From Worthiness to Wealth: Expert Advice for Tough Financial Times EP 1479

24:56If I could take a lot of uncorrelated bets, the return will equal the average of those bets, but the risk can be up to 80 % less. And it changed my, it really caused me to reflect because I remember thinking to myself, it felt like I was sitting next to a jungle and I could sit on the safe side. There's always risk in return. And what would I do? Would I have a less great upside and be safe? Or would I go through crossing this jungle in which things could kill me or whatever in an attempt to have a great upside, a great life, a great upside? And so that puzzle led me to do the things I described, but also I knew that I had to go have the great upside and not be constrained by the risk.

25:58And so I did the two things that I've described, but going into the puzzle, I found that it was great that to find people who could see things that I couldn't see and vice versa. So that we were on the mission together because people see things differently. I learned how people see things differently. Somebody will spot this or that. And then that back and forth helps you make better decisions. And if you're on the same mission with them. So one of the things I wanted was this meaningful work and meaningful relationships. And I found that that was so good that when I, you know, sort of got to the other side, like, you know, I had enough money and upside or whatever, I still wanted to stay in the jungle.

26:45And I still wanted to do this because the act of doing that with people that I was doing this meaningful work and meaningful relationships with was rewarding in and of itself, as well as success. So one of the things that you can learn is that you can see through other people's eyes. That doesn't mean you accept what they say blindly. It's that you think about their reasoning And if you do that, that's good. It also gave me a principle, which is one of my fundamental principles, which is pain plus reflection equals progress. Okay. We have this pain, whatever it is. And okay. The reaction is a negative reaction and could almost be, why did that thing happen to me?

27:37And, and so on. If instead, when one calms down from the pain, there are, is a lesson there about how reality works. Okay. It happened. It reality works that way. And then there's a thought, how do I deal with it better to produce better? What's my lesson? And if you acquire that, I used to acquire, I would acquire that. I still acquire that. And then I wrote them down as principles in my books. That's why the collection of principles, it's like a journal. Pain plus reflection equals that. And then you write down the principle like a, and that's what the collection of principles came from. That has, so that event, that painful event was the basis.

28:27is.

28:30Most people believe they inherited it all, right? You see somebody with money, you think, oh, mom or dad handed it to them. The truth is 79 % of the millionaires that I talked to first generation wealth builders. They didn't come from anything. These are people that focused and built money over time. Next myth. Well, if you're a millionaire, you make high paying job, right? You got big, big income. Yeah. Yeah. Nope. A third of the millionaires that we talked to never made six figures in a single working year. Really? Think about that for a second. Dual income never made six figures. So that blows that myth out of the water.

29:05A third of the millionaires that we talked to. Wow. Right? Now you think about six figures nowadays, it's more prevalent than it's ever been. But a lot of people with six figure salaries have nothing in the bank. Thank you. Because they just spend it all. That's exactly right. And they're using credit constantly to buy bigger things. That's right. No, no, you're absolutely right. So what happens is people tend to think that income is so important. And I tell you, no, it's not. Because I was one of those people. I remember I was making about 30 grand. And I thought, all right, when I get serious, I'm one year out of grad school making 30, 40 grand.

29:37I said, all right, when I make this amount, I'll start to get serious about my money. Well, you know that path, right? Well, when I make this amount, the next thing you know, lifestyle grows and you never end up taking control. But these are regular everyday people that took control and were focused. It was amazing. So let me tell you this. Top three positions of the 10 ,000 millionaires we studied. Number one was engineer, which doesn't surprise you, right? They're good at planning. Yeah. Accountants. Organized. Yeah. Accountants, same thing. They were number two. They're good at counting stuff.

30:05Number three was teachers. Wow. Teachers. They're not making that much. Exactly. And you think they're undervalued, underpaid. How are teachers doing this? Well, if you think about what it is, wealth building is a long-term view, right? Not a quick hit. And so these get rich quick schemes that we see on TV at late night, they get me riled up because they're preying on people. But these people were people that built wealth over time, investing in their 401k, their 403bs. So anyway, the goal of this book is to let people know their American dream is not dead. It's alive and it's well and it's available to people.

30:37We just have to take action. Absolutely. What are some of the things that they do on a daily basis, these millionaires? What are some of the steps to take and how do they think differently than non-millionaires? Great. 97 % of the millionaires that we studied feel that they control their own destiny. Now think about that for a minute because we have a victim mentality issue in America today where we want to blame somebody for us not achieving something or getting in our way. So these millionaires think differently. 94 % of them live on less than they make. So that means if they're making$100 ,000, they're living on$70 ,000 or$80 ,000, right?

31:11You can't build wealth if you live on more than you make. That's exactly right. And that's where the credit cards people start extending themselves and using credit cards. But 73 % of these millionaires never carried a dime of credit card debt. They never carried debt. Debt. Yeah. Right. Might use a card, pay it off every month. Pay it off. And so the mindset, and I love to give people an economics and a PhD in economics. Interest that you pay is a penalty, right? If I use someone else's money, they charge me. Yes. Right. That's a penalty. Interest that I earn on my investments is a reward. Yes.

31:41Right. So why choose to penalize yourself? Don't use debt. Get yourself out of debt and invest and grow your money to reward yourself. Yeah. Powerful. Yeah. Now, how have you managed to, through all the stuff you've gone through, I'm assuming the last, you know, 15, 20 years you've gone through some challenges. You told me before off camera that you have a child who has special needs and was told that they wouldn't live past a certain age. You're, you know, I'm assuming you've had challenges in relationships, with business partnerships. intimate relationships family yeah the more wealth that i've accumulated and the attention that i've gained there's more people with handouts yes expecting whatever it may be how have you personally managed the emotional challenges that have come your way by not letting it affect your mindset around money so that you don't do things emotionally with your money right well i mean i've been there i don't know about you but i made some mistakes yeah okay and uh You know, a mistake that you make one or two times, you can call it a mistake.

32:46But when you keep doing it over and over, it's not a mistake anymore. It's called a choice. So for me, I'm very I'm a man of faith. So obviously I'm rooted there. But I got good people around me. I got good friends, people that have known me since my childhood, people that know me for who I am. So I'm not an author and speaker with these people. I'm just Chris. And so those people keep me rooted. Right. Mama Hogan is no joke either. OK, she'll keep me rooted. And so I think it's really important to understand what am I trying to accomplish? Like, I don't want notoriety and I don't want to be famous.

33:18I want to be known that I help people think bigger. Right. And so staying rooted in that, it helps me to be very, very clear on what I'm doing. People will come up and tell me, oh, Chris, you changed my life financially. And I go, whoa, pump the brakes. I didn't change anything. I gave you some information. You did the changing. And so I think it's really important as as as we help people that we stay aware of who's doing what and our role. Yeah, I think there's a there's a story about Marcus Aurelius where he would go around the town and he had someone just walk with him beside him and say, you're just a man.

33:53I remember that every time someone would praise him, just a man. Can you imagine that? I mean, seriously, that cool. How rooted does that keep you? You know, so, you know, John Wooden's got a quote. He says, you know, be careful of fame because fame is manmade. And if man giveth, man can take it away. Absolutely. You know, and so being aware of that, I think, is really, really important. What's the heart behind what I'm trying to do? Yeah. And so, you know, if I travel and I go speak to 10 ,000 people, if I get one person whose eyes light up and they start thinking differently, then I've done my mission.

34:25Yeah. Yeah.

34:28If you got a thousand dollars, I would like just keep, you know, keep investing in yourself until you got another thousand. Okay. And, and then invest in yourself, you know, now, now you got 2000 investing in you go, go, go. You should start making money faster. At some point you should start like every time you make an investment in yourself, if I put fuel in my car, it's supposed to take me further. Right. Right. So if I invest in myself, then look, you know, there's things I bought that I didn't get a return on right away. But I didn't quit investing in a course or a workshop or training or education because it didn't work.

35:03Or your health. I spent 17 years going to school. None of it was any good for me. But it did teach me. It did teach me how to go to school. You know. How to study. How to study, how to go there, how to complete a course. Like I completed college. I'm not proud of that, by the way. You're not proud you completed it? Why not? No, because it was stupid. It was ridiculous. I should have dropped out. Like I knew it was a bad thing. I mean, what'd you major in? Majored in accounting. It's a good degree. It's not like just some, you know, business degree. Right. But you should have dropped out of it.

35:33I should 100 % because I would, I mean, I would still, I would still, I would, well, I'd have a five-year jump on my career, but the problem is I was on drugs. So, so, you know, physical, actual drugs. If I wouldn't have been on drugs, I would have quit college because I would have had enough confidence in myself. When you're on drugs, you can't have confidence because you know you're drugged. So everything is second guess because my self-esteem was like through the basement. And so I'm like, I need to quit college. But everybody around me said, oh, no, you got to finish college. You got to finish college.

36:05I'm like, what do I know? I'm a drug addict. And if I drop out, I don't have a degree. And then I got to hire me. I didn't even worry about any of that because I didn't worry about that. I just didn't have the confidence to follow my intuition. You can't when you're on drugs, when you're not yourself. So what do you do with a thousand bucks? Right. Um, you know, I think you just got to keep investing in you until like, Oh, now I'm making$3 ,000. Okay. Boom. Reinvest all that again. But what we do is we start taking it off the table. Right. We save it. We don't invest it. So I think people just need to get on that, that cycle of like, okay, I'm going to keep repeating this activity.

36:43I'm going to reinvest some money in myself, go to the workshop, or whatever. Monday, I got to be hustling again until, okay, now I got$4 ,000. Okay. Now I got 5 ,000. Now the income is starting to pick up. Income has to pick up. The income should be an indication that whatever you're learning is helping you. That's interesting. Until one day you're like, okay, I have more money here than I can actually invest in myself. I can't, like there's nothing I can go to to get rid of this money. You need to get rid of that money though. All my free time is going to my workshops. I don't have more free time to invest in me.

37:13I'm developing skills. I'm working. I'm earning more. Now, what's the next step? Yeah. And now it would be, okay, I got to spend money on marketing. I wouldn't go look for an investment right now. I'm going to spend money on marketing now. Now I'm going to spend money on marketing to get me more leads. And I would, you know, big mistake I made in my career was not spending more money on marketing. Because you turned, what, 50 when you really started investing? I was 51 when we started playing the social media game, and I was probably 56, 55 or 56 when we started spending money on marketing. Wow.

37:47Yeah. 51 when you started doing social media. Yeah, yeah. And I should have been spending money when I was 25 years old. When I was selling cars, I should have been spending money on ads. But I was scared, man. So what made you not scared 25 years later, 26 years later? At 51, I started studying, hey, what do all these successful people have in common? You know, whether it was the mattress dealer, the car dealer, the furniture dealer, or Elon Musk, they spend money, man. You know, they spend money. They spend a lot of money. And they don't worry about money the way I was worried about it. They use money.

38:29You know, they used it. They didn't save it. They didn't hoard money. and the greatest companies on this planet today, the ones that have just like, some of these companies have lost money for 25 years. Look at Amazon. Reinvest, 1.7 million employees. When I started, I remember I looked at Ernst Young. I said, I have a buddy that worked at Ernst Young. I said, how many employees you got? He's like 240 ,000. Wow. And I'm worried about 10 people. What am I thinking? So when I quit studying individuals and started studying people everything shifted for me when I quit trying to be the you know when I quit worrying about what Bob was doing or Pete or whoever and started saying hey man what is this big company doing because that also relieved me of being competitive with this guy Pete and started saying okay I'm going to go do what Coca-Cola does that's when I bought the plane wow really yeah How old were you when you bought the plane?

39:27I was 50, maybe 55, the first one. I bought it because I studied what Coca-Cola was doing. They bought planes. I said, why are they buying planes? Oh, then I learned how they write them off. And then I learned how they trade them every three years. That's crazy. So notice every three years I'm trading a plane. I'm getting rid of it, replacing it with another one. But what are they using it for? They don't use it for pleasure. They're not using it for Instagram photos. They're using it to go and set up headquarters in other countries. Wow. You know, so, so that's when I wrote, uh, if you're not first, you're last, because when I started studying these companies, I'm like, Coca-Cola is everywhere.

40:05You can't go any place and not see Coca-Cola. And I was, I was like this big, I was always thinking about what can I keep? And they were thinking about how many shells can we get on? How many eyeballs can we see? So that's when it all clicked for me. And that goes back to that thing about the financial misinformation. It's like, who am I studying? And that's when we started opening up the funds for…I went to New York City to go walk in Goldman Sachs and JP Morgan's offices. I wanted to walk in and see what it was like. These are multi-hundred billion dollar companies. Crazy. You know, and I walked in, I was like, oh my God, man.

40:50It just all hit me in a second. I've been doing everything wrong. What were they doing different? They owned the building. They weren't renting the building. They owned the building. Well, they don't care if they rent. They could rent it, but they owned it. The elevators were bigger than the studio. One elevator. That's crazy. And 60 people got on that elevator and went to the 120th floor. And then there was six of these. elevators, people going up and down. Everybody told me, don't take people's money. Do not let investors invest when you keep the whole deal for yourself. The second I walked into Goldman Sachs.

41:25Because all they're doing is getting investor money. That's all they do. Okay. And the difference is what I do is I could go to Goldman Sachs. I was there, they would give me money. And I'm like, I'm not gonna get money from them. I'm gonna do what they do. From individuals. Exactly. From my friends, from people that follow me, from people that support me, okay? Goldman Sachs will give money to anybody. Right. Okay, they don't know how to go to these people. They're not on Instagram or Facebook or LinkedIn or TikTok. So I'm going to create a fund where I can tell my audience, hey, Lewis, you can invest with me.

42:01I'm going to kick Goldman out of the deal or JP or whoever. There's a bunch of these guys, you know? It's not that they're doing a bad thing or anything. I'm not saying they're They're the devil, but they're close. Okay. Because they're not going to call you up and say, how are you doing, man? You know, without saying, hey, you got any money to invest. It's just not, you know, that's not what they do. Their job is to make money, period. So anyway, when I saw that, I'm like, okay, these people are, these are the richest institutions on the planet. They fund everything that happens. The company BlackRock, BlackRock's going to be, BlackRock and Vanguard, these are multi, be, you know, probably going to be worth$20 trillion each in the next handful of years.

42:43They say they'll own 99 % of all the assets on planet earth, not just in America. How are they able to do that? Because they scale, right? Because they think big. So they're funding everything. Everything that happens on this planet from media to pharmaceutical is going to be funded by those two companies. So it just, when you're studying your rich uncle or the neighbor down the street, they The think is only so big. And then when I started studying these other companies, I was like, okay, this is who, if you want to create that kind of legacy wealth and really help a lot of people, because they are in a position to help or hurt a lot of people.

43:24That's the scale you got to think at. Yeah. But it took you really 25 years to get there, to start thinking that way. Is that right? Because you weren't able to see yourself spending money for 25 years. You were just trying to earn more and more and more. Yeah, because I was just trying to, because I was, the grind, the grind, the grind was so, it was such a low level grind. Let's say you had the right information at 25. Yeah. Let's just say you had a rich uncle that did what these people did and you got to witness this. Yeah. Do you think that you wouldn't be able to get there faster? Yeah, 1 ,000 years.

43:59Or do you feel like money only comes to you when you're ready for it? No. When you're ready to make it and when you're ready to take on the risk or the responsibility. Sabrina will never make the mistakes I made, okay? Because she won't get in the wrong car. I got in the wrong vehicle. I didn't know. The vehicle I got in when I was 28 years old, I could actually make a hundred grand a year doing this. My daughters will never get in that vehicle. What would they do? They'll be like, I'm not getting in a hundred thousand dollar ride. If it can't bring me, they're going to be like, hey, if this doesn't have a billion dollar possibility, they're going to pick that.

44:35This is the wealthy. They put their kids, their kids see things differently. If they're not ruined, you know, if they're not completely ruined and scathed by having whatever they want, then they'll see opportunities different. Yeah. You know, and, and, but when, when you see the possibility, then you're like, I'm not going to get in that car, that car, that car, I'm going to get, I'm going to get, I'm going to get in a spaceship. So if I was 28 again today, I mean, I would know what industries to pick. Top three industries to pick. Well, hedge funds have to be one of them. Advertising and marketing has got to be a space to be in.

45:15And probably something to do with healthcare, if I can scale healthcare. If I could scale the organic alternative medicines, you know, so those are three massive spaces. Maybe financial too, the financial world. You know, in the next 30 years, we're probably going to have a disruption of the dollar. And the way money's, maybe we're a crypto currency, you know, environment in the future. So any of that's going to happen. you know, but the reason I would go there is like Jeff Bezos. When I saw the first interview with Jeff, when he was saying he was studying algorithms, I think he was at one of the big firms selling stocks.

46:03Before Amazon. Yeah, before Amazon. And then he saw something that came across his desk where there was a spike in internet activity, eyeballs going to the internet. That's when he said, I'm to go do Amazon. And he followed traffic. I didn't ever follow traffic. He followed scale. He followed scaling possibilities. And then what did he do? He followed this traffic, the possibility. Then he invested in the possibility. And then he went into debt on the possibility. And then he was willing to not get paid any money. But what did I do? I need money today. I got to have money this week. I need to have a little more money next week.

46:42And And if I get a little more money after that, I'm gonna save it all. And then I'm gonna go do that again. And I'm gonna feed the bank and I'm gonna keep feeding the bank. I don't even know how much money the bank's made off of me for 25 years. We don't know anybody that works harder than Grant Cardone. And as soon as he gets a bag, he brings it to us. What do they do? Hey, y 'all wanna borrow this money? Now repeat that 300 million times. Wow. And that's the American people. What about a family that's thinking, you know, I really feel comfortable having six months to a year of savings because I got kids, I got the rent, I got all the bills.

47:16What do you say to someone who's like, you know what, I see you're coming from, but maybe I don't feel that comfortable yet. Well, then keep money. If you think money's going to save you, you're just, again, they're stacking information on top of bad information. The money that you have saved in the last six months has probably dropped 11%. So the money that you have, you got a hundred grand. I got to have six months of savings. I need, you know, 4 ,000, my bills are four or 5 ,000 bucks. I got to have 30 grand in the bank. Got to have 30, but they really have 180. So first of all, I guarantee they have more than six months and they don't even know it because they're living out of terror.

47:55It's not logic. Right. You say it's logic. I need six months, but you got three times more than you need. Sure. Number one. Number two, you've never had an emergency that cost you 30 grand in your lifetime. Very few people ever had that emergency. Everybody hears about, oh yeah, my guy got in a bar, this happened, blah, blah, blah. But if you had assets, if you'd been investing in assets, you can always go use those assets for collateral to solve your cancer surgery. You can get a loan out from the bank if you got it. 100%. Or if you just took the money that you earned and keep reinvesting in assets that pay you, not assets that you wish one day will pay you, but assets that pay you every month.

48:36If you keep investing in that asset class, one day your cashflow will be your emergency account. My emergency account last month paid me a million six. My cashflow, my free cashflow. That's crazy. That's no work involved. That is not one second of one day. Okay, and that happens every single month in my place. But that's been because I made a bunch of investments for the last 25 years. End of every year, I dump all my cash out every year. I'm like, you need to get as close to zero as you can and replace it with assets that in January, if I dump out in December, January, I want a payment from that.

49:21It doesn't have to be a big payment. It just needs to be a drip off that asset. Something, yeah. So I'm going to go, I'm not going to buy a cup because the cup won't pay me. So in December, I had a bunch of money. Boom. I'm like, make a deal. You were in it, yes, a couple of days ago. Yeah, yeah. You bought that house. Take that cash, that garbage that you have. I already had a surplus of money. So if I can't buy two of these, I'm not going to buy one of them. If I can't write off some portion of it, I'm not going to buy it. If I can't do it out of passive income, I'm not going to touch it. Interesting.

49:51So those are my criteria for making investments, right? And it needs to cash flow. So I took a bunch of this cash that was sitting here just deteriorating, not providing me with safety, and took it and put it into this asset. And people are like, are you, Stu, you're ridiculous you paid that much money for that thing. Okay. We'll see. You know? So I buy this thing. This thing will provide rental income. I think this year I'll make$3 million on this deal. Wow. In cash flow. And how much do you have to put down? Are you going to buy the whole thing? Well, I paid cash for this house. So, so, but the reason I did it is not because this is a great deal, but, but this is a terrible deal.

50:27Keeping the cash. Keeping the cash is garbage. This, this Malibu house is probably one of the worst investments I ever made. Why? Okay. But, but I had a bunch of surplus cash. I had already bought in December, we bought almost 2000 apartments. If I could have got another apartment deal, I'd have bought another apartment deal with a 40 million, but I couldn't. You couldn't find one. I couldn't find another deal. Okay. I still had this money left over end of the year. It's just the thing that I do. End of the year dump out, literally like flush the toilet on your savings. So every day I look at my savings accounts.

50:58Okay. It's not because I'm worried about any more money anymore. I know for sure the money's going down in value. Everybody knows that this year, your money is depreciating, right? It's dropping down in value. What you were told that is a hundred grand is not a hundred grand. The bank's not even telling you the truth. it's a hundred less 11 ,000. It's 11 % right now? It could be 34 % less. Some people think it's going down 34%. That's crazy. But you're gonna still see a hundred because this is invisible taxing, right? It's inflation. So I know that. I know it's not a hundred. So when you guys look at your checking, I got 180 ,000, you're lying to yourself because you're not doing all the math on money.

51:39This is why Mike Saylor went and took all that money he had and invested in Bitcoin. Bitcoin, yeah. Because he's done the research. So I would listen to him. And I'm not saying you guys should go buy Bitcoin, but I'm not buying Bitcoin at those levels. Okay, I'm buying assets that can provide me with more cash, with more income. Maybe I should be buying Bitcoin. I don't know. But anyway, so I dumped this out. I dumped this for now. I've been shopping this piece of real estate for 19 months. I've been working this deal for 19 months. So I'm not being like, okay, I just got to go buy something. I'm not going to do that.

52:10But I'm trying to get rid of this cash to go into an asset that has the potential to go up in value over time. I dump out in January. Okay. I do three webinars. That's why everybody wants to know, man, what's the rush to make more money? Because I'm broke, man. And I got a new house. Right. You got bills to pay it out. You got expenses. So January 1st comes. I've done three webinars already to start filling this up again. Right. Now, if I walked into January 1st with 40 million bucks sitting in a bank account, dude, what's the rush, bro? You're not hungry. Yeah, let's plan. Let's do some planning this year.

52:49But what I do is I dump out. So every year for the last 15 years, every January, I end up with more assets. I hope you enjoyed today's episode and it inspired you on your journey towards greatness. Make sure to check out the show notes in the description for a full rundown of today's episode with all the important links. And if you want weekly exclusive bonus episodes with me personally, as well as ad-free listening, then make sure to subscribe to our Greatness Plus channel exclusively on Apple Podcasts. Share this with a friend on social media and leave us a review on Apple Podcasts as well. Let me know what you enjoyed about this episode in that review.

53:28I really love hearing feedback from you and it helps us figure out how we can support and serve you moving forward. And I want to remind you, if no one has told you lately, that you are loved, you are worthy, and you matter. And now it's time to go out there and do something great.