have a lot of people hate me for it 808 00:47:16.640 --> 00:47:20.560 And I have taught that, you know, we waste small amounts of money on a little thing 809 00:47:20.560 --> 00:47:22.560 I had your staff bring me a nice coffee 810 00:47:24.240 --> 00:47:26.000 When I started teaching a latte factor 811 00:47:26.000 --> 00:47:27.600 I would talk about the idea that we waste 812 00:47:28.800 --> 00:47:30.000 Five bucks a day on coffee 813 00:47:30.560 --> 00:47:33.040 And then if you don't believe you can start saving investing 814 00:47:33.760 --> 00:47:36.560 At least say $5 a day 815 00:47:36.560 --> 00:47:37.520 Make your coffee at home 816 00:47:38.160 --> 00:47:40.160 And people would say, but I don't want to give up my coffee 817 00:47:40.160 --> 00:47:42.800 Okay, well then figure out another way to save $5 a day 818 00:47:43.680 --> 00:47:45.760 This nice coffee, I don't know what cost you're in London 819 00:47:45.760 --> 00:47:46.560 In New York City 820 00:47:47.200 --> 00:47:50.240 That coffee right there is $9.50 821 00:47:51.280 --> 00:47:51.840 Plus a tip 822 00:47:53.040 --> 00:47:54.240 It's over 11 bucks 823 00:47:54.640 --> 00:47:56.160 I know because I was just in New York 824 00:47:57.120 --> 00:47:57.520 So 825 00:47:58.560 --> 00:48:00.400 Today we had a bunch of props here 826 00:48:00.400 --> 00:48:04.400 And I said, well, let's try to show like what is $27.40 827 00:48:04.400 --> 00:48:06.560 Like when I go to my hotel later when I leave here 828 00:48:07.680 --> 00:48:09.280 A cocktail is going to be 30 bucks 829 00:48:10.080 --> 00:48:11.280 Right, I was just in New York City 830 00:48:11.280 --> 00:48:14.240 I had a cocktail my hotel is $31.50 831 00:48:15.440 --> 00:48:17.120 Lying, $50 eating out 832 00:48:17.120 --> 00:48:18.320 You go on and have lunch today 833 00:48:18.320 --> 00:48:19.600 It's going to be $25 834 00:48:20.320 --> 00:48:22.960 And people say, well, I have to eat 835 00:48:22.960 --> 00:48:24.160 And I go, I know you do 836 00:48:24.160 --> 00:48:25.760 But you could also ground bag your lunch 837 00:48:25.760 --> 00:48:26.880 It's what my grandmother did 838 00:48:27.760 --> 00:48:28.960 Now her friend's teased her 839 00:48:29.760 --> 00:48:32.560 But my grandmother was able to retire to California 840 00:48:33.280 --> 00:48:35.520 And her friends all got stuck in Milwaukee, Wisconsin 841 00:48:35.520 --> 00:48:36.160 Where it was cold 842 00:48:36.160 --> 00:48:38.000 Because they couldn't afford to retire the way she did 843 00:48:38.800 --> 00:48:40.160 How many people could 844 00:48:41.520 --> 00:48:43.840 Actually save $27 a day 845 00:48:43.840 --> 00:48:46.000 Because if I go back again just over 10 years of my life 846 00:48:46.560 --> 00:48:48.560 And there's no chance I could have saved $27 in a day 847 00:48:49.200 --> 00:48:50.400 There's just no, there's just no 848 00:48:51.040 --> 00:48:51.760 There's no way 849 00:48:51.760 --> 00:48:53.040 If you go back to what age 850 00:48:53.040 --> 00:48:54.720 If I go back to between 851 00:48:56.400 --> 00:48:57.600 Like 18, 19 852 00:48:58.400 --> 00:48:58.960 Years old 853 00:48:58.960 --> 00:49:00.160 Roughly that period of my life 854 00:49:00.160 --> 00:49:00.320 Yeah 855 00:49:01.120 --> 00:49:03.040 There was no way I could have saved $27 a day 856 00:49:03.040 --> 00:49:04.240 Here's really the question 857 00:49:04.800 --> 00:49:06.320 Do you have friends 858 00:49:06.320 --> 00:49:08.400 And do you think you have people who work with you 859 00:49:09.760 --> 00:49:12.560 Who are making more than $50,000 a year 860 00:49:13.440 --> 00:49:15.840 And they're not saving $27 a day 861 00:49:15.840 --> 00:49:17.440 They're not even saving $10 a day 862 00:49:17.920 --> 00:49:18.560 This is true 863 00:49:18.560 --> 00:49:19.680 I actually did a bit of research 864 00:49:20.320 --> 00:49:21.120 On this 865 00:49:21.120 --> 00:49:22.640 And it says approximately 866 00:49:23.200 --> 00:49:24.720 40 to 50 million families 867 00:49:24.720 --> 00:49:26.080 If we just take the United States where I think 868 00:49:26.080 --> 00:49:27.440 That's what 330 million people roughly 869 00:49:28.160 --> 00:49:30.880 Approximately 40 to 50 million families in the US 870 00:49:30.880 --> 00:49:33.280 Can realistically save $27 a day 871 00:49:33.280 --> 00:49:37.760 This represents roughly the top 30 to 35% of households 872 00:49:37.760 --> 00:49:38.560 For everyone else 873 00:49:38.560 --> 00:49:40.720 The bottom 65 to 70% 874 00:49:40.720 --> 00:49:42.080 Saving that amount would require 875 00:49:42.080 --> 00:49:44.000 Either extreme poverty level budgeting 876 00:49:44.000 --> 00:49:46.000 Or is a mathematical impossibility 877 00:49:46.480 --> 00:49:47.600 Over 40 million people 878 00:49:47.600 --> 00:49:50.240 They think can afford to save $27 and 50 cents a day 879 00:49:50.240 --> 00:49:50.560 Yes 880 00:49:50.560 --> 00:49:52.640 Is based on income and expenditure data 881 00:49:52.640 --> 00:49:54.640 From 2025 to 26 882 00:49:54.720 --> 00:49:57.680 Approximately 40 to 50 million families in the US 883 00:49:57.680 --> 00:50:00.400 Can realistically save $27 a day 884 00:50:01.120 --> 00:50:05.440 So for those 40 to 50 million people in the United States 885 00:50:06.160 --> 00:50:07.440 That would be life-changing 886 00:50:08.160 --> 00:50:10.000 Now are there people who can't afford to save that? 887 00:50:10.000 --> 00:50:10.640 Absolutely 888 00:50:10.640 --> 00:50:11.520 In the United States 889 00:50:11.520 --> 00:50:13.120 I was just in Arizona 890 00:50:13.120 --> 00:50:14.640 I just in a keynote speech 891 00:50:14.640 --> 00:50:15.840 I asked the audience 892 00:50:17.040 --> 00:50:18.320 This is when the government was shut down 893 00:50:19.280 --> 00:50:19.920 I said 894 00:50:19.920 --> 00:50:21.920 How many people do you think in America 895 00:50:21.920 --> 00:50:23.680 Are taking and receiving 896 00:50:24.480 --> 00:50:25.920 Snap checks 897 00:50:25.920 --> 00:50:26.400 What's that? 898 00:50:27.520 --> 00:50:28.320 Thank you 899 00:50:28.320 --> 00:50:31.520 Because by the way most Americans don't even know what a snap check is 900 00:50:31.520 --> 00:50:34.080 That's a check that the government gives to people for food 901 00:50:34.800 --> 00:50:37.440 And the dollar amounts a little over $6 a day 902 00:50:38.400 --> 00:50:40.240 So smart people in a room 903 00:50:40.960 --> 00:50:44.160 By the way, I didn't know the answer is this a week prior either 904 00:50:44.160 --> 00:50:47.920 The answer is about 41 and a half million Americans 905 00:50:49.040 --> 00:50:50.080 Get a snap check 906 00:50:51.040 --> 00:50:53.760 When I told the room that the room gasped 907 00:50:54.480 --> 00:50:58.640 I said so when you wonder when you hear that the government was shut down 908 00:50:59.440 --> 00:51:01.440 For six weeks 909 00:51:01.840 --> 00:51:04.000 That was three pay cycles 910 00:51:05.680 --> 00:51:09.520 Well the average American doesn't have two weeks of expenses set aside 911 00:51:11.760 --> 00:51:15.360 I mean, I don't think everybody fully graphs the problem right now 912 00:51:15.360 --> 00:51:19.680 Four out of 10 Americans can't get their hands on a thousand dollars in case of emergency purposes 913 00:51:20.000 --> 00:51:22.240 If you actually dig into the federal reserve data 914 00:51:22.720 --> 00:51:28.240 It's 37% Americans can't get their hands on four hundred dollars in case of emergency purposes 915 00:51:28.720 --> 00:51:32.400 So there's a whole section of America that's truly struggling like 916 00:51:33.280 --> 00:51:35.280 But there's a whole lot of America 917 00:51:36.240 --> 00:51:40.000 That is still struggling. They're living page to page check 918 00:51:40.000 --> 00:51:43.200 But their money's being taken from them all the time 919 00:51:44.720 --> 00:51:46.720 Because they don't have a plan for it 920 00:51:47.360 --> 00:51:53.680 For that bottom 60% of Americans that my research says wouldn't be able to save $27 a day 921 00:51:54.320 --> 00:52:00.720 The data reveals a discretionary income cliff once you drop below the top 40% of earners the money available after builds vanishes rapidly 922 00:52:01.280 --> 00:52:07.280 The top 20% which I think $96,000 per household are in a surplus the middle 20% 923 00:52:08.080 --> 00:52:11.680 Have a 15,000 dollars surplus which the $27 a day 924 00:52:12.160 --> 00:52:18.160 Take 66% from but the bottom 40% often have a roughly $2,000 surplus 925 00:52:18.160 --> 00:52:22.080 So it's impossible for them to get to the $10,000 for that bottom 40% 926 00:52:23.840 --> 00:52:26.880 What's the advice for them start with something 927 00:52:27.680 --> 00:52:31.360 Okay, it's like we took this 50 and we said cut it in half 25 928 00:52:32.320 --> 00:52:37.600 I would say can you save a dollar a day? I have actually talked about this idea 929 00:52:37.600 --> 00:52:42.560 Really simple could you save $10 a day for 100 days? 930 00:52:43.200 --> 00:52:45.920 So like if you're listening to me and you happen to really be struggling right now 931 00:52:46.400 --> 00:52:49.680 My question would be could you save $10 a day for 100 days? Why? 932 00:52:50.160 --> 00:52:56.480 Because it would get you to your first $1000 and you'd now have more than 50% of Americans you don't have savings 933 00:52:57.360 --> 00:53:02.320 And I can't tell you how many people have come back after 100 days and said okay, I did it. It wasn't easy 934 00:53:03.120 --> 00:53:06.000 For some people saving $10 a day could be really really hard 935 00:53:06.320 --> 00:53:08.320 But 936 00:53:08.960 --> 00:53:11.760 You're you're into fitness you saw my son who just came in here 937 00:53:13.280 --> 00:53:21.680 Fitness is built through daily action, right? It's built through daily action daily eating well going to the gym 938 00:53:22.480 --> 00:53:24.960 Doing certain things on a regular basis 939 00:53:25.840 --> 00:53:27.840 Savings the same thing 940 00:53:28.800 --> 00:53:34.320 There's a company called acorns. I invested acorns back in 2015 acorns came up with an app 941 00:53:35.200 --> 00:53:41.440 That helps you roll your change up. So if I go to Starbucks and I spend $9 and 50 cents on a coffee 942 00:53:42.720 --> 00:53:44.720 You can round it up where the 50 cents 943 00:53:45.520 --> 00:53:50.720 To 10 bucks is put into investments just rounding up your change 944 00:53:52.240 --> 00:53:58.080 And people have saved tens of thousands of dollars over the last 10 years by just rounding up their change 945 00:53:59.680 --> 00:54:03.840 Every time I've tried to improve something in my life like my businesses my health my relationships 946 00:54:04.160 --> 00:54:07.440 I've noticed that the biggest shifts have come from being better informed 947 00:54:07.680 --> 00:54:10.400 And when it comes to our health most of us know very very little 948 00:54:10.640 --> 00:54:13.440 So when our team was approached about partnering with function health 949 00:54:13.520 --> 00:54:19.200 It felt very much aligned their team has developed a way of giving you a full 360 degree view of your health 950 00:54:19.280 --> 00:54:22.560 Many of the things that are going on in your body in the form of different tests 951 00:54:22.640 --> 00:54:27.680 You do one blood draw and it gives you access to over 160 lab results 952 00:54:27.920 --> 00:54:31.920 hormones heart health inflammation stress toxins the whole picture 953 00:54:32.080 --> 00:54:35.760 I use it and serve many of my team members. You sign up and you schedule tests 954 00:54:35.840 --> 00:54:38.640 And once you're done you get a little report like the one I have here 955 00:54:38.880 --> 00:54:41.600 I can see my in-range results my out-of-range results 956 00:54:41.680 --> 00:54:46.080 And there's a little AI function too. So if I have any questions about my out-of-range results 957 00:54:46.320 --> 00:54:51.600 I can just go in there and ask it any question I want and these tests are backed by doctors and thousands of hours of research 958 00:54:51.760 --> 00:54:57.600 It's $365 for a yearly membership go to functionhealth.com slash D-O-A-C 959 00:54:57.760 --> 00:55:01.840 And use the code D-O-A-C-25 for $25 off your membership 960 00:55:03.120 --> 00:55:06.560 I had a friend of mine contact me and I spoke to one of the previous financial advisors and 961 00:55:07.200 --> 00:55:09.200 Educators that I'd spoken to on the show about him 962 00:55:09.440 --> 00:55:15.360 He told me he was in deep financial debt probably earns about 50,000 pounds or dollars a year 963 00:55:15.680 --> 00:55:17.200 But has got himself into real debt 964 00:55:17.200 --> 00:55:19.200 I imagine a lot of my listeners are 965 00:55:19.600 --> 00:55:25.680 Somewhat in debt whether it's credit card debts or loans or others. Do you have any specific advice to people that are currently straddled with debt? 966 00:55:26.400 --> 00:55:29.680 Absolutely because it's one of the most important things you need to know how to get out of 967 00:55:30.320 --> 00:55:32.400 debt is like quicksand like you know 968 00:55:32.400 --> 00:55:35.200 You talked earlier about how you were in debt and what that felt like 969 00:55:35.760 --> 00:55:38.720 When I came out of college and I had $12,000 in credit card debt 970 00:55:38.880 --> 00:55:41.680 It felt like the greatest weight on my shoulders 971 00:55:42.160 --> 00:55:47.120 Like I was carrying like a 50 pound backpack and how did I get out debt and how do you get out debt? 972 00:55:47.440 --> 00:55:50.400 I won't give you the very simple formula to getting out of debt 973 00:55:51.200 --> 00:55:53.120 Dolde dolde stands for done 974 00:55:54.000 --> 00:55:54.960 on 975 00:55:54.960 --> 00:56:01.120 Last payment if you said to me, David. I've got five credit cards. I'd say, okay, Steven 976 00:56:03.120 --> 00:56:09.280 Tarrick's paper just like this and I'd start listing your credit cards. I go one two three 977 00:56:09.920 --> 00:56:12.480 four five and I'd list them all these 978 00:56:13.760 --> 00:56:15.520 Master card 979 00:56:15.520 --> 00:56:16.960 And I'd list them and then I want to know 980 00:56:18.000 --> 00:56:20.960 How much do you owe so I put the dollar amount down 981 00:56:22.160 --> 00:56:26.880 And what I would do is I put the dollar amount down on paper and I'd list it small 982 00:56:28.640 --> 00:56:30.640 To large 983 00:56:30.880 --> 00:56:32.880 Then I want to know the interest rate 984 00:56:35.040 --> 00:56:39.200 Now what people say is oh you should take the highest interest rate and pay it off first 985 00:56:39.760 --> 00:56:41.760 But I wouldn't tell you that Steven 986 00:56:42.000 --> 00:56:46.080 I'd tell you you take the smallest credit card. I don't care what the interest rate is 987 00:56:46.720 --> 00:56:53.680 The smallest amount smallest amounts maybe this card right here's five hundred dollars and this card down here is three thousand 988 00:56:55.200 --> 00:56:58.160 I'd have you make minimum payments on every card 989 00:56:59.360 --> 00:57:00.640 Automatically 990 00:57:00.640 --> 00:57:06.240 This is really important the automatic part. Have you go on I'd literally go in your house and open up the I'd open up your iPad 991 00:57:06.800 --> 00:57:12.160 And I'd have you make minimum payments online automatically so that every card's paid on time 992 00:57:13.440 --> 00:57:17.840 Then I'd say Steven how much extra money do you have because I want you to put it all towards the smallest card 993 00:57:18.560 --> 00:57:21.120 We're gonna get that small card paid off as fast as possible 994 00:57:21.120 --> 00:57:23.520 We're gonna add all the extra money to that small card 995 00:57:24.160 --> 00:57:26.160 minimum payments on everything 996 00:57:26.240 --> 00:57:28.160 Once that card's paid off 997 00:57:28.160 --> 00:57:31.760 We're gonna go like this you don't have to close the account because we don't want to lower your credit score 998 00:57:31.760 --> 00:57:33.920 But we're gonna put that card over here and never use it 999 00:57:34.400 --> 00:57:36.240 Now we're gonna go the next small next small card 1000 00:57:37.600 --> 00:57:39.440 Some people call this a snowball approach 1001 00:57:40.560 --> 00:57:47.440 The reason I teach this system is it reduces the amount of credit cards you have as fast as possible 1002 00:57:48.560 --> 00:57:51.360 And you see yourself make progress 1003 00:57:52.240 --> 00:57:56.960 It's really important to see yourself make progress when you're doing anything financially 1004 00:57:57.920 --> 00:57:59.520 Then I would attack the interest rates 1005 00:58:00.400 --> 00:58:02.560 because the interest rates aren't always 1006 00:58:03.440 --> 00:58:04.640 permanent 1007 00:58:04.640 --> 00:58:06.720 You can negotiate your rates lower 1008 00:58:07.440 --> 00:58:10.880 You can move credit cards to another card with a low interest rate 1009 00:58:11.680 --> 00:58:16.560 Have to be very careful though when you do that because they're waiting for you to make a slip up and make a late payment 1010 00:58:16.880 --> 00:58:19.600 And when they do they'll jack the credit card interest rates back up again 1011 00:58:20.960 --> 00:58:25.040 You can also call up your credit card companies if you're really struggling 1012 00:58:25.680 --> 00:58:30.560 And tell them I'm struggling and I like to know if you have a program in place where I can 1013 00:58:31.200 --> 00:58:33.840 Stop the interest rate and pay these cards off 1014 00:58:34.720 --> 00:58:39.200 And more accessible like it is basically what the nonprofit credit card counseling organizations do 1015 00:58:39.600 --> 00:58:42.320 But the credit card companies often have programs too for this 1016 00:58:43.440 --> 00:58:46.640 They'll tell you to stop using the card they'll actually make it so you can't use the card anymore 1017 00:58:46.640 --> 00:58:48.320 But they'll stop the interest rate 1018 00:58:49.040 --> 00:58:53.200 So that approach has helped so many people get a credit card debt 1019 00:58:54.800 --> 00:58:57.840 Now I just want to say something super important because I've gone through this 1020 00:58:57.920 --> 00:59:02.400 When you go through the work of getting out of credit card debt 1021 00:59:04.320 --> 00:59:06.320 It's a huge victory 1022 00:59:07.440 --> 00:59:09.440 Don't go out and celebrate 1023 00:59:10.160 --> 00:59:12.160 On the credit cards 1024 00:59:12.160 --> 00:59:15.280 Because I got myself out of credit card debt in college junior year 1025 00:59:15.760 --> 00:59:18.960 And then it went on a cell gradian and got myself back into credit card debt 1026 00:59:19.680 --> 00:59:25.200 And people do this all the time usually people get themselves in a hole at least twice sometimes three times 1027 00:59:26.160 --> 00:59:28.160 Don't go back in a hole again 1028 00:59:28.880 --> 00:59:32.320 I didn't carry credit cards for 30 years only carried in debit card 1029 00:59:33.440 --> 00:59:35.280 And I had to pay it over a month 1030 00:59:35.280 --> 00:59:40.640 Should these people who are in the bottom sort of 60% be thinking at all about 1031 00:59:41.200 --> 00:59:43.600 How to make more money how to increase their income 1032 00:59:44.640 --> 00:59:47.920 Absolutely, and what are the like the easiest ways to do that 1033 00:59:48.480 --> 00:59:52.000 With that you'd recommend just from your own experience of being in the professional world and 1034 00:59:52.960 --> 00:59:56.400 So my experience and I know that you look you wrote this great book 1035 00:59:57.200 --> 00:59:58.800 Tire of a CEO, right? 1036 00:59:58.800 --> 01:00:00.640 Anybody that read your book you're this great book 1037 01:00:00.640 --> 01:00:02.960 What's the best way to grow your income if you have a job? 1038 01:00:04.000 --> 01:00:06.000 It's to be good at what you do 1039 01:00:06.400 --> 01:00:09.600 Wait, you can have a job at minimum wage 1040 01:00:10.640 --> 01:00:12.240 Let's pretend you work at McDonald's 1041 01:00:12.960 --> 01:00:15.840 And you have a job working minimum wage McDonald's 1042 01:00:16.320 --> 01:00:20.720 The owner of McDonald's the guy who owns that franchise is the guy that owns that franchise 1043 01:00:21.200 --> 01:00:22.800 Desperately needs could employees 1044 01:00:23.760 --> 01:00:28.320 Who becomes a manager that makes for money the person who works really well 1045 01:00:28.880 --> 01:00:31.280 Now a lot of people I don't I don't know if I want to work McDonald's 1046 01:00:31.440 --> 01:00:33.440 I'm just giving it as an example 1047 01:00:33.520 --> 01:00:39.360 Anywhere you work how you grow your income is you are the best at what you do 1048 01:00:40.160 --> 01:00:43.600 You show up early you have a game plan at work 1049 01:00:44.160 --> 01:00:46.800 You work late you do what you say you're going to do 1050 01:00:47.600 --> 01:00:52.960 You don't wait to be told what to do right like I've been an entrepreneur all my lifetime 1051 01:00:53.120 --> 01:00:55.120 The hardest thing about being an entrepreneur is what 1052 01:00:56.480 --> 01:00:57.680 Yeah, everything 1053 01:00:58.560 --> 01:01:01.120 It's everything and most people are entrepreneurs go well, it's you know 1054 01:01:01.120 --> 01:01:04.160 That sounds hard to have good people unless you're a good leader 1055 01:01:04.800 --> 01:01:08.640 People are so thirsty to have jobs with purpose and meaning 1056 01:01:09.520 --> 01:01:12.000 And most people are actually looking for leadership 1057 01:01:13.040 --> 01:01:16.400 So if you can be really good at what you do 1058 01:01:17.200 --> 01:01:20.240 You will make more money. There's no limit to wealth in the world, right? 1059 01:01:20.240 --> 01:01:24.800 Like we've never seen so much wealth being created in our entire lives as right now 1060 01:01:25.360 --> 01:01:27.360 If I were young enough to go we should learn AI 1061 01:01:28.560 --> 01:01:32.640 Yeah, you know what probably you definitely should learn how to use AI because if you don't learn how to use AI 1062 01:01:32.720 --> 01:01:36.000 You're going to have really limited skills from going to into certain jobs 1063 01:01:36.800 --> 01:01:40.000 You know what else people are going to go out and do learn how to be a plumber 1064 01:01:41.120 --> 01:01:43.120 Learn how to be electrician 1065 01:01:43.440 --> 01:01:45.200 Learn how to put up garage doors 1066 01:01:45.200 --> 01:01:50.160 I have got friends I kind of I was just recently on a podcast with a guy who's made a billion dollars putting in garage doors 1067 01:01:52.000 --> 01:01:58.320 And he took me through his warehouse and showed me their garage door models 1068 01:01:58.320 --> 01:02:02.480 And I was like you know, I've got a friend who makes gyms that go in garages. I just connected them 1069 01:02:02.480 --> 01:02:06.320 He's got a huge business making gyms for garages 1070 01:02:07.680 --> 01:02:10.480 There's just no limit to the amount of opportunities out there 1071 01:02:10.480 --> 01:02:12.720 You have to though get out of a stuck mind frame 1072 01:02:12.800 --> 01:02:16.720 I mean you had tell me robins here. If there's anybody who can help you get out of the stuck mind frame 1073 01:02:17.280 --> 01:02:19.520 It's that guy right, but you can't 1074 01:02:20.480 --> 01:02:23.680 You can't have they zig-zag uses to call it stinking thinking 1075 01:02:24.480 --> 01:02:26.480 you have to have 1076 01:02:26.880 --> 01:02:33.120 The ability to look into the future and believe that your future can be as exciting today or better 1077 01:02:33.760 --> 01:02:38.880 I put up a post yesterday. I said um I would rather be an optimist 1078 01:02:39.760 --> 01:02:43.760 And be wrong than a pessimist and be right 1079 01:02:45.200 --> 01:02:47.600 And you show me somebody who wants to make more money 1080 01:02:48.720 --> 01:02:52.560 Going to roll an optimist and figure out how to go make more money 1081 01:02:54.000 --> 01:02:57.360 Do you think a lot of this is a mindset at at the core of it? 1082 01:02:57.440 --> 01:03:01.520 Obviously there are real socio economic factors and there's people living certain situations 1083 01:03:01.520 --> 01:03:04.320 And if I think back to you know where I was born in Botswana 1084 01:03:04.480 --> 01:03:08.960 There's just less opportunity and sometimes you have repressive governments and other factors that will 1085 01:03:09.360 --> 01:03:12.720 objectively keep you stuck, but all other things being equal 1086 01:03:14.400 --> 01:03:16.400 How much of the game is mindset? 1087 01:03:16.720 --> 01:03:18.400 It always comes down to a decision 1088 01:03:19.200 --> 01:03:21.200 And we started by talking about my grandmother 1089 01:03:21.200 --> 01:03:24.080 If my grandmother hadn't made a decision at the 30 1090 01:03:24.720 --> 01:03:28.240 That she didn't want to be poor. She was tired of living paycheck to paycheck 1091 01:03:28.960 --> 01:03:34.080 She hadn't decided that she would go out and teach herself about money and take 50 cents of her paycheck and 1092 01:03:34.400 --> 01:03:37.520 50 cents from my grandfather's paycheck and start investing 1093 01:03:38.560 --> 01:03:40.560 I wouldn't be here today 1094 01:03:40.560 --> 01:03:43.840 She made a decision that had a ripple effect through our family 1095 01:03:44.560 --> 01:03:47.840 She built financial security for herself with that one decision 1096 01:03:48.880 --> 01:03:53.360 She taught my father how to invest and he was a financial advisor for over 45 years 1097 01:03:53.920 --> 01:03:59.520 My sister's a financial advisor. I was a financial advisor. I spent the last 30 years teaching people about money 1098 01:04:00.320 --> 01:04:02.880 One woman's decision had this ripple effect 1099 01:04:03.520 --> 01:04:06.560 So one thing I say to people who are listening especially to the moms 1100 01:04:08.000 --> 01:04:10.480 Sometimes you got to make a decision that's not just for you 1101 01:04:12.160 --> 01:04:14.320 You're actually making this decision for your family 1102 01:04:15.040 --> 01:04:18.240 And you can come up with a list of reasons why this stuff won't work 1103 01:04:18.640 --> 01:04:20.960 Somebody who's watching this show or listening was right now 1104 01:04:21.680 --> 01:04:24.000 They're already interested in this 1105 01:04:24.560 --> 01:04:26.080 That's why they're here 1106 01:04:26.080 --> 01:04:30.000 Now they're here for a couple of reasons either either hurting financially 1107 01:04:30.720 --> 01:04:32.720 And they know they need to fix something 1108 01:04:33.840 --> 01:04:35.840 Start where you are 1109 01:04:35.840 --> 01:04:38.000 Fix what needs to be fixed 1110 01:04:38.000 --> 01:04:41.440 Some people are like you know, I think I'm doing pretty well, but I'm not sure if I'm doing everything well 1111 01:04:42.080 --> 01:04:46.480 You know, I've opened up my Roth IRA or I've opened up my 401k plan 1112 01:04:47.200 --> 01:04:49.840 Putting some money away, but I don't know if I'm putting enough money away 1113 01:04:51.520 --> 01:04:53.520 Then you can improve what you're doing 1114 01:04:53.920 --> 01:04:55.920 Some people like I'm renting 1115 01:04:55.920 --> 01:04:57.600 I think I would like to buy a house someday 1116 01:04:57.600 --> 01:05:00.960 All right, make that a goal. I teach three buckets when it comes to money three baskets 1117 01:05:01.920 --> 01:05:03.920 Pay yourself first for retirement 1118 01:05:04.240 --> 01:05:08.480 We haven't even talked about emergency yet putting inside putting inside money for emergency purposes 1119 01:05:08.960 --> 01:05:12.480 Have to talk about that you got to you got to get more money put inside for emergency purposes 1120 01:05:13.040 --> 01:05:16.160 And then building a dream account you need to put money away for your dreams 1121 01:05:16.720 --> 01:05:19.120 Those three accounts should be automated 1122 01:05:19.600 --> 01:05:24.640 And on that point of having three accounts you called it a future account and emergency account and a dream account 1123 01:05:25.440 --> 01:05:29.280 How much of your earnings should you be putting into each of those accounts on a monthly basis? 1124 01:05:29.520 --> 01:05:31.520 All right, so keep it super simple 1125 01:05:31.920 --> 01:05:37.280 I recommend one hour day again to this earlier. It's 12 and a half percent of your gross income 1126 01:05:37.440 --> 01:05:40.400 When you say one hour a day, you mean one hour of the time you wet a day 1127 01:05:40.960 --> 01:05:42.960 Yeah, so whatever you make an hour. Yeah 1128 01:05:43.360 --> 01:05:45.920 It's if you're sick if you're working a 40 hour work week 1129 01:05:46.560 --> 01:05:48.880 12 and a half percent of your gross income 1130 01:05:49.680 --> 01:05:51.680 Goes off the top and do a retirement account 1131 01:05:52.400 --> 01:05:56.640 Now, let me just say something up for the job butters and like I can't go from zero to 12 percent 1132 01:05:57.200 --> 01:05:59.200 Then start at one percent 1133 01:06:00.240 --> 01:06:07.200 If you're not saving right now and you're listening to us and all you do when you leave this podcast is make one decision 1134 01:06:08.320 --> 01:06:10.720 And that decision is I'm going to save one percent of my income 1135 01:06:11.440 --> 01:06:14.480 And you start that this month your life will change 1136 01:06:15.280 --> 01:06:20.800 Your life will change because you start the process of making a difference. It's just like the first day you go to the gym 1137 01:06:21.520 --> 01:06:24.480 Now I will tell you if you save one percent of your income you won't notice it 1138 01:06:25.040 --> 01:06:28.320 And if you did that every month for a year at the end of the year 1139 01:06:28.320 --> 01:06:32.640 You would have saved 12 percent and you will be saving four times what the average American saves 1140 01:06:33.200 --> 01:06:34.880 And you will be in a rock star shape 1141 01:06:35.600 --> 01:06:40.000 Then the second hour this is where people's minds blow up but the second hour 1142 01:06:40.720 --> 01:06:44.560 So the first hour goes for the future the second hour goes for safety and for dreams 1143 01:06:45.200 --> 01:06:48.720 So 30 minutes of your income roughly 5% 1144 01:06:49.600 --> 01:06:51.280 Should go into an emergency account 1145 01:06:52.000 --> 01:06:57.360 And another 5% goes into a dream account now that dream account could be for buying a house 1146 01:06:58.320 --> 01:07:00.320 Could be saving money for college 1147 01:07:00.480 --> 01:07:03.680 Could be the occasion you want to take at the end of the year could be getting married 1148 01:07:04.560 --> 01:07:06.080 Could be the engagement ring 1149 01:07:07.120 --> 01:07:11.280 But you're putting money away for your dreams because when you put money away for your dreams 1150 01:07:12.640 --> 01:07:14.640 That's how they become real 1151 01:07:14.640 --> 01:07:20.240 And you know the book is called the automatic millionaire. This is a book that sold over two million copies 1152 01:07:20.880 --> 01:07:22.640 And on its own 1153 01:07:22.640 --> 01:07:27.840 Why did you use the word automatic unless your financial plan is automatic 1154 01:07:28.560 --> 01:07:30.800 It will fail 1155 01:07:30.800 --> 01:07:32.800 How do I know this? 1156 01:07:32.960 --> 01:07:37.120 Because I spent nine years as a financial advisor at Morgan Stanley and I got to see first hand 1157 01:07:38.000 --> 01:07:41.120 Everyone who came into my office with an ordinary income who built wealth 1158 01:07:41.760 --> 01:07:43.760 They did it by saving automatically 1159 01:07:44.560 --> 01:07:48.640 Every single time a client came into my office and they said I'm going to bring you a check 1160 01:07:49.440 --> 01:07:51.200 Every month myself 1161 01:07:51.200 --> 01:07:53.360 I never had a client save for more than six months 1162 01:07:54.480 --> 01:07:56.480 They stopped 1163 01:07:56.480 --> 01:08:00.240 When once you make the decision to automate your financial life 1164 01:08:01.120 --> 01:08:03.120 It works in the background 1165 01:08:03.600 --> 01:08:05.600 Now here's the thing 1166 01:08:05.600 --> 01:08:07.600 Everybody else is already doing this to you 1167 01:08:08.800 --> 01:08:11.040 You go sign you go to go to a gym to go work out 1168 01:08:11.600 --> 01:08:13.840 They don't ask you to bring them money every month 1169 01:08:13.840 --> 01:08:15.680 They automatically bill you 1170 01:08:15.760 --> 01:08:16.960 You get a phone bill 1171 01:08:16.960 --> 01:08:18.400 They automatically bill you 1172 01:08:18.400 --> 01:08:22.560 Today in many cases when you rent they automatically pull the money out of your account 1173 01:08:22.560 --> 01:08:25.040 The banks automatically take money from you for your mortgage 1174 01:08:25.680 --> 01:08:28.000 When you pay taxes they're all automated 1175 01:08:28.800 --> 01:08:31.120 Everyone takes money from you automatically 1176 01:08:31.840 --> 01:08:36.080 Everything that you sign up for on your phone is a subscription service netflix 1177 01:08:36.720 --> 01:08:41.600 Go through your credit card today open up your phone look at all your subscriptions 1178 01:08:42.320 --> 01:08:44.960 All those businesses are taking money from you automatically 1179 01:08:45.520 --> 01:08:48.320 Why that's the only way they can be in business 1180 01:08:48.800 --> 01:08:51.120 They know if they don't get money from you automatically 1181 01:08:51.760 --> 01:08:53.920 You won't keep using them 1182 01:08:53.920 --> 01:08:57.040 Most people who start off with a free subscription 1183 01:08:57.040 --> 01:09:03.840 It'll take them three to six months to turn off something that they don't use 1184 01:09:05.520 --> 01:09:09.440 I'm here getting people to automate the financial life for themselves 1185 01:09:10.640 --> 01:09:14.720 Is there simple ways apps tools websites we can use 1186 01:09:14.720 --> 01:09:17.120 To go through all of our subscriptions and turn them all off 1187 01:09:18.560 --> 01:09:19.600 Yes 1188 01:09:19.600 --> 01:09:23.440 There are so let me tell you the easiest way for this is really actually 1189 01:09:24.160 --> 01:09:26.000 Free publicity for Apple okay 1190 01:09:27.040 --> 01:09:28.720 Because so many people have Apple phones 1191 01:09:29.600 --> 01:09:33.360 Number one only do your subscriptions inside of Apple 1192 01:09:34.080 --> 01:09:37.440 In an ideal world don't pay anybody directly do it all through Apple 1193 01:09:38.160 --> 01:09:39.360 Why? 1194 01:09:39.360 --> 01:09:42.880 Because if you go to the bottom of your phone you don't know how to do this and you put subscriptions 1195 01:09:43.840 --> 01:09:49.200 Up will pop everything that you've signed up for and you can go click click click and turn them all off 1196 01:09:50.080 --> 01:09:53.920 Another thing I will tell you is that when you sign up for anything 1197 01:09:54.080 --> 01:09:57.280 Let's say it's a one you because everything else a one-year trial subscription 1198 01:09:58.160 --> 01:10:00.160 Or a one month trial subscription 1199 01:10:00.960 --> 01:10:02.720 The moment you sign up for it 1200 01:10:02.720 --> 01:10:03.760 Shut it off 1201 01:10:03.760 --> 01:10:09.440 Because what happens is if you sign up for anything and think of any subscription you can imagine companies hate me for this 1202 01:10:10.080 --> 01:10:13.920 The moment you shut it off when the time comes for it to renew 1203 01:10:14.480 --> 01:10:16.480 They will offer you a better deal to renew 1204 01:10:16.880 --> 01:10:20.560 Okay, so I've opened up my iPhone. I've gone to the settings 1205 01:10:20.560 --> 01:10:23.600 I've clicked on my name in the settings and then I've clicked on the button subscriptions 1206 01:10:24.800 --> 01:10:26.560 I have 1207 01:10:26.560 --> 01:10:31.280 One two three four five six seven eight nine ten eleven 1208 01:10:32.160 --> 01:10:34.160 Of which 1209 01:10:34.880 --> 01:10:36.880 Three of them 1210 01:10:37.280 --> 01:10:39.280 I would keep 1211 01:10:39.280 --> 01:10:44.400 So all these other ones have just been running in the background and it's because I used them at one time 1212 01:10:44.400 --> 01:10:48.240 Yep, and it signed me up to some kind of free trial and I just totally forgot to cancel it 1213 01:10:48.720 --> 01:10:55.600 So I got oh my god some of them are massive. Okay, so so as you do this what you're doing right now is a real life 1214 01:10:56.320 --> 01:11:04.080 Example so if someone's listening to us watching this they're married. They've got kids or they're single by themselves 1215 01:11:05.040 --> 01:11:07.040 This one exercise 1216 01:11:07.360 --> 01:11:12.240 My guess is there are many many people listening that could find 50 a hundred two hundred dollars a month 1217 01:11:12.800 --> 01:11:18.240 They could shut off and redirect that money to saving and investing and that could change your life 1218 01:11:18.640 --> 01:11:24.000 Other of the wraps you can use and go to to figure out how to cancel or leave your subscriptions 1219 01:11:24.000 --> 01:11:28.000 So there there are and most these apps you have to pay for right so like you can go to 1220 01:11:28.560 --> 01:11:33.760 So then that then you're right back in the pain for now probably the two popular most popular apps are monarch 1221 01:11:34.720 --> 01:11:38.400 And why and maybe you can also use your credit cards 1222 01:11:38.880 --> 01:11:42.320 The credit comes are doing a better job of showing it on your statements 1223 01:11:43.280 --> 01:11:48.320 And again, I go back to the apple example because apple makes it the easiest to shut these off 1224 01:11:49.040 --> 01:11:51.680 Maybe some of you will be spending a hundred dollars a month 1225 01:11:51.920 --> 01:11:57.760 So I did a hundred dollars a month and it says if you invest if you sort of cancel those subscriptions and invest a hundred dollars per month 1226 01:11:58.160 --> 01:12:01.680 For 40 years and annual rate of return of about 10 percent 1227 01:12:01.760 --> 01:12:05.600 Which is roughly what you get if you just put it into some of the big tech index funds at the moment 1228 01:12:06.000 --> 01:12:08.320 The total money you'll have in 40 years 1229 01:12:09.040 --> 01:12:12.640 Is six hundred and thirty two thousand dollars 1230 01:12:13.200 --> 01:12:15.680 Which is a staggeringly life-changing amount of money 1231 01:12:16.080 --> 01:12:19.600 It's staggering and let me just give some very specific investment 1232 01:12:20.000 --> 01:12:23.920 For people to consider right and they still need to do their own due diligence and read 1233 01:12:24.080 --> 01:12:26.400 Perspectives and yesors risk and ball and stock market 1234 01:12:26.960 --> 01:12:30.480 But the first one I would talk about and look at these are all listed in my book 1235 01:12:30.480 --> 01:12:33.760 Because I just want to give it because people like what's an index fund? What do I buy 1236 01:12:34.880 --> 01:12:38.880 Look at the Vanguard total stock market fund. The symbol is VTI 1237 01:12:39.680 --> 01:12:43.040 Okay, this is actually the largest index fund in the world 1238 01:12:43.360 --> 01:12:46.640 There's trillions of dollars now in this fund. I talked about it in the book 1239 01:12:47.040 --> 01:12:51.840 I looked up the annual the annual returns of VTI the last 10 years have been 14 percent 1240 01:12:52.560 --> 01:12:54.320 14 percent annually 1241 01:12:54.400 --> 01:12:57.600 This fund has 3,500 stocks 1242 01:12:58.160 --> 01:13:00.480 You know all the biggest US stocks 1243 01:13:00.880 --> 01:13:03.600 So you don't have to figure out what stock to buy you buy this fund 1244 01:13:04.320 --> 01:13:07.680 You buy an exchange rate of mutual fund you have access to 1245 01:13:08.320 --> 01:13:10.320 3,500 great American companies 1246 01:13:11.120 --> 01:13:16.720 I'll give you another stock index fund. I love and everybody can buy this on their phone right now 1247 01:13:17.200 --> 01:13:19.600 Probably literally you can go to Vanguard Schwab 1248 01:13:19.760 --> 01:13:24.560 Fidelity this funds. This is an ETF. So it's available everywhere to stock 1249 01:13:24.800 --> 01:13:27.360 And if you want to figure out how to do this and you're listening right now 1250 01:13:27.360 --> 01:13:32.080 What I do is use chat to be to your Gemini and put in the stock the the fund that 1251 01:13:33.360 --> 01:13:39.520 Has been said and ask it how do I invest in this in the country that I'm in what apt do I need to use what website do I need to use again 1252 01:13:39.520 --> 01:13:45.200 This is not investment advice. Well, I guess kind of sounds like it is but well, but it's also like so like we 1253 01:13:45.200 --> 01:13:47.200 Someone says okay, but I'm not I'm in 1254 01:13:47.600 --> 01:13:51.760 Wherever I am. I'm in the UK. What's an index fund in the UK that covers the UK? 1255 01:13:52.160 --> 01:13:55.120 I'll give you the global version of VTI 1256 01:13:55.760 --> 01:14:02.400 So because I own these funds so I so the global version of VTI is a symbol which is all I'm gonna give you another Vanguard fund 1257 01:14:02.400 --> 01:14:05.280 When you say you own these funds for clarity, you mean you've invested in them 1258 01:14:05.360 --> 01:14:07.120 Yeah, I've got money in these mutual funds 1259 01:14:07.200 --> 01:14:12.160 So this other fund because I have I want money my my personal money that's in the stock market 1260 01:14:12.160 --> 01:14:16.720 I am one third global investments and I'm two thirds US investments 1261 01:14:17.760 --> 01:14:23.280 So I have a lot of global index funds this global index fund is symbol is VEA 1262 01:14:23.760 --> 01:14:30.240 Because this is the Vanguard global index fund without US stocks symbol again is VEA 1263 01:14:31.840 --> 01:14:38.240 That fund last year and it won't always be like this because global investments have underperformed the US for a long period time 1264 01:14:39.120 --> 01:14:41.120 That fund last year was up 35% 1265 01:14:42.240 --> 01:14:46.240 Last year global investments significantly outperformed the US investments 1266 01:14:46.880 --> 01:14:50.000 And the US investment market was up on average of 17% 1267 01:14:50.480 --> 01:14:55.920 So the US markets were up 17% or higher and global investments were up 30% or higher 1268 01:14:55.920 --> 01:15:00.960 Now there will be a point in time Steven without his shadow of it out that we will see a market pullback 1269 01:15:01.840 --> 01:15:07.040 And when that day comes you have to stay the course and keep investing automatically monthly 1270 01:15:08.080 --> 01:15:10.400 And then I give you a tech fund because everybody wants to know 1271 01:15:11.120 --> 01:15:16.320 What should I invest in that is you know should I invest in AI tech fund 1272 01:15:17.200 --> 01:15:20.480 And my answer would be is you don't need an AI tech fund 1273 01:15:20.960 --> 01:15:24.800 You need the best tech fund that's existed in my lifetime 1274 01:15:25.360 --> 01:15:31.840 And that's the NASDAQ 100 ETF and the symbol for that is QQQ 1275 01:15:33.120 --> 01:15:37.840 So go and look you know go into whatever you're using and go look up QQQ 1276 01:15:38.400 --> 01:15:40.800 Read about the top 100 stocks in the NASDAQ 1277 01:15:41.360 --> 01:15:42.960 And there are turns for QQQ 1278 01:15:42.960 --> 01:15:45.520 I mean actually in top of my mind right now I can I think it's over 1279 01:15:46.480 --> 01:15:48.080 20% 1280 01:15:48.960 --> 01:15:52.800 But look up what is the QQQ total return been for the last 10 years 1281 01:15:54.160 --> 01:15:57.840 I can tell you since I put money in QQQ it's gone up 10 fold 1282 01:15:58.400 --> 01:16:02.400 Now the market's been unbelievable and there will be pullbacks 1283 01:16:03.200 --> 01:16:06.800 And that is also why I should say this even because we haven't even addressed this 1284 01:16:06.800 --> 01:16:09.840 I don't run around telling people to put all their mind and stock market 1285 01:16:09.840 --> 01:16:11.600 I also don't think that young people 1286 01:16:12.240 --> 01:16:14.560 Should be putting all their mind and stock market 1287 01:16:14.560 --> 01:16:19.680 I think one of the greatest myths out there is that when you're young you should take a lot of risk 1288 01:16:20.960 --> 01:16:24.240 Let me say that one more time because it's super important so make sure it sits 1289 01:16:26.160 --> 01:16:28.160 Everyone says when you're young 1290 01:16:28.880 --> 01:16:30.880 You should take risk 1291 01:16:31.680 --> 01:16:37.760 The problem with that advice is that today people in their 20s and their 30s are taking a lot of risk 1292 01:16:38.320 --> 01:16:40.400 They're not just putting money in index funds 1293 01:16:40.960 --> 01:16:42.960 They're putting money in meme coins 1294 01:16:43.360 --> 01:16:45.600 They're putting money in meme stocks 1295 01:16:46.000 --> 01:16:47.840 They're putting money in NFTs 1296 01:16:48.560 --> 01:16:52.560 They're on social media and TikTok watching people day trade 1297 01:16:52.560 --> 01:16:54.560 They're trying to get into options 1298 01:16:54.560 --> 01:16:56.720 What they're really trying to do is get rich quick 1299 01:16:57.440 --> 01:16:59.760 All I can tell you is the older guy in the room here 1300 01:17:00.880 --> 01:17:03.920 People who try to get rich quick stay broke forever 1301 01:17:04.480 --> 01:17:08.400 And the problem with taking too much risk with your money when you're young is if you keep 1302 01:17:08.960 --> 01:17:12.880 If you do everything right like let's just say you're the you shut off all your subscriptions 1303 01:17:13.360 --> 01:17:15.280 And you're saving $200 a month 1304 01:17:15.280 --> 01:17:18.640 But you put that $200 a month into a junk investment 1305 01:17:19.360 --> 01:17:22.320 And you turn around in 10 years and you have nothing to show for it 1306 01:17:23.040 --> 01:17:25.040 You'll stop investing 1307 01:17:26.160 --> 01:17:27.680 Looking at the QQQ data 1308 01:17:27.680 --> 01:17:29.120 So this is the Mastak 100 1309 01:17:29.120 --> 01:17:33.360 So this invests in the top 100 companies in America 1310 01:17:33.360 --> 01:17:34.960 The Nasdaq's market change 1311 01:17:34.960 --> 01:17:39.120 The returns over the last 10 years from 2016 to 2026 1312 01:17:39.120 --> 01:17:42.480 The annualized returns have been roughly 19 percent 1313 01:17:43.200 --> 01:17:46.960 The total return of that period has been roughly 480 percent 1314 01:17:47.680 --> 01:17:50.560 So $10,000 investment 10 years ago 1315 01:17:51.200 --> 01:17:55.200 Would now be worth approximately $60,000 today if you've done nothing 1316 01:17:55.280 --> 01:17:56.800 Never added to it 1317 01:17:56.800 --> 01:17:58.160 Over the last 20 years 1318 01:17:59.040 --> 01:18:02.400 The annualized returns the return every year has been 15 percent 1319 01:18:02.400 --> 01:18:06.400 With a total return over that period of 1,500 percent 1320 01:18:06.400 --> 01:18:10.720 And against if you've added $10,000 to it 20 years ago and done nothing 1321 01:18:10.720 --> 01:18:13.920 You would have roughly $170,000 today 1322 01:18:15.440 --> 01:18:17.280 So here's the beauty of what you just did 1323 01:18:18.240 --> 01:18:21.120 You checked my my you checked my advice 1324 01:18:22.000 --> 01:18:26.320 You looked at the data and now you know what has deepened done in the past 1325 01:18:26.320 --> 01:18:27.120 Right 1326 01:18:27.120 --> 01:18:29.120 Let me give you a super boring fund 1327 01:18:29.120 --> 01:18:30.640 I'm not sponsored by Vanguard 1328 01:18:30.640 --> 01:18:32.560 I'm just giving generic vanilla stuff here 1329 01:18:33.360 --> 01:18:36.320 Look at the Vanguard balanced fund 1330 01:18:37.200 --> 01:18:39.200 So right Vanguard balanced fund 1331 01:18:39.600 --> 01:18:44.320 And the Vanguard balanced fund is 60 percent stocks and 40 percent bonds 1332 01:18:44.800 --> 01:18:46.320 That by the way is the most 1333 01:18:47.120 --> 01:18:50.400 Typical asset allocation the difference between stocks and bonds 1334 01:18:51.200 --> 01:18:52.400 In the world 1335 01:18:52.400 --> 01:18:57.440 The average retiree has a portfolio that's about 60 percent stock and 40 percent bonds 1336 01:18:58.240 --> 01:19:04.880 You look up the valinger balanced fund and what you're going to find is that fund his average to over 8 percent annually since inception 1337 01:19:06.160 --> 01:19:09.280 It is as boring an investment as they come 1338 01:19:09.280 --> 01:19:12.160 So if someone says well, I don't want to be 100 percent stocks 1339 01:19:12.160 --> 01:19:16.160 I just want to be I want to be more conservative, but I want some stock exposure 1340 01:19:16.800 --> 01:19:18.720 The Vanguard balanced funds a great example 1341 01:19:19.600 --> 01:19:22.800 I list all these funds in the automatic millionaire 1342 01:19:23.280 --> 01:19:28.400 One of the kind of funds I talk about the most is what's called a target dated mutual fund 1343 01:19:29.600 --> 01:19:32.880 I don't know if you guys have a foreign K plan. We have something similar 1344 01:19:33.120 --> 01:19:38.000 Okay, so in the US if you have a foreign K plan what you're going to find when you open up your foreign K plan 1345 01:19:38.400 --> 01:19:41.360 Is you have what are called target dated mutual funds? 1346 01:19:41.840 --> 01:19:46.080 This is a one stop mutual fund solution 1347 01:19:46.960 --> 01:19:50.320 To your investing all the way until you retire 1348 01:19:51.280 --> 01:19:58.560 And it will be divided among stocks and bonds and it will be what's called rebalanced automatically as you get closer to retirement 1349 01:19:58.560 --> 01:20:02.720 So I'll go from being more stocks when you're young less stocks as you get older 1350 01:20:04.160 --> 01:20:08.800 There are trillions of dollars now in these target dated mutual funds when I wrote the automatic mill or 20 years ago 1351 01:20:08.800 --> 01:20:10.240 It just came start 1352 01:20:10.240 --> 01:20:16.560 This automatic solution to investing has changed the game of investing for millions of Americans 1353 01:20:16.560 --> 01:20:21.280 That's why there's 24 million millionaires and that's why there's now 45 trillion dollars in retirement accounts 1354 01:20:22.640 --> 01:20:31.680 We have a brain budget the way to think about it is we have a limited amount of energy that we can spend every single day 1355 01:20:31.680 --> 01:20:39.200 I'm saying find ways to simplify your life and one way I've conserved my body budget is via our sponsor factor who are a meal delivery service 1356 01:20:39.440 --> 01:20:44.160 They are especially great because they make fresh meals and they cater to so many different diets 1357 01:20:44.160 --> 01:20:49.680 Hyprotein, keto, vegan, vegetarian, low card, gluten-free, paleo diets, you name it every meal 1358 01:20:49.680 --> 01:20:53.680 Is designed by a dietitian made by chefs and delivered right to me 1359 01:20:54.160 --> 01:20:56.000 Fresh and never frozen 1360 01:20:56.000 --> 01:20:58.160 So if you're ready to streamline your food intake 1361 01:20:58.160 --> 01:21:02.720 Visit factameals.com slash diary 50 off 1362 01:21:02.800 --> 01:21:11.040 And use my code diary 50 off to get 50% off your first factor box plus free breakfast for one year 1363 01:21:11.040 --> 01:21:15.600 And this offers only valid for new factor customers with code and qualifying auto review subscription purchase 1364 01:21:16.880 --> 01:21:19.760 Over the years people have reached out asking me for mentorship 1365 01:21:19.760 --> 01:21:25.440 But the challenge I've always faced is that my calendar doesn't permit me to help every single person that reaches out 1366 01:21:25.440 --> 01:21:27.440 So when I know I can't personally help 1367 01:21:27.440 --> 01:21:29.600 I try to push people towards tools that I think can 1368 01:21:29.680 --> 01:21:36.560 And that's why I wanted to tell you a little bit about resource that I think would be great for those of you who are founders of small and medium-sized businesses 1369 01:21:36.560 --> 01:21:40.240 It's a content series that our long-time show sponsor Vodafone has created 1370 01:21:40.240 --> 01:21:43.760 It's called Vodafonebusiness.connected 1371 01:21:43.760 --> 01:21:45.200 You'll find it on YouTube 1372 01:21:45.200 --> 01:21:50.000 This series delivers the knowledge that founders today need to grow their company in the digital age 1373 01:21:50.000 --> 01:21:54.160 There you'll learn about personal branding, cybersecurity, scaling e-commerce companies 1374 01:21:54.160 --> 01:21:58.480 And through conversations with many founders who I've invested in and work closely with 1375 01:21:58.480 --> 01:22:01.280 The opaque picture of building a business will become clear 1376 01:22:01.280 --> 01:22:05.440 Some of those founders I've invested in in the series include Christiana Brenton from FlightStory 1377 01:22:05.440 --> 01:22:07.360 Marissa poster from PerfectEd 1378 01:22:07.360 --> 01:22:09.120 Leo Harrison from chapter 2 1379 01:22:09.120 --> 01:22:12.240 And Georgia Gibson who I've partnered with to build Steven.com 1380 01:22:12.240 --> 01:22:14.400 And these are just a few of the great names involved 1381 01:22:14.400 --> 01:22:16.800 Such Vodafonebusiness.connected to learn more 1382 01:22:18.160 --> 01:22:21.920 The other book that you wrote which sold incredibly incredibly well 1383 01:22:21.920 --> 01:22:24.640 Is this book about smart couples finish rich 1384 01:22:24.640 --> 01:22:25.360 That's the title 1385 01:22:25.360 --> 01:22:26.560 Smart couples finish rich 1386 01:22:26.640 --> 01:22:30.240 Nine steps to creating a rich future for you and your partner 1387 01:22:30.240 --> 01:22:32.880 As it relates to how rich or wealthy you become 1388 01:22:32.880 --> 01:22:36.400 The person you choose and the way that you can figure that relationship 1389 01:22:36.400 --> 01:22:37.600 How consequential is that? 1390 01:22:38.720 --> 01:22:40.000 It's everything 1391 01:22:40.000 --> 01:22:40.720 Really? 1392 01:22:40.720 --> 01:22:41.840 It can be everything 1393 01:22:41.840 --> 01:22:42.800 Why? 1394 01:22:42.800 --> 01:22:43.680 You're married? 1395 01:22:43.680 --> 01:22:44.400 I'm married 1396 01:22:44.400 --> 01:22:44.720 Yeah 1397 01:22:44.720 --> 01:22:46.080 So why can it be everything? 1398 01:22:47.760 --> 01:22:50.560 Because here's what happens in the real world, Steven 1399 01:22:51.840 --> 01:22:54.880 Often we marry our financial opposite 1400 01:22:55.840 --> 01:22:58.800 So I always joke like I used to do a lot of seminars for couples 1401 01:22:58.800 --> 01:23:01.760 And I'd say there's two types of people that are born in the world 1402 01:23:02.400 --> 01:23:04.880 One person comes out literally with a calculator 1403 01:23:04.880 --> 01:23:07.040 And they're born to track where all the money goes 1404 01:23:07.040 --> 01:23:08.160 And they love to budget 1405 01:23:08.880 --> 01:23:10.480 And they're super excited about investing 1406 01:23:11.040 --> 01:23:12.000 That's one kind of person 1407 01:23:12.720 --> 01:23:14.560 The other kind of person 1408 01:23:14.560 --> 01:23:16.800 Loves to shop, loves to spend money 1409 01:23:18.000 --> 01:23:20.480 Almost inevitably those two people hook up 1410 01:23:21.280 --> 01:23:24.480 Now sometimes two people who like to spend money, marry 1411 01:23:25.120 --> 01:23:26.080 That's a disaster 1412 01:23:26.800 --> 01:23:27.760 Because they end up broke 1413 01:23:28.640 --> 01:23:32.160 So now what do you do about the couple that's got the financial opposites 1414 01:23:33.360 --> 01:23:35.200 That's what led to smart couples financial rich 1415 01:23:35.200 --> 01:23:35.760 Because 1416 01:23:37.680 --> 01:23:40.480 If you are married to your financial opposite 1417 01:23:41.120 --> 01:23:43.840 You will fight about money all the time 1418 01:23:44.720 --> 01:23:48.000 And fights about money are what lead to divorce 1419 01:23:48.960 --> 01:23:51.120 They're the number one cause of divorce 1420 01:23:51.760 --> 01:23:55.760 The real key in what I've been teaching now for over two decades 1421 01:23:55.760 --> 01:23:58.560 Is the way you get couples on the same page when it comes to money 1422 01:23:59.200 --> 01:24:00.400 Is you start with your values 1423 01:24:01.280 --> 01:24:04.320 So you look at what do you really value most together as a couple 1424 01:24:05.360 --> 01:24:07.200 You put the money aside for a second 1425 01:24:07.760 --> 01:24:10.320 You go through your values, what's most important to you 1426 01:24:10.960 --> 01:24:12.640 What do you really care about? 1427 01:24:12.640 --> 01:24:14.320 You talk about your values 1428 01:24:14.880 --> 01:24:18.640 And then you build a financial plan around what's really most important to you 1429 01:24:19.440 --> 01:24:23.600 You say that there's six worst money mistakes that couples make 1430 01:24:23.600 --> 01:24:26.640 And the first of those is not deciding who is responsible for what 1431 01:24:26.800 --> 01:24:27.040 Yeah 1432 01:24:28.480 --> 01:24:30.800 So often in a relationship 1433 01:24:31.440 --> 01:24:32.720 One person pays the bills 1434 01:24:34.800 --> 01:24:35.280 Okay 1435 01:24:36.400 --> 01:24:37.520 Who's managing the money 1436 01:24:38.320 --> 01:24:41.920 Now I used to say in every household there should be at least one person 1437 01:24:41.920 --> 01:24:46.240 This paying the bills and the other person's managing the money meaning that they're in charge of investments 1438 01:24:46.880 --> 01:24:49.600 That you still get together and go through it 1439 01:24:50.800 --> 01:24:53.680 As I've gotten old or I've really realized how important this is 1440 01:24:53.760 --> 01:24:56.560 Because I go back to the fact that the average age is 59 1441 01:24:56.640 --> 01:24:58.160 average age of widowhood is 59 1442 01:24:58.800 --> 01:25:00.080 I'm 59 now 1443 01:25:00.720 --> 01:25:03.680 I've had three best friends already passed away 1444 01:25:04.480 --> 01:25:05.120 All men 1445 01:25:05.920 --> 01:25:08.320 And they passed away before they were 57 1446 01:25:08.320 --> 01:25:10.320 So all these statistics that I talk about 1447 01:25:10.400 --> 01:25:11.680 I'm seeing them come true 1448 01:25:12.560 --> 01:25:15.280 And I will tell especially the women hear me loud 1449 01:25:15.520 --> 01:25:17.040 Hear me on this loud and clear 1450 01:25:18.000 --> 01:25:19.600 But this is important for the men too 1451 01:25:21.520 --> 01:25:25.360 The question you need this is hard to hear the question you have to ask yourself 1452 01:25:26.800 --> 01:25:29.040 Is if your partner died today 1453 01:25:30.240 --> 01:25:32.240 What would you need to know about the finances 1454 01:25:33.760 --> 01:25:38.640 And the answer is everything now what does that mean everything that means you would need to know where is the money 1455 01:25:39.600 --> 01:25:44.640 Do you have money in an old 401k plan does he have money in IRA account does he have money to bank account 1456 01:25:46.080 --> 01:25:48.080 What are the passwords to get into the accounts 1457 01:25:49.040 --> 01:25:51.040 Where's the will 1458 01:25:51.200 --> 01:25:54.400 You know six out of 10 people listening to us today don't have a will 1459 01:25:55.280 --> 01:26:02.880 You have to have a will at any age at any age if you especially if you're in a relationship you have to have a will if you have kids you have to have a will 1460 01:26:04.000 --> 01:26:05.840 Is their life insurance? 1461 01:26:06.400 --> 01:26:10.240 So many people today who have children don't have life insurance and they don't have assets 1462 01:26:10.400 --> 01:26:13.120 You should at least get a million to two million dollar term policy 1463 01:26:13.600 --> 01:26:15.280 super inexpensive 1464 01:26:15.280 --> 01:26:17.840 Protect your family you have to run 1465 01:26:18.720 --> 01:26:22.160 The drill right like that we got on a plane we flew here today 1466 01:26:22.240 --> 01:26:26.400 The first thing they do want to plan before you take off is they talk to you about what to do in case emergency purposes 1467 01:26:26.880 --> 01:26:29.200 The mask going to come down you can put it on your face 1468 01:26:29.360 --> 01:26:34.240 Okay, you get on a cruise boat the first thing you do is talk about what you're going to do if the cruise boat's got a problem 1469 01:26:34.240 --> 01:26:36.240 You're going to go get in these emergency boats 1470 01:26:36.480 --> 01:26:40.640 You need to run the fire drill for your family on finances 1471 01:26:41.360 --> 01:26:46.000 I almost died like it's now been four years ago. I my wife found me face down 1472 01:26:46.800 --> 01:26:48.320 passed out 1473 01:26:48.320 --> 01:26:50.320 I was brought to the hospital in Florence 1474 01:26:50.880 --> 01:26:55.600 Um, I was in a coma for four days. I was in the hospital for 17 1475 01:26:56.640 --> 01:27:00.240 I had meningitis when I came out of 1476 01:27:01.040 --> 01:27:04.400 Just like a movie. I'm laying down. I mean, I'm laying down in the hospital 1477 01:27:04.880 --> 01:27:06.800 Doctors looking over me doctor says 1478 01:27:07.520 --> 01:27:09.520 Do you know what your name is? 1479 01:27:09.520 --> 01:27:11.120 I said David 1480 01:27:11.120 --> 01:27:14.080 It's very good. You know your last name is I said it's Bach 1481 01:27:14.800 --> 01:27:21.600 Says do you know where you are? I go. Yeah, I'm in Milan. I just had an ankle surgery because I had had an ankle surgery two weeks prior 1482 01:27:22.560 --> 01:27:24.240 Tweets before that 1483 01:27:24.240 --> 01:27:28.320 And he says no, no, you're you're in Santa Morin novella. You're in the ICU 1484 01:27:29.120 --> 01:27:32.880 I were treating you right now for meningitis, but now that you've opened up your eyes 1485 01:27:32.880 --> 01:27:35.440 You're going to be oh you're going to be okay. You're safe now 1486 01:27:36.160 --> 01:27:39.280 And then they brought my wife in they said you know what her name is 1487 01:27:40.480 --> 01:27:43.840 I and I made a joke. I said this for Becca. She's like who? 1488 01:27:44.480 --> 01:27:47.040 I go honey. I can still be a smart as an hospital 1489 01:27:47.120 --> 01:27:51.520 It's a lesha and she starts screaming and yelling and she's like oh my god. Yeah. Oh my god. He's okay 1490 01:27:52.320 --> 01:27:56.240 But Stephen the truth was I wasn't okay because when you get meningitis you get brain swelling 1491 01:27:56.880 --> 01:28:00.400 So I couldn't remember things. I couldn't remember my passwords to 1492 01:28:01.120 --> 01:28:05.280 To the bank account. I didn't know the passwords to my phone number to my phone 1493 01:28:06.720 --> 01:28:08.880 One of the things I did when I came out of the hospital 1494 01:28:09.440 --> 01:28:12.640 Because I always manage the money as I said to my wife 1495 01:28:13.440 --> 01:28:15.440 We're gonna hire a financial advisor 1496 01:28:16.080 --> 01:28:18.080 And you have to be involved. What's going on? 1497 01:28:18.800 --> 01:28:21.440 We actually had yesterday our annual account review 1498 01:28:22.080 --> 01:28:24.960 Because I tell couples you got to have any annual account review either together 1499 01:28:25.440 --> 01:28:28.320 And if you have a financial advisor at a minimum with your financial advisor 1500 01:28:28.960 --> 01:28:30.160 and 1501 01:28:30.160 --> 01:28:33.600 I didn't want to cancel the appointment because I was either you guys inviting me to come here 1502 01:28:33.600 --> 01:28:37.040 I'm like I'm keeping the appointment. We'll fly you to fluid this morning 1503 01:28:38.080 --> 01:28:39.600 and so 1504 01:28:39.600 --> 01:28:44.480 Again having worked you know Morgan selling for nine years and been a financial advisor. I've seen too many couples 1505 01:28:45.280 --> 01:28:47.040 not do this 1506 01:28:47.120 --> 01:28:48.480 including 1507 01:28:48.480 --> 01:28:54.640 Sadly, Steven my dad just recently passed away and my dad was in the money management businesses whole life 1508 01:28:55.360 --> 01:28:58.000 So he managed the money and my mom 1509 01:28:58.720 --> 01:29:02.240 Was not involved and when my dad passed away we had a 1510 01:29:02.960 --> 01:29:09.840 Just like my book step in and help my mom with everything now. She's lucky. She's got two kids in the business 1511 01:29:10.480 --> 01:29:12.800 But as she did my mom was just a ripe 1512 01:29:13.520 --> 01:29:14.720 waiting 1513 01:29:14.720 --> 01:29:20.000 Example of somebody who could be taken advantage of so the time to learn about money is before there's a problem 1514 01:29:20.640 --> 01:29:23.120 If you took smart couples finish rush honestly Steven 1515 01:29:23.760 --> 01:29:26.160 That you it's designed to be a 1516 01:29:26.800 --> 01:29:32.400 He wrote map for two people together where you can sit down and go through this book chapter by chapter together 1517 01:29:32.800 --> 01:29:34.320 starting with 1518 01:29:34.320 --> 01:29:38.960 Just organizing your financial information putting everything into file folders it starts the conversation 1519 01:29:39.680 --> 01:29:43.280 And then talking about your values then talking about your dreams 1520 01:29:44.000 --> 01:29:48.720 Then going into well, what what do you want to share? You know, you have a very 1521 01:29:48.960 --> 01:29:54.000 I don't know all your stuff. I followed you for years as I told you. I'm a fan of yours 1522 01:29:54.000 --> 01:29:57.520 I've got your book. I've watched your podcast. I've listened to you now for years 1523 01:29:58.400 --> 01:30:01.360 As your business is expanding your life has gained more complicated 1524 01:30:03.120 --> 01:30:08.560 God forbid something happens to you tomorrow. Yeah, it'd be a fucking nightmare. And she's your fiance 1525 01:30:09.040 --> 01:30:11.040 Yeah, she wouldn't even know where to start 1526 01:30:12.000 --> 01:30:14.720 And I don't know if she would know who to call 1527 01:30:15.840 --> 01:30:17.360 so 1528 01:30:17.360 --> 01:30:21.680 It's a worthwhile conversation like I just had this guy in the show. I don't know maybe we really need like 1529 01:30:22.560 --> 01:30:25.360 You know involve you, but I was just looking at some of the data here 1530 01:30:25.440 --> 01:30:32.800 And it says that in terms of income ignorance according to a 2021 study by fidelity investments nearly 40% of couples 1531 01:30:33.280 --> 01:30:36.320 Could not even identify how much their partner earned 1532 01:30:36.960 --> 01:30:45.280 It says in terms of financial infidelity surveys from bank rate and credit cards.com consistently find that up to 40% of adults share 1533 01:30:45.840 --> 01:30:53.440 That they have kept financial secrets which is hiding cash hiding bank statements and hiding debts that they have from their romantic partner 1534 01:30:53.440 --> 01:30:59.440 So that's almost half and you pointed at this earlier on which is the CFO dynamic in many households 1535 01:30:59.440 --> 01:31:04.320 One spouse acts as the chief financial officer and research indicates that roughly 50% of couples 1536 01:31:05.120 --> 01:31:13.520 Have a non-managing spouse who has little to no idea how much money the family have total they don't know where it is and they don't know the passwords 1537 01:31:14.960 --> 01:31:16.000 It can sound scary 1538 01:31:16.160 --> 01:31:22.160 It can sound intimidating and yet I can tell you every day people who actually kind of do this basic stuff that we've talked about 1539 01:31:22.720 --> 01:31:24.480 Once you start to do it, you feel a lot better 1540 01:31:25.200 --> 01:31:30.880 You feel better instantly you don't you don't have to go from having no savings to having a million dollars to feel better 1541 01:31:31.440 --> 01:31:35.440 If you just start automatically saving some money paying yourself first 1542 01:31:36.480 --> 01:31:38.400 The moment you make that decision you'll feel better 1543 01:31:39.520 --> 01:31:44.400 You go and you turn off some subscription fees like you just looked at the moment you do that you'll feel better 1544 01:31:45.200 --> 01:31:51.680 It's literally like a financial muscle you start to build this financial muscle when you start to take action 1545 01:31:52.160 --> 01:31:59.280 It is action that changes your life. I always could say I wrote all these books if a person buys a book reads it and doesn't do anything 1546 01:32:00.240 --> 01:32:02.240 Then I was a form of entertainment 1547 01:32:03.120 --> 01:32:08.960 If you listen to a podcast on money and you don't do something then we were again a form of entertainment 1548 01:32:09.920 --> 01:32:14.400 My purpose for doing this podcast today while I got on a plane and flew out here immediately to do this with you 1549 01:32:15.360 --> 01:32:17.840 Was I want to try to change somebody's life today 1550 01:32:18.560 --> 01:32:22.000 I've always taken the approach like I want to change your person's life one person at a time 1551 01:32:23.040 --> 01:32:24.240 and 1552 01:32:24.240 --> 01:32:27.760 Sometimes the things I share are hard to hear but I also know they wake people up 1553 01:32:28.240 --> 01:32:32.000 You had this great great quote to this book. I was showing this today to my son 1554 01:32:33.520 --> 01:32:38.080 I'm holding for those of you who can't see me. I'm holding Steven's book a diary the CEO 1555 01:32:38.080 --> 01:32:43.360 Which is also sold a million copies and this is your quote on page 233 1556 01:32:43.360 --> 01:32:45.840 I wonder if you remember your quotes because sometimes you forget him right 1557 01:32:47.120 --> 01:32:51.840 If you want long-term success in business relationships and life 1558 01:32:52.480 --> 01:32:58.720 You have to get better at accepting uncomfortable truths as fast as possible 1559 01:32:59.840 --> 01:33:07.200 When you refuse to accept an uncomfortable truth you are choosing to accept an uncomfortable future 1560 01:33:08.320 --> 01:33:10.560 The one thing that wasn't in this quote was money 1561 01:33:11.840 --> 01:33:15.600 And everything we're talking about is I'm like you're gonna work 90,000 hours over your lifetime 1562 01:33:16.080 --> 01:33:18.560 If you don't pay yourself first and you have nothing to show for it 1563 01:33:19.040 --> 01:33:25.440 The uncomfortable truth is you will be broke. We haven't talked about um global issues and covering issues and debt 1564 01:33:27.760 --> 01:33:31.680 Why do you have to take care of yourself financially right now more than ever before 1565 01:33:32.640 --> 01:33:36.480 Because the future is about to radically change 1566 01:33:37.120 --> 01:33:41.520 And I will talk out of both sides of my mouth for a second number one. I believe the next 10 years 1567 01:33:42.160 --> 01:33:45.680 Hands down will be the greatest opportunity to build wealth in our lifetime 1568 01:33:46.240 --> 01:33:49.440 AI is create going to create so much wealth 1569 01:33:50.400 --> 01:33:51.600 That 1570 01:33:51.600 --> 01:33:56.560 We've ever seen anything like it like when you look at the returns and stock market from last year their result of AI 1571 01:33:57.040 --> 01:34:02.800 What's happening is AI is making companies more profitable and more productive than they've ever been 1572 01:34:03.360 --> 01:34:06.000 The downside is people are losing their jobs 1573 01:34:06.560 --> 01:34:12.640 Right you've had people on the show including Tony Robbins talking about this and there are gonna be a lot more of those job losses 1574 01:34:13.120 --> 01:34:18.400 So some people are gonna get much wealthier and then a whole lot of other people are gonna have a challenge 1575 01:34:19.440 --> 01:34:27.520 But there's another problem we we're not talking enough about and that is the safety nets of governments 1576 01:34:28.640 --> 01:34:32.960 All these safety nets that were created in the US so security 1577 01:34:34.080 --> 01:34:35.600 Medicare 1578 01:34:35.600 --> 01:34:37.120 Medicaid 1579 01:34:37.120 --> 01:34:40.000 Unemployment you can go through every single country 1580 01:34:40.960 --> 01:34:43.840 All of these things are called entitlement programs 1581 01:34:44.640 --> 01:34:46.640 Which is a fancy word for saying 1582 01:34:47.520 --> 01:34:49.360 The government made a promise to you 1583 01:34:50.720 --> 01:34:54.640 And a whole lot of people are dependent on that promise 1584 01:34:55.440 --> 01:34:59.440 And there's not enough money to pay for those promises 1585 01:35:00.080 --> 01:35:02.080 So like in the US you take Social Security 1586 01:35:02.640 --> 01:35:05.440 The average Social Security check right now is $1900 1587 01:35:06.160 --> 01:35:10.000 Not a lot of money but about 60 million Americans 1588 01:35:10.880 --> 01:35:13.040 Depend on that amount of money 1589 01:35:14.560 --> 01:35:20.640 In the US Social Security this is government data not me you can do all this stuff online 1590 01:35:22.000 --> 01:35:26.400 The government is telling us that in 2033 that's around the corner 1591 01:35:27.440 --> 01:35:33.440 This Social Security is gonna be underfunded and they're gonna have to cut the benefits now what they're talking about is kind of benefits by 20% 1592 01:35:34.160 --> 01:35:36.640 You have a lot of Americans that that's gonna be a real problem for 1593 01:35:38.320 --> 01:35:41.440 Every country's got this issue because people are living longer 1594 01:35:42.320 --> 01:35:44.160 Governments have more debt than they've ever had 1595 01:35:44.880 --> 01:35:46.880 I am here to tell you 1596 01:35:47.760 --> 01:35:49.920 It's a cliche term but no one's coming to save you 1597 01:35:50.640 --> 01:35:52.880 It's you're gonna have to save yourself 1598 01:35:53.520 --> 01:35:57.200 And you're gonna have to take your personal financial well-being 1599 01:35:58.160 --> 01:35:59.920 More seriously now than ever before 1600 01:36:00.880 --> 01:36:03.040 And if you do you will be in great shape 1601 01:36:03.440 --> 01:36:08.480 If you don't you will be dependent on a system that is buckling 1602 01:36:10.160 --> 01:36:16.480 One of the things in your I think it's the sixth point of the six things that couples get wrong is waiting too long to pay off the mortgage 1603 01:36:17.600 --> 01:36:21.680 What do you mean by that? I actually had a friend contact me um and ask this they said Steven 1604 01:36:21.680 --> 01:36:25.680 I've got some cash that that's been given to me. I think through an inheritance 1605 01:36:26.240 --> 01:36:32.320 Should I pay off my mortgage or should I go invest in the stock market in the S&P 500 or something else? Yeah 1606 01:36:32.720 --> 01:36:34.320 I didn't know what to say because I'm not financially 1607 01:36:34.720 --> 01:36:39.520 So if you call me up and you said David what should I do? I go Steven. What's the rate on your mortgage 1608 01:36:40.320 --> 01:36:44.240 Then you'd say well, David. I got a mortgage five years ago and it's two and a half percent 1609 01:36:44.480 --> 01:36:47.040 I'd say okay. Well, that's a really low rate Steven. You know what 1610 01:36:47.760 --> 01:36:50.640 You can put the money in a money market get account right now and make more than that 1611 01:36:50.720 --> 01:36:54.080 So maybe you don't need rush to pay it off as fast as possible 1612 01:36:54.880 --> 01:36:57.600 But if you've got a mortgage that's six or seven or eight percent 1613 01:36:58.160 --> 01:36:59.600 It's a no-brainer 1614 01:36:59.600 --> 01:37:04.000 The biggest thing I can tell you about paying down your mortgage early is actually really simple 1615 01:37:04.560 --> 01:37:06.160 Here's ways to do it 1616 01:37:07.040 --> 01:37:09.280 If you make one extra payment a year on a mortgage 1617 01:37:09.920 --> 01:37:13.440 You'll take a 30-year mortgage and you'll pay it off depends on the rate 1618 01:37:14.080 --> 01:37:16.080 five six seven-year center 1619 01:37:17.040 --> 01:37:20.000 So you can go online you can run a calculator. Today you don't even need calculus 1620 01:37:20.000 --> 01:37:23.200 Just run the question you put in your mortgage. You tell Gemini 1621 01:37:23.600 --> 01:37:26.240 Here's the size of my mortgage. Here's my mortgage payment 1622 01:37:26.960 --> 01:37:32.560 If I make an extra payment a year how many how many years faster will I pay it off and how much will I save 1623 01:37:33.280 --> 01:37:35.280 And you'll see the number 1624 01:37:35.280 --> 01:37:40.480 When people see the number in black and white. I've got to do that. Now here's the key 1625 01:37:41.440 --> 01:37:43.440 make that payment automatic 1626 01:37:44.640 --> 01:37:49.600 Easiest way you make your payment automatic is either make one extra payment at the end of the year or 1627 01:37:50.400 --> 01:37:53.360 Take your mortgage payment and increase it by 10 percent 1628 01:37:54.000 --> 01:37:55.760 So if your mortgage payment is a thousand dollars 1629 01:37:56.400 --> 01:38:01.040 Make an $1,100 a month mortgage payment and tell the bank you want to add that to the principal 1630 01:38:02.080 --> 01:38:06.320 When people do that they need to make sure though that money is actually paying down the principal 1631 01:38:07.120 --> 01:38:09.520 Another way to do that is to buy a weekly mortgage payment plan 1632 01:38:10.080 --> 01:38:12.880 Where you take your mortgage you split in half you pay half every two weeks 1633 01:38:13.360 --> 01:38:15.360 That'll also pay your mortgage off early 1634 01:38:15.600 --> 01:38:17.600 Pre-nuptial agreements. I'm engaged. Yep 1635 01:38:18.400 --> 01:38:20.400 Should I be getting a prenup 1636 01:38:21.200 --> 01:38:24.960 So I would tell anyone who's getting married 1637 01:38:27.040 --> 01:38:29.280 Number one if your incomes are not the same you should have pre-nupt 1638 01:38:30.240 --> 01:38:32.480 Number two if you both have good incomes you should get a prenup 1639 01:38:32.960 --> 01:38:35.920 Number three if you're in your 30s you should get a prenup 1640 01:38:36.720 --> 01:38:39.600 You would never go into a business without a contract 1641 01:38:40.800 --> 01:38:47.280 Marriage is the ultimate contract. It's just is now. Is it romantic to do a pre-nuptial agreement? No 1642 01:38:48.560 --> 01:38:52.480 Does one person in the relationship typically not like that doing a prenup? 1643 01:38:53.280 --> 01:38:57.200 Yes, I know a lot of women today who want pre-nups and the husbands don't want them 1644 01:38:57.840 --> 01:38:59.840 It's whoever's making the money 1645 01:38:59.840 --> 01:39:02.000 But I will say this about pre-nups 1646 01:39:02.000 --> 01:39:04.000 You need a lawyer she needs a lawyer 1647 01:39:04.480 --> 01:39:10.560 You cannot go and do a prenup right before you get married when people do that those pre-nups get thrown out the window 1648 01:39:11.200 --> 01:39:16.480 Because they will claim and say and have an argument for I was under 1649 01:39:18.320 --> 01:39:19.760 Extremely 1650 01:39:19.760 --> 01:39:23.040 undue influence to sign this agreement before 1651 01:39:23.920 --> 01:39:31.200 The wedding and those agreements get thrown out even if there's disclaimer language and both of you need attorneys 1652 01:39:32.720 --> 01:39:35.360 And pre-nuptial agreements can often be like a negotiation 1653 01:39:36.240 --> 01:39:40.080 And you can learn a lot about your partner that you just not always pretty and I'm not saying you 1654 01:39:40.080 --> 01:39:43.680 But one can learn a lot about their partner that's not always pretty when you do a pre-nuptial agreement 1655 01:39:44.400 --> 01:39:48.320 And once the pre-nuptial agreement is done if it's a reasonable pre-nuptial agreement 1656 01:39:48.320 --> 01:39:51.280 It goes in a file it doesn't get looked out again 1657 01:39:52.080 --> 01:39:55.120 And it won't matter unless today comes that you need to pull it out 1658 01:39:56.080 --> 01:39:57.680 And that's for our first time marriage 1659 01:39:58.560 --> 01:40:03.680 Okay, you're a second time marriage or a third time marriage and you've got kids 1660 01:40:04.240 --> 01:40:06.240 And custody issues and 1661 01:40:07.120 --> 01:40:11.040 Support for your first wife. Yeah, definitely need a printout 1662 01:40:12.000 --> 01:40:14.240 What is the most important thing we should have talked about that we didn't talk about? 1663 01:40:14.640 --> 01:40:17.200 Hmm, Steven. We've talked a lot about money today 1664 01:40:18.400 --> 01:40:20.400 But money's just a tool 1665 01:40:20.400 --> 01:40:22.640 So we actually haven't got to talk a lot about is 1666 01:40:23.520 --> 01:40:26.400 Using money just to free yourself to live your best life 1667 01:40:26.960 --> 01:40:29.440 And you don't have to have money to live your best life 1668 01:40:30.240 --> 01:40:32.240 Again, money is just a tool 1669 01:40:32.480 --> 01:40:34.000 So what's most important life? 1670 01:40:34.720 --> 01:40:36.880 I'm gonna say things that people know health 1671 01:40:38.080 --> 01:40:40.560 Yeah, I started following you because of all the shows you didn't help 1672 01:40:41.920 --> 01:40:43.920 Love 1673 01:40:44.080 --> 01:40:46.080 People hold on to love way too much 1674 01:40:48.160 --> 01:40:49.920 gratitude 1675 01:40:50.000 --> 01:40:52.800 Being consistently grateful for the life you have 1676 01:40:54.000 --> 01:40:56.000 friendship 1677 01:40:56.480 --> 01:40:58.480 Loving your friends fully 1678 01:40:59.200 --> 01:41:01.200 And the last thing is fun 1679 01:41:01.600 --> 01:41:07.440 You know, I think people go through life on that some point they stop designing their life 1680 01:41:08.240 --> 01:41:11.120 My grandmother used to say you got to dream it 1681 01:41:12.240 --> 01:41:14.720 design it and do it 1682 01:41:17.200 --> 01:41:19.040 And she's like and you kind of run out of time 1683 01:41:19.680 --> 01:41:21.440 So what I would say to anybody is like 1684 01:41:22.320 --> 01:41:27.760 This is you've got this one beautiful moment in time where you're here 1685 01:41:29.840 --> 01:41:31.840 What do you want 1686 01:41:32.960 --> 01:41:34.960 And start working on that today 1687 01:41:35.840 --> 01:41:37.840 You listen to the episode with Tony Robbins 1688 01:41:40.160 --> 01:41:42.320 You've referenced him several times in this conversation 1689 01:41:43.040 --> 01:41:48.640 You're somewhere to ask me who is the greatest mentor and greatest influence in my life besides my grandmother and my father 1690 01:41:49.040 --> 01:41:50.640 It's Tony Robbins 1691 01:41:50.640 --> 01:41:55.680 So I went to Tony Robbins some years in the early 90s back in the day when he had an infomercial without yoga sets 1692 01:41:57.280 --> 01:41:59.760 And I went to a program that he taught in Hawaii 1693 01:42:00.400 --> 01:42:02.240 He had this big hotel called the white Kaloah 1694 01:42:03.040 --> 01:42:05.280 And he did it he did an exercise 1695 01:42:05.920 --> 01:42:08.720 So it's like I remember like this is yesterday 1696 01:42:09.200 --> 01:42:13.680 He said to this room we were in there were I don't know a thousand of us in this room 1697 01:42:14.640 --> 01:42:18.080 He said how many of you have a dream that you're not working on 1698 01:42:19.120 --> 01:42:24.800 And we all we all had dreams so he got us into a peak state and he had his work on our dreams 1699 01:42:26.000 --> 01:42:28.000 And then he asked the question 1700 01:42:28.400 --> 01:42:30.400 How many of you think you're going to be alive in 10 years 1701 01:42:32.320 --> 01:42:35.680 Everyone's like yeah, we were live in 10 years. He's like great. So I got a question for you 1702 01:42:36.800 --> 01:42:39.200 Are you going to be alive in 10 years 1703 01:42:39.920 --> 01:42:41.920 Having worked on your dream 1704 01:42:43.040 --> 01:42:46.320 Hopefully gotten it right done all the things I've taught you to do 1705 01:42:47.280 --> 01:42:51.920 You know model the masters got yourself in peak state learned the pattern recognition 1706 01:42:53.760 --> 01:42:58.240 Have you gotten 10 years older having gone through dreams and maybe got it 1707 01:42:58.800 --> 01:43:03.600 Or did you just get 10 years over 10 years older and you let your dream die 1708 01:43:06.480 --> 01:43:10.080 You let your dream die and the roots just let that sit 1709 01:43:11.360 --> 01:43:14.240 And then he had his go-off in groups of 10 1710 01:43:15.200 --> 01:43:18.320 And share our individual dream so we'd all written it down on paper 1711 01:43:18.800 --> 01:43:22.720 So I shared that my dream and this young kid 1712 01:43:23.680 --> 01:43:25.200 Financial advisor I'm a guy 1713 01:43:26.000 --> 01:43:32.000 I shared my dream was to write a book called smart women finish rich and teach a million women to be smart with money 1714 01:43:32.400 --> 01:43:36.800 So they could protect themselves teach their kids and help their family 1715 01:43:38.080 --> 01:43:42.640 My heart's pounding Steve and I'm sharing this idea with 10 strangers and then we go back in the room 1716 01:43:43.120 --> 01:43:46.080 And he's like how that go you guys all ready and gets us back in a peak state 1717 01:43:46.640 --> 01:43:49.360 10 minutes later woman comes taps me on the shoulder and she says 1718 01:43:50.000 --> 01:43:52.000 I just heard about your dream 1719 01:43:52.000 --> 01:43:55.040 My name's Vicki I've worked on Tony's last two books 1720 01:43:56.000 --> 01:43:58.560 If you want to do your book you're going to need a book proposal 1721 01:43:59.200 --> 01:44:01.920 You've done books you know this she's like I can help you write a book 1722 01:44:03.200 --> 01:44:06.480 I hired her I start working on that book proposal later 1723 01:44:06.480 --> 01:44:12.400 I would go after the same age of the Tony as Jam Miller she become my agent he'd write a cover letter 1724 01:44:13.280 --> 01:44:15.920 I get a book deal and I start working to help millions of people 1725 01:44:16.640 --> 01:44:18.800 It's started at the Tony Robbins seminar 1726 01:44:19.520 --> 01:44:23.200 And I go back to my grandmother the right dream it design it and do it 1727 01:44:24.720 --> 01:44:29.600 He gave me the life skills to do that and I will tell you something about Tony because you know 1728 01:44:29.680 --> 01:44:33.680 You see Tony on all these shows and people go it's Tony the real deal 1729 01:44:34.400 --> 01:44:37.280 I see even if I was with you and I sent Tony a text 1730 01:44:38.000 --> 01:44:41.040 And Tony has a lot of friends like this Tony gets right back to me 1731 01:44:41.520 --> 01:44:43.120 Tony's the real deal 1732 01:44:43.120 --> 01:44:46.880 I just went to Germany and took my older son Jaku's 22 1733 01:44:47.440 --> 01:44:49.120 To see him do 1734 01:44:49.120 --> 01:44:50.960 UPW in September 1735 01:44:50.960 --> 01:44:52.480 Could bring tears my 1736 01:44:52.480 --> 01:44:55.600 Because I wanted Jack to have the experience without me there so he was 1737 01:44:56.320 --> 01:44:58.240 You know blessed Tony sitting in the front row 1738 01:44:59.040 --> 01:45:02.000 I came in on day three when he was in the peak state 1739 01:45:02.800 --> 01:45:04.720 And I came in and I watched him 1740 01:45:05.600 --> 01:45:11.360 You know, I was basically his age and I thought you know, you know, I went in and I gave him a hug 1741 01:45:12.240 --> 01:45:14.320 And I'm like you just don't even know this is just 1742 01:45:15.040 --> 01:45:19.520 This experience that you're saying what you're learning today if you use this stuff 1743 01:45:20.480 --> 01:45:22.480 It will change your life 1744 01:45:24.640 --> 01:45:26.880 That's the power of Tony and people go you know 1745 01:45:27.600 --> 01:45:31.840 Whatever it is your podcast your events Tony's events 1746 01:45:32.960 --> 01:45:34.720 My books 1747 01:45:34.720 --> 01:45:36.720 We're just catalyst 1748 01:45:38.160 --> 01:45:40.160 God 1749 01:45:40.160 --> 01:45:42.880 God gave you a seed and a dream 1750 01:45:43.840 --> 01:45:47.280 And when we're the catalyst for like look cook do this 1751 01:45:48.240 --> 01:45:50.240 Listen to that voice 1752 01:45:50.320 --> 01:45:55.440 Whoever your God is that soul that you hear yourself saying I have a dream if I only had 10 years left to live 1753 01:45:56.000 --> 01:45:58.000 I would really 1754 01:45:58.000 --> 01:46:00.000 Hate to die with that dream inside me 1755 01:46:00.880 --> 01:46:02.880 That's the dream you go work on 1756 01:46:03.520 --> 01:46:05.520 And since then you've 1757 01:46:05.760 --> 01:46:11.520 Done exactly that you've educated hundreds of millions of people through your books through podcast seminars newsletters 1758 01:46:12.000 --> 01:46:18.480 And thousands of media appearances on how to do exactly that how to get financially free pursue their dreams get hold of their money 1759 01:46:19.040 --> 01:46:21.200 So that they can live the life that is um 1760 01:46:21.200 --> 01:46:23.520 Destined for them and that is an incredible thing 1761 01:46:24.000 --> 01:46:29.200 And you've sold almost 10 million copies of your books worldwide. I'm sure you're gonna hit that number at some point soon 1762 01:46:30.000 --> 01:46:33.760 And uh, I guess you'll never get to see the impact that that's had on so many people's lives 1763 01:46:33.760 --> 01:46:40.720 And how you've therefore changed the trajectory of their financial future in their kids and their kids and their kids like your grandmother did for you and your family 1764 01:46:41.680 --> 01:46:44.560 I highly recommend everybody go and listen to that episode. I'm actually gonna link it below 1765 01:46:44.640 --> 01:46:46.640 So if you haven't listened to the episode with Tony Robbins 1766 01:46:46.640 --> 01:46:49.040 That's a great next thing to do if you're still listening now 1767 01:46:49.600 --> 01:46:55.280 But David, I wanted to thank you so much for coming and uh you present a really interesting different perspective on the subject of money 1768 01:46:55.280 --> 01:47:01.600 Which is is hard to find its rare um, but it's very very very important and hopeful it'll be consequential for many 1769 01:47:02.080 --> 01:47:09.680 We have a closing tradition as you know um where we ask the next guest the question left by the last and the question left for you is 1770 01:47:10.080 --> 01:47:16.160 Interesting if you had all the money you needed to have to support yourself and your family 1771 01:47:16.720 --> 01:47:18.880 zero financial 1772 01:47:18.880 --> 01:47:19.920 worries 1773 01:47:19.920 --> 01:47:23.120 What job profession would you be doing or rather 1774 01:47:23.760 --> 01:47:26.720 What would you spend your time on? 1775 01:47:28.720 --> 01:47:31.760 That's so real that this is the question you're giving me 1776 01:47:32.720 --> 01:47:36.800 That that was asked before I got here like that's like that's a god moment too like that's meant to be 1777 01:47:36.800 --> 01:47:38.960 This is by the way, I'm not making this up so so 1778 01:47:40.560 --> 01:47:42.080 Because that's me 1779 01:47:42.080 --> 01:47:44.640 I have enough I have all the money that I need 1780 01:47:45.360 --> 01:47:51.200 I have my health right now. I have my time and this year what I'm going to what I want to go do my dream for the year 1781 01:47:51.680 --> 01:47:54.000 I want to have an endless ski season 1782 01:47:54.640 --> 01:47:58.400 So at the end of the year ask me did I ski somewhere every month this year? 1783 01:47:59.040 --> 01:48:03.040 I leave you today. I go back to Florence for 24 hours in a turn and I'm gonna 1784 01:48:03.040 --> 01:48:08.240 Reverbie Switzerland with friends. I'm gonna try to ski somewhere every day every month this year 1785 01:48:08.880 --> 01:48:12.240 With friends and with family all around the world for fun 1786 01:48:12.720 --> 01:48:15.680 I did this as my last dream to help one 1787 01:48:16.320 --> 01:48:21.040 More generation be smarter money. This is my final book these may be my final podcast 1788 01:48:21.680 --> 01:48:23.680 And what you've done is you've updated 1789 01:48:24.480 --> 01:48:31.760 Your smash hit best selling book that's this sold millions and millions and millions of copies that you wrote 20 years ago to make it relevant to the 1790 01:48:32.320 --> 01:48:38.240 Current financial situation in world that we live in and my goal with this was a lot of my readers now in their 50s and the 60s 1791 01:48:38.240 --> 01:48:42.240 But they've got young kids like I do and I wanted this to be a book they can put in their hands 1792 01:48:43.120 --> 01:48:46.480 I'm gonna link the book below fantastic reader you've written several incredible books 1793 01:48:46.560 --> 01:48:51.040 So it's I'm gonna link all of them below in the description for anyone that wants to grab a copy of them 1794 01:48:51.840 --> 01:48:56.640 The automatic millionaire a powerful one step plan to live and finish rich 1795 01:48:57.600 --> 01:49:00.400 Baby, thank you, Stephen. Thank you. It's been great 1796 01:49:01.120 --> 01:49:05.920 I'm gonna show you how to get clear what you really want figure out what's been stopping you put the plan in place and 1797 01:49:05.920 --> 01:49:08.560 He chew the most important thing that's made me successful 1798 01:49:08.560 --> 01:49:12.960 And I think people fully realize the significance of how many of the most influential people on planet earth 1799 01:49:13.040 --> 01:49:18.240 You have worked with and continue to work with what is the pattern that you noticed in those people? 1800 01:49:18.400 --> 01:49:20.720 So I found four things with them and the first thing is