Why Buying a Lamborghini Could Be Smarter Than Saving Money w/ Pejman Ghadimi 💎 E122

0:00The world has been conditioned to think they can basically buy things and they have to make a ton of money to keep wasting their money buying luxuries. but I teach people in and out how to actually park their money in luxuries and live much better lifestyles than they ever thought possible without actually wasting or spending their money, but rather parking it.

0:23Ladies and gentlemen, welcome to a very special edition of the Money Mondays podcast. As you guys know, 99 % of the time I record inside of an RV motorhome traveling around the country, but we actually have someone in the car industry, so I should have my motorhome here, but I just found out that he happened to be in town. He was here from Florida. So we decided let's knock out a podcast. So we're here in this amazing studio in Santa Monica, Brentwood area. Now, as you guys know, we cover three core topics, how to make money and invest money, how to give away to charity on this podcast. Typically our episodes are 32 to 40 minutes because the average workout is 45 minutes.

0:57The average commute to work is 45 minutes. So you'll be able to listen to this episode in under 40 minutes for your listening pleasure. Now, without further ado, I'm going to have our guest give us a quick two-minute bio so we can get straight to the money. Well, I appreciate you having me on. And real short, I am the ultimate guy when it comes to alternative assets, cars, watches, art, handbags, and everything else that comes with investing or putting money or parking money, I should say, in those things. So the world has been conditioned to think they can basically buy things and they have to make a ton of money to keep wasting their money buying luxuries.

1:31but I teach people in and out how to actually park their money in luxuries and live much better lifestyles than they ever thought possible without actually wasting or spending their money, but rather parking it. And so I have a huge background in finance. I am the founder of Exotic Car Hacks, Watch Trading Academy, and also have authored a ton of books on human awareness and how basically humans make decisions around their day-to-day lives. Okay, so let's break that down. There's a lot of fun movies. There's a lot of stuff in there. Exotic Car Hacks. What is that? Exotic Car Hacks is a platform that since 2009 or so has been teaching people how to buy, trade, and sell exotic cars as a means of actually parking their money into alternative assets instead of actually looking at cars as liability.

2:17It's helping them look at them as an asset. So a lot of times when people, we are preconditioned to think, oh, you buy a Lamborghini or you buy a Bentley, you buy a Mercedes. The second you drive off the lot, it's down 10%, 20 % or some number that people just make up. Which usually leads people to not buying those things because they're usually looked at as a bad investment or as a bad purchase because it's like a kind of a piss your money away purchase, right? But the way we've reframed this and we've been really good at helping people understand that not every car is created equal and the right Lamborghinis, the right Ferraris will depreciate during their first year, but then ultimately hold flat at what we call a bottom cash value.

2:55And so we invented the bottom cash value formula, which is a formula that enables us to understand every single car in the market and which cars will actually have a stop in that depreciation based on time and will only depreciate based on miles and conditions, such as if you crash your car or not. And by identifying these cars, you're able to hop car to car, meaning one year, two years, three years, however you want. But you're able to ultimately buy a car or finance it however way you want. But once you put that money in the car, it doesn't actually depreciate. So even if you're making your payment, even if you're, let's say you can't afford to buy a quarter million dollar car cash, you're still paying your monthly payment like a normal payment.

3:30But at the end, when you go sell your car, you actually recoup that payment because it's not equity in the car. And you ultimately, the car itself hasn't actually depreciated from the purchase price that you actually bought it for. So there's some guys we know on social media like Dan M.I., Andy Fursella, et cetera, that might have 40, 50, 60 cars sitting in a garage that are not being driven. how are those on the appreciation depreciation scale so i know all those people really well i actually bought one of dan i'm previous cars and i'm very close friends with andy and i also personally collect cars so those collections not only don't depreciate they actually appreciate okay so that's that's like the tier level of the collector spectrum where you're buying cars that are so rare and exclusive like i personally do that's not what i teach every day because that's a very small group of people sure but you're buying cars so exclusive and specs configurations or hard to get models that they're immediately significantly in higher demand on the used market because most people can't get them on the new market so that's a difference here because that's like hey i have all the money in the world and i'm just buying a ton of but when you're normal and starting up you usually look at your most people will will comfortably buy a range rover they'll be like oh that's my luxury kind of like i bought myself a range over a really nice follow for the price of that Range Rover, they could probably have a Lamborghini Urus or a Rolls-Royce Cullinan.

4:50Those are cars that they don't think they can afford usually when they buy the Range Rover because they think in conventional mindset of if the payment is$1 ,000 a month on the Range Rover, it's$3 ,000 a month on the Cullinan. So therefore I can't afford a Cullinan. That's like $2 ,000 of extra money. But it's not true though, because even though you're spending$3 ,000 a month maybe for the Cullinan, if you're buying the right Cullinan, that money is still parked in the car. But that Range Rover will keep depreciating over your lease back down to basically a wash of 40, 50K after like three years of ownership.

5:23But that same Cullinan, which you could drive the exact same car, might cost you 15 grand over three years. But it's a Cullinan. So you got to drive a Rolls-Royce for less money than a Range Rover. Now, I wouldn't say you got to drive a Rolls-Royce for less money than like Honda Civic. Sure. But if you're going to buy a Range Rover anyways, why not get a Lamborghini Aeros or Cullinan and save the money? You said something in there that said someone, they couldn't buy it on the new car market. So is that because something only has like 50 or 100 units, like people can't go buy it? Or because Ferrari sometimes has a list of, you have to have previously have a Ferrari to buy this Ferrari?

5:57So both. Like the cars you mentioned earlier, those two people's specific collections are filled with cars that are very exclusive in nature. So they're not just a Bugatti. They're like a carbon fiber Bugatti, which is like a full exposed carbon final edition like Supersport. is incredibly hard to get and it should have been ordered like three years ago it finally came in so it's a very unique type of clientele for these companies and over time these kind of levels once they're reached are just like there only needs to be 10 of us wanting that car and there's only three of us that have it right so so amongst the 10 we all know each other so it's like oh you got this i wish when you don't want to call me yeah but so those cars are at that level but generally speaking, like Ferrari has a list, obviously, for super VIP customers.

6:42And those cars are worth usually two to three X of what you're paying for them. Oh, really? Yeah, right as they come out, if those are the right cars. But sometimes there's also this misknowledge, which we teach our students not to fall for, that just because you walk in a dealership and a Ferrari dealer tells you, oh, that car has a list and you need to buy these other five cars before, that isn't necessarily true. That's just a game that Ferrari understands the common public believes to play. So they want to make their money. So they loop you into three, four, like average cars to sell you a decent car.

7:10But even that car would depreciate and wouldn't be the right car. So you also mentioned the training academy. What are you training? How does it work? What's the concept behind it? So watch trading academy is something different because watches have like cars are what we call wealth preservation. So you can actually buy a car, preserve your money. And so buy a great car, enjoy a great lifestyle, not lose any money. And you don't have to rent it out. You don't have to create income or anything that's, that's, that has liability. On the other side, that if you want to make money, we teach people basically have to take watches and turn them into a profit center.

7:39So watches have huge amounts of margins. So if you're in any type of investing ideology or in real estate, the reason people like real estate is because the asset class is usually safe. You buy it. And over time, even if you make a bad mistake, it'll generally pay off, like even if it's a 10-year return. But there's no liquidity to it. And it's very hard to constantly turn real estate unless, of course, you're in the business and you have capital and you're constantly like transacting on it. But you still have paperwork. You have to set up your LCs. You have all your 1031 exchanges. So it's very different from the watch game, which is completely unregulated, doesn't have any type of like paperwork associated with it.

8:19And it's the easiest thing to trade for margins that are anywhere from 20 to 30 percent, some cases as high as 40 % and can start as low as$2 ,000 a watch. So we're also trained to think watches, because they're exclusive and sold in boutiques, are generally expensive. When you walk in a mall, you'll see a Hublot boutique and you'll see like a$20 ,000 watch. And you'll be like, wow, I got to work my way up to owning a$20 ,000 watch. What people don't know is that that Hublot is actually a$4 ,000 watch. Exactly. $4 ,000 sold then for$20 ,000. So even if there's a discount sell to you for like 18 you think you've got a great deal of 16 but the real worth of that watch on the secondary market is 45 grand so could you technically find that watch on the secondary market for 45 grand if i told you where to get it how to negotiate it and then turn around and sell it for seven to eight grand to another guy that thought paying 20 grand was the easy way out for sure it's basic arbitrage right but knowing which watches to buy how to actually negotiate them down the right price and knowing which ones actually stay strong in value so even if you can't sell it for six months the value doesn't really go anywhere is the key to learning how to make money with watches and it's something that we have students doing this part-time they're making ten thousand dollars like a month we have other students doing this full-time making three million dollars a year doing it's like amazing yeah and they don't have any watch knowledge but they just understand which models to go after and what to do with it so fascinating so i used to own a jewelry store my former life in 2008 i opened up in downtown san diego by the stadium by petco park i called it platinum collections i had sammy the jeweler running the one side of it i we had these dynamis watches the the floating watches there uh i've seen you wear this for a long time 2008 we start we started selling them um and it was a fascinating business because the margins were nuts huge right like especially on diamonds exactly yeah exactly i was i mean i I mean, the diamond market's taken a tank recently because of all the fake diamonds, the lab-grown diamonds, not the fake ones.

10:17But I was able to give like 20, 30, 40, 50 % off and still be making 20, 30, 40, 50%. Exactly. And it's the same thing with watches. And a lot of people don't realize that. Like even major manufacturer watches, their costs on the inventory they're selling to the boutiques, like Cartier watches are 30 cents on the dollar. Whoa. But how many people go in and buy Cartier watches for their wives, for their girlfriends, whatever, and they think they're like, oh, my God, like I got a great deal. I got 10 % off on a new watch. That watch that was 10 grand of Cartier, 30 grand of Cartier, only cost 30 cents for that manufacturer.

10:48Then they sold it to the store to 50 cents, and the store made 50 cents in margin. So that's what they make their money, plus tax, whatever. But when they're on the used market, they cost less than 50 cents on a dollar. And they're brand new, so they're just like leftover, and they're just not sold at the store. And a lot of people think, well, what if I buy it from a third party and it's not real or it's fake? But it doesn't work that way anymore. There's so many authorized and really reliable jewelers in the world that are selling secondary watches. And they're real and they're not like issue.

11:17They have the same paperwork, the same warranties, the same everything. And they're just sold at$50 ,000. So if someone out there is listening and wants to learn from you, are they the someone that's like, wants to actually own a jewelry store? Own a website to sell jewelry? Or they're just someone that's in the mix? Zero. So the reason we started this was because we realized people want luxuries. Sure. Like this wasn't about teaching people how to start jewelry stores. Like I could care less for that. That's a real business. It requires all the logistics, the licensing. None of that stuff. Yeah, none of that stuff.

11:49The point was if you're a normal human being, you'll technically aspire to make money. They're listening to Money Mondays. They want to make money. The point is if you learn to make money, typically you want to make money because you want to improve your lifestyle. First, you improve your house. Then you improve your car. then you tend to end up in travel, luxuries, et cetera. My argument has always been, no matter who you are, if you aspire to do great things, you're going to legitimately end up in a position to buy great things. And when you buy them, there's only two ways you buy them. Either you buy them in a fashion that allows you to keep buying them without losing money, and in many cases, turning even your hobbies or things you want into a money center, or you end up creating expenses all the time, and ultimately these expenses never come back.

12:33And you have to keep making even more money to keep upgrading your lifestyle. So we all know that even our dream car is only our dream car for a very short period of time. Like we know that there's another car we'll want more. We know when there's a cool watch we like, there's a better watch we'll eventually want more or a second one. So the argument is, you know you're going to divorce these things anyways. They're not like there to be like loved forever. So when you buy them, buy them in a manner that allows you to make money off of them when you get rid of them instead of actually lose money every time you do it.

13:03This is one of the key things that athletes don't learn. Because if you think about like someone who doesn't have money training, typically comes into the game, the first thing they go, I got$100 million, I got to buy cars, I got to buy this. What if they bought these cars right? And at some point they said, oh man, I overspent, I need to get my money back out of the car. And instead of saying I paid$600K for a car, I got$300K back. They said I paid$550K for a car, I got$540K back. Amazing. Right, so it's like, okay, so I made a mistake, I shouldn't have bought that car, maybe I over... but I didn't lose that money.

13:31It was just sitting there in the right car. And I didn't want it now. You know, for any reason, like I only need two cars instead of 10. It is what it is. So we have been brainwashed as a society to think clearly that our job is to make money so we spend money. And one of the things we've been teaching people since 2010 is you don't need to spend money to have lifestyle. You can learn to park money. And while you can't park money in travel because it's, or in food, like if you go to restaurants, money's gone. at the very least the largest purchases you make like your home your car and your jewelry and even the handbags you buy for your wife your girlfriend whatever or for yourself those things can be places you park money and recycle that money over time and people really this is the interesting thing then like people know this already when it comes to housing there's not one person that buys a piece of real estate thinking it's a bad purchase like i'll never get my money back there are people who overspend on real estate, but they'll never think like buying a house is a disaster.

14:29Like, why did I buy a house? It's stupid. They'll say, oh, well, in a couple of years, if I don't like it, I'll upgrade it or get rid of it, whatever, get my money back. But they don't learn to think that way when it comes to luxuries because society has brainwashed us to think that all luxuries are basically expenditures and you're trolling your money away. But there has been, especially post-COVID, a significant shift in the amount of luxury goods in the marketplace. Like there's a ton more Lamborghinis today than there were 10 years ago. Ton more Rolexes on people's hands than there were before.

14:59And the key areas like California, Florida, Texas, and these large states where people are like businesses booming, etc. People are spending money. Sure. Right? And that's great. You should want that. You should want to aspire to make more money so you can live a better lifestyle. But the argument is why not learn to actually not – we're never saying as someone don't buy these things like they're bad things. They're amazing. Everyone should experience what it's like to wear a 100K watch. Everyone should experience what it's like to drive a half a million dollar car. But what if you could experience it and it didn't have to be a financial burden?

15:31That's the difference. And while it sounds really good to be true and people are like, well, you got to learn how to really sell cars and buy cars and be a dealer. You really don't. This world exists and because people are so alienated from it, they assume it's not for them or they're going to have to pay cash or go and work really hard or it's a bad expense. but it's really not like i mean look there are kids out there who know nothing about watches making 700 800k part-time from their houses trading five to 15 watches a month okay like what i'm saying is let's assume someone's like it's amazing exactly it's an amazing i mean 800 grand is a lot of money you know even 300 grand is a lot of money let's not even use big numbers 10 grand a month is a lot of money for sure it depends on what your aspirations are but if you have a normal job and you're working at a coffee shop or something and you You have$1 ,500 saved.

16:20You can literally take that$1 ,500, buy your first watch, let it grow into its own thing, similar to a trade you would do in the stock market. Except the difference is the stock can disappear to nothing. And it can just keep going down and you don't even understand what's happening. But a watch is on your wrist. So it's opening doors as you meet people. You're getting into new peer groups. And you're making the same money you would in the market. And it's easier to trade in and out of without having to wait for bumps and dumps and anything else. What are your thoughts on the exotic car rental market?

16:51And like basically high-end Turo. Like, have you ever thought about the Lamborghinis and Rolls Royces where people are renting them out? Terrible. So this is the big misconception in the world of cars. People believe that the revenue associated with cars has to be when you share them, similar to Airbnb. And Turo makes that very easy. You can rent stuff. If you want to make money renting cars, buy Corvettes, put them on Turo. It's cheap. It's easy. Buy a couple of ones, even if they've been salvaged, hit before, repaired. and put those on Turo. The amount of money that will come to rent that on a continuous basis and just keep giving you money, even if there's an accident there and there, the net positive will be better over time.

17:29It's a risky business because generally you have to have separate insurance. You try to put it on people's insurance or Turo's insurance, but there are very high limitations there when it comes to exotic cars, not so high on cheaper Corvettes and Audis and things like that. So if I was going to try to make money in the rental business on Turo, I would never rent out an exotic. You have to understand that when an exotic gets hit in an accident, it's worth 20 to 25 % less. So the moment you Turo your car and you're like, oh yeah, I made like five grand and I didn't do anything because someone's worked, it's done.

18:00You know, I think it's done and the money's gone. So you want to avoid that at all costs. And one of the big misconceptions, again, when you're in a position to own something like that, like generally own it, you don't want to lend it to people. Like, I've never seen someone that's like, I've made enough money to buy my Rolls Royce. And in order to pay for the payment, I want to lend it to a complete stranger for two days out of a month. No, nobody wants to do that. Like, nobody will do that. Like, generally, people that do that is they don't understand business and they only see business in a linear manner.

18:27That's like, well, if I buy the car and I have a 5K payment and then I rent it out for five days out of the 30 days, well, that's 5K. Like, my payment's paid off. but they don't look at the liability, the asset costs, the issues with if they get kicked off tour or they don't cover the insurance. So they put themselves in a bad like financial position. And I would never, ever, ever tell people that renting their car is the way to minimize their expenses. Are there certain assets that you want to buy and just hold forever? Are there certain things you just hold? You can hold, like I have a very extensive personal watch collection and a very extensive personal car collection, very similar to Andy Frazell's collection.

19:04Like I I have a lot of cars from Bugattis to like Porsches, rare, old, new. And one of the things that's really key is once you get through this process of buying and driving your cars, you obviously get richer in life. Like you obviously make more money, you get 10 years older, you have more adult money, right? Then when you're in your 20s and your 30s, you have more serious money. You might build a business, things might change, or you might be in a position where, hey, for 10 years, you've done this strategy we talked about and you didn't actually waste money. So even though you're making more money, You know, it keeps accumulating.

19:35And at some point, it makes sense to switch from this idea of, hey, I'm going to drive a new car every two, three years and get in and out, to I'd like to own two to three nice cars like a Porsche, a Ferrari, and maybe like a Range Rover. And you can start buying cars that historically go up in value every single year for the next 30 years. They'll never go down. And they won't always go up every single year, like 2 % or anything. but over a 10-year period historically they've never not gone up at least 10 15 so and they are bumps when they might go up 30 40 if it's a very rare car depending on the type of car you buy and they don't have to be expensive in the last like maybe two three years we've seen cars that were 100k go up to 250 300 because they're becoming collectible and they're older and there's less of them on the market and or suddenly a celebrity ends up buying a more vintage Ferrari a lot of people are like, oh, that is a collectible car we never looked at.

20:28And there's only 10 left. They quickly get off the market. Now they come back at double the price. So there's a lot of memes and news articles this last few months in particular about Birkin bags. Now, all these girls love to post about these news articles saying that Birkin bags are actually beating the S &P 500 as an investment. And the same articles were there about watches in 2020, 2021, and 2022. So that's a marketing strategy, but yeah. Talk us through that. Okay, so it's very true that the right handbags and particularly Hermes bags from the Kelly and the Birkin, not all sizes, but the majority of the smaller ones from 28 and down, will typically be worth more than MSRP, brand new, as soon as you buy them.

21:07Usually 2 to 3x, depending on the color, the leather, and the styles. And it's very true that with the price increases of luxuries, so like you've seen this over regarding tariffs, you've seen this over the last like three years because of the COVID and supply chain issues. you notice that generally speaking like manufacturers will raise their prices because the cost of goods go up well that stabilizes the used market to basically not move or also move up with it so if you had a bag that was two times msrp meaning that brand new uh came out for 14 000 but used was maybe 28 000 on top of that in profit right so it was basically selling for like 30 to 40 grand, right?

21:47That bag, if the price increase of the bag goes from 14 to 16, will not go, instead of being 30 to 40, will go like 33 to 43. So it'll move up over time. So the cost of entry gets more expensive. And it's very true because bags are another asset class that hasn't depreciated over the last 10, 15 years. But Hermes bags have gained popularity, but even pre-popularity were so scarce in certain colors that they end up being worth a lot of money on the secondary markets. Now, if you don't have the access to the list that Hermes to get a bag, you can still buy used bags at the right. Like they're used, but like brand new, meaning they're new in box, but they're not sold at the store.

22:25That's what I mean by use. And you can still make those bags literally like turn into a profit center by wearing them for free for three, four or five years and maybe making five, six grand at the time of sale. And we teach that in one of our courses, too, called Secure the Handbag. Secure the Handbag. That's great. Yeah, we have courses on cars, watches, art, and handbags, as well as real estate. So we basically teach people how to take any of the expenses that their lives require them to have in the luxury segment and turn them into a money-making opportunity instead. What are your thoughts about wine bottles?

23:00So that gets a little bit trickier. So art and wine are a very acquired taste, and it's a very specific type of segment that's very hard to transact in. Actually, you're a case study in one of my courses, too, for the card market, you know, because you do all the cards and cards. Yeah, exactly. So cards, I was actually talking about this in one of our webinars, is that a lot of people ask me, well, what about cards? What about sneakers? What about these other things? Right? They're all collectibles, and technically they could be sold. So it goes back to the wine thing, so you'll kind of loop into this.

23:34So the reason sneakers really don't fit into the model we talk about is because sneakers have no utility. Because once the utility is used, meaning once you put them on, the value is gone, right? So they're gone. Like you buy those like expensive sneakers. I'm not buying these shoes, guys. Right. Like so you're buying them, right? Like and you understand they're worth a lot of money. But once you use them, that worth basically disappears. So it's almost like you can buy something. It's arbitrage. You buy it cheap. You look, it might go up. You buy it. So it's different because we talk about the utility of things is just as important as the investment.

24:07So the difference between investing in a stock versus investing in a car is that you want a car. You're going to buy a car anyways. You want a watch on your wrist. You're not forced to. You're going to buy it anyways. So the utility is very, very important. And cards specifically don't necessarily have a utility in that manner because it can be used. You can't like throw a Pokemon card or someone for something. But the main thing that's really important about cards is the one piece of it that's become very transactional over the last couple of years is the institution of it, which means that people like you have basically opened shops that enable people to trade these things and have liquidity for them.

24:43Right. So they can come to you. I'll buy it. Right. You'll put a number on it. Now, that number might be lower than what the market is because you're like, I'm in the business and making money, so I'll buy it for this, I'll sell it for that. I pay 70 cents on the dollar. Exactly. And cards have become that because of people like you, because they're becoming more institutionalized where people can trade them. So wine also has its model like that, but it's not as open. And because it's such a scarce amount of people, it doesn't work in what we talk about. So similar to art, too. You could have art that's like basically$5 ,000 art that's worthless that you're buying that has no value because you like the picture.

25:18Or it could be blue chip art. Like you might be buying something that you like a, I want to say like a brainwash or something that you're like entry level still has some kind of tradability because people want it. And you might say, OK, I paid like five, but it always will be worth four. Like so it's always has some liquidity. And that's what we mean by a store of value. So you have to find things that have a continuity of institution being willing to pay for it so that you're never overpaying and have huge drops of like 50 to 80 percent because you're just buying because you want it. and nobody really wants to buy a pawn shop, you know?