Financial Advisors React to RIDICULOUS Money Clips

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0:56So good, so good, so good. Lookity lookity here Content crew has been busy

1:02Brian Preston:With some ridiculous financial content And Brent I am so excited to see What the internet has in store for us today I'm gonna show y 'all How to turn$60 into$1 ,000 The first thing you wanna do is Go to your nearest gas station And pump some gas Go to your job Go to your job I bet And now all you gotta do Is wait for your truck Or whatever vehicle you're driving To fill up with gas Okay While you wait for your vehicle To finish pumping You can clean your windshield wipers Oh look at this It wasn't even$60 That's$50 and$53 And now that you have a full tank, you can drive yourself to work in two weeks and make a thousand dollars.

1:32Brian Preston:Exactly right. You're not supposed to ruin the punchline. You ruined the punchline. Whatever. I might have given him the idea for that. How often do I say that the best way, sometimes you have to even do 23-8 because your first wealth builder is going to be your J-O-B. That's right. He might be a financial mutant that saw our content and actually said, you know what? Let me make something out of this. I love that. It's not get rich quick. It's not get rich overnight. is, hey, I need to go recognize how do I have a shovel, create an income, have resources, defer a little bit of those resources through discipline, through saving, through building for the future and build for my future self.

2:08Brian Preston:I love it. Well done. Everything that I wanted to see, I saw this week. And again, the market is so distracted with so many things. I'm not, I'm not distracted, guys. I'm spending about 15 to 20 % on this meme stock stuff because it's hot and it's early and the one thing that we learned from 21 by the way i forgot to say this he's like the most important thing when trading meme stocks when trading any of this stuff the most important thing is being a little bit early the last time we did this i was fortunate enough to aggressively get early on all these trades sometimes i exited early on others like gamestop do you remember this dave when i posted my exit on gamestop on twitter and and i don't know what happened maybe there was some random algorithm attached to my tweets it just triggered some type of domino effect to bigger money.

2:56I don't know, but that was maybe the luckiest trade I've ever made.

3:03It's just, there's nothing. It's gone. Yes. Hey, you want to get rich? Let me tell you a system that I have that's going to blow your mind. Get in early. Buy low, sell high. You'll dominate the world.

3:25Brian Preston:Yeah, that's great if you can do it and you can replicate it and you can do it over and over again. But think about how many meme coins, meme stocks, meme fill in the blanks we've seen over the past five, six, seven years. And how many have been the ones that have actually created wealth and how many have fizzled into nothing? We think there's a better mousetrap and a better way to build wealth and it's not that. Here's what I'm buying. this Rolex was one of the dumbest yet smartest financial decisions I've ever made. You see, when I bought this watch back in 2015, at the time, it cost me£5 ,400.

3:58Why it was one of the dumbest decisions at that time was that I only bought this watch with the intention of looking cool in front of people that ended up not giving a s***. The reason why it became one of the best decisions I've ever made is that this Rolex right here, which is a Submariner, is actually one of the most in-demand Rolexes on the market. This means that going off current market value, I could sell this exact watch right here for around£12 ,000, which is more than double the original price I paid for it over eight years ago. And an investment like this completely crushes any kind of returns that I've ever had on any kind of stock investment or property.

4:32Brian Preston:What's the takeaway? What's the learning opportunity? I should go out and buy luxury goods. I should go spend a lot on watches. Just because a poor financial decision turned out okay for you does not mean that it was a wise financial decision should replicate. It means you got lucky and you ended up at the right place, the right time with the right accident and the right mistake, and it didn't burn you. Just because the market value is listed at that doesn't mean that's actually what your net proceeds would be. There's a lot of friction or transaction costs to actually turn that Rolex into liquid capital for you.

5:08If you want proof of this, take it down to a pawn shop, see what they'll give it.

5:11Brian Preston:So Brian, here's what I'm trying to figure out. He started off by talking about how bad this investment was, but then he went to - He rubs our nose in how much money he's made. And so here's what's not clear to me. Does he think that this was a wise investment and it was a decision that he would repeat? Or does he recognize, oh, wow, I made a foolish decision that just happened not to burn me? Because what I worry is, okay, I made a bad mistake, but it had a good outcome. That means I'm going to go make another bad mistake and hope for another good outcome. Oftentimes in our financial life, it does not work that way.

5:44The average American makes what? $58 ,000 a year? The average worldwide is like$35 ,000 a year. All right. Well, it's median. Someone working a job,$50 ,000 a year, if they wanted to start a business, how long would it take them to save up a quarter of a million dollars? With that$50 ,000, they'd have to pay taxes on it. Oh, yeah, taxes, living, eating. Yeah, living, spending. About 10 to 15 years. 10 to 15 years, what would you say? About maybe 8 to 10 years. Now, ask me how long it would take me to go get a quarter of a million dollars from the bank. Probably a week. 30 minutes. Is that all business is?

6:17So once you understand how money flows and how debt actually works in a debt operated country, which is America, you learn that debt saves you time. And here's the craziest thing about it all. Let's say after that 10 to 15 years, you save up that quarter million dollars and you invest in this business and it fails. Can you get that money back that you invested? No. What if you fail and it was the bank's money? You file bankruptcy and you start the business. It's the bank. Oh, there you go. It's the bank. File bankruptcy. It's the bank. Yeah. There's a lot of small businesses out there that are based upon what work you do.

6:45Think about your attorneys, your accountants, your doctors. They're all service-based businesses. Much lower, it's more about who you are and the skills you have and the service you can offer than building up a big capital nut to go out there and start a company. You really only need like$250 ,000 if you're going to be doing manufacturing or something. Capital-intensive business. And that's a much different game than what I think when we're saying the startup of a small business.

7:12Brian Preston:Man, it's way more easier to go out and borrow money than to save up. Well, of course. And in some instances, that's necessary. Like when it comes to buying a home, yeah, instead of saving up cash to pay for a home, it's okay if you save it for a down payment and you go out and borrow to be able to do that. But that's a very different thing than what he's talking about. He's using the same logic that, man, I could go save up to go buy something at a store or I could just swipe my credit card. You know how much faster I could swipe my credit card? Just because you can borrow, just because debt's available does not mean that debt is always the right solution for the purchase that you are making.

7:47Brian Preston:One, that's not the way that consumption works. And two, that's not the way that business works. Easier is not necessarily better. What's the most legit get rich quick scheme in history? Simple, figure out how to make an underground in a year and then move to Brazil or Thailand. Now you're a millionaire. is not how much you make is how much buying power you have. It's not how much you make is how much you spend. Well, sure, if you want to live in Brazil, or if you want to live in Argentina, you want to live in one of those places, a lot of us don't necessarily want to live in those places. We like the place that we live in, like where we have relationships, where we establish.

8:22Brian Preston:Yeah, there are certainly lower cost of living places, but that's no different than saying, hey, you ought to just go find the absolute lowest cost of living place in the middle of Arkansas and go live there. How far your money goes is only one part of the life equation that we get to live. Bo, can you go home and record the conversation when you go home and tell your wife and children that you're moving? We're Brazil. We're out. Let's go. Tell me how that goes. Yeah, it's not going to go good. With kids and schools and all the churches and everything else that you have, you know, roots in the ground with.

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9:50After three months, plan auto renews at$12.99 a month. Terms apply. Bought this$52 ,000 Toyota Sienna less than a year ago. Today, it's fully paid off. But here's the catch. we didn't use any of our salaries to pay for it. We have a baby on the way so we wanted to eliminate some of our monthly expenses. Originally we were going to pay cash but if I wrote a check for$52 ,000 that money is gone forever. So instead we did something that goes against all traditional financial advice. We financed the whole thing instead. But we didn't buy the van until we had enough assets to cover the payments for the van.

10:20For two years I invested in alternative investments like small businesses and real estate. By the time we signed for the van those investments were paying us double the return than the interest rate on the loan. Then we use that passive income to aggressively pay down the car notes. The investments essentially paid for our new van. If I had paid cash upfront, I'd have a paid off van and then no cash in the bank. But because I did it this way, I have a paid off van and I still have the assets bringing in monthly income. Don't buy luxuries with your labor. Plan ahead and invest in assets and let them pay for your liabilities.

10:52I almost felt like he forced the content creation on this is because he was like, hey, I bought my wife this minivan. How can we make this somewhat deductible? So maybe I can deduct a portion of this. Oh, I'll throw it in this video and say, hey, I set up all this side hustle businesses over here because I didn't use the$52 ,000 that all paid it back. It felt kind of clunky to me. It didn't make sense.

11:12Brian Preston:Here's all he said. If I can save dollars and invest dollars and create passive income, the passive income that I can create can pay for my living expenses. That's all he said. well, that is the definition of working towards financial independence. I want to put my money to work and that money is going to work harder than I can. And the money that money earns can then be used to pay for my living expenses. That is a true statement. Now, what he did that was a little more aggressive is rather than waiting until he had a big pocket of a big bucket of assets and in financial independence, he said, I'm going to go out and lever.

11:44Brian Preston:I'm going to borrow all the money in this van. I'm going to pay an interest rate on that, but the money I'm going to create on my passive investments is going to be greater. and I'm going to play this arbitrage game. And in this situation for him, that worked, but that works until it doesn't work. A better method is build up a healthy, large base of assets where then you're not just counting on those passive investments to pay for a car payment or a note or a loan. You can actually count on your passive investments, your portfolio to pay for your entire life. That's a better way to do it. That video did nothing for me.

12:15Like, what do I do with my next dollar based upon if I took his guidance? I mean, Roth IRA or what's going to be pressure washing driveways? What's this thing that's going to actually create the money to pay off the minivan? I didn't find any actionable advice out of that. We hit upon the idea of co-ownership, which is what Picasso allows you to do. A home in eighths, one eighths, two eighths, three eighths. And then you co-own it with other people. It's like carpooling. Time share your house. People into a single home that's higher end. And so it alleviates demand in the mid tier by aggregating eight people into the upper price tier.

12:47Most people can't afford a second home. Many can hardly afford a first home. It's very expensive to own a second home because of underutilization. And most second homes are only used six weeks a year. Why is six weeks relevant? Well, that's one eighth of a home. I firmly believe that Picasso is good for communities, that the problem is empty second home. Those homes are utilized. Local services and restaurants and bars and wineries, you know, other services are used because the homes are highly utilized. Our typical homes, whole home value is around four to eight million. So you divide that by eight to get your unit value.

13:15So$500 ,000 to a million dollars is what most people are paying for their Picasso or one-eighth of the home. Yeah, but can we all just say timeshare? He just came up with a timeshare concept without saying timeshare, but for your luxury property.

13:30Brian Preston:Hey, let me ask you a question, Brian. Do you really think that the problem in our real estate market right now is a bunch of empty second homes? Hey, for all of you young folks out there in between the age of 20 and 40 that are trying to get in your first home, I think the real estate problem we have right now is empty second homes. And we need to work to figure out how we solve that problem. Well, when I'm trying to solve housing issues, it's not necessarily even for any secondary homes. You shouldn't need to pay them more, all right? There should be a different way to get employees to want to stay here.

14:00That kind of investment isn't necessary. No, we should invest. Excuse me? We will give the people a retirement plan. One where we match the investments. Yeah, okay, because we can definitely afford matching, not all at once. Go on. If they leave after one year, they lose everything. We match nothing. Year two, they lose most of it. Year four, perhaps enough just to make them hesitate. We don't forbid escape. You simply attach a price to it. Okay. And how long until their 401k plan will fully be vested? I say six, seven years. Actually, no, make it like three, four to preserve the comment section.

14:43after every bad day that they want to leave it becomes a calculation because leaving will feel like theft from themselves punishment disguised as a benefit i don't think this is wrong one of

14:54Brian Preston:the things that i tell my people is hey i want you guys to be here for a long time and i'm going to give you more money to stay here long i'm going to give you this much money if you stay here for six years i'm going to give you this much money if you stay here for this many years it aligns the incentives. What the employee naturally wants is more money in their retirement account. And what the employer naturally wants is long-tenured employees. I don't think that's a bad thing. I think it mutually incentivizes behaviors to align expectations. Well, and if we actually went back to the room where this was all invented, there was this whole thing where we had defined benefit pension plans.

15:33And then they came up with they're like, hey, is there a way that we can do defined contribution where we're not actually on the hook for what happens 30, 40 years down the road? There's what, if you want to get the cameras inside the room, be a fly on the wall, it was much nerdier than that.

15:50Brian Preston:Brent, I love that the internet is always rife with tons of financial information, but not all of it's great, but you know a great place where you can go get amazing financial content? What are you talking about? I'm headed out right after this to go pick up a new Rolex. Or that, yep. Or you could go to moneyguy.com slash resources. Check out the plethora of free tools and deliverables we have out there because we really do believe that there is a better way to do money. We believe that you can do money better. With that, I'm your host, Brian, joined by Mr. Bo, Money Guy. Out. Let me tell you a system that I have that's going to blow your mind.

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