How to Build a Million-Dollar Portfolio Starting From Nothing | Graham Stephan

13:34Lewis Howes:that's huge

13:35Graham Stephan:yeah 3.6 million dollars how old were you? I had just turned 19 or I was just turning 19 that's a massive commission yeah it was and that buyer I met doing an open house I'd done an open house every single Sunday for nine months and then just a buyer happened to walk in we had a great conversation he was a doctor and straight up just gave me a chance like that was one of those things where he's like I remember when I was 18 and someone gave me a chance and I want to do the same for you that's cool I want you to help us find a house and I did and like I have so much to him but I I spent all that money buying a Lotus Elise.

14:11Graham Stephan:And the car, I think, was like 30 grand plus taxes and stuff like that. And you also have to pay tax on the commission. So I was left over like nothing afterwards. But that car, I started taking it every weekend to these car meets, like early in the morning. Like early Sunday, wake up at like 6 a.m., go to a car meet, and I meet car friends there. Like people driving like Ferraris on Lambos. And here I got in for the cost of a new Honda Accord. And so being around those people, getting into those groups, and I loved it. It was just fun. I'd take the car and go to car meets. And then right afterwards, I'd go into an open house.

14:49Graham Stephan:I'd park the car out in front. And people commented. It helped.

14:54Lewis Howes:So what sounds like you said and what you tell people not to do is actually a great investment. In hindsight, yeah. Right. It was a bad investment, but it was a great investment.

15:02Graham Stephan:Could have gone the other way too, I think, had I been reckless with it or maybe not used it. Like if I was like, oh, I'm going to go pick up chicks in the car now. Sure, sure. I'm like not worked. But I just used it as like a passion and a networking tool at the same time.

15:16Lewis Howes:What's the best invisible asset that you've invested in for yourself?

15:21Graham Stephan:Oh, man.

15:23Lewis Howes:That continues to pay dividends today. What do you mean invisible asset? Like not a physical thing, but more of a skill set, a learning, something you've developed, a relationship that you've invested in, something invisible that is not a tangible thing you've invested in.

15:40Graham Stephan:Oh, I would say just great people and mentors around me. if uh jason oppenheim i say this all the time has been like one of the best parts of like just learning i guess not how to be more assertive but like being able to convey what you want and being able to um basically give a give a direction in a way that people will understand and seeing him operate on such a high level. Just watching him, like I just go into the office and just listen to him speak and see how he negotiates and like those sort of connections and just being able to learn from those people has been invaluable. Yeah, that's beautiful.

16:26Lewis Howes:One of the biggest money mistakes I see people make is waiting for the perfect time to get serious about their finances. And I've been there myself. It can be easy to say you'll just deal with it later, but later has a way of showing up fast. And that brings us to today's sponsor, Northwestern Mutual. They'll match you with a financial professional who'll work with you to build a plan based on what's important to you, looking out for your blind spots and finding new opportunities to help grow your wealth and protect what you've worked so hard for. They listen to you, find out what's going on in your life today and what you have in mind for the near and long term.

17:01Lewis Howes:Personally, Northwestern Mutual has been behind my financial and emotional security as an entrepreneur most of my life. Having someone in my corner helps me make clearer decisions and stay focused on building a future I am proud of. Find a better way to money at nm.com, the Northwestern Mutual Life Insurance Company, Milwaukee, Wisconsin, and Northwestern Mutual Wealth Management Company. Paid testimonial by a Northwestern Mutual policy owner. This podcast is supported by Ring. With Ring, it's protected. You know those moments when you're expecting a package and you're not home and you're thinking about it all day, wondering if it's just sitting out there.

17:38Lewis Howes:That's something I think about, especially with how often we're ordering things for the house. And this is where Ring comes in. Keep track of packages and see more at the front door with battery doorbell. And honestly, Ring has been a game changer for me. I like being able to quickly check and see where my package shows up and just know it's there. And beyond that, I'm also keeping an eye out on the yard. With the Outdoor Cam Plus, you get a wide field of view and clear retinal 2K video, so you can see what's happening around your home, even at night. You can also upgrade to 4K cameras and doorbells with retinal vision, which gives you ultra-clear footage and lets you zoom in without losing important details.

18:12Lewis Howes:And for me, it's that extra peace of mind. Whether it's making sure a delivery arrived or just checking in on things outside, it's simple and easy. Your door, your yard, your home. With Ring, it's protected. Shop cameras, doorbells, and more right now at ring.com.

18:53Lewis Howes:delivers 20 billion live probiotic cultures in a one pill per day formula, which makes it easy to stay consistent. And if you care about building habits that support your goals, this is one way to stay intentional with your health. Nature's Bounty, it's in your nature. Learn more at naturesbounty.com. These statements have not been evaluated by the Food and Drug Administration. These products are not intended to diagnose, treat, cure, or prevent any disease. What's your plan with this year, with the recession potentially going to happen? You're talking a lot about this on your channel. What's your plan to do with the cash?

19:27Lewis Howes:What do you plan to do with it over the next 6 to 12 months? If everything crashes. If real estate crashes, if the stock market crashes, what will you do?

19:38Graham Stephan:When buying in, I'm dollar-cost averaging into the index funds every day. So every day the market's open, it's a habit of mine to wake up every morning and to buy the same dollar amount. Every single day.

19:48Lewis Howes:How much is that every day?

19:49Graham Stephan:Five grand.

19:50Lewis Howes:Five grand a day.

19:51Graham Stephan:Just right in there. Index funds. Always index funds. It's just like my morning routine is just like index funds. Anything above that, obviously taxes, I can take that into consideration, goes into the cash pile. And in a perfect world, I want a really good commercial property that's triple net, ideally in Las Vegas. But I believe we have a ways to go on that. Because right now I have that money parked in treasuries. and it's earning about 4.4%, maybe 4.5%, 4.3%. That's not bad. Yeah, and I just keep rolling it over. That's not bad. So if I'm making 4.4%, but I'm looking at commercial properties, making 4.5 % to 5%, I don't see the risk premium there yet.

20:33Graham Stephan:So I think if I could find something at 7%, 7.5%, to me that gives enough of a buffer where if the market continues going down, I've locked that in. but I've yet to see those deals come up yet. So I'm looking, I look every day and I think it'll get to a point where I could start making offers but some of the properties that come up, they're great but I don't want to be like their first week on the market. Here's an offer for 30 % less. It's like, I'm not gonna shoot myself in the foot. It's offensive to them. But if it's been listed for six months, four months, whatever, then I'd consider making an offer.

21:07Lewis Howes:Yeah, I know you get asked this question a lot but if someone had between 20 ,000 in cash or$100 ,000 in cash, and I know you're not a financial advisor, what would you be suggesting as options for them to do to invest it as opposed to holding onto it in the bank and they wanted to invest it somewhere, what would you suggest? Between$20 ,000 and$100 ,000 of extra cash laying around that they want to invest in somewhere and make an interest.

21:33Graham Stephan:The biggest thing that's made a difference for me is house hacking. One of the best things that I've done is buy the duplex. I moved in one side. I rented out the other. I think a lot of people, now not every area has a duplex that you could go and buy, but I found that if you could reduce your housing, because housing makes up 25 to 35 % of your income, a third of it is gone just for a place to live. But if you could find a way to reduce that by using that down payment, leveraging that for a duplex or a triplex or anything where you could rent out the other units, ideally it'll cover your overhead, but even if it covers half, Like to be able to save an extra 20 % of your income by building up equity in a property that you could rent out, I think that's tremendous.

22:18Graham Stephan:But you also have to be okay with being a landlord, putting in the time to like managing a property. Fixing stuff, everything. Yeah, and you also have to be careful about what you buy, that it's a good deal. It's like just because it's a duplex doesn't mean it's worth buying. So if you're willing to put in the work, I think that could probably yield the highest results.

22:36Lewis Howes:Yeah. What's your thoughts about owning a home in general? I know there's different real estate experts that talk about, you know, only rent where you live and own the thing that you rent out. So it brings you in passive income. What's your thoughts? You own your home. You live there. Do you think people should buy a home or should they rent and use their down payment as an investment to bring in cash somewhere else?

22:58Graham Stephan:I think it really depends on the area. Places like Los Angeles generally are cheaper to rent. The difference becomes if you plan to live in the house for like 15, 20 years, and you know it's a place that you're gonna be raising a family, or for the peace of mind of being able to not worry about rent increases. But Los Angeles is an area, for instance. It's kind of a bubble, yeah. Yeah, where renting is so much cheaper. The majority of the city is rent control. Your rent's going up usually 3 % to 5 % a year, the very most. It's cheaper. You'll save more money.

23:33Lewis Howes:I mean, it's more expensive rent here than it is anywhere in the country. Yeah, true. A lot of other places.

23:38Graham Stephan:It's cheaper to rent versus owning here

23:41Lewis Howes:because it's so expensive to own.

23:42Graham Stephan:I would say generally, if you plan to live in the house for seven to 10 years, it's usually cheaper to own, but you have to factor in also your closing costs, commissions, maintenance.

23:53Lewis Howes:Now in LA, there was a whole mansion tax coming out. Did you see this in April? Yeah, I saw that. In April, 5 % if you sell a home.

24:00Graham Stephan:I don't think that passed, did it? I'm pretty sure in April, if your house is over$5 million. I don't think that passed. I think it did. It passed. I have not kept up. I'm glad. You're in Vegas now. I think it did.

24:12Lewis Howes:So it's like, if you had a$5 million home, 5 % on the mansion tax. On top of it. I think it's stupid.

24:19Graham Stephan:It's crazy, right? My issue with California is that their solution to everything is tax. Let's not fix everything that's broken here. We just need more money. But they make so much money to begin with. Where does it go? Who knows? Where does it go? So their thing is just, let's tax the rich people. Let's drive everyone out of state. But then let's tax the people who stayed even more. That makes no sense to me. I think, you know, California is such an amazing state with so much to offer. Why did you move?

24:47Lewis Howes:You grew up here. Yeah. You know, grew up in Cali, in LA. Why go to Vegas when the weather is perfect here 90 % of the time? You've got the ocean. You've got the mountains. You've got industries here. Why move away?

25:01Graham Stephan:I think the quality of life deteriorated to a point where it was better somewhere else. And I never thought I would leave. But what really kept me here was doing real estate. And like up until 2020, I was going to the office every single day to the Oppenheim Group. And I would do real estate on the set. Like I was like 85 % YouTube at that point. But if a client came around, like I was, and they were looking for a$4 million house, like I'm going to help them find a house. Anyone else? I had, you know, a cool little referral business within the office of like, I'll give that to so-and-so and I'll give that to this and it worked really well and I'd be involved in the phone like throughout the process But they would do a lot of the stuff and it worked really well but when COVID happened and I was just like home Making videos I realized how much I loved just like being able to make videos and like Do that I just had so much fun doing that then I realized you don't have to be in Los Angeles to do that Just checked out Vegas realized how nice it is in some of these areas of like Henderson and in the summer, I really liked it.

25:59Graham Stephan:I'm inside anyway. You're talking about going to the beach and the mountains. You don't do that. How many people in all really go to the beach? No one goes to the beach. Sure, you go to the mountains, but every now and then, I'm inside anyway. Might as well save on property tax, might as well save on all these things. The quality of life there was so much better. The house was way less expensive. Way bigger. Twice the square footage. I was able to have a larger office. My office in Vegas was like four times the size of my office in LA. I was able to also have a podcast studio in my house at the time Jack was living with me.

26:36Graham Stephan:He had a bedroom there. So like I would say half the house was an office. And that was like an entirely separate part of everything. Like, you know, walk in, you have the kitchen, everything. And then this left side was office. It was like Jack's room. He was editing. He was doing the podcast. It was perfect setup. But then also it's like, there's no potholes in the road. There's no traffic. Everyone is really friendly. It's a really great community. I know all the neighbors. And like in Los Angeles, you might know the people on either side of you. And that's it. It was so like closed off. Vegas was like very friendly and nice.

27:11Graham Stephan:It's been perfect for you. Yeah. So immediately I knew like this is the right choice. And I would say every now and then I do miss. The weather here is obviously better. Yeah. But I don't mind the heat. You're inside all the time anyways. I would say the biggest difference though, I like the people here. I feel like here you get a wide range of people, perspectives, ideas. It's like this melting pot of different cultures that you don't get as much in Vegas. And I miss this sort of like free spirit entrepreneur. There's something different here than you get in Vegas. And sometimes I feel in Vegas, you get in your own little world.

27:52Graham Stephan:and just like just doing one thing and then I come back here and like get to meet and see other people who are doing like much bigger things and it's inspirational for me to see. Maybe you're moving back out in the next year or two. No. Just come out more. But I could come back for work and I could, you know, come back here for a few days and then jet right back home. That's cool. I'm happy with that.

28:11Lewis Howes:That's good, man. I'm curious about what is the psychology that happens for you when money comes into your bank account? When you get a check, which I don't know if you get checks anymore, but when money enters the bank account And you get paid on the 20th or 21st on YouTube money every month or whatever it is. Sponsors come in. When it enters and you see it come through, is there an emotional connection you have to that dollar amount? Yeah. Or is it neutral? Is it exciting? Is it fun? Is it scary?

28:41Graham Stephan:What is the feelings that you have? So immediately, because it's really hard to separate what I have in my bank account versus what I'll have left over after tax. so whatever money is in there i just mentally will do and i you know do quarterly taxes but like everything that comes in i just multiply that by 0.6 and i just assume 40 is going to be gone for taxes accounting miscellaneous fees just random stuff just average 0.6 percent and then i take what's left over of that and then i multiply that by four percent and that to me is how much that money will last for the rest of my life. And so I do that with everything.

29:21Graham Stephan:So for every$100 I get, I have$60 left. Or sorry,$60. For every$100 I have,$60 left, 0.4. I think that works out to be like$2.80 or whatever it works out to be. That's my passive income. I'll never go below that. And so I invest everything. My actual personal expenses and cost of living is very low. Everything I do is either for the business, discretionary, personal is almost nothing. So it's just like everything gets invested for the most part that's left over from that.

29:56Lewis Howes:How does it feel though when you're analyzing this, you see the dollar amount come in, you multiply, you do all these things. Does it excite you? Do you feel abundant? Do you feel like, okay, everything's on the right track? Do you feel scarce ever?

30:10Graham Stephan:I'm sure I definitely, everyone tells me I've got like a scarcity mindset because I'm so much like when I get something I don't want to lose it but I've also been very conservative in terms of like uh building wealth saving money uh in terms of like investment returns like everything I'm like for if I just can average four percent like I'm fine or even three usually three percent but um no for me I just think like I've always increased my lifestyle based on really the three percent rule of like I could spend three percent of what I have invested every single year regardless of how much it makes three percent what can i buy with that and then even of that i'm like okay well i still want to save half so it's like really the one and a half percent rule um but it gives me something to look forward to that i know it's sustainable like whatever i want to do as long as i stick with that i i can get new experiences i can work my way up to something else in a way that i don't have to worry about it running out and um just feel safer that way yeah Because at least what I've seen from real estate, so many people just like blow all of their money.

31:16Graham Stephan:I remember this one person who was well known and was making$5 to$10 million a year. And they were having difficulty qualifying for a house, making$5 to$10 million a year because they spent it all. Now, their view, I'm sure, was I'm just going to keep making money. Like it's not an issue. And they've gone on to have a successful career, make a lot of money. But for me, I can never be at a point where I'm spending that much. And that's the threshold. Because you never want to go down. I think it's really hard to scale back. It's very easy to scale up. So I've always made sure to be very careful.

31:54Graham Stephan:Once you get used to something, it's hard to go down. And it's very easy to go up. And you don't want to set the bar too high just in case. So I've always been really cautious about what I do. And just knowing that lifestyle inflation is a thing. and how could I curb that in such a way that is sustainable but still gives me something to look forward to how often do you make emotional purchases almost never I don't think there's any purchase that I make that's emotional really no I mean the only thing that I bought without money in mind was my aquarium that was the only thing that I did not yeah I didn't look at the price tag I don't care about how much it costs and I'm not getting any return on my money that It was the only thing, but I built that into like what I have invested.

32:40Graham Stephan:I'm like, okay, if I have X amount invested, that'll pay for the aquarium and X amount invested in addition to that will pay for all the maintenance. So I just like factored it in that and worked towards that being a goal.

32:54Lewis Howes:You know how people sometimes invest in something that seems incredible at first, but then it doesn't live up to the hype. Like when everyone was convinced NFTs were the future and people were buying them for thousands of dollars and now they barely have any value. Marketers know that feeling. They optimize for numbers that look great, like impressions, but then they don't see revenue. LinkedIn has a word for that, bull spend. Instead, you can get the highest ROAS of major ad networks with LinkedIn ads. Cut the bull spend. Advertise on LinkedIn. Spend$250 and get a$250 credit. Go to linkedin.com slash Lewis.

33:26Lewis Howes:Terms apply. Hiring isn't just filling seats. With Indeed Sponsored Jobs, they'll help you match with candidates who can actually move your business forward. Target candidates by skills, certifications, or location. Join the 3.3 million employers worldwide that use Indeed to connect with quality talent that fits their needs. Spend less time searching and more time actually interviewing candidates who check all your boxes. Less stress, less time, more results now with Indeed Sponsored Jobs. And listeners of this show will get a$75 sponsored job credit to help you get your job the premium status it deserves at Indeed.com slash podcast.

34:11Lewis Howes:Terms and conditions apply. Hiring, do it the right way with Indeed. What were the three biggest lessons that doing real estate sales taught you about life and business in general?

34:24Graham Stephan:Yeah, I would say not giving up. because with sales, it's like you have to stay on it and learning how to differentiate between, like read people, I guess is a big one because I got fooled so often. Like as a young agent, you don't realize how many fakes there are out there. Like people who will just waste your time and pretend to be buyers. I had this dude and I was so naive. Looking back, I was an idiot. He walked into the open house and told me that he was in the market for like 25 to$50 million homes. The guy wasn't like, you know, representing himself in such a way where he could afford these houses.

35:01Graham Stephan:And nor would a guy of that caliber, realistically, trust an 18-year-old kid who's like brand new to show him. Show him 20, yeah. Yeah, show me 50. Like, chances are they have business managers. They don't even show up to the houses first. They have assistants do it first. And then they have people vet it. And then they show up and they're very discreet. This guy was very flashy about like, oh, yeah, I did this. And my company does that. Like, they're talking about it. I had no idea. So I'm sitting there showing him houses. And every agent is looking at me like, is this guy pre-qualified? Blah, blah, blah.

35:32Graham Stephan:And I'm like, oh, yeah, he's good. I'm just an idiot. And I remember one agent. I would consider her like not a mentor, but she really took me under her wing. And she had a listing. And she's like, bring him to my listing and I'll feel him out for you. And she was there anyway. And so he came there. And she started asking him questions about his proof of funds. Literally goes into his car in his trunk and pulls out papers and hands it to her and she's like this is a proof of funds It was like a word document the guy just printed out saying like X amount company blank this this and afterwards She's like this guy is fake.

36:06Graham Stephan:He's not real. He's not a real buyer and then But you'd already spent 20 listings showing him 20 listings as an idiot Yeah, but then you also ruin your name in the process of like any time you bring a buyer by these agents remember that You know, oh, this is Graham He's the kid who brought by this like really bad buyer. He wasted my time I spent an hour setting up this house and like their time is valuable my time. I got nothing to lose And this guy meanwhile was just I think he was just dreaming and he was using it as Inspiration and he would spend like two hours at the house. It's like laying back.

36:36Graham Stephan:Oh my gosh. I was an idiot.

36:38Lewis Howes:Oh, man Okay, so learning learning to read people Never giving up being consistent. Yeah, but you can't but you can't never give up unless you know how to read the right person know what their really intentions are what's another big lesson you think

36:51Graham Stephan:you've learned from real estate I loved it I don't know there's something about it where I just felt I could do this 24 7 and it never felt like work it's just like what I enjoy do like I got so excited every day to wake up like you know the feeling sometimes we had just like a really good day and you can't go to sleep or like so excited yeah yeah like maybe like a Christmas morning or you can't wait to wake up like you know you're going to Disneyland or something like that that's how I felt going into work I just enjoy it like I would wake up early and like be excited every day to be able to go and do real estate like learn and be around these houses because for me it was so foreign to like walk into a five million dollar house get to be around people who could afford that and like everyone I saw like what can I learn from this person I just found it really inspiring yeah that's cool yeah it really opened up my mind in terms of like what's possible and so I really believe that like having access to Los Angeles just gave me that worldview of like it's insane the possibilities that are out there yes and just believing that hey if these guys could do it why can't I and you would see that they're nothing special it's just they've got good at a skill and you don't need to be like this super

37:59Lewis Howes:human person I'm curious about your thoughts on money and relationships how has lived how has been living an extreme frugal financial lifestyle supported or hurt you in intimate relationship with your girlfriend?

38:17Graham Stephan:I don't think it's ever hurt. It's never hurt? I don't think it's ever hurt. Even like just dating in general, I think there are cheaper ways to do everything. And people that know me in general, they kind of would know what they're getting into. Right, right. They're not expecting you to do something. Yeah, it shouldn't be a surprise, but like I would say a lot of the things that you would do like in a real estate they're either free or they're very inexpensive like I think it's more important to spend quality time with the other person versus like hey we're gonna go to like this fancy restaurant I think there's a time and a place for that for sure but I think at least for the first like the dating period it doesn't have to be expensive at all um and with Macy it's been it's been really nice because she's I don't want to say she's as frugal as I she's okay with spending money on certain things if she feels like the values there versus I'm always like the cost like oh but the value might not be there for this we could get 80 % of it you know I want to say with her I've definitely loosened up because I could afford it but a lot of the things still it's like she enjoys contributing I appreciate that I think some of our trips it's like you know she's got credit card points she's like I opened up these credit cards I got the sign up I was like so it's a free trip you know So a lot of things like this, they don't have to cost money.

39:32Graham Stephan:But I will say I have loosened up with Macy's. Just in the sense that I don't fret over a$60 dinner anymore. Five years ago, I was sitting at$50 dinner,$60, and be like, well, we could do that for cheaper over here. I'm going to eat a little bit at home, and I'm going to go there and get one. I'm bad.

39:52Lewis Howes:Really bad. Do you wish you would have changed that? If you could go back, would you have done it differently? Had more balance? I probably not.

39:59Graham Stephan:I mean, I'm sure there are things going back where I'm like, yeah, I should have done that. It was stupid. But one time, I know I'm going to get hate for this, but there was a car meet and I had budgeted it. And again, like it's different if you're making like 20 grand a year. I was probably making 100 grand a year. And I had budgeted that day only for gas. I didn't have enough for the food. And they're all driving through Malibu and they're going to like this fancy place for lunch. I got a subway instead. and you know sat down at the table and I asked to serve really nicely because it was like a row of like 20 people like can I eat my Subway here oh my and they were totally cool with it and I figured the tip that I'd leave them is way less than what I would have spent on this meal that I didn't need I wanted a Subway I didn't want to spend$50 so I just left the tip instead and I ate my Subway they're totally fine with it I forget what it was a restaurant in Malibu But there were 20 people at the table.

40:57Graham Stephan:I don't know how big the bill would be. But anyway, that's the stuff that I, in hindsight, it was cringy to do. Oh, the other thing I would do all the time is

41:13Graham Stephan:if I were out with friends and there's extra food they weren't taking at home, I would be the one. You would take it home. Everything. Box it up. Everything. But I would get a whole meal out of that. That's great, yeah. A whole meal. I need to take more stuff home. That's what I need to do. Nothing would ever go to waste. That's good. Even when we go out with the Oppenheim group, it was usually the six of us. Oh, they had lots of good food then. And Jason was the type, order everything. And then you'd say, you got a meal for a week. Yeah, but because he likes to be like, I'm going to have a few bites of this, a few bites of that, a few bites of this.

41:41Graham Stephan:And then there'd be like half a meal there. And he would just, oh, I'm going to take it all home. And I'd put it in the fridge and I'd live off that for days. so that's that's a lot like when i made one of my how much i spend in a week videos i think my like grocery bill is like a hundred and something dollars a month for food but now a lot of that was subsidized by like eating really good food but taking it all home and then divvying it up throughout like it's like a meal prep but like it's food that would have gone to waste yeah so i'm curious what

42:15Lewis Howes:What do you think of the biggest money myths that keep a lot of people broke?

42:22Graham Stephan:Oh, money myths that keep people broke. I don't know. I always feel like that you could die tomorrow is a common thing that I would hear a lot of people say. Like, I'd rather just live now than my perspective is that you can always live tomorrow, too. like your chances of living tomorrow knock on this much higher than passing away yeah so i think plan for tomorrow is a probably better approach statistically i feel like you can live just as easily like in your 30s and early 40s as you can i'm sure the experiences you're in 20s are different um looking back i still feel like mentally i feel like 23 to 25 i don't think i've grown up since then mentally i still feel the same age uh except i need more sleep now but i feel like now like i've i've done so much saving throughout my 20s that now i can finally like loosen up to a certain extent buy an extra piece of sushi one piece yeah i still i still look at prices like we went out to sushi today i saw a 28 roll and a 15 roll i'm like 15 i get two of those versus is one of those.

43:34Graham Stephan:Yeah. I'd rather the two, so I got the two.

43:36Lewis Howes:So if you had to go back and just imagine your 18-year-old self, how old are you now? 32. 32. So imagine 14 years ago. And imagine that you, in a hypothetical world, you had to become a millionaire in half the time. So you had to hit your first million in revenue and sales coming in in half the time from 18 to that time. as opposed to when you were, I don't know how old you were. That was 26. 26. You had to do it at 22, 23, right? Let's just say hypothetical scenario, you had to. What would you have done differently in order to get there? Would it even be possible?

44:17Graham Stephan:It would have. It would have been YouTube for me. Yeah, because every day after real estate, I wouldn't watch TV, watch YouTube. Like that was my version of TV. This is like 2008. Early YouTube. Very early YouTube. but that was like I would come home and just watch YouTube videos. That was what I enjoyed doing. And I noticed back then that there was no business or entrepreneur content on there. And what really solidified it for me was Rob Dom, he's a car channel, posted a video about how he was able to buy a Lamborghini Diablo, a 2001. And he made a video in his garage way before the Tai Lopez stuff, way before.

44:57Graham Stephan:But he made a really inspirational video about what he did for a living to afford a Lamborghini Diablo and was so honest about it. And there was a guy before him. His name was Robert Himmler or Himmler. I don't know his name. I can't remember his last name, how it's pronounced. He drove a green Lamborghini and was selling a program or a course or something about how to get rich or something like that. There was some speculation that it was family money or something like that. But he, I believe, owned a car customization shop or something like that. So Rob Daum made this video basically saying, I'm gonna just tell you what I know for free.

45:36Graham Stephan:I have nothing to sell you. And this is my story. And he posted it. I was so inspired by that. That for me is like, I wanna do that. And what really hit it off for me was that I sent him a message on Instagram. He maybe only had a few thousand subscribers at the time. Sorry, not Instagram, Facebook. I sent him a message and I'm like, hey, I love your content. And I could pull it up here if you wanna see it. But my original message back then was like, there's a huge market on YouTube for this type of content. If you double down on this, it could be huge. Really? Yeah. I bet I could pull it up now.

46:07Graham Stephan:So this was a video he put on YouTube.

46:09Lewis Howes:Yeah. You mentioned him on Facebook. He was just doing a couple videos. He wasn't doing it consistently. Correct.

46:14Graham Stephan:Hey, Rob. Message from a fan and fellow car enthusiast. I've been watching your videos from before you had 10 ,000 subscribers and love your videos. I'm so happy how far you've come. You'll be hitting 100 ,000 subscribers shortly. you've definitely been a great inspiration. I have two questions for you if you have the time. And then I asked like what camera mics you use. Sure. And then what did you find give your biggest break? Was it uploading content regularly? Was it car videos? Was it inspirational? And then I said, just a comment. I believe you could have a great career in motivational speaking in business.

46:44Graham Stephan:There's a big market for young people who don't relate to Tony Robbins and who have never heard of Napoleon Hill before. Just food for thought. This would be a big opportunity. And then he responded back. Mackie gave his answers and said, I want to be a motivational speaker without actually being a motivational speaker. Ha ha. And then I said, you know, I think you could take these very, very far in that direction. But that was more than 10 years ago. But I wanted to do that, but I didn't have the courage to do it. Why didn't you have the courage? I didn't have a Lambo. I know how stupid it sounds, but I felt like who would listen to me?

47:15Graham Stephan:What did I have to have? Like Rob had a business and a Lamborghini. He was credible. Yeah. What did I have? um you know looking back it's stupid because i could have like i felt i needed either a million dollars a lamborghini like something a show of success because back then that's what you had to do on youtube it was like lamborghinis just got clicks and you know me starting my career in real estate with you know 150 grand in savings or like still a lot like looking back i could have said I had to make 100 grand by 20-something. I didn't have the courage. I felt like I would embarrass myself.

47:53Graham Stephan:But had I started back then, I would have been so early. And it was just a feeling. I wanted to do that, but I just didn't put it off for years.

48:02Lewis Howes:I'm really excited you're talking about this because I think a lot of people don't have the courage to do the thing they really want to do because they don't feel credible or ready to do it. So what would you say to people who are like, well, I don't have the money, I don't have the credibility yet, I'm just getting started in this thing, and I want to start talking about it or creating content or doing whatever, writing a book about it. But who's going to listen to me? What would you say to those people?

48:23Graham Stephan:You just got to do it. It got to a point for me where I guess the intuition of like, I want to be doing this. Why am I not? Started getting to a point where I just felt if I don't do it now, I'm never going to do it. And then I thought to myself, would I look back in the future and regret not doing this? And then I thought, yes. and so I just I secretly made a YouTube channel and filmed the video during an open house and I'd like just with my iPhone One take did and well I did multiple takes trying to get ready for it people would walk in the house I'd like But I just posted one video and I was like, I'm just gonna post up see what happens and I had no idea what I was doing, but I learned like as I was doing it You know I had the window right here So I had like realized if I shoot against the window like I look to like, you know dark and if I go here Lighting's better looks minor things then I looked on YouTube like how to edit a YouTube video on YouTube Learned iMovie through there like how to edit a good thumbnail I could just see what's working and like Daryl Eve's was a big one for me like learning the about like SEO and stuff like that like how to rank Michael back then was just a rank on the first page for different key search results So like I wanted to rank first page for passive income how to be a millionaire real estate my fit, but the first one I ranked was 2008 it's so niche 2008 Lotus Exige s240 and There were like 20 videos on there with like 20 ,000 plus views.

49:54Graham Stephan:I want to be on the first page So I made my video Lotus Exige s240 review You know through that like something like that and I slowly wanted to just climb and I shared it online and like that didn't help But like over time, it just kept doing better. So you've just got to start.

50:11Lewis Howes:Do you feel like you have a scarcity mindset or an abundance mindset?

50:17Graham Stephan:I don't know. Probably a degree of both, I would say. I don't like loss. So I'm really like risk averse when it comes to stuff like that. Like I'm okay losing a certain percentage because it's like, okay, if you have$100, if you lose a penny, it's not that big of a deal. So it's like things like that in terms of a percentage don't phase me. But just in general, I'm really against loss. So like whatever I get, I'm very conservative with it because I want to make it last. So in terms of that, I would say a scarcity mindset. There is some abundance, though, in terms of like bigger opportunities and pursuing, I would say, passions.

50:58Graham Stephan:Not afraid to do that anymore. But yeah, financially, I'm just very conservative.

51:04Lewis Howes:Yeah.

51:07Lewis Howes:Freakonomics Radio is sponsored by Range Rover Sport, a vehicle that blends power, poise, and performance. With a distinctly British design, the Range Rover Sport is built to take on roads anywhere. Free from unnecessary details, its raw power and agility shine. Combining a dynamic sporting personality with elegance and agility, it delivers an instinctive drive. Its assertive stance hints at an equally refined driving performance. defining true modern luxury, the Range Rover Sport features the latest innovations in comfort and convenience. The cabin air purification system alongside the active noise cancellation creates a new level of quality, comfort, and control.

51:47Lewis Howes:Terrain Response 2 offers seven terrain modes to choose from, fine-tuning the vehicle for any challenging roads ahead. A force inside and out, the Range Rover Sport is available with a choice of powerful engines, including a plug-in hybrid with an estimated range of 53 miles. Build your Range Rover sport at Range Rover.com slash US slash sport. Guys, we got to talk about your secret late night internet searches. You know the ones, bumpy leg rash, hair loss, trying to figure out your body by endlessly searching for answers. We've all done it and it never works. Thankfully, there's Amazon Health AI.

52:28Lewis Howes:It can connect your symptoms with your medical history to offer personalized care 24-7. So call off the search. Amazon Health AI is here. Healthcare just got less painful. What's the investment you've made that had the biggest loss? Financial investment. Like in an asset class. Oh, an asset class. Like stocks or crypto or real estate. Did you ever lose a bunch of money that you're like, man, I put 100 grand and I lost it all?

52:57Graham Stephan:Dollar amount or percentage? Yeah, dollar amount.

52:59Lewis Howes:Yeah.

53:01Graham Stephan:Very stupid one. I bought Robinhood stock. That was probably the worst loss I took. Individual stock. That was an individual stock I picked.

53:10Lewis Howes:What did you put in it, roughly? 200 grand. 200 grand. How much did you lose?

53:16Graham Stephan:I was down like 60, 70 % by the time I sold.

53:20Lewis Howes:So 150 grand or something you lost.

53:21Graham Stephan:Yeah, that was stupid. it still was in the ratios of like what is what was acceptable to me in terms of like a percentage but it was stupid I mean it was just like that was a gamble was that an emotional lost it was when their stock dropped like they saw a substantial drop and I'm like people are still posting their screenshots on Wall Street bets Robin Hood has a lot of cash they're not going anywhere there's so many places to pivot um take a risk on this and i think i put 100 grand in that and then it dropped even more i'm like i'm gonna double down on this because oh man stupid that was stupid but again like in the big picture we're talking about uh you know if the portfolio size is let's say 8 million bucks like we're talking about like you know 200 grand total of that so in a percentage it's like not that bad but when you think of the dollar i don't think of the dollar amount like i really separate like uh it's the worst that was just that was a stupid one now i do have others that make up for it on the other side i think enphase at one point was up like 400 and something percent the original tesla i bought was up 2000 to percent so like i had winners on that that's big um and i sold almost all my tesla too back in march the high which was luck because i sold it to buy a tesla roadster and then i just kept selling it afterwards because i was like well now i sold this i may as well just reinvest it in the s &p and i'm like i'm still getting an equal exposure in the s &p just putting it there and it's safer and that was just luck but I also had the opposite of that.

55:09Graham Stephan:I sold my original half. My original half, I think I sold in 2020 when it had increased threefold really quickly. Looking back, I mean, that's still way cheaper than it is today. It's crazy. Oh, well. You win some, you lose some. So that's why it's like individual stocks, such a tiny part of my portfolio. But looking back, it's a stupid stuff. I would have been better off just putting all of it. It is fun. But, I mean, you get it out of your system. Yeah, of course.

55:39Lewis Howes:And a lot has happened the last couple of years with crypto, NFTs, and now AI coming in. A lot of around AI. What's your thoughts on crypto, NFTs, AI in terms of building wealth for the future? When it seems like there's been a lot of scams and all these different things and get-rich-quick scams and people losing a lot of money. how can people use these tools or should they even consider them to build wealth in the future

56:09Graham Stephan:i i never understood nfts that was the one thing that i i really tried to like get into it i wanted to buy a crypto punk but i just didn't i thought it was kind of neat to have like oh the kind of the original but crypto kitties was like the original one i never really understood i never got into NFTs. Crypto, I've had an on and off relationship with because I bought Bitcoin originally. 2017. For how much? 16.5. 17. And I day traded. Because for me, it's like, everyone is talking about Bitcoin. And at the time, it went from basically$1 ,000 from when I started making YouTube videos to 17. And so that whole rise, people are calling me, Make a video about Bitcoin.

56:54Graham Stephan:I didn't get it. I'm like, I don't understand it And I thought when I made that video like I'm gonna buy a Bitcoin and see if I understand Firsthand what it's about and maybe like me buying into it. I could Just feel firsthand what everyone else is feeling. Yeah, that helps like you sometimes when I'm talking about something it's hard to talk about something like objectively without having been in it and then once you're in it you could kind of see like like you put on the goggles and you see like wow this is what everyone else sees and experiences like this is why they feel this way uh so i bought a bitcoin but i was like i had so much fun trading it because it was like 24 7 it's like you could be there at like and i was just having so much fun like two o 'clock in the morning like checking it going up but i was making like these little 20 30 dollar like profits like it went up and i just sell and then I place a limit and then like buy and like do this.

57:53Graham Stephan:But I just like trade it. And then from there, I just spread it amongst a whole bunch of like, you know, crap coins just for fun. But I don't just really focus just on Bitcoin, really.

58:08Lewis Howes:So... What do you feel like AI is going to be coming now for building wealth? Do you think anything's there around... I think it's probably too early.

58:15Graham Stephan:I worry AI is going to become like the next hype-y sort of thing. and I could see it going in that direction. I don't know how that'll come about, but I could totally see like a year or two from now, like AI become the next like crypto boom, NFT, Web 3.0 and all these things, yeah. Something like that. I think like with crypto, I could see there being a huge future in that in terms of like the blockchain and like its use cases. I think, I'm surprised they haven't created a digital dollar yet. Like I think that's coming. I think it's gonna get to the point where everyone, like you get a social security number, you get a wallet and they know exactly how much goes into that wallet how much goes out where it goes like imagine every dollar has like a has a tracking device in it and they can see like wait a second you received this dollar you got paid from this person but you paid it out to here why wasn't there tax why didn't you claim this like I think it's all gonna get to that point in the future there's gonna be no privacy now they can't get away with like with that physical money at all for probably quite some time it's always gonna be legal tender like imagine trying to like scrounge up dollars from like you're not going to do it

59:22Lewis Howes:restaurants that don't take physical currency you know in la at least there's like it's getting that way where it's only through the app yeah just don't i think it's just gonna they're gonna

59:30Graham Stephan:make it so convenient um and they're gonna build so many walls around using cash that people are gonna go i'm gonna pay attention to it so i think cryptocurrency is going to provide an option for them to do a digital dollar to track everything um and they'll know if like they'll try to curb anything and just track it. So I could see it going in that direction. So I think it's a ton of opportunity. I also think, someone else had mentioned this, it makes sense to me, like verifying luxury goods. Like if you want to buy, let's say a Ferrari, you have something on the blockchain. So it's like, you are the owner.

1:00:04Graham Stephan:This is built by Ferrari. Here's all the details. Buy a Louis Vuitton bag and like the replicas are getting so good. You want to verify it's that. Here's a little, you know, NFT thing that comes with it. You can scan it and like you are the, like this belongs to this. Right. So I could see that.

1:00:21Lewis Howes:That's interesting.

1:00:21Graham Stephan:So that's where I think it's going, but I think we're just, you know, in that initial boom phase and it's going to develop and I think the potential is huge. And that's why I don't know if like Bitcoin, Ethereum is going to be something that stands out like an Amazon of the dot-com bubble or if it's going to be like a GeoCities where it's like nobody uses that. So I don't think we know quite yet, but I do think there's a ton of potential in that. AI, I don't know. I'm not smart enough to understand it. I don't know anything about it either. So, yeah. I think it's really cool. What I was saying in my video yesterday, I think it's going to get to a point where AI is going to be able to create any video you want.

1:00:59Graham Stephan:Like, imagine you searching and getting a tutorial for anything you need, and it's created in AI. Crazy. Like, here's an example. It's a character. Yeah. Like, here's an example. But it's going to be so lifelike that you're not going to know this isn't a person making a video. Like, imagine you're changing a car in a 2006 Toyota Prius. You type in YouTube, how to change tire, 2006 Toyota Prius. You're going to get videos of people who have made that, but it's not going to be a 2006, it's going to be a 2005. It's not going to be the same color. There's going to be an intro, fluff, all that sort of stuff.

1:01:29Graham Stephan:But imagine if you type that in, AI could create that video based on the blueprints of that car, how to change a tire. And it shows your exact car, a 2006 Toyota Prius, how to change the tire. Here's what you do. Here's where the tool is. Here's this. Here's what you do. And if you have a question, how do I get the lug nut on when it's too tight? And it creates a video, how to get the lug nut off that's too tight. But why can't it do that in the future? I think it can.

1:01:56Lewis Howes:I've got a couple of final questions for you. What's your money goals? If you could predict, it's 2030, seven years away. Seven years, yeah. Where would you like to be in seven years with your money goals? with your investments, cash, assets. Obviously, there's so much that could happen in the next seven years. So many new developments that probably will happen that you're not even aware of. But if you could have a goal in mind in seven years, where would you like to be financially? I mean, I feel like I'm already there.

1:02:30Graham Stephan:But it would be cool to be able to make a million a year in passive income. I think it would be really cool just from investments. I think it would be a neat goal to have. I think it's doable

1:02:44Lewis Howes:what do you need to make a million dollars a year in passive how does the calculations work for you

1:02:48Graham Stephan:probably about 25 million invested in relatively safe investments real estate, index funds yeah I'm talking net so like net of all mortgage payments just like purely profit a million a year do you think you need 25 million

1:03:04Lewis Howes:in assets

1:03:05Graham Stephan:maybe less if it's real estate you could probably do that with like 15 to 20, depending on the property you buy and if it's triple net and how much work you're doing on that. So I think it's doable. It depends on the investment. It just depends on what's the opportunity at the time. But I like having a split between like index funds and real estate because I feel like, you know, they're different enough where I'm not too concentrated.

1:03:27Lewis Howes:Sure, sure. That's cool.

1:03:28Graham Stephan:But that would be just a goal if I'm to say anything. A million a year. Probably passive income.

1:03:34Lewis Howes:That's pretty inspiring. You could have a lot of sushi with that. You could, yeah. Would you start spending more with that million in cash? Would you look at it as like, now I can spend on whatever? Or what would you think about then? I have no idea.

1:03:46Graham Stephan:I'd probably get a bigger aquarium. Realistically, though, I would say traveling first class, which you could do with credit card points. But being able to do that more frequently. I do want to travel. I think that's a goal of mine, to do one day. I really want to do van life at some point. Van life? Yeah, I really want to do it.

1:04:03Lewis Howes:Get a nice van and go around the country.

1:04:05Graham Stephan:Yeah, I think take the podcast on the road and do van life. I think it would be so fun. I'd like visit all 50 states. I think it would be really cool. Spend six months doing that. That's cool. Travel, I think would be a lot of fun. Bigger aquarium. But for the most part, I think at this point, I just want to buy back my time and just be able to enjoy the things. Like the other day, it sounds stupid, but it was a weekday and I just wanted to read a book. I never wanted to read a book. I'm not a reader necessarily for books. I'll read anything online. If it's on Reddit, I'll read the whole thing.

1:04:37Graham Stephan:But I just felt like reading a book. but I was like well but I got so much work I need to do and like I'd feel better getting caught up and like ahead than I would reading the book but I really wanted to read the book so I think I'll probably lean more in the direction of like taking more time like even doing a trip like this like a year ago I wouldn't have done it because I'm like I'm so focused on I just need to make videos and anything that distracts me from that I don't think I was my happiest doing that because I like I just felt so stressed like you know there was just just random things that I was not fully like in the moment for because my mind was constantly thinking like YouTube videos what would be a good title for tomorrow's video like be like people around having conversations and I'd be there I'd be present but like there's like that 20 % of my brain that's thinking like YouTube it's always there I don't think it's gonna go away but I would like to scale back from that a little bit more in the moment we'll have to get you out here once every couple

1:05:33Lewis Howes:months then for a couple days you know so that's good man yeah um graham stefan show on on youtube you've got some amazing content over there i love it um you've got the podcast as well which is really exciting how can we uh ice coffee hours podcast you guys can see it both on youtube how can we be of best service for you you've got over four point something million subscribers now what can we do to serve you?

1:06:01Graham Stephan:I don't want anything. I would just say, if you want to subscribe, that would be cool. Subscribe to your channel. I don't know. I'd just say, just subscribe to your channel. Like at this point, I'm fine. I would rather just, you know, guys subscribe here on this channel would be really nice. Subscribe to both of our channels.

1:06:21Lewis Howes:Yes. This is, one of the questions I ask everyone at the end is called the three truths question. So imagine another hypothetical scenario. It's your last day on earth. You live as long as you want to live. And you accomplish everything. Your money goals, life goals, they all happen. But for whatever reason, you've got to take all of your content with you. So no one has access to your information, your content, YouTube, whatever else you create. It goes to some other place when you die in the future. So it just gets deleted. Well, maybe it's just we don't have access to it. It's somewhere else.

1:06:54Lewis Howes:Hypothetically. So it's private. Yeah, it's private. It's unlisted. but for whatever whatever reason you have the opportunity to share three final truths with the world three things that you know to be true that you would share as lessons to the world and that's all we would have of your content left what would be again off the top of your head those three truths for you i don't know i don't know if there's like any absolute truths out there

1:07:23Graham Stephan:Or just lessons that you would want to share. Three. I would say, gosh, like probably self-belief, like believing you can do something is very important. I think people are drawn to confidence. And so if you could learn how to be your best self and accept that, I think that would go a long way. and I think the less concerned you are with what other people think usually the better they think about you because you're not afraid to be yourself I think everyone is scared to be themselves and so when they see someone else just like you know not caring other people look up to that in a way that so many people can't do so I would say like those things universally for me have been true

1:08:10Lewis Howes:That's cool, man. Final question for you before I ask it. I want to acknowledge you, Graham, for your commitment and dedication. It's been incredible what you've created over the last five years on YouTube. Every week you show up and give something inspiring, informational, and entertaining. And I know it takes you days of research and days of work, and you're doing a lot of it on your own. And you've helped a lot of people. Educate them, learn. and learn about a scary subject for a lot of people, which is money, in a fun way. So I really acknowledge you for how you keep showing up. And I know it's a lot of work, and I know you're probably going to have to figure out how to make it happen in the future at scale, but what you've created in the last four or five years has been really inspiring.

1:08:53Lewis Howes:So I acknowledge you for your efforts, your intelligence, and your creativity. It's really cool. Thanks. Final question, what's your definition of greatness?

1:09:03Graham Stephan:oh man i would just say honestly to help others i think if you make an impact on someone else's life and it's a positive impact and you could they they have a good feeling towards that i think there's nothing better than that yeah anytime i meet somebody who's like you know i bought my first house because of you and my credit score is great and i turn my finances around now i have like 10k in the bank and i'm broke like just the impact because i know like how that would feel for me like for me like meeting Rob Dom for me would be one of those moments where I'm like dude you have no idea how much you've helped me just like your video and how to buy a Lamborghini it was like set me off like and I'll remember that for the rest of my life and so just like having that for other people I think is so insane like it's it's hard to put into words but it's it's so neat and then you feel like you've got a friend yeah and so everyone I meet who's like if they watch my videos I know they're like in a personal finance investing, building wealth.

1:09:58Graham Stephan:Chances are they're an entrepreneur. And so we're instant friends because of that, no matter what their background is. It's neat, and I've never had that before.

1:10:08Lewis Howes: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. I really love hearing feedback from you and it helps us figure out how we can support and serve you moving forward.

1:10:46Lewis Howes: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.