The Path to Financial Freedom No One Talks About

27:15But this allows you to make decisions where money is not a limiting factor. There have been times in my life, in my parents' life, that they had to choose jobs that were not the ideal job because we needed money, because we needed money to live, because we needed money so that I could go to college, because we needed money to pay our rent in New York City, what have you. You will never have money as a deciding factor ever again because you got the money piece. Now you decide, do I enjoy this? Does this contribute to my happiness? And that's the power of the FU number. I love the FU number. What about before that though?

28:02So someone's listening to this and they've been told, look, if you never want to feel like you're going to work a day in your life, do something you love every day. Lie. Right. Okay, good. I want to hear what you think about this. Or, hey, you should not work for money because you'll be miserable, work at something that you would enjoy only. And I'm just curious your thoughts about that. You just went thumbs down. So I think I know where you're going to go with it. But what would you say to someone who's like, you know what? I don't make enough money. I like what I do, but I could go do this other thing over there.

28:31It would pay me a lot more money. Or I'm in college and I'm going to choose a path that I think I'd love. Or should I choose a path where I can make a lot of money? So what's your advice about that? So there's this Japanese concept called Ikigai. and imagine a quadruple Venn diagram with a tiny little sliver in the middle. You are looking for something that you enjoy doing, the world needs, you can make money doing, and that actually allows you to be happy. So you are looking for something that's kind of in the middle of all of that. And what is really powerful is that you aren't just looking for something that is your passion project, because another passion of most people's is having a home and eating food at the same time.

29:26And so I say, you know, yes, we should encourage people to find their passions. But if you're not good at it, you're not happy doing it, you're not making money doing it, and the world doesn't need it, don't do it. Because ultimately, you want to find something that is a happy medium, where you not only have a happy career, but also a happy lifestyle. Because you're not spending 100 % of your time at work. You're spending a good portion of your time at home. And is that career choice going to make home very hard for you? Maybe. A tool that I love for any of the college students or even parents listening is go to bls.gov.

30:11It's the Bureau of Labor Statistics. And they have an occupational handbook that has literally every job under the sun. And whether you want to be an accountant all the way to a zookeeper, A through Z, you can find that job. And it will give you what credentials you need to have that job, what that job as a median salary for that job and then different specifications. So say one of the jobs you're looking at is computer programmer. It'll tell you what a government computer programming job pays, a private sector computer programming job, an educational, a healthcare, what have you. And you can actually filter by geographic location as well and see what does someone doing this job in New York City get paid versus someone living in Tulsa, Oklahoma.

30:59and it gives you a good sense of, do I want to do all of these things that will certify me and get me to that point to have that job? One, two, is this job something that I'm actually interested in because it does a full breakdown of what the job is? And three, will I get paid enough money to live the lifestyle that I want? And I think it's more important than people think because Because following your passion, I mean, listen, it may work if you have a trust fund to fall back on. But I come from Chinese immigrant parents and they were like, once you are done with school, you are on your own. You are on your own own.

31:39Do not call us. There is no bailout. You got to figure it out. And so I got the job that I knew was going to pay for the lifestyle I wanted. I wanted to ball out. I wanted to go to nice dinners. I wanted to have nice things. I knew I wasn't going to be able to go be an English teacher with what I wanted.

32:01And maybe sometimes, maybe your passion project isn't your career. Exactly. Maybe your career is what you do to earn a living, and your passion project is what you do on the weekends or what you do when you have your FU money. I've spent seasons of my life where I've had to do things that I didn't love to do every single day because it was going to afford me the opportunity to do the things that I love to do every single day. Exactly. And I don't know that enough of that's not emphasized, and I think you take criticism for saying it, but I appreciate the fact that you say it because I think there's a lot of validity to it.

32:27One thing I noticed about you for someone who discusses money a lot, I want to ask you about this. You don't discuss entrepreneurship as much as everybody else does as much. You discuss it. But for most people that are talking about money, it is tied to being an entrepreneur a hundred percent of the time, especially on social media. And you do discuss it, but you discuss jobs at least as much, if not a little bit more. And so that is another unique thing about you. Is that because you don't think most people are cut out to be entrepreneurs that it takes a special type of person or is it just like realistically, not everybody's going to be one, but why is that the face?

33:03I listened to your stuff closely. You don't talk about entrepreneurship nearly as much as other money oriented people do. Let's say. Yeah. I really appreciate you asking that question because I've never been asked it before and I've done quite a few interviews. So you really have done your homework. You know, there are multiple different ways to become financially stable and there are multiple different ways to become millionaires. The easiest way is to just have a job and invest early and often. And frankly, for most people, climbing the ladder of a traditional W-2 career is the most likely way that they are going to be able to hit that type of financial stability and financial freedom that they want.

33:51I think I talk less about entrepreneurship because while I recognize there are many, many success stories, myself included being one, I find it a little hilarious when people who didn't have money become content creators, and then make content about being content creators or entrepreneurship and small business, and then make money off of that. Because not everyone is going to become an influencer. Not everybody gets to have a small business. And the risk of those failing are so much higher than being responsible with W2 income. And this isn't to deter anybody from having a small business or having any of these things.

34:36But I think there's a time and place for everything. For me, I had a full-time job, a W-2 job in digital media sales for a year and three months before I took Your Rich BFF full-time. I was doing it both at once. I was using my nine to five to fund my five to nine. And I am so glad I did that because before I started Your Rich BFF, I had set aside$100 ,000 in cash to make sure that I was going to be able to sustain for the following year, even if my business didn't make any money. And many people don't have that luxury. Entrepreneurship is awesome. It's definitely made for so many people. I don't think it's made for everyone.

35:26And I think that's a little bit of a, I would say hot take because everybody wants to believe that they can do it. But in most cases, you'd be better off just climbing the corporate ladder. I'm glad you talk about it's why I asked you, because I was actually talking to somebody the other day because I made my money as an entrepreneur, obviously, and I'm a big proponent of it. But I think I surprised the person. I'm trying to remember who it was. but I said, you know, there is another lane. Yeah. And not everybody's cut out for the pressure that comes with being an entrepreneur, the mindset, the emotional burden that you're, you're carrying the stress that's going to be years and years of it.

36:06Some people are great number twos in a company. Some people are incredibly good at being a support person in their job. And, and it's not ever discussed about on social media or in the, you know, the new influencer space, that there is another lane. Now, I think the vast majority of people that are going to get wealthy probably have freedom and own their own businesses. But I actually think there's a ton of room, in my opinion, for someone who does exactly the principles you teach, has their act together financially, and maybe even he just has a side hustle that brings in 10 or 15 or 20 grand a year, too.

36:34There's nothing wrong with that. So I'm glad that I asked you because you would think the only way to get wealthy now is to be an entrepreneur. It's not necessarily true. By the way, you might be an employee and get an equity position as a young employee in a startup. And, you know, there's a whole lot of those stories that, you know, people all the time, you know, a lot of these guys that own NBA teams or families that own NFL teams, some of them were employees at Microsoft and had a bunch of equity in a company that went nuts. So this stuff is possible, not just as an entrepreneur. I'm really glad that you talk about that.

37:06And you mentioned, oh, I was going to say, you mentioned like, you know, the real way to become wealthy. It's like, I think we also have to think about how we're defining wealthy. When I think about entrepreneurship in my mind, it's a barbell, right? There's two segments. There's the folks that really hit it out of the park. We're talking ultimately eight, nine figure, maybe 10 figure net worths. There's also a huge subset of entrepreneurs that go bankrupt that end up with nothing. Whereas the folks in the other lane of working that job, you know, climbing that ladder, doing a good job and continuously asking for raises and getting promoted.

37:46The odds that they're like more so in the middle, upper middle is much higher. But to your point, if you want to really knock it out of the park, entrepreneurship typically is the way to do it. But by the way, I know where it was now. I want to share the story with you really quick in the audience because you're right. And I'm a big entrepreneurial oriented person. I hope my children become entrepreneurs. I hope they actually go get jobs first. No, where they learn as they earn, or, you know, I don't even care what they earn, but that they take that learning and entrepreneurship. However, I know where I was.

38:16I won't say who, but I was at a friend's restaurant who's owned this restaurant for about 20 years. And a lot of folks that are listening to this that own restaurants will tell you, like, you live there. You live there for the most part, for the most part. It's six, seven days a week, 360 days a year. and I had another friend that was in there that makes about$120 ,000 a year. And I know the guy that owns the restaurant makes about$120 ,000 a year. And it was a Friday night. And I said to the person I was with, I said, which of those two people would you rather be in life? Would you rather be the guy who makes$120 ,000 a year and on a Friday night is out for a nice dinner with his family?

38:54Or would you rather be the person who makes$120 ,000 a year who is working this Friday night in their restaurant and will be working here next Friday? And here it was interesting. This person was an entrepreneur. They said, I'd actually rather be the restaurant guy. I said, that shocks me. But why? And he said, because this is his place. You could tell he loves it. He's passionate about the food. It's a family legacy. I said, you got it. OK, but I said, is the question not worth at least asking? For sure. A lot of people would say the other guy looks like he's having a better Friday night than the dude who owns the place.

39:24So it's worth discussing and evaluating everybody, your pathway. way. And she's one of the only people that sort of takes this position. It's kind of a contrarian position. And so I like it a lot. All right. Got a tough one for you. You're getting married in a couple months. Oh boy. Okay. You know what I'm going to ask you? Do you believe in prenups? And I'm not asking anything personal, but, but this is a really common question in this day and age. Um, prenup when somebody gets married, you're for it or you're not for it. 1000 % for the prenup. And you said we didn't have to get personal, but Ed, we're besties now.

40:00So let's get personal. I'm getting one. Okay. Okay. So I think what really frustrates me is like the fact that the prenup has been demonized. We see it in pop culture or TV. It's always the story of one partner is, you know, leaving a trillionaire and one partner leaves destitute. They have nothing. They're on the sidewalk with their two little suitcases. It's like so sad. That is not actually how prenups work. Here's the thing. Whether or not you draft your own prenup with your own lawyer, you get a prenup, but the government gets to write it. And I don't trust the government as far as I can throw them.

40:42Okay. I don't care who you are. I'm guessing you likely take a similar view. You're like, I would rather do something and make decisions and have agency in my life than let somebody else do it, especially for something as big as this. and prenups are really important because one, it's a great time to actually get financially naked with your partner. A lot of couples do not talk about money until they are already married and it's too damn late, but also prenups can be the most fair thing on a sunny day, on a day that you and your partner have nothing but love for each other. sit down, order a pizza, grab a two liter of soda, if you drink soda, whatever, and talk about how you feel there is an equitable split in your assets.

41:35And in my case, my partner and I, we met when he was making much more money than I did. And he paid for everything. He took me out to dinner. He paid for vacations. Everything was amazing. Over the past few years, I have been very lucky. My career has taken off. My business has taken off. And now I make significantly more money. And I pay for more things. But ultimately, over the past seven years, we have been a rock solid team. And our prenup is going to state that everything we take into this relationship, we will be splitting as 50-50 partners. With a carve out of my business, he will have a 0 % equity stake in my business.

42:20I will have a 100 % equity stake in my business. Then anything that we make during the period of the marriage, anything, assets, everything, 50-50, except for my business. And if things were to dissolve, we would depart 50-50 on everything except for my business. two reasons one i built this baby myself i am keeping every single thing about her two i have to think about myself as an entrepreneur no agent no manager no nobody wants to sign somebody who owns a business that is 50 owned by an ex-husband that is bad business you're going to run into things meddling scheming what have you i wanted to have that fully protected I've built so much.

43:13I don't want that to ever go away. However, dollars are just dollars. We met in a time when we had our peanut butter jelly days. He paid for more. Now I pay for more. We're not nickel and diming each other as a couple, but it is important to set these boundaries. And I know the follow-up question, I can already see it on your face. It's like, well, what if one person makes a ton of money and one person doesn't work or like doesn't have money. Yes, I understand. I think again, on a sunny day, sit down with your partner and make it very clear. Maybe you're saying, hey, I as a, you know, I as a wife, I'm happy to be a stay at home parent.

44:00I will forego my career, my potential earnings to build our home, take care of our family. That is an incredibly challenging task, one, and an incredibly noble thing to do to take care of the home. But you better make sure that you are cut in financially because I have gotten so many DMs from women that are either in their 40s or 50s and they'll say, I just found out my husband is cheating. We, you know, he has the career, he has the money. I don't even know the passwords to our bank accounts. I need to start over. and now I have a 20 year gap in the workforce. All I can get is the entry level job and that's not going to sustain me.

44:45Or I get the message from the 60, 70, maybe sometimes even 80 year old. And the message is, I had a wonderful marriage. My husband just died and I don't even know what we have. I don't know what the passwords to anything are. What do I do? And my opinion of the prenup is it's literally just a team huddle. You get to get together, discuss what you have, what you earn, what you owe, what you spend, have it all laid out on the table and then decide what an equitable split would be. And that's going to prevent any of these horrible catastrophic situations because you are both locked in to your financial situation.

45:31Everybody needs to know exactly what's going on in their financial situation. You cannot have your partner be your proxy. Everybody needs to be involved. So good. I do feel close now because not only do I now know that you have a prenup, I know what's in your prenup. So this is actually pretty cool. I think there's some advice I just want to reiterate. Forget the prenup advice. You all can decide whether you agree with her on that or not. However, no matter what it is, that sunny day conversation should be happening with your money. Yes. And it doesn't with couples get together and talk about your money.

46:05You talk about your kids, you talk about your, most of you are spending more time planning your vacation this summer than you are your entire financial life. And the second scenario you described is too common where one of the two does not know the passwords, does not know where anything is at, does not know who their life insurance is with. And that's just not right. You got to have that sunny day conversation. If it's once a quarter, sit out there with that pizza or whatever you're doing and just talk for an hour or two about money, about savings and get on the same page. Nothing's worse than one's a spender, one's a saver.

46:38One's got these goals, the other. So it's such good advice to have these conversations. And I'm really grateful that you phrase it the way you do.

46:50let's get specific on some money stuff. I'll throw three things at you. Give me your thoughts on all three. Okay. What's this to say? Index ETFs, real estate, crypto. Okay. What would you say to those three things? Index funds, ETFs, big fan. I think this is a way better solution than trying to stock pick because I saw hedge funds blow up all the time because they picked wrong. Real estate. I am a fan. However, I do think renting has been really demonized. And right now it is cheaper to rent than buy in 70 % of all US markets. So please don't think that if you don't feel like you want to own a home or can't afford a home that you don't get to be financially successful, it is not an absolute end all be all.

47:34If real estate is part of your investment strategy, great. If not, you can keep renting, continue investing in the stock market. You're still going to be okay. And crypto, I have like a very middle of the fairway take. It is an okay thing to be investing in, but it cannot be the only thing you're investing in. When it comes to crypto, I recommend it be anywhere potentially between zero to 5 % of your portfolio. This is because crypto is incredibly volatile, likely going to see some more regulation coming in the future. and you don't know how that's going to impact you. And frankly, before you even get to the crypto step, there's a ton of other stuff that is going to be more lucrative, have better tax benefits, and be more impactful to your financial improvement than buying random crypto.

48:27Okay, so good. By the way, this is a great conversation. What I like about it is, I already know there's a few things you've said not everybody's going to agree with, and I like that that means we're having a healthy spirited conversation about a really sensitive topic. And you and I just vibe. And we do vibe, right? Because I think one of the reasons we vibe is it's a topic that's important to both of us. But there's another reason we vibe, which is my next question. You have the two, there's three things I wanted my children to leave my home with, if they could have it. And one I would call like their faith, their morals, their ethics, which to me wrapped in that develops confidence.

49:08that element of their life. The second element I wanted them to have was an extraordinary ability to communicate, to communicate. And the third is a real understanding of keeping themselves safe in the world. And one of those things is understanding money. And you have all three of those things, but one of them that is so obvious with you, you have an incredible ability to communicate. And I wonder if you just talk about, people wonder, what should I be focusing on? And there's a lot of this, I'm healing myself, I'm overcoming trauma, I'm working on my confidence, my worthiness level. All that stuff is awesome in personal development.

49:50I'm getting more fit, I cold plunge, I drink water, I meditate. All that stuff's awesome, right? I mean, I've done shows on all of it, I've written books about it. But what's not talked a lot about to get you through life, this life will be really difficult if you can't communicate well. Really difficult if you don't have personal skills, verbal, written, some type of ability to communicate, and an understanding about the currency that moves the world, which is money. So just talk about those things. And you have to acknowledge those are two extraordinary things about you. Humility aside, it's got to be things you've worked on.

50:28And how important do you think it is that people work on those things? You know, I think communication is so critically important. And to your point, I don't think I'm smarter, faster, better, stronger than most other people. I am a much better communicator. And I know this. And it stems from a very unique experience that I had as a child. My parents are Chinese immigrants. They came to America in their early 20s. They started their careers. English is their second language. And to this day, my parents can speak English, but it's certainly not something that they're confident in doing. And growing up, I watched so many experiences and so many times them be taken advantage of, them be spoken down to, them be mistreated for their lack of ability to do so, to communicate effectively.

51:27and as you know like an eight-year-old I was the person on the phone with the insurance claims guy trying to figure out what was going on when we would get into a car accident because my English was better and one kind of like threw me into the deep end of the pool very quickly I was like oh what is a deductible I'm googling trying to figuring out what these things are but I think it gave me a sense of confidence as well that nothing in my life was ever going to be handed to me. I could not ask my parents for help writing that five paragraph essay at school because their English was worse than mine.

52:10And I could not help. They could not help me with the reading portion of the SAT because they didn't know what that word meant. I had to figure out what that word meant. And I would say I probably have a lot more reps under my belt of effective communication out of necessity than the average person gets, because you typically don't start doing that until maybe college, maybe after college. I've been doing it since I was able to speak because my English has always been better than my parents. And I think knowing that that was a skill that ultimately allowed me, and I saw it happen a couple of times, when my mom would get a certain result, when she would discuss with someone.

52:54And then I would say, give me the phone. And I would pick up and I would say, excuse me, this is exactly what happened. These are my expectations. I really appreciate your help. Thank you so much. Please. I would, you know, I would speak in a way that I knew what I had to say to get what I wanted. And because of that, we would get that refund or we would, you know, get a fee waived or something would happen. And knowing that there was a positive result, essentially, I like Pavlov myself into speaking a certain way. Because when there were certain times that I would come to the phone, I'd be like, why are you yelling at my mom?

53:31And I was so angry. And I was so emotional. I wouldn't get the results I wanted. And over time, I realized when you are polite, when you speak clearly and very, you know, you enunciate, you're patient, you don't take your your emotions out on people but also you're very clear and demand what you are just what you deserve you get what you want and i've been able to take that into the workplace practice it there and now i do this as part of my living yeah you're extraordinary and it's easier and easier to win in life if you have that skill set because fewer and fewer people have it because of the digital age they're in the phone so much those of you listening to the show or watching it today.

54:12One of the things I would recommend, I've never said this on the show, whether it's me or someone that's on the show, if you think they're a great communicator, study how they communicate. Their phraseology, their pacing, their cadence, their hand gestures, their facial expressions. The more you begin to study not just what someone's saying, but how they say it, which is my obsession, I think you're going to begin to develop a huge advantage in life. All right, first off, I've loved today. I want to ask you one more question because I thought this stood out to me. And yeah, I do do my research, especially when it's someone that as I start researching them, they're interesting.

54:47And then I can't get enough, right? Like I wish we could have talked for three hours today. But as a woman and as a Chinese-American woman, I was struck by you saying, I'm really not, I think I got this right. I'm not so much into equality. I'm into equity. Yeah. Right? And I was, that was, that's a strike. You say it that way to get attention. I know that. Yeah. But but what do you mean when you say that, that you believe equity is the most important thing as opposed to just equality? And you make a distinction between the two that I think is probably important for your own well-being to clarify before they take this soundbite out of context.

55:26So what do you mean by it? You know, I think about it when it comes to food allergies. So equality is we all get a kind bar on the plane. I'm allergic to almonds. Okay. So now I don't get a snack on the plane. However, the plane now offers kind bars and Cheez-Its. So I'll get Cheez-Its. And in that way, we all get a snack. And I think I feel that way very much when it comes to money, because for so long, it's been very one size fits all. You have to do this. You have to do that. This is the path. Whereas when you're actually thinking about financial education, it's got to look different for different people.

56:13And that clip that you're referencing, I was chatting with a girlfriend, Valeria Lipovetsky, and she had asked me about how my now fiance and I split our housing costs. And I always tell this story back in the day when we first started dating, he made a lot more money. And the apartment that we were renting in New York City, it was$5 ,000 a month. And I told him, I did not feel comfortable spending$2 ,500 a month on rent. And he said, well, my office is really close to this apartment. I want to live here. There's a gym in the building. I want all these things. I will pay, you know, 3 ,200 and you can pick up the 1 ,800.

57:08And I followed up and I was like, are you sure? Are you okay with that? And he said, yes, I love you. You're my partner. We're building a life together. I don't want you to feel in a financially precarious situation just because I want to live in this nicer building. Because there were certainly buildings that I could have gone halfsies on that were probably not as nice, probably walk-ups, maybe further from the office for him. And because of that, that is completely warped and warped in a good way, I will say. My view of how people should approach finances, it should not be one size fits all, especially when you're talking to a partner because why would you want your partner to be in a bad financial position?

57:53What we should consider when splitting expenses is, is this a comparable burden on our wallets? Because if I am making twice as much as you are, then I should pay two thirds of the rent and you should pay one third because all of our money put into a pile. That's what that looks like. That's the fractional breakout. And I think one, it's really worked for us but two I think there are a lot of people out there that end up in resentful relationships because they don't have the money talk and they're afraid to and people will overextend themselves again trying to keep up with the joneses but suddenly the joneses is your partner you know what you're so right and the equity thing if you really play that all the way out, it's really a healthier way to have a relationship.

58:49Yeah. Like in certain relationships, maybe I am making more of the money, but you're doing more of the stuff that requires the heavy lifting with the kids or, you know, fixing stuff around the house. It's never equal. It's equity. And sometimes it's two thirds me, one third you, sometimes it's 90 % you, 10 % me. So I actually think that conversation when it comes to money and relationships overall is super cogent advice. Today was really good. Like, like right down the middle, how you do a podcast was valuable. No, seriously, I've done a billion of them. Every second was valuable on a topic that matters.

59:27And what I love is you're willing to speak your mind freely, knowing not everyone's going to agree with every single thing you say, yet you feel so strongly about it. And to be candid with you, you know, the more and more I listen to you, the more I'm more I'm recommending people follow and listen to you unsolicited. And so that's probably the highest compliment I could give you. I thought that was extraordinary. And I enjoyed it like very, very much. So thank you. Of course. Thank you so much for having me. And the next time we're together, I'm buying you dinner. I would love that. I think that would be equitable.

59:58So thank you. I'll take the equity in the dinner. And hey, guys, remember this. she's your rich BFF on social media and she's got rich AF the book you get to tell you want to improve your understanding of money this is your girl right here you should be following her you should be listening to her and the future is just brighter and brighter and best of luck with your wedding coming up soon and your prenup that goes with it yeah thank you so much all right god bless you everybody share this episode take care this is the Ed Myland Show