Early Retirement Expert: A House Vs Stocks, Here's The Truth!

25:54How am I going to buy a house? But I did. And in fact, I didn't buy a home when I was young by myself. 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. We put 10 % down. And my best friend and I, Andrew, we split that down payment. So we each put$12 ,500 down. This is how we scraped it together. The house was a complete fixer-upper. And we didn't have enough money to make the mortgage payments, so we rented out bedrooms. And we had friends rent bedrooms, and that helped us cover our mortgage. We scraped it together. And that's what a lot of people do when you're young.

26:33But if you don't get in the game of homeownership, and you rent in your 20s, and you rent in your 30s, you're going to turn around in your 40s and having not built any net worth. When I wrote The Automatic Millionaire 20 years ago, two things have happened since then. The stock market has gone up in 20 years, 600%. Okay, so if you had$100 ,000, just that has gone to$600 ,000. If you bought a house, the house has gone up 400%. So when you read this book with all these, there's a whole chapter of updated success stories. There are a lot of ordinary people that started saving$5,$10,$15,$20 a day, bought a starter house, and today they're millionaires.

27:22So am I not better off renting and investing in the stock market versus buying a house? Because obviously when I buy a house, I'm paying a premium on the house so that I can get a mortgage. I want to bust this myth because what happens is people come on and they go, Look, I can tell you right now, the stock market over the last 20 years has averaged over 10 % annually. People go the returns are better in the stock market than the real estate. Yeah, but that's not apples to apple comparison. Why? When you buy a piece of real estate, when you buy a home, people don't typically pay cash for their first house.

28:02They put down 20 % and they borrow the other 80%. So you take like an example of a$200 ,000 home. $200 ,000 home, you put$40 ,000 in. Home goes from$200 ,000 to$400 ,000 in 10 years. This has happened to so many people in the last five years. Since COVID, there are markets all over the U.S. where housing prices have gone up 100 % to 200%. So a person buys a$200 ,000 home. They borrowed 80%. It's doubled. So they've made$200 ,000 in profit. They didn't put in$200 ,000. They put in$40 ,000. So they got a five times return on their down payment. They go to sell their house. They don't pay taxes on the gain.

28:47Because when you own a home, at least in the United States, you own a home for over two years if you're single, you get$250 ,000 in tax-free gains. If you're married, you get over half a million dollars in tax-free gains. You get tax deductions on the mortgages. So what happens is people come here and they go, you know what? You shouldn't be tied down. You need to be flexible when you're young. You don't want to have the responsibility. And you should take the extra money and you should put it in a mutual fund. And you know what happens in the real world, Stephen? People don't do that. They rent an apartment that's nicer than what they can afford and they spend all their money.

29:24And then they turn around in their mid-30s and they have no equity because they haven't bought anything and they also haven't saved money. It is an absolute freaking myth that people take this extra money that they could have used to buy a house and they're going to put it in the stock market. They don't do that. And that's why also, by the way, corporate America got into the game of buying up real estate all over America, houses and building apartments to rent to an entire generation, hoping these people never buy. Like 10 days ago, Trump came out and basically said he wants the institutions out of buying up all the homes in America.

30:13Why does he want to do that? because he recognizes how serious of a problem it is to have a generation of Americans who are renters. I'm telling you, when you look at average Americans, I'm talking about ordinary Americans, when you look at where their wealth is, it's in home equity and it's in the stock market. And this is the last thing I'll say. Generational wealth is created, for better or worse, through home equity. So when you look at what, you know, you asked the question about causation. If a family doesn't buy a home, the likelihood the next generation can buy a home is very low. Because when someone dies, the money that is in the house, that home equity, is often what transfers to the next generation and helps the next generation buy a house.

31:08I was looking at some stats here because I want to, what I want, I wish I could sit down all of the guests that have been on my show that have had a difference of opinion and have said that buying a house is a bad investment. It could be a really interesting conversation, right? It would be a really interesting conversation. What I've done as an alternative to that approach is I've pulled up what they've said. 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. 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.

31:38And one of my guests cited Robert Schiller as the evidence of that. After maintenance, which usually equals 1 % to 2%, property taxes, which equals about 1%, insurance and transaction costs, the net real returns approach roughly zero on average. So when you say housing is a great investment, are you referencing the gross appreciation, which is the total appreciation, or the net returns after taxes, maintenance, insurance, in selling costs. So when you dig into these kind of numbers like this, what they are is they're numbers, but they're not real world, right? So like when you talk to someone who owns a home today and they've owned it for 20 years and you ask them, how much of your net worth is now in the equity in your house?

32:23Over 50 % of their net worth is in their house. You will see people on your YouTube channel that literally, if you read the comments, I'm sure you do. I do, yeah. Where people say, It's not true. I read a comment yesterday on your YouTube page. All I know is I bought a house and it's gone up in value three and a half times. And the rent when I bought the house was$1 ,200. And the rent today to buy that, if I had that house, if I was renting, it would be$4 ,000. So the thing is you have to understand is that rents always go up, Stephen. Like I lived in New York City for 18 years. when I moved in New York City in 2001 a really nice apartment a nice apartment was like six thousand dollars a month when I left New York that same apartment was twenty five thousand dollars a month follow the follow the insanity of that math now that apartment went from being two million dollar apartment to a five million dollar apartment so I could have been renting it but in my case I owned it and it went up in value$3 million.

33:35So I have friends who have been renting in New York for 20 years. They have built no net worth. I have no vested interest in this conversation, meaning I don't sell real estate. I'm not a real estate agent. I'm not selling real estate. I've just seen in the real world how people have built wealth. The McIntyres in this book, The Automatic Millionaire, when they came into my office and they were worth$1.8 million, and he was 52 and able to retire, having earned an average of$40 ,000 a year, all their money wasn't in the stock market. They had bought a home in San Leandro, California, what they called a middle-class neighborhood.

34:15Their home at the time was worth about$300 ,000. They had paid their mortgage off and they had bought one more house on their street. They rented the first house. They bought a second house on their street. They paid that mortgage off. And so they owned two homes for Anclair, one house they got income from, one house they lived in with no debt, and then they had saved money in their 401k plan. So if I was a young person, or not even a young person, a middle-aged and older person, who took my down payment that I was going to pay into the house, let's say my down payment was$20 ,000, and I put that into the S &P 500 instead, over the long run, won't that grow larger than the total home equity potentially?

34:58here's why the index fund theory doesn't work. You can't live inside an index fund. You can't live inside a mutual fund. You have to live somewhere as long as you're alive. Here's what people should do. Take a look at what you're paying in rent. Now, ask yourself a question. If I'm paying$5 ,000 a month in rent, which lots of people are, right? Do you know people paying$5 ,000 a month in rent? Yes. Okay, so they're paying$60 ,000 a year. Let's take that number. Yeah. So over 10 years, they're going to spend$600 ,000 in rent. Yeah. If the rent doesn't go up. Yeah. In 20 years, they're going to spend$1.2 million in rent.

35:43If the rent doesn't go up. In 30 years, they will have spent$2 million in rent if the rent doesn't go up. But the rent does go up. So the question you just have to ask yourself is, am I going to take all this money that I'm spending on rent and never build anything? And if you really believe that renting is better than owning, then you should still consider the idea of buying something that somebody else rents. Because I promise you somebody's getting rich in the transaction. If you're the renter, you're not the one who's getting rich in the transaction of renting. It is a great short-term solution, renting.

36:22It is not a great term, long-term wealth building solution. The other thing that people often talk about, and you cited earlier, is the mobility that renting gives you. Yeah. Your son was here a second ago. He's 16 years old. Yeah. Soon he'll be at the age where he's got his own place and he's thinking about different career opportunities. Then I got AI's this big thing, so he might want to go to San Francisco. Then he might want to go live in Florence and wherever else. if he's bought a place, there is an interesting sort of psychological, but also financial component to the fact that it makes it harder for you to move with the opportunity of life.

36:55And if what people say about the future of work is true, that we're going to have many more careers in our lives than we did in the past, one might assume that we're also going to be more mobile. And so is there an argument to say that buying a house might hurt my professional opportunities, my ability to pursue professional opportunities? The answer is possibly, right? But here's the thing about rent. Rent's, interestingly enough, a major obligation, right? Usually when you go and you do a lease, you lock yourself into a one-year lease. Sometimes you lock yourself into a two-year lease. When you buy something, and this is assuming that you have the money to buy something, Stephen, look up, because you've got all the data at your fingertips here, look what the average length of time it takes to sell a home in the United States.

37:46Just Google that right now. Because what I will tell you is in certain markets, you can put your home on the market and you can sell it in less than 90 days. Now, some markets, you can sell your home in less than 30 days. In many cases, you actually have more flexibility when you own something than when you rent. And that's if you want to sell it. It says the average time from listing to sale is about 47 to 62 days from listing to closing in 2025, including 16 days on the market and 30 to 45 days to close. That's called less than two months. Even in hot markets, the process from putting a house on the market to legally selling it can take 1.5 to three months, meaning home equity isn't a quickly accessible investment.

38:31Yeah. But do you think that's pretty quick? 90 days? It is. I mean, it takes you that much time to get out of a lease. Exactly. So here you've got a piece of property that you can turn around and sell in less than 90 days. Now, this is the U.S. You can't do that. Like, for instance, I live in Italy. That could be very hard to do that in Italy. But in the U.S., you've got something that's in a good market. It's liquid. The other thing is you can rent it, right? You're actually not trapped. If you start to build equity in your home and you pay your mortgage down slightly, next thing you know, you're able to rent that property and you can still move.

39:01Today, people are taking their homes and they're Airbnb-ing them. What I really want for people is the chance to be financially free. There's also an age at which it doesn't matter if you own. You know, once you start to get older and you've built financial security, you get in your 50s or your 60s or your 70s and you just want to travel and you don't want to own anything. That's a different stage of life. So the question just becomes the money that you make. I go back to the 90 ,000 hour comment. When you work 90 ,000 hours over your lifetime, what's your plan to keep some of this money? you have to have a pay yourself first plan that has to be your number one priority is that when you earn money the first person who you're going to pay is you if you say you know what i watched steven and i saw david and i've seen a bunch of other people on his show and i'm not going to buy a house okay then you have to pay yourself first more now i go around the world for the last 30 years starting with oprah with the automatic millionaire I launched this book on Oprah and I talked about, you have to save one hour a day of your income.

40:08And people will get on these social media boards and be like, I can't save 10 % of my income. I can't live off 90 % of my income. It's not possible I have to spend all of it. Right? Well, then that person who's renting and not buying a house, which is for savings, is clearly never going to save. So the other thing about buying a house is it does require for savings. Because when you have a mortgage payment, part of that mortgage payment is paying down your debt. And I teach you how to use a bi-weekly mortgage payment plan. So you take a 30-year mortgage and you pay it off five years earlier. And doing that can save you, depends on the size of the home, can save you$50 ,000 to$100 ,000 just in interest payments.

40:50You talk about having a savings mindset. What is a savings mindset? And how does one go about saving if they are one of those people that says, listen, I'm barely getting by as it is, David? Yeah. How the hell am I going to save money when I'm actually increasingly getting into more debt right now? So the first thing is you have to find your money. So what I find, Steve, is when I talk to people, most people don't know where their money goes. Literally, they don't know. They're like, how much money do you spend a month? Well, I'm not really sure. How much money do you spend a year? Well, I'm not really sure.

41:21You need to be sure. So you should be doing something to track where your money goes. Now, you can be sophisticated. You can use an app that will track where your money goes. You can also take out a pad of paper. And I give people a seven-day financial challenge. For seven days, just bring a little pad of paper with you and write down every single day where your money goes. Now, why do I want people to do that? Because most people today are spending money unconsciously. I go back to these phones. The fact that I don't even have to carry a wallet anymore, right? It's just click, click, click and pay for things.

41:55We've lost touch with spending money. So when people start to see what they're really spending, it's a wake-up call. The biggest thing I've been sharing lately is what does it take to blow$10 ,000 a year per day in terms of spending? How much money do you need to spend a day to blow$10 ,000? Now show us the – here – now we happen to have these – we have pounds today, right? So I'm holding – Stephen, right now I'm holding what is known as a brick. So I don't know if your staff told you how much I'm holding here. You know what? What'd you guess I'm holding? It looks like maybe$5 ,000. Okay, so this is a life-changing amount of money.

42:35Stephen, this is$10 ,000, right? And what does it take to blow$10 ,000 in a year per day? How much money do you have to spend per day to go through$10 ,000? I'll make it easy for you. The answer is$27.40 a day. $27.40 a day adds up equaling$10 ,000 over the year. Now, before we go through where do you spend this money and how do you waste$27.40 a day, the question becomes if you didn't waste$27.40 a day and you were able to get yourself to invest$10 ,000 a year, what could this be worth over time? And the answer is in 40 years, if this was in the S &P 500 fund, which you quoted earlier, and you earned 10 % annually with reinvested dividends, that stack there would grow to over $4 ,400 ,000 if you invested$27.40 a day.

43:41Pass me this big, Britt. Yeah. So if I save half of this a day, then in, did you say 40 years? In 40 years. So let me give you the math on a couple of different ways of doing this. Okay, so what would happen if you invested roughly half of this a day? The number I use is$27.40 a day. It's the magic number. That equals$10 ,000 a year. If you invested that a day for 40 years, you'd have over$4 ,424 ,000. If I invest$27 a day, in 40 years, I'll have$4 million. Over$4 million. Let's go through the yeah buts now. Because people are going to hear this. Some people are going to go, wait, what? And then we'll talk about where you find$27.40 a day.

44:27Yeah, but$4 ,400 ,000 won't be worth a lot of money in 40 years. With inflation, it won't be worth that much. It won't have the same purchasing power. My answer would be, it's worth a whole lot more than zero. Right? If you're not saving any money, if you can't save$27.40 a day, you won't have$4 ,400 ,000. Yeah, but with taxes, you know, it won't grow that much. Well, it could if it was in a retirement account. You wouldn't be paying taxes on the money. Yeah, but it's not possible to earn 10 % on my money. Well, the stock market for over 100 years has averaged over 10 % annually with reinvested dividends.

45:09Yeah, but the stock market's risky and complicated. Well, no, it's not. If you bought an index fund, it's actually not that risky and complicated. Yeah, but I don't know. I don't know how to get started. Well, you could start really easily. You could open up a brokerage account. You could go to a Charles Schwab, Fidelity. I mean, I'm literally going to go through them all. Vanguard, Robinhood, Coinbase, Acorns. And in less than 10 minutes, you could open up an account, and be saving, pick a dollar amount,$5 a day,$10 a day,$27 a day, and that could change your life. Now, why is$10 ,000, Stephen, such an important dollar amount?

45:50Here's what I can tell you having done this for 30 years. This dollar amount right here, first of all, this is one in two Americans don't have$1 ,000 in a bank account right now. So this is 10 times what one out of two Americans have. But more importantly,$10 ,000, when we do surveys and we ask people, how much money would it take to totally change your life? The answer is not a million dollars. The answer is not$100 ,000. The answer is actually$10 ,000. And the question is, why is it$10 ,000? And the reason is, is that's about what the average person has in credit card debt. And they feel like they're drowning, like you talked about earlier.

46:33And they know that that could pay off their credit card debt. Or they have a job they don't like. And they knew that if they had$10 ,000 in a savings account, they'd quit that job and they'd be free. They'd have to go find another job. Or start a business or something. Or start a business. Or, God forbid, they're in an abusive relationship and they can't leave. But if they had$10 ,000, they'd leave. So, you know, a lot of people go, David, you just make this all too simple. And it's true. I do. Because when it's simple, people take action on it. So for years, I have taught this concept called the latte factor.

47:12A lot of people love me for it. Now I have a lot of people hate me for it. And I have taught that, you know, we waste small amounts of money on a little thing. I had your staff bring me a nice coffee. When I started teaching the latte factor, I would talk about the idea that we waste five bucks a day on coffee. and that if you don't believe you can start saving and investing, at least save$5 a day. Make your coffee at home. And people would say, but I don't want to give up my coffee. Okay, well then figure out another way to save$5 a day. This iced coffee, I don't know what it costs you're in London.

47:45In New York City, that coffee right there is$9.50. Plus a tip, it's over$11. I know because I was just in New York. so today we had a bunch of props here and i said well let's try to show like what what is 27 and 40 cents like when i go to my hotel later when i leave here a cocktail is going to be 30 bucks right i was just in york city cocktail i had a cocktail my hotel was 31 and 50 cents wine 50 eating out you go and have lunch today it's going to be 25 and people say well i have to eat. And I go, I know you do, but you could also ground bag your lunch. It's what my grandmother did. Now her friends teased her, but my grandma was able to retire to California and her friends all got stuck in Milwaukee, Wisconsin where it was cold because they couldn't afford to retire the way she did.

48:38How many people could actually save$27 a day? Because if I go back again, just over 10 years of my life, I mean, there's no chance I could save$27 in a day. There's just no, There's just no, there's no way. If you go back to what age? If I go back to between like 18, 19 years old, roughly that period of my life. Yeah. There was no way I could have saved$27 a day. Here's really the question. Do you have friends and do you think you have people who work with you who are making more than$50 ,000 a year and they're not saving$27 a day? They're not even saving$10 a day. This is true. I actually did a bit of research.

49:19on this. And it says approximately 40 to 50 million families, if we just take the United States where I think there's what, 330 million people roughly, approximately 40 to 50 million families in the US can realistically save$27 a day. This represents roughly the top 30 to 35 % of households. For everyone else, the bottom 65 to 70%. Saving that amount would require either extreme poverty level budgeting or is a mathematical impossibility. Over 40 million people they think can afford to save$27.50 a day? Yes. It's based on income and expenditure data from 2025 to 2026. Approximately 40 to 50 million families in the US can realistically save$27 a day.

50:00So for those 40 to 50 million people in the United States, that would be life-changing. Now, are there people who can't afford to save that? Absolutely. In the United States, I was just in Arizona. I just did a keynote speech. I asked the audience, this is when the government was shut down i said how many people do you think in america are taking and receiving snap checks what's that thank you because by the way most americans don't even know what a snap check is that's a check that the government gives to people for food and the dollar amounts a little over six dollars a day so smart people in a room by the way i didn't know the answer to this a week prior either.

50:43The answer is about 41.5 million Americans get a snap check. When I told the room that, the room gasped. I said, so when you hear that the government was shut down for six weeks, that was three pay cycles. Well, the average American doesn't have two weeks of expenses set aside. I mean, I don't think everybody fully grasps the problem right now. Four out of 10 Americans can't get their hands on$1 ,000 in case of emergency purposes. If you actually dig into the Federal Reserve data, it's 37 % of Americans can't get their hands on$400 in case of emergency purposes. So there's a whole section of America that's truly struggling.

51:32But there's a whole lot of America that is still struggling. They're living paycheck to paycheck, but their money's being taken from them all the time because they don't have a plan for it. For that bottom 60 % of Americans that my research says wouldn't be able to save$27 a day, the data reveals a discretionary income cliff. Once you drop below the top 40 % of earners, the money available after bills vanishes rapidly. The top 20%, which earn, I think,$96 ,000 per household, are in a surplus. The middle 20 % have a$15 ,000 surplus, which the$27 a day takes 66 % from. But the bottom 40 % often have a roughly$2 ,000 surplus.

52:18So it's impossible for them to get to the$10 ,000. For that bottom 40%, what's the advice for them? Start with something. Okay, so like we took this 50 and we said cut it in half to 25. I would say, can you save a dollar a day? I have actually talked about this idea really simple could you save$10 a day for 100 days so like if you're listening to me and you happen to really be struggling right now my question would be could you save$10 a day for 100 days why because it would get you your first$1 ,000 and you now have more than 50 % of Americans who don't have savings 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 for some people saving$10 a day It could be really, really hard.

53:08But you're into fitness. You saw my son who just came in here. Fitness is built through daily action, right? It's built through daily action, daily eating well, going to the gym, doing certain things on a regular basis. Saving is the same thing. There's a company called Acorns. I invested in Acorns back in 2015. Acorns came up with an app. that helps you roll your change up. So if I go to Starbucks and I spend$9.50 on a coffee, you can round it up where the 50 cents to 10 bucks is put into investments. Just rounding up your change. And people have saved tens of thousands of dollars over the last 10 years by just rounding up their change.

53:59Every time I've tried to improve something in my life, like my businesses, my health, my relationships, I've noticed that the biggest shifts have come from being better informed and when it comes to our health most of us know very very little so when our team was approached about partnering with Function Health it felt very much aligned their team has developed a way of giving you a full 360 degree view of your health many of the things that are going on in your body in the form of different tests you do one blood draw and it gives you access to over 160 lab results hormones heart health, inflammation, stress, toxins, the whole picture.

54:32I use it and serve many of my team members. You sign up and you schedule your tests and once you're done you get a little report like the one I have here. I can see my in-range results, my out-of-range results and there's a little AI function too so if I have any questions about my out-of-range results 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. It's$365 for a yearly membership. Go to functionhealth.com slash doac and use the code DOAC25 for$25 off your membership. I had a friend of mine contact me and I spoke to one of the previous financial advisors and educators that I'd spoken to on the show about him.

55:09He told me he was in deep financial debt, probably earns about 50 ,000 pounds or dollars a year, but has got himself into real debt. And I imagine a lot of my listeners are 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? Absolutely, because it's one of the most important things you need to know how to get out of. Debt is like quicksand. Like, you know, you talked earlier about how you were in debt and what that felt like. When I came out of college and I had$12 ,000 in credit card debt, it felt like the greatest weight on my shoulders.

55:42Like I was carrying like a 50-pound backpack. And how did I get out of debt and how do you get out of debt? I will give you the very simple formula to getting out of debt. DOLP. DOLP stands for done on last payment. If you said to me, David, I've got five credit cards. I'd say, okay, Stephen, take out this paper just like this, and I'd start listing your credit cards. I'd go one, two, three, four, five. And I'd list them well, Visa, MasterCard. And I'd list them. And then I want to know, how much do you owe? So I put the dollar amount down. And what I would do is I put the dollar amount down on paper, and I'd list it small to large.

56:30Then I want to know the interest rate. Now, what people say is, oh, you should take the highest interest rate and pay it off first. But I wouldn't tell you that, Stephen. I'd tell you, you take the smallest credit card. I don't care what the interest rate is. The smallest amount. Smallest amount. So maybe this card right here is$500. And this card down here is$3 ,000. I'd have you make minimum payments on every card automatically. This is really important, the automatic part. Have you go on, I'd literally go into your house and open up your iPad. And I'd have you make minimum payments online automatically so that every card's paid on time.

57:13Then I'd say, Stephen, how much extra money do you have? Because I want you to put it all towards the smallest card. We're going to get that small card paid off as fast as possible. We're going to add all the extra money to that small card. Minimum payments on everything. Once that card's paid off, we're going to go like this. You don't have to close the account because we don't want to lower your credit score. But we're going to put that card over here and never use it. Now we're going to go to the next smallest card. Some people call this a snowball approach. The reason I teach this system is it reduces the amount of credit cards you have as fast as possible.

57:48And you see yourself make progress. It's really important to see yourself make progress when you're doing anything financially. Then I would attack the interest rates. Because the interest rates aren't always permanent. You can negotiate your rates lower. You can move credit cards to another card with a low interest rate. 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. And when they do, they'll jack the credit card interest rates back up again. You can also call up your credit card companies if you're really struggling and tell them I'm struggling and I'd like to know if you have a program in place where I can stop the interest rate and pay these cards off and more accessible.

58:36This is basically what the nonprofit credit card counseling organizations do. But the credit card companies often have programs too for this. They'll tell you to stop using the card. They'll actually make it so you can't use the card anymore, but they'll stop the interest rate. So that approach has helped so many people get out of credit card debt. Now, I just want to say something super important because I've gone through this. when you go through the work of getting out of credit card debt it's a huge victory don't go out and celebrate on the credit cards because i got myself out of credit card debt in college junior year and then i went out and celebrated and got myself back into credit card debt and people do this all the time usually people get themselves in a hole at least twice, sometimes three times, don't go back in a hole again.

59:28I didn't carry credit cards for 30 years. I only carried a debit card and I had to pay it off every month. Should these people who are in the bottom sort of 60 % be thinking at all about how to make more money, how to increase their income? Absolutely. And what are the like the easiest ways to do that that you'd recommend just from your own experience of, you know, being in the professional world? And So my experience, and I know that you, look, you wrote this great book, Diary of a CEO, right? Anybody that hasn't read your book, you wrote this great book. What's the best way to grow your income if you have a job?

1:00:04It's to be good at what you do, right? You can have a job at minimum wage. Let's pretend you work at McDonald's and you have a job working minimum wage at McDonald's. The owner of McDonald's, the guy who owns that franchise, or the gal that owns that franchise, desperately needs good employees. Who becomes a manager that makes more money? The person who works really well. Now, a lot of people go, well, I don't know if I want to work at McDonald's. I'm just giving it as an example. Anywhere you work, how you grow your income, is you are the best at what you do. You show up early. You have a game plan at work.

1:00:43You work late. You do what you say you're going to do. You don't wait to be told what to do, right? Like, I've been an entrepreneur all my lifetime. The hardest thing about being an entrepreneur is what? Yeah. Everything. It's everything. And most people who are entrepreneurs go, well, you know, a lot of times it's hard to have good people unless you're a good leader. People are so thirsty to have jobs with purpose and meaning. And most people are actually looking for leadership. shit. So if you can be really good at what you do, you will make more money. There's no limit to wealth in the world, right?

1:01:20Like we've never seen so much wealth being created in our entire lives as right now. If I were a young, a lot of people would go, well, you should learn AI. Yeah, you know what? Probably you definitely should learn how to use AI because if you don't learn how to use AI, you're going to have really limited skills and go into certain jobs. You know what else people are going to go out and do? Learn how to be a plumber. Learn how to be an electrician. Learn how to put up garage doors. I've got friends, I was just recently on a podcast with a guy who's made a billion dollars putting in garage doors.

1:01:51And he took me through his warehouse and showed me their garage door models. And I was like, you know, I've got a friend who makes gyms that go in garages. I just connected them. He's got a huge business, making gyms for garages. there's just no limit to the amount of opportunities out there. You have to, though, get out of a stuck mind frame. I mean, you had Tony Robbins here. If there's anybody who can help you get out of a stuck mind frame, it's that guy, right? But you can't have, Zig Ziglar used to call it stinking thinking. You have to have the ability to look into the future and believe that your future can be as exciting today or better.

1:02:33I put up a post yesterday. I said, I would rather be an optimist and be wrong than a pessimist and be right. And you show me somebody who wants to make more money, go in the world an optimist and figure out how to go make more money. Do you think a lot of this is a mindset at the core of it? Obviously, there are real socioeconomic factors and there's people who live in certain situations. And if I think back to, you know, where I was born in Botswana, there's just less opportunity. And sometimes you have repressive governments and other factors that will objectively keep you stuck. But all other things being equal, how much of the game is mindset?

1:03:16It always comes down to a decision. And we started by talking about my grandmother. If my grandmother hadn't made a decision at 30, that she didn't want to be poor, she was tired of living paycheck to paycheck. She hadn't decided that she would go out and teach herself about money and take 50 cents of her paycheck and 50 cents from my grandfather's paycheck and start investing. I wouldn't be here today. She made a decision that had a ripple effect through our family. She built financial security for herself with that one decision. She taught my father how to invest, and he was a financial advisor for over 45 years.

1:03:53My sister's a financial advisor. I was a financial advisor. or I've spent the last 30 years teaching people about money, one woman's decision had this ripple effect. So one thing I say to people who are listening, especially the moms, sometimes you've got to make a decision that's not just for you. You're actually making a decision for your family. And you can come up with a list of reasons why this stuff won't work. Somebody who's watching this show or listening to us right now, they're already interested in this. That's why they're here. Now, they're here for a couple of reasons. Either A, they're hurting financially, and they know they need to fix something.

1:04:32Great. Start where you are. Fix what needs to be fixed. Some people are like, you know, I think I'm doing pretty well, but I'm not sure if I'm doing everything well. You know, I've opened up my Roth IRA, or I've opened up my 401k plan. I'm putting some money away, but I don't know if I'm putting enough money away. Then you can improve what you're doing. Some people are like, I'm renting. I think I would like to buy a house someday. All right, make that a goal. I teach three buckets when it comes to money, three baskets. Pay yourself first for retirement. We haven't even talked about emergencies yet.

1:05:06Putting aside money for emergency purposes. Have to talk about that. You got to get more money put aside for emergency purposes. And then building a dream account. You need to put money away for your dreams. Those three accounts should be automated. And on that point of having three accounts, You call it a future account, an emergency account, and a dream account. How much of your earnings should you be putting into each of those accounts on a monthly basis? All right. So keep it super simple. I recommend one hour a day. Again, I said this earlier. It's 12.5 % of your gross income. When you say one hour a day, you mean one hour of the time you work per day?

1:05:40Yeah. So whatever you make an hour. Yeah. If you're working a 40-hour work week, 12.5 % of your gross income goes off the top into a retirement account. Now, let me just say something for the yeah butters. They're like, I can't go from zero to 12%. There's no way. Then start at 1%. 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. And that decision is I'm going to save 1 % of my income. And you start that this month, your life will change. 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.

1:06:21Now, I will tell you, if you save 1 % of your income, you won't notice it. And if you did that every month for a year, at the end of the year, you would have saved 12%, and you will be saving four times what the average American saves, and you will be in a rock star shape. Then the second hour, this is where people's minds blow up, but the second hour, so the first hour goes for the future, the second hour goes for safety and for dreams. So 30 minutes of your income, roughly 5%, should go into an emergency account. And another 5 % goes into a dream account. Now, that dream account could be for buying a house, could be saving money for college, could be the vacation you want to take at the end of the year, could be getting married, could be the engagement ring.

1:07:06But you're putting money away for your dreams. Because when you put money away for your dreams, that's how they become real. And, you know, the book is called The Automatic Millionaire. This is a book that sold over 2 million copies on its own. Why did you use the word automatic? Unless your financial plan is automatic, it will fail. How do I know this? Because I spent nine years as a financial advisor at Morgan Stanley, and I got to see firsthand. Everyone who came into my office with an ordinary income, who built wealth, they did it by saving automatically. every single time a client came into my office and they said i'm gonna bring you a check every month myself i never had a client save for more than six months they stopped when once you make the decision to automate your financial life it works in the background now here's the thing everybody else is already doing this to you you go sign you go to go to a gym to go work out They don't ask you to bring them money every month.

1:08:13They automatically bill you. You get a phone bill. They automatically bill you. Today, in many cases, when you rent, they automatically pull the money out of your account. The banks automatically take money from you for your mortgage. When you pay taxes, they're all automated. Everyone takes money from you automatically. Everything that you sign up for on your phone is a subscription service. Netflix. Go through your credit card today. Open up your phone. Look at all your subscriptions. All those businesses are taking money from you automatically. Why? That's the only way they can be in business.

1:08:48They know if they don't get money from you automatically, you won't keep using them. Most people who start off with a free subscription, it'll take them three to six months to turn off something that they don't use. I'm here getting people to automate their financial life for themselves. Is there simple ways, apps, tools, websites we can use to go through all of our subscriptions and turn them all off? Yes, there are. So let me tell you the easiest way. This is really actually free publicity for Apple, okay? Because so many people have Apple phones. Number one, only do your subscriptions inside of Apple.

1:09:33In an ideal world, don't pay anybody directly. Do it all through Apple. Why? Why? Because if you go to the bottom of your phone and you don't know how to do this and you put subscriptions, up will pop everything that you've signed up for. And you can go click, click, click and turn them all off. Another thing I will tell you is that when you sign up for anything, let's say it's a one year, because everything now is a one year trial subscription or a one month trial subscription. The moment you sign up for it, shut it off. Because what happens is if you sign up for anything and think of any subscription you can imagine companies hate me for this the moment you shut it off when the time comes for it to renew they will offer you a better deal to renew okay so i've opened up my phone i've gone to the settings i've clicked on my name in the settings and then i've clicked on the button subscriptions i have one two three four five six seven eight nine, ten, eleven, of which three of them I would keep.

1:10:39So all these other ones have just been running in the background, and it's because I used an app one time, and it signed me up to some kind of free trial, and I just totally forgot to cancel it. Oh my God, some of them are massive. Okay, so as you do this, what you're doing right now is a real-life example. So if someone's listening to us, watching this, they're married, they've got kids, or they're single by themselves, this one exercise, my guess is there are many, many people listening that could find$50,$100,$200 a month that they could shut off and redirect that money to saving and investing.

1:11:16And that could change their life. Are there other apps you can use and go to to figure out how to cancel or leave your subscription? So there are, and most of these apps you have to pay for. Right. So like you can go to, so then you're right back into paying for an app. Probably the two popular, most popular apps are Monarch and YNAB. You can also use your credit cards. The credit card comes to doing a better job of showing it on your statements. And again, I go back to the Apple example because Apple makes it the easiest to shut these off. Maybe some of you will be spending$100 a month. So I did$100 a month.

1:11:53And it says, if you invest, if you sort of cancel those subscriptions and invest$100 per month for 40 years, an annual rate of return of about 10%, which is roughly what you get if you just put it into some of the big tech index funds at the moment, the total money you'll have in 40 years is$632 ,000, which is a staggeringly life-changing amount of money. It's staggering. And let me just give some very specific investments for people to consider, right? And they still need to do their own due diligence and read prospectuses. And yes, there's risk involved in the stock market. But the first one I would talk about and look at, these are all listed in my book because I just want to give you, because people are like, what's an index fund?

1:12:32What do I buy? Look at the Vanguard Total Stock Market Fund. The symbol is VTI. Okay, this is actually the largest index fund in the world. There's trillions of dollars now in this fund. I talk about it in the book. I looked up the annual returns of VTI the last 10 years have been 14%, 14 % annually. This fund has 3 ,500 stocks, all the biggest US stocks. So you don't have to figure out what stock to buy. You buy this fund. You buy an exchange-traded mutual fund. You have access to 3 ,500 great American companies. I'll give you another stock index fund I love. And everybody can buy this on their phone right now, probably.

1:13:17Literally, you can go to Vanguard, Schwab, Fidelity. this funds this is an etf so it's available everywhere it's a stock and if you want to figure out how to do this and you're listening right now what i'd do is use chat gpt or gemini and put in the stock the the fund that um has been said and ask it how do i invest in this in the country that i'm in what app do i need to use what website do i need to use again this is not investment advice well i guess it kind of sounds like it is but well no but it's also like so like Like someone says, okay, but I'm not, I'm in wherever I am. I'm in the UK.

1:13:49What's an index fund in the UK that covers the UK? I'll give you the global version of VTI. So, because I own these funds. So I, so the global version of VTI is a symbol, which is all, I'm going to give you another Vanguard fund. When you say you own these funds, for clarity, you mean you've invested in them? Yeah, I've got money in these mutual funds. So this other fund, because I have, I want money, my personal money that's in the stock market. I am one-third global investments, and I'm two-thirds U.S. investments. So I have a lot of global index funds. This global index fund, the symbol is VEA.

1:14:23Okay, so this is the Vanguard global index fund without U.S. stock. Symbol, again, is VEA. That fund last year, and it won't always be like this, because global investments have underperformed the U.S. for a long period of time, that fund last year was up 35%. Last year, global investments significantly outperformed the U.S. investments. And the U.S. investment market was up on average of 17%. So the U.S. markets were up 17 % or higher, and global investments were up 30 % or higher. Now, there will be a point in time, Stephen, without a shadow of a doubt, that we will see a market pullback. And when that day comes, you have to stay the course and keep investing automatically monthly.

1:15:07And then I'm going to give you a tech fund because everybody wants to know, what should I invest in that is, you know, should I invest in an AI tech fund? And my answer would be is you don't need an AI tech fund. You need the best tech fund that's existed in my lifetime. And that's the NASDAQ 100 ETF. And the symbol for that is QQQ. So go and look, you know, go into whatever you're using and go look up QQQ, read about the top 100 stocks in the NASDAQ. and the returns for QQQ, I mean, actually, on top of my mind right now, I think it's over 20%. But look up, what is the QQQ total return been for the last 10 years?

1:15:54I can tell you since I put money in QQQ, it's gone up tenfold. Now, the market's been unbelievable and there will be pullbacks. And that is also why I should say this, even because we haven't even addressed this. I don't run around telling people to put all their money in the stock market. I also don't think that young people should be putting all their money in the stock market. I think one of the greatest myths out there is that when you're young, you should take a lot of risk. Let me say that one more time because it's super important, so make sure it sits. Everyone says when you're young, you should take risk.

1:16:31The problem with that advice is that today, people in their 20s and their 30s are taking a lot of risk. They're not just putting money in index funds. They're putting money in meme coins. They're putting money in meme stocks. They're putting money in NFTs. They're on social media and TikTok watching people day trade. They're trying to get into options. What they're really trying to do is get rich quick. All I can tell you is the older guy in the room here, people who try to get rich quick stay broke forever. And the problem with taking too much risk with your money when you're young is if you do everything right, like let's just say you shut off all your subscriptions and you're saving$200 a month, but you put that$200 a month into a junk investment and you turn around in 10 years and you have nothing to show for it, you'll stop investing.

1:17:26Looking at the QQQ data, so this is the NASDAQ 100. So this invests in the top 100 companies in America. And the Nasdaq stock exchange. The returns over the last 10 years from 2016 to 2026, the annualized returns have been roughly 19%. The total return of that period has been roughly 480%. So$10 ,000 investment 10 years ago would now be worth approximately$60 ,000 today if you've done nothing. Done nothing. Never added to it. Over the last 20 years, the annualized returns, the return every year has been 15 % with a total return over that period of 1 ,500%. And again, so if you've added$10 ,000 to it 20 years ago and done nothing, you would have roughly$170 ,000 today.

1:18:15So here's the beauty of what you just did. You checked my advice. You looked at the data. And now you know what has been done in the past. Let me give you a super boring fund. I'm not sponsored by Vanguard. I'm just giving generic vanilla stuff here. Look at the Vanguard Balanced Fund. So Vanguard Balanced Fund. And the Vanguard Balanced Fund is 60 % stocks and 40 % bonds. That, by the way, is the most typical asset allocation, the difference between stocks and bonds in the world. The average retiree has a portfolio that's about 60 % stock and 40 % bonds. You look up the Vanguard Balance Fund, and what you're going to find is that fund has averaged over 8 % annually since inception.

1:19:05It is as boring an investment as they come. So if someone says, well, I don't want to be 100 % stocks. I just want to be more conservative, but I want some stock exposure. The Vanguard Balance Fund is a great example. I list all these funds in the Automatic Millionaire. One of the kind of funds I talk about the most is what's called a target-dated mutual fund. I don't know if you guys have a 401k plan. We have something similar. Okay. So in the US, if you have a 401k plan, what you're going to find when you open up your 401k plan is you have what are called target-dated mutual funds. This is a one-stop mutual fund solution to your investing all the way until you retire.

1:19:51And it will be divided among stocks and bonds, and it will be what's called rebalanced automatically as you get closer to retirement. So I'll go from being more stocks when you're young, less stocks as you get older. There are trillions of dollars now in these target data mutual funds. When I wrote The Automatic Millionaire 20 years ago, it was just getting started. This automatic solution to investing has changed the game of investing for millions of Americans. That's why there's 24 million millionaires, and that's why there's now$45 trillion in retirement accounts. 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.

1:20:31I'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. They are especially great because they make fresh meals and they cater to so many different diets. High protein, keto, vegan, vegetarian, low carb, gluten-free, paleo diets, you name it. Every meal is designed by a dietician, made by chefs and delivered right to me. Fresh and never frozen. So if you're ready to streamline your food intake, visit factomeals.com slash diary50off and use my code, Diary50OFF, to get 50 % off your first Factor box plus free breakfast for one year.

1:21:11And this offer is only valid for new Factor customers with code and qualifying auto-review subscription purchase. Over the years, people have reached out asking me for mentorship, but the challenge I've always faced is that my calendar doesn't permit me to help every single person that reaches out. So when I know I can't personally help, I try to push people towards tools that I think can. And that's why I wanted to tell you a little bit about a resource that I think will be great for those of you who are founders of small and medium-sized businesses. It's a content series that our longtime show sponsor Vodafone has created.

1:21:40It's called VodafoneBusiness.Connected. You'll find it on YouTube. This series delivers the knowledge that founders today need to grow their company in the digital age. There you'll learn about personal branding, cybersecurity, scaling e-commerce companies, and through conversations with many founders who I've invested in and work closely with, the opaque picture of building a business will become clear. Some of those founders I've invested in in the series include Christiana Brenton from Flight Story, Marissa Poster from Perfect Ted, Leo Harrison from Chapter 2, and Georgia Gibson, who I've partnered with to buildstephen.com.

1:22:12And these are just a few of the great names involved. Search Vodafonebusiness.connected to learn more. The other book that you wrote, which sold incredibly, incredibly well, is this book about Smart Couples Finish Rich. That's the title, Smart Couples Finish Rich. Nine Steps to Creating a rich future for you and your partner. As it relates to how rich or wealthy you become, the person you choose and the way that you configure that relationship, how consequential is that? It's everything. Really? It can be everything. Why? You're married? I'm married. Yeah. So why can it be everything? Because here's what happens in the real world, Stephen.

1:22:52Often we marry our financial opposite. So I always joke, like I used to do a lot of seminars for couples. And I'd say, there's two types of people that are born in the world. One person comes out literally with a calculator and they're born to track where all the money goes and they love to budget and they're super excited about investing. That's one kind of person. The other kind of person loves to shop, loves to spend money. Almost inevitably, those two people hook up. Now, sometimes two people who like to spend money marry. that's a disaster because they end up broke. So now what do you do about the couple that's got their financial opposites?

1:23:33That's what led to smart couples to finish rich because if you are married to your financial opposite, you will fight about money all the time. And fights about money are what lead to divorce. They're the number one cause of divorce. The real key in what I've been teaching now for over two decades is the way you get couples on the same page when it comes to money is you start with your values. So you look at what do you really value most together as a couple. You put the money aside for a second. You go through your values. What's most important to you? What do you really care about? You talk about your values.

1:24:14And then you build a financial plan around what's really most important to you. You say that there's six worst money mistakes that couples make. And the first of those is not deciding who's responsible for what. Yeah. So often in a relationship, one person pays the bills. Okay. Who's managing the money? Now, I used to say in every household, there should be at least one person that's paying the bills. And if the other person is managing the money, meaning that they're in charge of investments, that you still get together and go through it. As I've gotten older, I've really realized how important this is because I go back to the fact that the average age is 59.

1:24:56Average age of widowhood is 59. I'm 59 now. I've had three best friends already pass away, all men. And they passed away before they were 57. So all these statistics that I talk about, I'm seeing them come true. and I will tell especially the women hear me louder hear me on this loud and clear but this is important for the men too the question you need this is hard to hear the question you have to ask yourself is if your partner died today what would you need to know about the finances and the answer is everything now what does that mean everything that means you would need to know where is the money?

1:25:40Does he have money in an old 401k plan? Does he have money in an IRA account? Does he have money in a bank account? What are the passwords to get into the accounts? Where's the will? You know, six out of 10 people listening to us today don't have a will. You have to have a will. At any age. At any age. Especially if you're in a relationship, you have to have a will. If you have kids, you have to have a will. Is there life insurance? But, you know, so many people today who have children don't have life insurance and they don't have assets. You should at least get a million to$2 million term policy.

1:26:13Super inexpensive. Protect your family. You have to run the drill, right? Like we got on a plane. We flew here today. The first thing they do on a plane before you take off is they talk to you about what to do in case of emergency purposes. The mask is going to come down. You can put it on your face. 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. You're going to go get in these emergency boats. You need to run the fire drill for your family on finances. I almost died. Like it's now been four years ago. My wife found me face down, passed out.

1:26:48I was brought to the hospital in Florence. I was in a coma for four days. I was in the hospital for 17. I had meningitis. When I came out of just like a movie, I'm laying down. I mean, I'm laying down. I'm in the hospital. Doctor's looking over me. Doctor says, do you know what your name is? I said, it's David. He's very good. He says, your last name is? I said, it's Bach. He 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, two weeks before that. And he says, no, no, you're in Santa Maria Novella. You're in the ICU.

1:27:29We're treating you right now for meningitis. but now that you've opened up your eyes, you're gonna be okay, you're safe now. And then they brought my wife in. They said, do you know what her name is? And I made a joke. I said, this is Rebecca. She's like, who? And I go, honey, I can still be a smart ass in the hospital. It's Alaysha. And she starts screaming and yelling and she's like, oh my God, oh my God, he's okay. But Stephen, the truth was I wasn't okay because when you get meningitis, you get brain swelling. So I couldn't remember things. I couldn't remember my passwords. to the bank account.

1:28:02I didn't know the passwords to my phone number anymore, to my phone. One of the things I did when I came out of the hospital, because I always manage the money, is I said to my wife, we're going to hire a financial advisor and you have to be involved in what's going on. We actually had yesterday our annual account review. Because I tell couples, you got to have an annual account review either together. And if you have a financial advisor at a minimum with your financial advisor. And I didn't want to cancel the appointment because I was, even though you guys invited me to come here, I'm like, I'm keeping the appointment.

1:28:35We'll fly here this morning. And so again, having worked at Morgan Stanley for nine years and been a financial advisor, I've seen too many couples not do this, including sadly, Stephen, my dad just recently passed away. And my dad was in the money management business his whole life. so he managed the money and my mom was not involved and when my dad passed away we had to just like my book step in and help my mom with everything now she's lucky she's got two kids in the business but as she did my mom was just a ripe waiting example of somebody who could be taken advantage of so the time to learn about money is before there's a problem if you took Booksmart Couples Finishers.

1:29:22Honestly, Stephen, it's designed to be a roadmap for two people together where you can sit down and go through this book chapter by chapter together, starting with just organizing your financial information, putting everything into file folders. It starts the conversation. And then talking about your values, then talking about your dreams, then going into, well, what do you want to share? You have a very complicated, I don't know all your stuff, but I've followed you for years. As I told you, I'm a fan of yours. I've got your book. I've watched your podcast. I've listened to you now for years.

1:29:58As your business is expanding, your life is getting more complicated. God forbid something happens to you tomorrow. Yeah, it'd be a fucking nightmare. And she's your fiance. Yeah. She wouldn't even know where to start. And I don't know if she would know who to call. so it's a worthwhile conversation like i just had this guy in the show and i don't know maybe maybe we really need to like you know involve you a little bit i was just looking at some of the data here and it says that in terms of income ignorance according to a 2021 study by fidelity investments nearly 40 percent of couples could not even identify how much their partner earned it says in terms of financial infidelity surveys from bank rate and creditcards.com consistently find that up to 40 % of adults share that they have kept financial secrets, which is hiding cash, hiding bank statements, and hiding debts that they have from their romantic partner.

1:30:53So that's almost half. And you pointed at this earlier on, which is the CFO dynamic. In many households, one spouse acts as the chief financial officer. And research indicates that roughly 50 % of couples 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. It can sound scary. 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, once you start to do it, you feel a lot better. You feel better instantly. You don't have to go from having no savings to having a million dollars to feel better.

1:31:31If you just start automatically saving some money, paying yourself first, the moment you make that decision, you'll feel better. You go and you turn off some subscription fees like you just looked at. The moment you do that, you'll feel better. It's literally like a financial muscle. You start to build this financial muscle when you start to take action. It is action that changes your life. I always say, I wrote all these books. If a person buys a book, reads it, and doesn't do anything, then I was a form of entertainment. if you listen to a podcast on money and you don't do something then we were again a form of entertainment my purpose for doing this podcast today why i got on a plane and flew out here immediately to do this with you was i want to try to change somebody's life today i've always taken the approach of like i want to change a person's life one person at a time and sometimes the things i share are hard to hear but i also know they wake people up you had this great great quote in this book.

1:32:30I was showing this today to my son. I'm holding, for those of you who can't see me, I'm holding Stephen's book, A Diary of the CEO, which is also sold millions of copies. And this is your quote on page 233. I wonder if you remember your quotes because sometimes you forget them, right? If you want long-term success in business, relationships, and life, you have to get better at accepting uncomfortable truths as fast as possible. when you refuse to accept an uncomfortable truth you are choosing to accept an uncomfortable future the one thing that wasn't in this quote was money and everything we're talking about is i'm like you're going to work 90 000 hours over your lifetime if you don't pay yourself first and you have nothing to show for it the uncomfortable truth is you will be broke we haven't talked about global issues and government issues and debt.

1:33:27Why do you have to take care of yourself financially right now more than ever before? Because the future is about to radically change. And I will talk out of both sides of my mouth for a second. Number one, I believe the next 10 years, hands down, will be the greatest opportunity to build wealth in our lifetime. AI is going to create so much wealth that we've never seen anything like it. Like when you look at the returns in the stock market from last year, they're a result of AI. What's happening is AI is making companies more profitable and more productive than they've ever been. The downside is people are losing their jobs, right?

1:34:06You've had people on the show, including Tony Robbins, talking about this. And there are going to be a lot more of those job losses. So some people are going to get much wealthier. And then a whole lot of other people are going to have a challenge. But there's another problem that we're not talking enough about. And that is the safety nets of governments. All these safety nets that were created in the U.S., Social Security, Medicare, Medicaid, unemployment. You can go through every single country. All of these things are called entitlement programs, which is a fancy word for saying the government made a promise to you.

1:34:50And a whole lot of people are dependent on that promise. And there's not enough money to pay for those promises. So like in the U.S., you take Social Security. The average Social Security check right now is$1 ,900. dollars. Not a lot of money, but about 60 million Americans depend on that amount of money. In the US, Social Security, this is government data, not me. You can do all this stuff online. The government is telling us that in 2033, that's around the corner, that Social Security is going to be underfunded and they're going to have to cut the benefits. Now, what they're talking about I was cutting the benefits by 20%.

1:35:34You have a lot of Americans that that's going to be a real problem for. Every country's got this issue because people are living longer. Governments have more debt than they've ever had. I am here to tell you it's a cliche term, but no one's coming to save you. You're going to have to save yourself. And you're going to have to take your personal financial well-being more seriously now than ever before. And if you do, you will be in great shape. If you don't, you will be dependent on a system that is buckling. 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.

1:36:17What do you mean by that? I actually had a friend contact me and ask this. They said, Stephen, I've got some cash that's been given to me, I think through an inheritance. should I pay off my mortgage or should I go invest in the stock market and the S &P 500 or something else? Yeah. I didn't know what to say because I'm not a financial advisor. So if you called me up and you said, David, what should I do? I'd go, Stephen, what's the rate on your mortgage? Then you'd say, well, David, I got a mortgage five years ago and it's two and a half percent. And I'd say, okay, well, that's a really low rate, Stephen.

1:36:46You know what? You can put the money in a money market account right now and make more than that. So maybe you don't need to rush to pay it off as fast as possible. But if you've got a mortgage at 6 % or 7 % or 8%, it's a no-brainer. The biggest thing I can tell you about paying down your mortgage early is actually really simple. Here's ways to do it. If you make one extra payment a year on a mortgage, you'll take a 30-year mortgage and you'll pay it off, depends on the rate, five, six, seven years sooner. So you can go online, you can run a calculator. Today, you don't even need calculators. You just run the question.

1:37:21You put in your mortgage, you tell Gemini, here's the size of my mortgage, here's my mortgage payment. If I make an extra payment a year, how many years faster will I pay it off? And how much will I save? And you'll see the number. When people see the number in black and white, they go, I've got to do that. Now, here's the key. Make that payment automatic. The easiest way you make your payment automatic is either make one extra payment at the end of the year, or take your mortgage payment and increase it by 10%. So if your mortgage payment's$1 ,000, make an$1 ,100 a month mortgage payment and tell the bank you want to add that to the principal.

1:38:01When people do that, they need to make sure though that money's actually paying down the principal. Another way to do that is a bi-weekly mortgage payment plan, where you take your mortgage, you split in half, you pay half every two weeks, that'll also pay your mortgage off really. Prenuptal agreements. I'm engaged. Yep. Should I be getting a prenup? So I would tell anyone who's getting married, number one, if your incomes are not the same, you should get a prenup. Number two, if you both have good incomes, you should get a prenup. Number three, if you're in your thirties, you should get a prenup.

1:38:36You would never go into a business without a contract. Marriage is the ultimate contract. It just is. Now, is it romantic to do a prenuptial agreement? No. Does one person in the relationship typically not like doing a prenup? Yes. I know a lot of women today who want prenups and the husbands don't want them. It's whoever's making the money. But I will say this about prenups. You need a lawyer, she needs a lawyer. You cannot go and do a prenup right before you get married. When people do that, those prenups get thrown out the window because they will claim and say and have an argument for, I was under extremely undue influence to sign this agreement before the wedding.

1:39:24And those agreements get thrown out, even if there's disclaimer language. and both of you need attorneys. And prenuptial agreements can often be like a negotiation. And you can learn a lot about your partner that it's not always pretty. I'm not saying you, but one can learn a lot about their partner that's not always pretty when you do a prenuptial agreement. And once the prenuptial agreement is done, if it's a reasonable prenuptial agreement, it goes in a file, it doesn't get looked at again, and it won't matter unless the day comes that you need to pull it out. And that's for a first-time marriage.

1:39:58Okay, you're a second-time marriage or a third-time marriage, and you've got kids and custody issues and support for your first wife, you definitely need a prenup. What is the most important thing we should have talked about that we didn't talk about? Stephen, we've talked a lot about money today. But money is just a tool. So what we actually haven't got to talk a lot about is using money to free yourself to live your best life. and you don't have to have money to live your best life. Again, money is just a tool. So what's most important in life? I'm going to say things that people know. Health.

1:40:38I started following you because of all the shows you did on health. Love. People hold on to love way too much. Gratitude. Being consistently grateful for the life you have. Friendship. loving your friends fully and the last thing is fun you know does i think people go through life and at some point they stop designing their life my grandmother used to say you got to dream it design it and do it and she's like you've got to run out of time so what i would say to anybody is like this is you've got this one beautiful moment in time where you're here what do you want and start working on that today you listened to the episode with tony robbins though yeah you've referenced him several times in this conversation if someone were to ask me who is the greatest mentor and greatest influence in my life besides my grandmother and my father It's Tony Robbins.

1:41:50So I went to Tony Robbins seminars in the early 90s, back in the day when he had an infomercial with audio cassettes. And I went to a program that he taught in Hawaii. He had this big hotel called the Waikoloa. And he did an exercise. This is so, it's like I remember like this was yesterday. He said to this, the room we were in, there were, I don't know, a thousand of us in this room. He said, how many of you have a dream that you're not working on? and we all had dreams. So he got us into a peak state, and he had his work on our dreams. And then he asked the question, how many of you think you're going to be alive in 10 years?

1:42:32Everyone's like, yeah, I'm going to be alive in 10 years. He's like, great, so I've got a question for you. Are you going to be alive in 10 years, having worked on your dream, hopefully gotten it, right? Done all the things I've taught you to do. you know model the masters got yourself in peak state learn the pattern recognition have you gotten 10 years older having gone through dreams and maybe got it or did you just get 10 years over 10 years older and you let your dream die you let your dream die and the room he just let that sit and then he had his go off in groups of 10 and share our individual dream.

1:43:16So we'd all written it down on paper. So I shared that my dream from this young kid, financial advisor, I'm a guy, I shared my dream was to write a book called Smart Women Finish Rich and teach a million women to be smart with money so they could protect themselves, teach their kids, and help their family. My heart's pounding, Stephen. I'm sharing this idea with 10 strangers. And then we go back into the room and he's like, how'd that go? Are you guys all ready? He gets us back in a peak state. 10 minutes later, a woman comes, taps me on the shoulder and she says, I just heard about your dream.

1:43:51My name's Vicki. I've worked on Tony's last two books. If you want to do your book, you're going to need a book proposal. You've done books, you know this. She's like, I can help you write a book proposal. I hired her. I started working on that book proposal. Later, I would go after the same agent that Tony has, Jan Miller. She'd become my agent. He'd write a cover letter. I'd get a book deal and I'd start working to help millions of people. It started at a Tony Robbins seminar. And I go back to my grandmother, right? Dream it, design it, and do it. He gave me the life skills to do that. And I will tell you something about Tony because you see Tony on all these shows and people go, is Tony the real deal?

1:44:33well, Stephen, if I was with you and I sent Tony a text, and Tony has a lot of friends like this, Tony gets right back to me. Tony's the real deal. I just went to Germany and took my older son, Jack, who's 22, to see him do UPW in September. It could bring tears to my eyes. Because I wanted Jack to have the experience without me there. So he was, you know, bless Tony, sitting in the front row. I came in on day three when he was in the peak state. and I came in and I watched him. You know, I was basically his age and I thought, God, you know, I went in and I gave him a hug and I'm like, you just don't even know.

1:45:13This is just, this experience that you're seeing, what you're learning today, if you use this stuff, it will change your life. That's the power of Tony and people go, you know, whatever it is, your podcast, your events, Tony's events, my books were just catalysts. But God, God gave you a seed and a dream. And when we're the catalyst for like, look, go do this, listen to that voice. Whoever your God is, that soul that you hear yourself saying, I have a dream. If I only had 10 years left to live, I would really hate to die with that dream inside me. that's the dream you go work on. And since then you've done exactly that.

1:46:06You've educated hundreds of millions of people through your books, through podcasts, seminars, newsletters, and thousands of media appearances on how to do exactly that, how to get financially free, pursue their dreams, get hold of their money so that they can live the life that is destined for them. And that is an incredible thing. And you've sold almost 10 million copies of your books worldwide. I'm sure you're going to hit that number at some point soon. And I guess you'll never get to see the impact that that's had on so many people's lives and how you've therefore changed the trajectory of their financial future and their kids and their kids and their kids like your grandmother did for you and your family.

1:46:41I'd highly recommend everybody go and listen to that episode. I'm actually going to link it below. So if you haven't listened to the episode with Tony Robbins, that's a great next thing to do if you're still listening now. But David, I wanted to thank you so much for coming. And you present a really interesting different perspective on the subject of money, which is hard to find. It's rare, but it's very, very, very important. And hopefully it'll be consequential for many. We have a closing tradition, as you know, where we ask the next guest the question left by the last. And the question left for you is, interesting.

1:47:11If you had all the money you needed to have to support yourself and your family, zero financial worries what job profession would you be doing or rather what would you spend your time on that's surreal that this is the question you're giving me that that was asked before i got here like that's that's a god moment too like that's meant to be this is by the way i'm not making this up so because that's me i have enough i have all the money that i need i have my health right now. I have my time. And this year, what I want to go do, my dream for the year, I want to have an endless ski season. So at the end of the year, ask me, did I ski somewhere every month this year?

1:47:58I leave you today. I go back to Florence for 24 hours and I turn around and go to Verbier, Switzerland with friends. I'm going to try to ski somewhere every day, every month this year with friends and with family all around the world for fun. I did this as my last dream to help one more generation be smarter with their money. This is my final book. These may be my final podcasts. And what you've done is you've updated your smash hit bestselling book that sold millions and millions and millions of copies that you wrote 20 years ago to make it relevant to the current financial situation and world that we live in.

1:48:34And my goal with this was a lot of my readers now in their 50s and their 60s, but they've got young kids like I do. And I wanted this to be a book they can put in their hands. I'm going to link the book below. Fantastic reader. You've written several incredible books. So I'm going to link all of them below in the description for anyone that wants to grab a copy of them. The Automatic Millionaire, a powerful one-step plan to live and finish rich. David, thank you. Stephen, thank you. It's been great. I'm going to show you how to get clear on what you really want, figure out what's been stopping you, put the plan in place, and teach you the most important thing that's made me successful.

1:49:08And I don't think people fully realize the significance of how many of the most influential people on planet Earth you have worked with and continue to work with. What is the pattern that you noticed in those people? So I found four things with them. The first thing is...