The Finance Expert: 6 Keys to WEALTH Formula (ANYONE Can Become A MILLIONAIRE!) Jaspreet Singh
Summary
TLDRこのスクリプトは、財産を築くためのシンプルな6ステップの公式を紹介しています。話者は、お金に関する誤った考え方と向き合うことで、自己教育と投資の重要性を強調しています。彼は、学校教育では教えられないお金と投資に関する知識を自ら学び、実践することで、財産を築くことができた経験を共有します。また、借金を減らし、節約と投資のバランスを保ちながら、お金の流れをコントロールする方法についても説明しています。
Takeaways
- 💡 成功と豊かな生活を築くには、まず豊かな心構想を持つことが重要です。
- 📈 財産を築くには、収入から支出を引いた残りのお金を投資することが求められます。
- 🏦 銀行は、人々が金融的に無知識であることで利益を得ることができます。
- 🏠 リアルエステートは、キャッシュフローと税制上の利点から、富裕層の人々が愛する投資の一つです。
- 📚 教育は、人々を豊かにするための鍵であり、しかし学校では財産に関する教育が提供されません。
- 🚫 クレジットカードの利用は、無知識であれば借金を増やす原因となりますが、適切に管理すれば便利なツールです。
- 🔄 インフレが高くなると、銀行に預けられた現金は価値を失ぎます。
- 💼 ビジネスや金融の本を読むことで、自己教育を行い、成功への道を模索することができます。
- 🎓 大学での成績や学位は、収入と直接的な関係があると思っていたが、実際にはそうではないことが明らかになりました。
- 🤔 富裕を築くには、自分の価値観や人生の目的を再確認し、それに向かって行動することが重要です。
- 🔄 資産形成には、毎月の収入に基づいて一定の割合を投資し、節約することが重要です。
Q & A
What is the main message the speaker is trying to convey about wealth and mindset?
-The speaker emphasizes that to become wealthy, one must adopt a different mindset than the majority, focusing on building wealth through investments rather than just saving money. They stress the importance of financial education and understanding how to use financial tools effectively.
How does the speaker describe their initial experience with real estate investing?
-The speaker describes their initial experience as challenging and filled with mistakes. They bought a property at a young age without proper knowledge or guidance, leading to financial stress and learning through trial and error.
What is the speaker's strategy for managing credit card debt?
-The speaker advocates for paying off credit card debt as quickly as possible to stop the financial bleeding. They mention that credit cards can be a tool if used with financial education, but without it, they can lead to significant debt and financial strain.
What is the speaker's approach to saving money?
-The speaker suggests saving at least $2,000 for emergencies and then paying off high-interest debts. They also recommend creating a financial system where a portion of income is consistently invested and saved, regardless of the income level.
How does the speaker define a 'wealth formula'?
-The speaker's wealth formula is a simple mathematical concept: Income minus Expenses equals Investments plus Savings. They emphasize that savings are for protection against emergencies, while investments are what will lead to wealth.
What are the six steps the speaker mentions for building wealth?
-The speaker outlines six steps for building wealth: 1) Build the right mindset, 2) Create a financial base, 3) Lead your money by creating a financial system, 4) Invest your money for growth, 5) Increase your income, and 6) Minimize expenses. These steps are meant to be followed regardless of age.
How does the speaker view the role of education in achieving financial success?
-The speaker believes that education is crucial for financial success. They mention that without the right mindset, one will not seek opportunities, and without education, one cannot effectively use financial tools or understand investment strategies.
What is the speaker's opinion on the traditional path of education and career?
-The speaker questions the traditional path of getting a good degree and a job to make money. They argue that this path often leads to financial struggles and that true wealth comes from understanding investments and entrepreneurship.
How does the speaker describe the importance of passive income?
-The speaker highlights the importance of passive income as a way to generate wealth without actively working. They mention their own experience with real estate investments, which provided them with a steady cash flow without the need for constant active work.
What is the speaker's advice on managing and investing in real estate?
-The speaker advises on investing in growing areas with stable or rising populations and ensuring a 7% cash on cash return. They also stress the importance of having a system in place for property management to minimize time and effort.
Outlines
💡 财富公式的启示
演讲者分享了他如何从传统教育观念中觉醒,意识到财富与学历、工作努力程度并不直接相关。他通过创建一个简化的财富公式,开始质疑并深入探索财富的本质。他强调了心态的重要性,以及如何通过投资而非仅仅储蓄来实现财富增长。
🎓 教育与财富的误区
演讲者讲述了他如何从医学院的学习中意识到,即使成为医生也不一定能实现财务自由。他通过研究美国最富有的人,发现他们并非都遵循传统的教育和职业路径。这促使他开始探索房地产投资,并在19岁时成功购买了第一处房产。
🏦 银行与财务教育
演讲者探讨了银行如何通过鼓励储蓄和信用卡消费来获利,同时指出这些做法对个人财务的负面影响。他强调了财务教育的重要性,并揭示了为什么保持人们财务无知对某些系统是有利的。他还讨论了如何通过理解和利用税法来优化个人财务。
💼 创业与投资
演讲者分享了他的创业经历,包括在大学期间创办的派对策划公司,以及如何通过阅读商业书籍和实践来学习财务知识。他强调了创业精神和投资房地产的重要性,并分享了他如何在房地产投资中取得成功,尽管过程中遇到了挑战。
🏠 房地产投资的智慧
演讲者详细讲述了他如何通过房地产投资来建立被动收入。他分享了自己的投资策略,包括选择投资地点、确保至少7%的现金回报率,以及如何通过物业管理公司来实现投资的被动化。他还讨论了如何通过教育和实践来克服房地产投资中的困难。
🚀 财富增长的策略
演讲者提出了一个财富增长的六步公式,强调了建立正确心态的重要性。他讨论了如何通过增加收入、减少支出或两者兼而有之来增加投资。他还提到了如何通过教育和自我提升来实现财务目标,并分享了他个人的投资策略,包括在不同领域如股票、房地产和加密货币中的投资。
Mindmap
Keywords
💡財産形成
💡マインドセット
💡投資
💡節約
💡借金
💡不動産投資
💡税金
💡資産の多様化
💡経済的な教育
💡長期的な視点
Highlights
The speaker created a 'wealth formula' that simplifies wealth-building into a six-step process.
The speaker emphasizes the importance of having the right mindset for wealth accumulation, which involves thinking differently from the majority.
The speaker shares their personal journey of questioning traditional success paths, such as getting a degree and a job, and realizing that these do not necessarily lead to wealth.
The speaker highlights the misconception that grades and income are directly correlated, which they challenged by observing successful individuals like Steve Jobs and Warren Buffett.
The speaker's event planning business in college and their early real estate investment at 19 years old serve as examples of entrepreneurial ventures that led to wealth-building.
The speaker discusses the importance of investing in real estate, stocks, and businesses, rather than just saving money, to achieve wealth.
The speaker shares their experience of dealing with financial struggles and the emotional journey of learning about money and entrepreneurship.
The speaker emphasizes that wealthy people work to own the corporate ladder, not just climb it, which is a different mindset from the majority.
The speaker points out that financial education is often not taught in schools, which is profitable for banks and governments as it keeps people financially uneducated and poor.
The speaker discusses the benefits of investing in real estate, such as cash flow and tax benefits, and shares their personal strategy for investing in real estate.
The speaker talks about the importance of having a financial system in place, such as the 75/15/10 plan, to proportionately invest and save based on income.
The speaker explains the concept of passive investing, including index funds, ETFs, and mutual funds, as a way to invest in a diversified portfolio without active management.
The speaker shares their approach to active investing, which involves researching and investing in businesses, real estate, and stocks, and the importance of having a system to manage investments.
The speaker discusses the challenges and learning curve associated with real estate investing, including dealing with tenants, contractors, and property management.
The speaker emphasizes the importance of having a clear investment strategy, such as aiming for a 7% cash on cash return, and investing in growing areas with stable or rising populations.
The speaker talks about the impact of interest rates on property prices and the economy, and how the Federal Reserve's actions to fight inflation can influence these rates.
The speaker shares their personal experiences with real estate investing, including the mistakes made and the lessons learned, which led to a better understanding of the investment process.
The speaker discusses the importance of having a financial base, such as saving $2,000 for emergencies and paying off high-interest debts, as a foundation for wealth-building.
The speaker emphasizes the role of financial education in understanding how to use credit cards and other financial tools effectively, rather than viewing them as scams.
The speaker talks about the importance of being proactive in financial planning and not waiting until it's too late to address financial issues.
Transcripts
it's not very complex but I created this
wealth formula which breaks it down into
a very simple almost mathematical thing
where it's six steps I am sing from the
minority mind.com where money Minds we
think rich I realized that something's
wrong and I was like am I missing
something because I thought that if you
go to school get a good degree you can
make a lot of money and if you work
harder in school get better grades
you'll make even more money so I thought
it was just directly correlated your
grades your income and that's when I
started questioning things as you start
to go down deeper and deeper down the
rabbit hole you start to realize oh my
God everything that I've been told is a
lie I can't show off my stock portfolio
or my real estate portfolio the way that
I can my Gucci belt and most people
would rather have the show would rather
have the look than the actual thing that
will make you wealthy right and that
goes back to the mindset the thing you
talk so much about your mindset has to
be focused on saying you know what I
want to become wealthy how do you invest
where it doesn't become a Time suck and
an extra job well
see hey guys I want to quickly check in
with you before we continue on with this
episode and I know thinking through all
your personal finances on your own can
feel overwhelming but I'm also so glad
that you're here taking the first step
to building up your wealth by tuning
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facet.gov told go to school get a degree
get a job and all you figure it out
right and then what happens for the
majority of people is you end up broke
you end up struggling financially and
you you can never figure out why what is
it that you want to achieve in your life
financially and then you have to go out
and figure it out yourself because
unfortunately school will never teach
you this stuff I saw my parents work
their butt off every single day if my
dad got a Saturday and a Sunday off it
was considered a long week
and so I didn't get to spend a lot of
time with my parents growing up and they
would always tell me that you know you
have to go out and become successful and
I completely agreed because I wanted to
give back to my parents I wanted to help
support them and I figured okay if I
want to become successful I should
follow the steps that were told to
become successful what are those steps
go to school get a good degree get a
good job for me in my case it was become
a doctor and along that way it was in
college I realized that something's
wrong
something's not adding up and it
actually happened I was studying to get
into Medical School M and as I was
studying I I started reading other
business books and financial books and I
remember this I was in the library
studying and I went on to Google and I
searched the richest people in America
and know you see people like Steve Jobs
Warren Buffett Bill Gates Mark
Zuckerberg and I was like huh none of
these people are doctors MH none of
these people went down that traditional
route of of you know getting a degree
doing a good job am I missing something
because I thought that if you go to
school get a good degree you can make a
lot of money and if you work harder in
school get better grades you'll make
even more money so I thought it was just
directly correlated your grades your
income and that's when I started
questioning things and I realized oh
maybe this isn't right and as he start
to go down deeper and deeper down the
RAB hole you start to realize oh my God
everything that I've been told is a lie
and so that that kind of pushed me into
this whole painful emotional journey of
learning about money learning about
entrepreneurship learning about what
does it mean to become wealthy and how
do you actually do it right so that was
that was kind of the the initial phase
for me and then I had to go out and
actually start learning it yeah and the
first real experience of that for me was
I I had this event planning company that
I started in college and the reason why
I started it was because when I was in
high school I worked at Indian weddings
so I got to know a lot of the DJs right
and when I was in high school these DJs
were like hey man you know a lot of
people in high school how about we host
a teen party for your friends in high
school I was like all right that's fine
you know why not started this little
teen party party business in high school
and I go to college don't know what to
expect because my parents didn't go to
university here I think everybody goes
to college to study hard and and become
this big thing in college I get to
college and everybody is partying
they're blowing their money that they
don't have on alcohol they're drinking I
don't drink I don't smoke I'm not I'm
not into that party scene but I need
something to do on Friday nights so I
was like why don't I just take this teen
party business that I had in high school
bring it to college and that's what I
did my freshman year I was 17 years old
just had a knocking on the door of every
club venue bar restaurant asking if I
could host a party here some would say
yeah it's going to cost you $10,000 some
would say yeah it's going to cost you 20
grand I don't have that money right but
then one or two said you can do it here
we're not going to charge you a penny
just give us half of the cover charge
half of the money that you bring in I
said okay now I'm in business so I
started making a little bit of money
doing this and I had some cash saved up
and I'm starting to read these business
books and every Business book said
wealthy people invest in real estate I
don't know what that means I don't know
any Real Estate Investors my parents
aren't investors and so I was like okay
if wealthy people invest in real estate
maybe I should invest in real estate and
this was right after the 2008 crash in
I'm in Michigan where estate was hit
extremely hard so I was like all right
you know well I would like to invest in
real estate I'm studying for a medical
college ad Mission test I start going to
Google because I'm bored while I'm
studying for this exam I'm reading about
the the Forbes richest people none of
them are doctors none of them are people
that work the traditional path and you
know I have this idea to start investing
in real estate so I started looking at
real estate in between my study sessions
and on August 22nd I took the Medical
College admission test the MCAT August
23rd I closed on my closed on my first
real estate investment property wow how
old were you I was 19 holy cow it was
$88,000 for was the investment was the
price of the condo it was the condo was
8 Grand 8 Grand how' you get a condo
for8 Grand this is right after the 2008
crash wow you got out of forclosure or
what it was out of forclosure that same
condo was selling for about 150 Grand
just a few years prior come on yeah and
so I came in it was actually listed on
sale for $8,400 I made an offer for
$4,000 they came down to $7,000 and I
was still trying to push them lower but
then they said they had another offer on
the table I didn't want to lose it so I
said I'll give you eight grand right wow
so I bought it for eight grand put in a
few thousand worth of work and at leased
it for $600 a month and now all of a
sudden my mind was blown because I kind
of had this idea of what
entrepreneurship was I had never heard
that term until I came to college but I
was running this event pic company I'm
starting to learn about this thing
called entrepreneurship and now I have
this condo that's generating me this
like almost passive income I say almost
because I was making a lot of mistakes
in the beginning but now I'm like wow
this investing thing is very unique
because I never learned this in school
my teachers never taught me this but why
am I working so hard in school I mean I
want to become a doctor so I can
ultimately make money now I start having
this you know I talked about an
emotional dilemma why am I becoming a
doctor okay I want to make my parents
happy check I want to be successful
check do I really want to be a
doctor maybe and and now I'm starting to
question my like my actual beliefs
because if I become a doctor how do you
make money you treat people I kind of
have this entrepreneurial mind I want to
become successful how do you make more
money you treat more people so it's like
this kind of runs into a dilemma because
if I'm trying to maximize my income as a
doctor I got to maximize how many
patients I see maybe that means I don't
get to give the best value to each
individual patient but as a human I want
to provide the most value possible so I
start to kind of face this dilemma where
maybe I'm becoming a doctor for the
wrong reasons interesting and then I run
this idea by my parents I don't want to
be a doctor and they're like absolutely
not my my my my dad was angry my mom was
Furious it took my mom about a year and
a half to believe that her son was not
going to be a doctored oh man and I had
I mean when I say it was it was it was
tough like my parents would tell all
their friends just not going to become a
doctor oh wow you're not becoming one
I'm not going to become one now I'm
getting calls from my family in IND
calls from my family across what are you
doing you're disgrace to your family
exactly exactly I hear that again and
again and again but I was like this is
not for me and I started to realize that
there's more to this thing so now I
started to go down this financial
education journey and the more I I
learned the more I realized I was lied
to like we're taught to go to school to
get a degree to get a job so we can then
get a job and climb the corporate ladder
well wealthy people don't do that
wealthy people are not working to climb
the corporate ladder they're working to
own the corporate ladder I didn't even
realize that you could do that now you
can climb the corporate letter and work
to own the corporate letter at the same
time but it's a different mindset right
most of us are taught to get that degree
so we can do one thing climb the corpor
letter get earn a bigger salary but if
you only rely on your salary you're just
one step away from being broke because
if you lose your job something happens
to you you can't work or your company
goes down you lost your salary and now
you have no coming in and now what
you're scrambling for a job maybe you
have some savings to help take care of
you right or if you haven't been saving
and you just spend on on on things all
the time and you have no savings then
you're really screwed yeah you're going
into credit card debt right and now
you're trying to figure out how do you
make things work and by then it's too
late this is where you got to be
proactive and now I'm just like this is
crazy why was I never taught this I was
never taught about wealth I was never
taught about investing I was never
taught about this sort of financial
education but why aren't we taught this
and that's when I realized it's very
profit to keep people financially
uneducated it's profit to keep people
poor interesting what is the what would
you say is the main system that keeps
people poor
then it goes down to so many different
things the banks profit when you're
financially uneducated because they will
keep you saving money in the bank
they'll keep you in Consumer Debt if the
banks lived by their own advice which is
save money the Banks would be losing
money when you go and deposit $1,000 in
the bank that cash that you deposited is
a liability for the bank an asset is
something that puts money in your pocket
a liability is something that takes
money away from your pocket so when the
bank has your cash it's a liability for
them they want to get rid of it as fast
as possible and the way they do that is
by lending it out because it's an
investment for the bank they don't want
to hold on to cash but they want you to
save your money you want you to give
them cash right and just leave it there
leave it there and what's happening to
your cash while it's there it's losing
value to inflation each and every day
every day that you keep your cash in the
bank you're becoming poorer each and
every day now it's funny I made a video
on this in 2016 it was my first video to
go viral it was called you're guaranteed
to go broke if you do this and I was
talking about inflation at 2 to 3% if
you keep your cash in the bank you're
going broke every single day now here we
are 8 and a half% 8 and a half% and now
people are starting to realize wow this
inflation is a real problem
and so now when you keep your cash in
the bank the bank is paying you 0 one%
maybe .5% if you're lucky and they're
turning around lending it for 5% 6% and
so the bank does not want to keep the
cash and savings because it's a
liability for them they want to keep you
spending money on their credit card
because now they'll get to earn 18 to
25% in interest every time you spend a
dollar wow governments want you to be
financially uneducated because when
you're financially uneducated guess what
you are an employee and you're a
consumer who pays the highest taxes
employees and consumers everybody knows
that rich people don't pay taxes it
makes people angry but a lot of times we
don't understand why right and we get
angry at the wrong things and the wrong
reasons yeah but the more you make as a
business owner until you're like uber
rich I feel like you're spending a lot
of taxes you are man and and you know
what and there's a lot of things that
you can do right legally to pay less
money in taxes and there's different
ways that you can invest your money to
pay less money in taxes so I'll give you
a couple examples let me start with this
tax avoidance and tax evading are two
similar words with two very different
outcomes this is one of the first things
that you learn in law school tax evading
is illegal yes you go to jail yes tax
avoiding is legal and then you get hated
for doing that but but this is the way
it works but you're playing within a the
rules of the system and if you learn the
IRS code it's a rulebook M and the
people who understand the rule book are
the people who have the money to hire
the good accountants and the Good
attorneys but you're not an accountant
but have you studied the I have studied
a lot of laot tax law really yeah and so
what happens is wealthy people will
understand how this works play Within
that system and pay little to no money
in taxes what are three things that
people who are making half a million and
above should be doing to avoid
taxes better so let's start with let I'm
going to assume that you have either
some sort of your own income you're a
side Hustler or you are a business owner
yes so if you make half a million
dollars let's assume that's profit you
are taxed on income so if you take out a
salary that's going to be taxed now the
question is what is a tax deduction or
the better question is how can you make
something a tax deduction because
anything can be a tax deduction if you
know how to make it a deduction M so
that's the question that you have to ask
yourself because if you don't have an
income you don't have any tax so this is
what wealthy people are doing so I'll
give you an example of it being done
then I'll show you how people can do it
on a potentially smaller scale Elon Musk
he is probably the biggest example of
this he never got paid a salary running
and owning Tesla he got paid in stock
options so these stock options even
before it was public this is uh I think
it was around the time that it was
public or maybe a little bit before okay
but
he's been getting stock options for a
long time sure but the stock options
that he gets or originally got were at
$6 a share so when the stock went up to
$1,000 a share and he was given millions
of these stock options now he has on
paper a lot of money but that money
isn't in his bank account so what he
does is instead of selling it and having
an income he goes to the bank and says
hey I have these stock options which are
worth billions of dollars how about you
give me a loan loan at 3 4 5% interest
no bank is going to say no to that
because the value of this is so much
there billions of dollars I me you can
make the number smaller but no bank is
going to say no he takes that loan pays
three to four to 5% interest on it and
if his company grows his stock value
Grows by
6% he just made a profit on that he does
have to take any money out never took an
income doesn't pay any taxes and is able
to now spend his money Live Free by buy
whatever he wants live rich and not pay
a penny and tax so he didn't have to
sell any of the stock because if you
sold it he'd pay an income tax right
when you sell it instead you get a loan
out from the bank MH and you don't have
to pay tax on that loan when you go and
get a mortgage you're debt it's debt
it's not taxable it's not income if you
go and refinance your home it's not
income it's cash that you have in your
pocket but it's not income you're tax on
income so now your job now as a as a
business owner is strategically how do
you not have an income now you might say
well I need money to spend sure of
course you do but how can you now
strategically use your income to pay for
your lifestyle now again it's got to be
within the rules so talk to a tax
adviser but right now after the pandemic
one of the things that the presidential
Administration wants to do is encourage
people to eat out eat at restaurants
because restaurants were hit so hard by
the pandemic right so what did they do
they created a 100% deduction on food
through 2022 so if you go out to eat
with your team it's a 100% Adu right so
right off I'm here in San Diego well
we're in LA right now but I'm here on a
two-month business trip to San Diego
with my business partner uh I have to
rent a a car actually got a Ford Mustang
cuz I always wanted to for Mustang when
I was a kid that was like my dream car
so I got one here with a convertible
nice uh and you know we have to go to
business meetings we have to go out and
explore San Diego do these things my
business partner is my wife we're
staying in air BNB in beautiful San
Diego guess what these things are tax
deductions against my business I'm here
working when you're an entrepreneur
everything is work yeah now the question
is how do you spend your money in a way
that's going to give you a tax write off
but you have to be smart here because
you don't want to just blow
$500,000 so you don't have to pay 150
Grand in taxes right like my accountant
uh called me up last year and said just
bre you need to go out and buy a G wagon
I said what I don't want to buy a G
wagon why he said you know there's this
tax reduction going on saying if you go
out and buy a heavy car it's still going
on right now if you go out and buy a
heavy car you can deduct up to 100% of
that value of that vehicle right now
really and because you're an influencer
you can potentially claim that as an
influencer you need a G wagon to help
you support your lifestyle the tax code
allows this and I was like well I don't
want to go out and spend 150 grand for a
car that I don't necessarily need just
so I can save let's just say 50 Grand on
those taxes so you have to be smart here
and know what's right for you and not
just spend your money uh to you know
spend a dollar to save 2 right so you
know you just need to know the right
strategies that can work for you and
these things change over time which is
why the best thing that you can do is go
ahead and hire a tax accountant a Tax
Advisor somebody that isn't just going
to file your taxes but someone that's
going to help guide you and say all
right you know here are some things that
you could potentially spend your money
on here are where there are more
benefits coming this year next year
things that you want to do and there's
going to be times where it's going to be
more beneficial for you to spend money
there's going to be times where it's
going to be more beneficial for you to
take in money and you know it's all a
game yeah and this is what wealthy
people understand it's all a game and a
lot of people
hate that oh this person's not paying
taxes that person's not paying taxes but
at the end of the day what you have to
remember is somebody else wrote the tax
code yeah all the people are doing is
they're trying to learn okay this is
what the tax code is what do I do and
and you know and then you kind of get
into the other philosophical questions
who's going to do better with 100 Grand
the government or me if I have 100 Grand
in my pocket I can go hire an employee
or two the government's going to you
know spend that money wherever they
spend it and pennies will end up
actually go to help people I'm all for
helping people I think that's very
important as soon as we hit a million
subscribers on YouTube what we did was I
took my team we went out to a teacher
store and essentially I asked them hey
can we buy everything in your store wow
because you know the the whole during
the pandemic people weren't going to
class uh in person and so a lot of these
businesses were hurt I said can I buy
everything and she said well we need
some of this stuff for our teachers I
said what can we buy so then we went out
and bought a big chunk of the
store Mr be style Mr beat style it was a
fun video uh took the team out kind of
as a celebration we we bought a big
chunk took it out to a school in Detroit
gave it to them for free and then I
asked the principal there's a friend of
mine I said how many teachers do you
have okay and I gave every one of his
teachers a $500 check to help them help
support their students giving is
important but you know it goes back to
that tax question of who does a better
job with their money right entrepreneurs
who are working to create more jobs for
working to produce more value or the
government which you know may not be so
good with their money absolutely yeah so
you started doing the real estate thing
early are you still a massive investor
in real estate what's your apprach on it
now yeah yeah so this this an
interesting question that you asked
especially right after the tax question
so real estate is one of the the best
tax games for investors that's one of
the reasons why wealthy people love
investing in real estate because not
only can you get cash flow but you also
get tax benefits I started investing in
real estate when I was 19 on accident I
went through a lot of pain I remember
when I told my dad first Hey Dad I want
to go invest in real estate he was like
you're stupid go study go become a
doctor so uh I started investing in real
estate then and and I contined to buy
homes and I remember CU remember this is
right after the 2008 crash I was buying
homes for like 30 Grand in good areas I
remember home prices went up to $50,000
and I was like that's a lot of money for
a home I didn't know anything else right
that's all I saw and so to me I was like
that's expensive but I continued buying
um and I I still am buying but not as
much as I was before because now I've
been working on a couple other
businesses and so what I'm realizing is
okay when I invest my money in real
estate my goal is to get a 7% cash on
cash return on my money meaning for
every dollar I invest I want to get
seven cents back in cash flow positive
cash flow every year if I invest 100
Grand I won $7,000 of profit every
single year Well I I'm an entrepreneur
right so I'm working on a couple
different companies one of which is
Market briefs and so now I'm in this
position where what do I do with this
cash I can take this money put it in
real estate get a 7 8% return on my
money or I can put it in Market briefs
which would be a a bigger tax deduction
because now you know if I spend money in
advertising I spend money on marketing I
hire more employees we have a smaller
profit but then I can grow the company
significantly faster than 7% a year so
what I've been doing now is investing
more of my money into Market briefs
because it's something that I'm super
passionate about like I love real estate
I love revitalizing homes and buildings
and really helping to build the
neighborhoods through that but Market
briefs had such a a different
value in the sense that we're making
financial news accessible because you I
didn't grow up learning about money
right and CNBC looked cool but I never
understood anything that was happening
there they have all these confusing
terms that are going on so it's a way to
make Financial education and what's
going on with money more accessible to
people because I'm realizing how
important that is to me because the more
and more I talk to people the more that
people listen to what I say the more I
hear oh my God I wish I would have
learned this when I was younger like
yeah I know me too and and so it's like
it's important for me to help get that
message out there because it it's so
needed it's not very complex but I
created this wealth formula which breaks
it down into a very simple almost
mathematical thing where it's you take
your income you subtract your expenses
and that equals your Investments plus
your savings income plus income minus
expenses equals your Investments plus
your savings so if you want to become
wealthy It ultimately comes down to
having more Investments your savings are
not there to make you wealthy they're
there to protect you against an
emergency your Investments are will make
you wealthy so if you want to become
wealthy sooner or if you want to become
a wealthy you need more Investments you
need more Investments how do you do that
well if it's your income minus your
expenses it's basic math either increase
your income decrease your expenses or do
both right so that's the ultimate
formula so now if we talk about let's
break it down step by step on how do you
actually do it
six steps and this is no matter what age
you are these are the six steps that you
want to follow before you get into the
six steps what is the mindset that
someone needs to think about step number
one is build the
mindset so step number one is you need
to have the right mindset and so this is
why I call myself the minority mindset
and you know the brand minority mindset
because it's all about thinking
differently than the majority of people
because if you follow what the majority
of people do in 80 to 90% of situations
you're probably doing something wrong
and you'll be in debt you'll be paying
off debts and loans for the rest of your
life the majority of people are broke
the majority of people are living
paycheck to paycheck the majority of
people are drowning in debt the majority
people have zero to no Investments the
majority people are unhappy the majority
of people are miserable and the majority
of people do not like their jobs this is
not me exaggerating these are all
statistical numbers where more than 50%
of people feel this way and so if now
you keep doing what everybody else does
you're going to end up like everybody
else and so this is where now you want
to think a little bit different and try
to find what's right for you and starty
to get educated yourself because when it
comes to the mindset the first thing you
have to understand is that it is
possible because if you're sitting there
saying it's not possible for someone
like me somebody who has my background
my parents my whatever I can't become
successful I 100% guarantee that you
will not be able to become successful
you
cannot change your outcome without
changing your mindset oh that's big and
and the previous interview we had we
talked about mindset versus tool set
where most of the times we assume that
the reason why we can't become
successful is because we lack the tool
set when in reality for 90% of people
it's lacking the right mindset because
when you have the right mindset you'll
discover that the tool set is right
around you so it's first believing that
you can do it because once you know and
believe that you can do it that belief
is going to then impact your decisions
because now you can say you know what
yeah maybe I can become successful what
are you going to do you're going to go
on to YouTube watch videos how do I
become successful and you start watching
videos maybe you start binging
videos and now you start to realize oh
okay I can start to do this I can change
this about my life I need to change the
way I think I need to change my actions
I need to do more things in my day I
need to stop watching so much Netflix I
need to do this then maybe you start
reading books and I start reading
business books because I have read a lot
of business books and there's so much
wealth in a $20 Business book just go on
to audible look at some of the top
business books and just start reading
and you will learn so much now you start
reading them maybe you start doing a
little bit maybe you don't succeed too
much but you start taking some action
and you start to learn even more because
your experiences are some of the best
teachers teachers in the world even if
you make mistakes I have learned from my
mistakes I didn't have a mentor I didn't
have guidance I don't have investor
family members I didn't have people
telling me how entrepreneurship works I
screwed up a ton just like you we made a
ton of mistakes and that's how we
learned and then maybe you go and take a
class now you're like okay I want to
learn how to do this I'm trying to build
this business I'm doing something wrong
I'm trying to get a better job or I'm
trying to get a raise I keep doing
something wrong youve read books now
maybe you find a class you invest some
money in this class and now you have
more education now you try more and now
you start to see over time oh my God 12
months ago I had no idea I didn't even
believe that I can do it now that I
believe that I can do it I started
watching YouTube videos I started
reading books I started taking classes I
started taking action and then you keep
doing it maybe you hire a coach maybe
you hire a consultant I mean the list
goes on and on and on you can do but it
all first starts with the mindset
because if you tell yourself you can't
your mind shut down and you're never
going to find an opportunity you're
never going to look for the opportunity
so that's where the mindset is the most
important thing and if you don't have
the right mindset this is where the
first thing you want to do is start
learning how do I build self-esteem how
do I build my confidence how do I
believe in myself and there's I don't
have a ton of videos on this I know you
have a ton of videos on this watch
Louis's stuff right so start there then
we go a little bit deeper now for
focusing on finances mindset is number
one mindset is number one the second
thing now once you build the right
mindset is you want to create your
financial base and the best way to
understand this is just to think if you
wanted to build a house what do you do
first well you got to Foundation you got
to build the foundation if you want to
Bild a bigger house if you want to build
a bigger house you want to dig a deeper
Foundation you want to build a tall
building you need an even deeper
foundation so you have to start by
building a financial base and what that
means financially is first you want to
save $2,000 at the very least you want
to put aside some cash for savings as
fast as possible because right now it's
something like 40 to 70% of Americans
don't have well 40% of Americans don't
have ,000 to put aside and something
close to 70% of Americans don't even
have 400% $400 put aside to protect them
against an emergency so the you know
most Americans don't have $1,000 put
aside get a $2,000 B two grand as fast
as possible and then you need to cut the
financial bleeding that means your
highin debts your credit card debts your
hard money loans your 0% APR loans which
are now charging you 20 to
25% these need to be paid off as fast as
possible because these are loans that
are skinning you alive financially so I
mean it seems like credit cards are one
of the biggest things that hold people
back look credit cards credit cards are
a tool they are a tool if you're not
educated with them you can get stuck if
you have this tool without the education
it will burn you I only spend with a
credit card I spend money because I know
how to use a tool and now because I know
how to use my credit card what happens
well I don't spend more than I would
otherwise because I use my credit card
just as a medium of exchange I'm going
to spend this money anyways might as
well use my credit card for my credit
card gives me perks it gives me cash
back it gives me fraud protection gives
me free insurance it gives me Hotel
upgrades it gives me all these things
just because I use my credit card
instead of paying with cash and so now
again it's the financial education
because now some people will say oh my
God these credit card companies are
scams well the reason why they're looked
at as scams it's because we don't have
the right education on how to use them
right it's a tool without the education
on how to use it and this is where now
you have to build that Financial
education and many times you're going to
have to go out and do it yourself
because a credit card company is not a
incentivized to give you the financial
education because they're going to make
less money right it's profitable to keep
people poor it's profitable to keep
people financially uneducated because
now if you just keep spending money in
your credit card because you have no
idea what you're doing now your credit
card company's going to get rich the
average household in America has $6,200
with the credit card debt so if you have
credit card debt in America you probably
have an average of $600 wow now let's
talk about that because if and what's
the interest on that well that's
15 to 25 28% and every month every month
you're paying that you're paying it
every month so it's not 6,000 a month
it's really you know over years if you
never fully pay it off you're just
paying more and more and more and the
interest rate on your credit card isn't
fixed rate it's variable interest rate
so as the Federal Reserve Bank raises
interest rates the interest rate on your
credit card also goes up so if you are
21 years old right now and you invested
$6,200 which is the average household
credit card debt right now if you invest
$6,200 right now and you got a 20%
return on your money and you did that
for the next 45 46 years you are going
to retire with $20
million $20 million and you never invest
another Penny again say one more time if
you invest $6,200 today and you never
invest another Penny again and at 21 at
21 and you get a 20% return on your
money you're going to retire with 20
million wow now you're going to say just
where in the world am I going to get a
20% return on my money year after year
you're right but but your credit card
company's doing it every single day wow
they're charging you and so when you
have that sort of credit card debt
that's you making your credit card
company richer now you know whether or
not you think it's a scam look let's
move past and understand what's going on
that way now you can use it to your
advantage because I get tens of
thousands of dollars worth of cash back
every year from my credit card company
because I use it as a tool and I
understand how to use it and this is
where look if you don't want to use a
credit card it doesn't matter but just
don't if you have credit card debt you
have to pay that off because that is
skinning you alive right now understand
the financial education aspect so that's
the first thing you want to do is create
your financial base so you got to save
some cash then you got to pay that
credit card debt off cut the fin cut the
financial bleeding what's the strategy
if you got three credit cards what's the
strategy to to get r that of debt so
Dave Rams is going to tell you to do
something called the snowball method the
smallest first or smallest first to the
biggest because you're building momentum
right right uh a financial advisor may
tell you the opposite do the debt
Avalanche which is now pay the highest
interest rate first and then go down
because now you're going to pay off the
most interest first so it costs you the
most money the long term the reason why
Dave Ramsey recommends the snowball
method is because psychologically when
you get those small wins of paying
something off you feel like you're
winning and you can pay it off faster
yeah a adviser is going to look at the
math and say hey look these numbers are
telling me that pay off the higher
interest rate first because it's going
to save you the most money over the long
term which one's right again not going
to say which one do what's best for you
because I know if I was in a situation
I'm not I like the idea of paying down
the heavy interest rate first because
that's how my brain works I don't need
the small wins like that I can work for
the long term I think you know the
entrepreneurial mindset where you know I
know how my mind works so I understand
myself and this is just honestly being
open and honest with yourself if you
can't stay true with it then do a
snowball it does not matter screw payt
it off a few months early just get it
away and paid it off as fast as possible
cut out cut the financial bleeding and
have a $2,000 base that's step two okay
step that's step two now the next thing
you want to do is what I call lead your
money so this is where you want to
create a financial system and start
investing your money because your
savings will never make you wealthy you
cannot save your way to wealth you have
to invest your money your savings won't
make you wealthy because of what we've
talked about in previous interviews
inflation you're losing money in the
savings if inflation is high than the
interest that you're getting at the bank
then your savings are effectively making
you poorer each and every day because
now your savings are losing value to
inflation now does this mean you should
not save any money no it means you need
to save your money strategically so you
want to save your money for three
reasons and three reasons only save your
money for an emergency save your money
for a big purchase if you want want to
buy a car you want to buy a house you
want to buy a nice watch whatever you
want to buy you need cash in order to do
that and then three save your money for
an investment if you're not saving your
money for one of these three reasons
you're saving your money the wrong way
and it is making you poorer by saving
that money so now we focusing on the
first aspect of saving your money for an
emergency how much do you save this is
now again going to depend on your risk
tolerance you want to save somewhere
between 3 to 12 months worth of your
expenses and the amount of money you
save is going to depend on where you are
in life and how much risk you're willing
to take on if you're like hey dude I'm
I'm 25 years old I don't have any
financial responsibilities I don't need
that much savings fine save a few months
worth of savings and that's it invest
more aggressively if you're like hey I
have a family I have kids I have a
spouse I I don't want to take on all
this risk then save six months N9 months
a Year's worth of savings because now it
will give you that peace of mind that
you have some extra cash put aside so
it's going to depend on your risk
tolerance and and what you want but this
in this Le of money step this is where
you want to understand that there's more
more to putting your money aside than
just saving your money you also want to
be putting your money to work and the
best way to do this is to create a
system where no matter how much money
you're making you are going to
proportionately continually invest and
save based off your income so what does
that mean well one of the simplest
things you can do is follow something
like percentage my 75 15 10 plan which
means for every dollar that you earn 75
cents is the maximum that you can spend
15 cents is the minimum that you invest
and 10 cents is the minimum that you
save and this never changes with your
income the only thing that you would
ever change is after you hit that
savings goal for your emergency savings
you don't keep saving your money for the
Emergency because you built that
whatever months you want you put that
towards your Investments yes and now
whether you're making 40 Grand 400 Grand
4 million 40 million you just keep
following the same thing and you're
living below your means and now you're
you're constantly putting money aside
for Investments now again we talked
about this before this investment money
can either be passively invested all of
it or you can put this money aside to be
invested so you can put this money into
a bank account you're looking for a
rental property you're looking for a
business to buy you're looking for a
cheap stock to buy this now depends on
know your investment goals right where
do you want to be invested how do you
want to invest your money and this is
that Financial education now of you know
what do you want to do and your personal
goals if you don't want to be involved
with your money you don't want to be hey
day-to-day investing or paying attention
to the markets you hate that idea just
passively invested right you become
wealthy with your investment money your
savings are there to protect you against
an emergency your spending money is what
allows you to live your life live your
life and and have the nice things and so
now we'll get into now how do you live
more live better today by earning more
money in a bit but this is where now the
passive investing is the most accessible
way for somebody to start investing and
then somebody's going to say what do I
invest in right because we're talking
about well you can invest in the stock
market there are funds like there's
index funds ETFs mutual funds they all
work similarly with some Nuance
differences that allow you to invest
into a basket of stocks a group of
companies so for example I like ETFs
just because they're very convenient so
you invest in a ticker symbol ETFs stand
for exchange traded funds so for example
if you wanted to invest in the stock
market the General stock market there's
a fund an ETF called vti now I'm not
telling you what to invest in just
giving you some examples vti is a total
Stock Market ETF if you invest in that
one ticker symbol you're getting
exposure to the United States stock
market you're getting Diversified
getting Diversified in the stock market
not across different asset classes but
within the stock market you can then you
know pick oh I want to invest in let's
say the S&P 500 which is the 500 largest
companies in the stock market spy
there's a ETF that gives you exposure to
that let's say you want to invest in the
Dow Jones that is the most commonly
discussed uh fund it is a group of 30
companies in the stock market big large
companies Dia is a ETF that gives the
exposure to that you could invest in
three stocks which would be hundreds of
stocks throughout those three
Investments ETFs y those three ETF give
exposure to hundreds not thousands and
all you need to do is invest in those
three things and set it and forget it
essenti now you can just set it auto
remember automatic so the key here now
is you invest when the Market's up and
down you don't change it so when you see
the market crash happen you don't stop
you keep investing the only thing that
you would change is potentially buy more
yes because when you see these types of
Market pullbacks most people are selling
and they're running away because they're
panicking and getting scared that my
investment is going down that's what you
want to be coming and buying
aggressively because now Investments are
going on sale and so this is where it's
again that mindset shift of
understanding what is it that you want
to be investing in and how long are you
investing for if you're investing for
the long term who cares what's happening
in the next two months or next two years
you're investing for the next 20 years I
call it a decade of sacrifice if you
want to become wealthy and seriously
wealthy not like oh I have a little bit
of money no you want to become wealthy
you got to put in what I call that
decade of sacrifice where you're working
to spend less and earn more that way you
have more money to invest and most
people are not willing to go through
that sacrifice because that means I
can't have that Gucci belt today so I
can have more Investments today I can't
show off my stock portfolio of real
estate portfolio the way that I can my
Gucci belt and most people would rather
have the show would rather have the look
than the actual thing that will make you
wealthy right and that you know it goes
back to the mindset the thing you talk
so much about your mindset has to be
focused on saying you know what I want
to become wealthy and that's hard
because now for one you have to be
convinced yourself and now you might
have a spouse you might have kids and
that means you all have to be on the
same page financially right because this
is a money is a team game it's in the
house if you think you know I'm going to
and to build my and then your husband or
your wife is going out and spending all
this m they're going to be pulling you
back so you got to be on board where I'm
mentally on the same page my spouse is
on the same page my kids are on the same
page we're going to build wealth and
we're going to build something that
we've never seen before and that's that
first mindset where now I believe I can
do it I'm going to do it now you start
putting in that sacrifice so we started
about the passive investing next is
active investing and I also should
mention that you can do passive and
active investing I do both mhm what's
the example for you so I invest my money
in five places um I invest my money into
businesses which are my own businesses
and startups that I invest in invest my
money into physical real estate invest
my money into stocks invest some of my
money into cryptocurrency a little bit
more of a speculative play and then I
invest a small piece of my portfolio
about 2% of My overall Investment
Portfolio into physical gold so my gold
my
cryptocurrency and some of my stock
market Investments are passive
meaning this happens for my stock market
every week for crypto every day for gold
every month it's the automatic passive
and consistent I don't touch it it is
automatically pulled out of my check-in
account and it is invested interesting
and your bank you can set a parameters
in your bank to automatically do this
yes two specific places you want to
invest exactly that's nice it is
technology has made investing so much
more accessible do all these Banks do
this or what are like the top few that
you see that many banks will allow you
to money from One bank account to the
other these investment accounts you're
going to have to work with a particular
brokerage there's tons of brokerages out
there that do this you can find whatever
you like for let's to say you want to
invest in the stock market there's a
bunch of brokerages out there that will
allow you now to invest your money into
the stock market through this passive
type of system you just have to find
what's right for you and this could
depend on what country you're in uh you
know and just that your what interface
you like the best and it's become very
accessible there are so many it is so
much simpler now than 10 years years ago
let alone 50 years ago so we are very
blessed to be able to do this now right
on the active side this is where now I
invest into my own businesses I invest
into real estate uh and then I also
invest in some stocks do you do real
estate funds or do you do your own
individual real estate buildings
yourself I have done some real estate
funds but that is the smallest piece uh
most of it probably 99 Point some per of
it is actual physical real estate that
I'm going on and buying myself
and so now it's when we talk about
active investing what does this mean
first this means now that you are going
out finding investment opportunities to
invest in and then you're putting your
money in and uh now this is where the
research is important so like for
example business I invest in my own
businesses I also invest in some
startups startup investing is very risky
nine out of 10 startups will
statistically fail so I know that when I
invest my money in these startups a big
chunk of this money will I will probably
never see again but my goal is now that
a small piece of these startups that I
invest in will go big and then that will
make up for the other losses yes with
real estate my goal is completely
different with real estate my goal is
cash flow uh I call it cash flow because
cash flow funds the guac flow and what
that means is now when I own a cash flow
producing asset I'm getting money coming
into my account now every month with my
real estate that I don't have to
actively work to earn because I have a
property management company in place I
have a system in place so it's not like
I have to go to work to earn this money
I buy the properties I have the systems
where we renovate the properties with
the contractors we do the right
inspections then I give the keys to the
property manager my job is done now
every month I'm getting cash deposited
into my bank account every month and
every quarter I get financial reports
going over what's going on with my
properties so it's hands off I still
review the properties like I review the
financials I review what the property
manager is doing but I'm not going to
work to earn this cash now I should also
say it took me a ton of work and a ton
of time and a ton of headache and a ton
of mistakes to learn how to do it the
right way yeah because uh you know I
didn't grow up with Real Estate
Investors and my family I had to go out
and just kind of do it and figure it out
and it was very stressful you know a lot
of people on the internet make real
estate investing seem like this Holy
Grail go buy some real estate and you're
going to be swimming in the doome but
here's the thing when you buy real
estate on your own it's almost like a
full-time job managing the property
managing if you're doing the Airbnb or
short-term rentals it's like you're
going to constantly clean and adjust and
promote it and Market it and deal with
the Airbnb stuff or you need to find
someone to pay to manage it yeah but
ultimately at the end of the day you got
to deal with the taxes of it you got to
deal with the expenses of it you got to
deal with the fixing of it you got to
deal with the regulations around it
whatever it might be so how do you
invest where it doesn't become a Time
suck and an extra job so in the real
estate but it's actually cash flow that
is more passive is that even possible
with real estate for I can only speak
from my experiences because for me it
was a huge time suck in it was like a
full-time job it was more than a
full-time job I couldn't sleep at night
because of how many issues I dealt with
but so why so why be in real estate
today if it caused you so much pain
previously well see I you you go in with
the vision right like entrepreneurs you
have to be a little bit crazy you don't
know how something's in a workout but
you're you're putting in countless hours
you're not sleeping at night you're
sacrificing vacation you're not talking
to your family you're doing a bunch of
crazy things because you think this
thing is going to work that's how it was
for real estate I'm known for being like
that stupid person and I've always been
that thing and for me it's like I
believe something so much that I'm
willing to make a lot of sacrifices and
keep doing something and for me when I
invested in real estate I was 19 when I
started when I bought my first property
and um I did it kind of all by myself
because uh I told my dad I wanted to
invest in real estate and I grew up in a
very traditional
Indian house my parents are immigrants
from a state in India called Punjab so
my parents came to this country with
very little and so yeah EXA you got the
moves down that's our dance we were just
talking about F before this it's a
traditional dance um but my parents came
here with very little and um you know
they wanted me to be a doctor and it was
very like strict that you have to become
a doctor nothing else is the options
anything that wasn't medical related was
like a big no no so becoming a lawyer
you were a failure I was yeah that was
huge compromise for me to become an
attorney with my parents but this is
before I even became an attorney where I
said I want to invest in real estate and
my dad was like and I was actually
studying for the Medical College
admission test when I had the idea to
start investing in real estate and I had
some cash saved up because I was working
on uh event planning company at the time
when I was in college my parents didn't
know about that so I was making a little
bit of money and I was like I want to
invest in real estate my dad's like
you're stupid go study go become a
doctor and then worry about all this
other stuff that you're doing so I was
like all right I'm just going to
yeah you know so how much was your first
deal it was a small condo that I bought
the condo about three or four years
prior to me purchasing it sold for about
150 Grand it went through foreclosure
the banks had it listed for $8,400 how
man you got the jackpot of that thing it
sounds like so I I made an offer for
four grand oh my gosh I don't know what
I was doing right so I'm I'm like well
did you get it well I put an offer for
four grand they said we'll give it to
you for $7,000 and I said no I'm going
to I don't know what I offered something
else maybe less five grand yeah and then
another person came in to potentially
buy the property and so the bank says we
have another offer on the table give us
your highest and best offer now to put
this in perspective I didn't know this
was a good deal because I'm 19 I knew
nothing about money five grand is a lot
of money at 19 like all your money yeah
so I know nothing about investing I
don't know what passive investing was I
had only read books about uh investing
so I'm I'm reading some books and now
I'm just just going on doing it because
I know nobody in real estate I didn't
even know you could invest in real
estate so I'm like okay well somebody's
making an offer I kind of like this deal
because I looked at a few other
properties so I was like well how about
I make an offer for eight grand we'll
see where they go and the bank took my
offer the other person offered less than
what I did wow so I bought it for eight
grand I put in a few thousand worth of
work and then I listed it for $600 a
month and the profit on that was between
$250 to $300 a month depending on the
month which now sounds great right this
is the the beauty of real estate the
downfall is it was a big pain because I
didn't know what I was doing I hired a I
don't want to say scam property manager
because I haven't been able to validate
that but I don't know if they were
licensed right the tenant moved in we
didn't have a lease the tenant was
absolutely crazy they had my phone
number so now I'm going to class like I
remember I was coming out in my
chemistry classes or my physics classes
and I had these voicemails these multi-e
long voicemails of the tenants talking
about how the world is ending they're
like this property is going to go up in
Flames so I was like what's going on I
get an electrician out there we go to
the property and this is like after
multiple issues that happened I went
with an envelope of cash I probably had
like $50 of cash in this envelope that I
gave to them because I felt bad for the
tenant electricians looking at the
property they're like yeah your light
bulb fused we can just replace that
that's it that was it there was an
instance where they were cutting
cucumbers on the countertop they missed
the Cucumber they scratched the
countertop she calls me crying that she
needs a brand new countertop oh my gosh
I gave it to them oh because I didn't I
don't know what's going on so like I
dealt with a lot of issues and that was
just the first one I mean like the first
I would say three were my learning curve
where I was like a full-time like I'm on
the phone talking to people trying to
find contractors I'm trying to find the
right attorneys I got screwed over by
attorneys I got I mean I made every
mistake possible why' you keep doing
real estate after the first three failed
yeah see this is where the the stupid
comes in out me
well I read books and people talk about
how investors own thousands of real
estate units I was like how can somebody
deal with thousands of tenants like this
like it's not possible like there has to
be a system I just had to figure out how
to crack that code how do I break this
system and that was my journey was
learning it and it was very painful very
expensive uh and very stressful because
the third deal literally depleted my
bank account um I was talking to my wife
about this the other day where uh that
third deal was so stressful because I
made every mistake possible I talk about
this on YouTube it's my worst real
estate deal
ever um I bought the deal because my
contractor told me it was a good deal he
told me that hey we can fix it up for
not a lot of money and because it's such
a good deal you're going to be able to
make a lot of money on it wow so he's
like don't even worry about getting an
inspection on the property just go out
and buy it so that's what I did I
trusted him right bought the property
gave him the money he ran away I didn't
know that he wanted the money because he
was running into financial
problems then this property it turns out
had a lot of defects behind the scenes
which I didn't know we had the City come
out and look at the property and it was
the repairs cost way more than what the
actual property cost and so now I was
really in trouble because I wanted to
get this property rented out my bank
account that property account literally
went negative and I had an overdraft fee
on this account uh which I had no money
to pay at the time for that property
because I was putting all my cash into
this and like I was saying before I was
in that event planning party business
which was a cash business so I had like
literally a bag of cash in my room so I
went to my last resort was I pulled the
cash out of my bag and I gave it to the
contractor I was like we got to get this
done I need to get this I need to get
some income out of this property because
I couldn't sell it I couldn't get a
certificate of occupancy I couldn't rent
it out
and so it was like I was so stuck I was
fortunate that I had that cash but I
mean it was a tough situation that was
my real life tuition like that was where
I learned like I say that one deal
taught me years worth of real estate in
one property because I learned so many
things that I should not do but then
from there you know I was able to
stabilize I made some more money with
other Ventures that I was doing because
I was making money for one reason to buy
real estate like that's all I was doing
and losing it in the real estate losing
in real estate but I was learning right
that was my learning process so I guess
I can't you know I I wouldn't change it
because I learned a lot from it very
stressful like when I say lost sleep I
lost a lot of sleep dur that time so
when you're going to buy a property now
what is the approach that you take so
that it maximizes your return saves you
time and energy and minimizes stress if
you like what is the approach if you're
like okay am I buying single unit
properties am I buying apartment
buildings am I buying duplexes
fourplexes am I what am I working with
another investor and buying a bigger
deal what is that thought process into
buying a deal yeah first off and then
how do you set it up so it doesn't take
you a lot of time to manage it sure so I
would say the first thing is I need to
know what my return is going to be and
generally my general rule of thumb is I
need a 7% cash onh return annually and
what that means is for every dollar that
I invest I want to see seven cents of
cash flow uh that's money that's hitting
my bank account after expenses um that
has nothing to do with appreciation so I
want to look at those financials I want
the 7 % cash on cash return then I got
to look at where am I investing uh so I
like to invest in areas that are growing
uh that have more like upand coming to
it so this is now I want to see
populations at least stable if not
Rising do a quick Google search of any
City and Google will tell you what's
happening with the population it's made
it so easy wow what are the top three
cities that are rising that are also not
over I guess overpriced right now now
one of those top let's see in 24 months
where that actually is because we're
going through this correction in real
estate right now so let's see where
interest rates go cuz that's going to
influence uh housing prices and real
estate prices in general interesting but
keep an eye on interest rates the
general thing is as interest rates go up
property prices will go down so let
let's let's rediscussed in what do you
think is going to happen over the next
12 months with interest rates well the
Federal Reserve Bank says that they're
going to raise interest rates and if
they keep doing that they're going to
push this economy into a lot of pain
because it came down a little bit right
recently so mortgage rates and interest
rates are two different things so okay
interest rates set by the Federal
Reserve Bank are called the federal
funds rates this is the interest rate
that One Bank pays another when they
lend each other money overnight so that
think of it like the wholesale price
right when when you go to buy this mug
from Amazon Amazon's buying it from the
manufacturer they they're buying it
cheaper then they sell it to you at a
marked up price called the retail price
so banks have this wholesale price
called the federal funds rate then they
Jack it up and sell it to you as the
mortgage rate so federal funds rates the
Fed rate can influence where mortgage
rates are going so interest rates can be
different than mortgage rates right they
are different than mortgage rates what's
the current kind of interest rate at the
time of this interview uh for mortgage
rates for the interest rate versus
mortgage rate so so uh the federal fund
right now is right around 5% just under
5% the federal funds rate mortgage rates
are hovering around the mid 6% for a
30-year fixed rate mortgage now the
question is where are we going to go
from here the Federal Reserve Bank has a
mission to fight inflation that is a big
deal it is a super serious problem and
we've discussed this in other interviews
I'm not going to go too deep into like
what is inflation why that's happening
we have an inflation problem and that is
a serious problem because if we don't
solve the inflation problem then we risk
a serious currency crisis we risk
potential hyperinflation we risk our our
dollar losing the reserve currency
status so it is a serious issue to bring
inflation down because yeah a recession
is bad a currency crisis is even worse
that's why the Federal Reserve Bank is
working to increase interest rates
because that brings down inflation now
they're looking to increase them
increase interest rates and what about
the mortgage rates so that pushes
mortgage rates higher higher so now
Rising interest rates have a consequence
and that consequence is a slowing
economy because when you raise interest
rates
it makes borrowing money more
expensive money less people buy and now
if you remember what we said just a few
minutes ago in our economic system
spending is good for the economy higher
interest rates less spending bad for the
economy our economic system wants people
to spend money in fact they want you to
be in debt and spend money because if
you're in debt and you're spending money
they're making money they're making more
moneyy and I can be rich and I can have
whatever else I want in life so let's
just start with that with money and
money me I think a lot of people just
think we're stuck in these these phases
the other thing that has been
fascinating is a money myth that I think
people that want to get rich is that the
best way to get rich
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