7 Things We Wish We Knew About Money Earlier!

seven

things

you

wish

you

knew

about

money

a little sooner is brian preston the

money

guy yeah brian I'm really excited about this show because have you ever had those

things

in life where someone tells you something and you drop a knowledge bomb? and you say ah, I

wish

I'd known about that or like I think about your life, one of the things you wish you'd known sooner was like good laundry detergent, you found out about that too late in life. toilet paper, yes, toilet paper, another huge one. There are some things that if I

knew

about this sooner, could improve my life.

What we want to do today is look at some of those financial things that you may not have caught on to. Still or maybe, if you've noticed, it will resonate like, oh, you know, they're so right, that's so true, so these are like shortcuts of knowledge tricks to help people if you're young and just starting out. . or you just need to know more about money, these are things that can help you improve your finances, yeah well let's jump right into this, number one because this one is important, having money is like being cool now, I know you are to do.

Skip to this, but I think I'm a kid of the '70s and '80s and there used to be all these movies where you had the nerd who mowed the lawn and then daydreamed while the cool kids walked by. his convertibles trying to figure out how you could be a part of it and what you usually find out in the crescendo of the movie at the most critical point is as soon as he realizes that he doesn't have to play it cool or try to impress someone. is when you realize that you're actually cool, that's exactly right if, if you're someone cool, you don't have to try to be cool and what we found out is that money is pretty much the same way, it's amazing for my.

When we meet friends or meet people in the community and they, especially if they know where we live, they want to show off and they want to be flexible because they think that will give this impression of oh look. How successful I am Look how well I have done well What we discovered in our experience is that often, like wealth, true wealth is not something you can see, it is not something flashy and flashy. Well, this book you know we all know the next millionaire. Obviously the door has had a big impact on me, but Dr.

Stanley also had another book called Stop Acting Rich and then here's part two and start living like a real millionaire because a big part of life is that We think like someone whose aspirations we are. I have to act apart. I was there last January. I was in Las Vegas. All of this is covered and I remember my friend and I stopped at every watch store because I wanted to see all the different watches and then you know. It's like all these designer things, all these things cost a fortune, but why? Because this is what we know about wealth.

I think about two of the richest people on the planet and they're definitely not that worried about style or what they wear because I I mean, look at this for those who don't have YouTube and have the image, this is Warren Buffett and Bill Gates and it says 162 billion dollars combined and not a single Gucci belt in sight and by the way, they look like the nerdiest guys. on the planet, but I love it because no one would question, you know, these guys have obviously reached the pinnacle of wealth and yet they're not focused on trying to look like that, they're not trying to look rich, they're not trying to give that image or that facade, they actually have the wealth to back it up, well, think about Zuckerberg for years, everyone talks about his hoodies, you know, because that's what he wore and then Steve Jobs and his mom jeans and the black turtleneck sweater. that he wore because he wore the same outfit every day because he didn't want to have to make a decision in the morning, I mean these are all the kind of behaviors that they don't care about, they're cool, but they get there and it's like that with the rich , if you do it right, you don't have to look rich and you even know we took some statistics and data from stop acting rich and this is what we found out about millionaires, yeah, what I love about this.

You obviously know that these two are billionaires, well let's take it a step further to make people like you in everyday life. Millionaires generally don't tend to act like they're rich, and as you said, this is stopping acting rich, one of the first things. What was found in this book was that millionaires spend around 16 on haircuts. Now the data point was from 2009, when we were doing this in the pre-show. I thought there had been a bit of inflation because I don't even know if you can get a good clip-in haircut at 16 anymore, but it's still a point that you don't hear anything about, you know, because it's not uncommon to hear about politicians or celebrities who They spent hundreds of dollars, if not thousands. of dollars on a haircut, the average millionaire spent 16 in 2009.

Yes, another fun little statistic is that four out of ten millionaires own a bottle of wine for less than ten dollars, so they're not buying things from the top shelf . You go to the local wholesale grocery store to buy a nine dollar bottle of wine that probably tastes just as good and then on vehicles, the average car spends about 31,000. Daniel thinks the statistics are a little ridiculous because he put an Oldsmobile 1976, you know. In your vision, I don't know where that photo of Daniel is, I don't know that most millionaires drive that, but they do drive very reasonable cars, they recognize that these are not status symbols that consolidate their wealth, but about having wealth, not pretending and trying to look like they have wealth, me, Brian, we do this all the time, uh,

earlier

in life, you know, people told us, oh, you know, so and so, they have the house, they have the car and they have the boatman, you know, they definitely have money and we always remind them that no, that doesn't prove that someone has money, it just assumes that someone has the ability to spend money when you see all the trappings, it's more of a reflection. from your consumption behavior than your savings and wealth creation behavior, so my advice is the way I would think about this and I think we both reflect this is that I think we have a lot of probably successful aspirational audiences, which means that you are gaining ground in your career you are starting to make more money as you become successful in your career I just want to tell you not to feel the pressure I think sometimes with success you feel like society tells you to be successful you have to look successful and you get on this treadmill of buying bigger, nicer things because you want to flex in some way, but the reality is, I'm not talking about looking around and seeing how many people are wearing smart watches versus other people's Rolexes.

You probably aspire to be one and then you feel very comfortable with your it's not a minivan but you drive what we bother you with is the genius of mom, you know why, because my wife was previously a mom, the car was my wife's car and then we bought him a new one and instead of going out and buying a new car, I drive a white midsize SUV and it works well for me because I don't care, it's not, I don't feel like I have to have a nice car as a status symbol and the reason Why I don't have it is because I have recognized that one of the practical guidelines is that I focus on those things that are really valuable, so if you want to figure out how to classify them, to counteract the tendency, find out how you can focus on value when It's about your consumption decisions, so we've even tried to give you some barriers or guidelines on how to make sure your life stays in control so your eyes don't get bigger. than your wallet, for example, housing, we like you to keep your home at an affordable price so that you don't get into that situation where your house is rich and you live poor because that is the biggest obstacle to your finances, so We like you to keep your house. payments and expenses below 25 of your gross income and then when it comes to cars, we want you to sign up for 23.8, you want to put down 20 when you buy a car, you don't want to finance it for more than three years and All of your car payments, no matter how many cars you have, cannot exceed eight percent of your monthly income, if you can keep it within that range then you are doing what you are supposed to do now just because you can't.

I mean, you should, I could go out and buy a new car right now and I could go 23.8, but my mom's car rocks and rolls, it's paid for, it's paid for, you have to answer the question: what do you really do you value and, for me, what do I value? building my investment accounts building wealth more than replacing that car prematurely we talked about this, we'll get into it later in the show with some of these other key points, but small decisions while you're so young, in your 20s and 30s, have a big effect dominoes that's why when we make a rule of 20 3 years 8 23 8 I want you to know that there is a little more on the rails is that for luxury cars I want you to pay for them the same as cash because if you can buy a fancy brand, a expensive brand, you need to make sure you're doing everything you're supposed to do and that's why we also say that no car payment should exceed what you're actually putting into the markets.

It will break my heart to find out. You have a car payment of 800 a month, but you are only putting 200 a month into your investments. No, I always want the scale of investments versus outflows from depreciating assets such as vehicles to definitely weigh on the scale of investments, investing yourself first before you. We're getting into those depreciable assets. You know, I think if Warren or Bill were here, they would share this same little mantra with you. Being rich is much better than looking rich, so if you can practice that, you will set yourself up for success. no doubt number two time is more valuable than money now we were in the pre show prep we were like daniel and that graph looks like money and tom are the same and I can tell you you know that and I think this is just a bit of daniel a little bit younger, but as you get older and more sentimental like me, you recognize that it feels like the resource of time is moving so fast that you have to focus on making everything purposeful and actionable so as not to waste this valuable resource, yes, Brian.

I want to give you a lot of credit, this is one of the ways that I feel that through our relationship, this is something that you have mentored me a lot on, especially for young people who are super motivated and super motivated, we are so caught up in me . gotta get to the next thing the next achievement the next the next the next the next we push so hard we don't stop and recognize man one of the things you should really be grateful for one of the things you should really enjoy is the ride the one I'm in, it makes sense to recognize that while I want to have that career achievement or I want to reach that next milestone, realistically, time right now is probably the most valuable resource we all have, especially people who you're younger in, well , Tom breaks it down two ways: I want you to know that you have a limited amount of time and you have to put money to work in your financial resources to get the best version of yourself, but also time is very powerful in the fact that You need to build memories, that is what you are implying is that you need to enjoy every stage of your life because you are going to find that this moves very quickly and to have proof of that think about one of the richest men who has ever lived. on this planet was Boone Pickens, who passed away in 2019 and was known for giving commencement speeches trying to inspire people who were trying to figure out how to achieve the success that he had and what he used to end much of his life.

Graduation speeches are the following quote: He would say that he would always offer these future leaders a deal. He would trade them my wealth and success, my 68,000-acre ranch, and my private jet in exchange for their seat in the audience. That's how I told them. I would have the chance to start over. You would experience all the opportunities that America has to offer. He didn't say now is your chance. So I would trade all my success, all my trappings, all my wealth if I had a little more time. to be able to do it all over again, so I want to say the most important thing for those who are younger is don't take time for granted, don't get busy doing nothing, make sure time is a valuable part of if you're planning for the future.

Are you investing for the future? Have you discovered it? Did you start with the end in mind so you know where you are on your journey? Don't take this resource for granted, so that's kind of a sentimental, maudlin idea. There's also a mathematical implication about how valuable time is, so Daniel helped us do a really interesting case study and we said, "Okay, let's say we have a handful of people who are going to invest and all they're going to do is to do". Are they going to max out their Roth ira for a decade, so we're going to have an individual who maxes out the Roth at age 20 and then we'll see one who does it at age 30 andthen one? that does when they're 40 years old and we mean with exactly the same amount of money saved, you just know the standard six thousand dollars a year over a ten year period with these three people saving exactly the same, how different is the The picture looks like this, if we take our person who started when he was twenty years old and decided to maximize his roth ira every year when he was 20 years old, he saved a total of 60,000 and suppose that because he is 20 years old, they can earn a rate of return of around 10 on average throughout their career as an investor by the time they reach the age of 65, that 60 thousand dollars invested will have become more than one and a half million dollars.

It's believable, remember they stopped at 29, they only did this through when they were 20 and stopped saving, that 60,000 will have turned into a million and a half dollars, talking about the power of their army of dollars and the compound growth, this is it, guys, and I want you to see why we did this during the 20s, but now. we are going to go for 30 the same amount of money the same ten years the same six thousand dollars then sixty thousand dollars invested once again we listen to 20 year olds that number that money became 1.5 million dollars what happens during 30 years yes, for 30 Now, again, we're a little further out on our timeline, so we're going to reduce the rate of return to nine percent for someone starting at 30 and 60,000 invested at 65 years still turns into almost 600,000, which is fantastic, 60,000 turns into 600,000, but it's a million dollars less than what its 20-year-old counterpart was able to achieve.

Well, look at that, I mean, that's almost, we basically took almost two-thirds of the money, yeah, just. because of time, not because incrementally there was some decision or difference in value between 60,000, the only difference here was when the money was put to work, time was the component that changed this and then take it for a 40 year old man , it's still surprising what their money is. You can make the same sixty thousand dollars, six thousand dollars a year for a decade becomes two hundred and fifty-one thousand dollars when you retire, that's great because look you're getting a multiple of more than four times, which is an opportunity to incredible growth, but that same money for 20-somethings becomes a million and a half dollars.

This shows you the value of letting that money seep in and build deeper roots. Make it grow more and more. Those trees can really keep growing and make all your dreams come true so that our The hope is that you learn and figure this out from the beginning because if you're a financial mutant, what if you're someone who says you know I don't want to save only for a decade? I want to start saving and I want to keep saving, what if you are someone who starts at age 20? All you did was maximize your roth ira, you just made six thousand dollars every year for your entire working career, from the age of 20 to 65 you would invest a total of around two hundred and seventy thousand dollars and those two hundred and seventy thousand dollars invested would become at over two and a half million dollars and all you did was discover how valuable time can be if you start early, so I hope that's something that gives you energy because look, I know that six thousand dollars if you're 20 years old is a lot of money, but it's still something I think is doable if you make the concerted effort.

I'm going to put that much money into work, I'm going to go ahead and make sure I have five hundred dollars a month working for me, you guys can do it and two and a half million dollars, I don't care what they say about inflation or anything else they say. is going down. the pipe for us is a lot of money with just a little bit it's totally that concept of delayed gratification where you take a little bit of today for that big beautiful tomorrow it's really one of those things where look bo says this the best thing is that you know that The best time to start investing was yesterday, yes, but what's the rest of it?

If the best time to start was yesterday, that means the second best time to start investing is today, don't waste the time I have available to you right now, so make it happen and that brings you to number three. Your financial life doesn't have to be complicated now, Brian, I have to confess that this is something I fell victim to when I was a much younger man. assuming that in order to be rich and be able to accumulate any level of success it had to be complicated, you had to go out and study stock charts and you had to discover things that other people didn't discover and you had to I got into the deal early and when I found out about the IPOS I thought, "Oh my God, I have to participate in those things." I was under the impression that the more complicated it was, the more sophisticated it was, the harder it was to understand. that would be related to more wealth, greater numbers and greater successes.

I fell into the same trap. I mean, I think I've shared this story before. The thing is, as a working person fresh out of college, he works for a public accounting firm and does taxes. I realize that you know that he comes from low income, he does taxes now, and he actually does taxes for people who are successful. I thought, "A lot of these people have rental properties, they own k1 businesses, and then you see all this complicated stuff." the returns you say, it's going to be great to have all these complicated things in my life in the future, but the reality is that complication doesn't necessarily create that success and if you can create, you know that creating wealth is actually a very simple concept, everything what you have to have is a little bit of discipline, that's the delayed gratification we're talking about, where you take a little bit today for that big, beautiful tomorrow and then you have to convert that into money, that is, if you can live on less of what you earn, convert that into money that is invested and then you have enough time, that is the third component, it is that simple to create wealth, you don't have to go out and try to make this as complex as possible and that is why when Seminary lawyers are seminary financial planners, after giving you the steak dinner and talking about annuities, they always make things seem much more difficult than they really are.

Yeah, it always amazes me that when someone has a certain level of success, they start making good decisions and they start accumulating wealth and their portfolio reaches a critical mass size uh and all of a sudden now they have wealth, all of a sudden they come to this conclusion oh, it What I've done my whole life to get me here wasn't good Enough is enough, yes, I did the mutual funds and the ETFs and the index funds. Now I have to start picking stocks or now I have to get into private equity or now I need a crazy complicated estate plan even though my estate is nowhere near $11 million, don't let yourself fall into the trap , brian, you made this up and you've told me so many times and I've heard you say it over and over again and now If you've been through this, it's amazing that as you become successful and your wealth accumulates, the complications will have a way of find yourself, you don't have to go looking for it.

Yes, please keep your life as simple as possible for as long as possible because you don't have to. look it up like bo said because it will happen one day you will wake up and wonder how I got this complex tax return and that is the beauty of the cycle of abundance and why we can give away tons of free advice that we know if come, learn, apply, grow your wealth to a level where complexity will occur naturally, you will graduate beyond what we can teach on the youtube podcast and you will need to partner with a financial advisor and that is when we will take the relationship to the next level, very practical application, yes You can do something simple, make it simple.

I am surprised by the number of people who receive them. You know, when they come in and we see all their accounts from all these different institutions. We thought, "Hey, you know that." Now you have 13 different investment accounts, we could probably boil them down to four or five and consolidate them. They're like well, I can do it, yeah, you can do it, don't make it harder than it has to be. The complexity, the complication will find that you don't I don't feel like you have to look for it, I think that's a great segue into number four: lazy investing is the best investing and that sounds so contrary that you would think that the harder you work, because I think I'm an advocate of hard work. like sometimes you sleep better after you've done a hard day's work if you're splitting firewood if you're working in the garden you sleep like a baby that night because you feel like you've put in a good day's work How can you be lazy with money really profit?

Yeah, so let's talk about this. I mean, one of the first things we talked about is active management versus passive or index investing. You would think this person here is paid handsomely for what he does. they would do totally better and be rewarded for their hard work instead of just buying the index because indexes are boring unfortunately the data doesn't support that yeah so when we look at the 2020 spiva study look ya You know, how often index funds do it. outperformed their active manager counterparts, it was surprising to find that when looking at large US large-cap companies, 87.7 percent of active managers underperform their stated index, meaning that the funds they were used with those dollars they would have been better off over this 15-year period where We're thinking about just buying the index, there's a very small portion, so then you think, well, what about mid-cap companies?

Surely smaller companies do better. Of mid-cap managers, 82.2 percent underperformed their index over that 15-year period. Small cap managers were too. 82 percent of active managers underperform the index and then when you look at international and non-domestic investments, 87.8 percent of active managers underperform the index over a 15-year period, so we think that instead of trying to beat the index. There is nothing wrong with simply being the market by buying into the market using index funds and capturing growth in those asset classes. I mean, this is kind of common sense when you think about why index funds are incredibly affordable and cheap. they are practically free on your internal expenses if you are running an active management shop, you have business costs that you have to pay to managers and then they are not even that tax efficient, that's the other thing because from the turnover it creates more transactions Taxable index funds simply don't have as much swing because, again, lazy investing may be the best investment, it just works in the long run and the cost savings and tax efficiency prove to be that extra push. that gives you the best performance now, so Brian, I can already hear people saying no, no, no, hey guys, I got it, I know how to read it, I know how to read tea leaves, I can hear some of our dear darlings. friend audience people rachel I say no, no, you can choose the active combination, you have to do a little work, you just have to be really good, so we said, okay, let's operate under that premise and assume that you are the best investor of all time . and not only can you know what to invest and you know what kind of assets to use, but you can also find the perfect and exact time to put your money to work.

What I love about this illustration that we're about to go over is that we have What's Done in the Other Shows the World's Worst Investor, where we take someone who actually bought at the highest peak of the market and then show how long term, even if you stayed consistent, you would be rewarded, you know, because again, investing lazily, you couldn't. I can't outsmart yourselves, but many of you know that many of our financial mutants are smart because they'll say, Oh my God, I wish they would have that backwards and show what happens if someone actually has that magic crystal ball where they can . investing at the bottom of the market because that's what I think a lot of us try to do when we're in this internal struggle of timing the market as if the markets are overvalued right now.

I hear that constantly, so why not? wait until we can buy low and then sell high, that's always the emotional fear and greed battle that's going on, let's just wait until it's cheaper, so what if you really had a superpower that allowed you to buy at the bottom of the market? In fact, I'll help you, so let's look at it in 1980, according to the United States Social Security Administration, we know that the average income was twelve thousand five hundred and thirteen dollars and since you are all financial mutants, we know that you would have been saving. 25 of your gross income or about 260 and 70 cents permonth and you recognize that I'm going to wait until the end and I'm going to hit the nail on the head, so I'm going to invest at the end of Black Monday I'm going to invest in October 1990.

I'm going to do it on October 9, 2002 at the bottom of the dotcom bubble. I'm going to catch the great recession at the bottom on March 9, 2009 and then I'm even going to take advantage of covid from March 23 to March 23 until 2020. I'm going to get to the end, so what I'm going to do is accumulate cash and when it reaches these dates. I'm going to invest all that cash that I've accumulated, so if you look at it, we accumulated cash until October of '87 and then we invested it all, then we started generating cash again and then we invested it all, we keep building and Building and building and building and investing and this is what we found.

If you were the best timekeeper in the market, you would have saved 129,308 during this period, but because you are such an astute investor you turn that 129,000 into almost 1.8 million. dollars over that 40 year period, so look at the picture in this, remember I'm talking about investing is climbing a mountain with you, you know, yo-yo, yeah, that yo-yo is going up and down in the short term, but you're always going up a hill, but this is made even better by the fact that you were finding the low points on those hills and that's when you were deploying and investing the money, that's great, this is what you think is valuable superpower. but guys, this is what's crazy to me when we made these dads, I was like, wait a minute, come back, I want to see that number one more time, because you would think that's a valuable superpower, I mean, you could, essentially, conquer the world.

If you had this, this is like going back to the future, you know the sports almanac, you know all the plays to make, but is it valuable? Because I mean, right now there are people sitting on the sidelines because they think the market is overvalued. What if they were building? get cash to do this exact same strategy where when the market goes down and what's the end of the emotion cycle and when the markets are cheap they're going to deploy those resources, it's really valuable, I think the answer will actually be I surprised you, yeah, so we said, what if you had another investor who just did it systematically?

They were boring, they were lazy and they said, "You know what." Okay, I'm going to save my $260 and 70 cents a month, but instead of waiting and worrying. the bottom of the mark at the top of the market I'm just going to invest every month no matter where the market is I'm just going to put my money to work every month well what we found out is that person I've saved the same 129,308 dollars, but instead of having only $1.8 million, the lazy, boring, non-active, uninvolved investor has almost $2.1 million. I need people to understand that this is not a dollar difference, it is an incremental decision difference, not a money difference.

They put the exact same dollars to work, it's just that one had the superpower of knowing when the markets were going to fall, investing his money on those dates, the other just said "set it, forget it automatically for the people I'm going to make my investment" . process it doesn't matter if it's raining outside if bad things are happening in another part of the world I don't care I'm going to buy the same time every month and somehow that's more powerful consistency the automation of behavior the habit of behavior is more powerful than the superpower of knowing when the markets will be at the bottom, so what is the practical application here?

We think you should really know where you are on your wealth creation journey. Now I have people asking me all the time. Hey, yeah, you're a financier, how was last month? What did you mark? You were beaten last week. How did it go? I have no idea. I'll be honest because I just don't stay in tune with my performance because I know that with my schedule I care much more about how much I'm putting in work than what those army of dollar bills are doing this day or this week or this month, so you need to understand. what stage of your financial life cycle you are at. and what things you should focus on, yeah, and in practical application, know where you are in your journey at the beginning, it's like bo said, developing your critical mass of assets and I've talked about this several times and with half a million examples. the dollar market makes 20, you just added a hundred thousand dollars, a lot of money, when you have 50,000, you make 20, you make 10,000, it's a big difference between 10 and 100 because you're probably replacing years of living expenses at that time, That's why we talk.

About whether you know where you are on the journey at the beginning Target Retirement Funds Index All you have to answer are two questions: How much can I save When do I need it Does all the heavy lifting for you once you get past five years six hundred thousand dollars in assets, there are some additional things you want to start thinking about and that's what I like. You can still use index funds just like you use index target retirement funds, but now you might want to get a little more diversification by buying them. funds individually so you can harvest losses, you can donate appreciated securities to charities, you can also do taxes, there's all kinds of fun stuff, but don't look for that complication until you've built up that critical mass, that's exactly right, okay, now Number five in terms of the seven things that we want you to know about money or that we hope you discover about money at the beginning of your wealth creation journey is that money doesn't watch the news, it doesn't pay attention to the headlines.

I have a picture of this, I mean, it really does. I don't know what Mr. or Mrs. Money is like, I have a picture of them actually in front of the TV and I can, like Daniel found the newspaper and it's true. I mean, I think sometimes we make a lot of money from the news media and let it panic in the short term because I feel like remembering how the media gets paid eyeballs. It is not for you to see that segment, but to sell advertising. That's what your eyes need, they need your ears, they need your attention long enough to be able to sell more ads and guess what they discovered.

Good news about puppies, kids graduating and you know, it's fun, it feels good, profits in the market, right? It doesn't really play that well you know everything if it bleeds it leads is true with media and finance and they have realized that negativity will keep your attention much longer than positive things and as part of that they show it. and they focus on politics, pandemics, you know all the negative sides of the economy, they want to do everything in their power to try to help you, not to generate wealth for yourself, but to keep your attention, and that is something you should definitely understand, it seems like a distinction. for us that there is very little responsibility for being very, very wrong again.

This is an illustration that Daniel put together for us. If we go back to the great recession, the last significant crisis we saw, here are some of the headlines I've seen since then that the risk of a double-dip recession is increasing, it's time to say that a double-dip recession may be occurring. double drop. Oh, why are America's big banks predicting a recession? Six signs were closer to the next recession than Wall Street believes it doubled. A procession is more likely than a V-shaped recovery. All these headlines came out during this 10-12 year period and yet deep down, the s p 500 kept jumping, that yo-yo on the mountain it kept moving higher and higher and higher and higher, I mean, even think about how we just got over the pandemic, you know 2020 was just a strange year, and you see the Wall Street headline thinks a double dip recession is more likely than a V-shaped recovery and this is after the V-shape.

The recovery had already done the V. It was V-shaped. They were just saying we basically turned this into a W, but what did it do? He continued climbing the mountain. Nobody wants you to understand this. The press, the financial media, no. I don't know more than anyone what is going to happen next, what we do know is that look, technological innovation, humanity wants to be better, more successful and wants to continue innovating and make life easier. I bet that if you look at the pace of innovation it's accelerating, not slowing down, if you look at the number of advances we make every decade compared to what we're doing every 50 years, you'll see that we're accomplishing so much within 20 years that We can't even imagine that all you are doing when you invest is buying a little bit of that future success.

Don't let anyone try to convince you that we're breaking everything down. You will be part of the success that you just have to achieve. The decision is whether I want to own it or just live it. So what is the practical conclusion? How can you use this knowledge to your advantage? Well, we think the most important thing you really need to understand is there. There is a difference between information and actionable information and they are not usually intertwined. Just because you have information doesn't mean it justifies an action or reaction to that information. What I find funny is that we come up with show themes every two weeks. well, we have a whole list, we have a whiteboard, a virtual whiteboard, but when we put up with them we don't know what's coming and then it's so interesting that you don't even have to follow if these things just write themselves. we know the pipeline was hacked we all know the colonial pipeline was hacked and here's the gas pipeline hack leading to panic buying in the southeast that's information yeah that's information I don't know if I consider that information actionable other than if you're driving At a gas station you see that it is open, okay if you want, I understand, you are reasonable, but that does not mean that what it does not lead to is that we have to start putting gasoline and garbage bags and then putting them in the trunk of our car, that is not actionable information and yet this is the panic that I see from so many people in the public now, fortunately, not so many people in the public are pouring gas in the trunk of their car, I mean, this is simply asking that Something horrible happens to you to the point where you know, look at this, the US Consumer Product Safety Commission has to post on their Twitter account not to do this.

That's why we have instructions on shampoo bottles. There are people out there. that are simply pushing the boundaries of what you consider common sense information does not always have to be actionable and you need to understand that a lot of the things that come through your television, through your radio through the Internet, are information that can absorb, but it doesn't necessarily turn them into actionable items, so the practical takeaway for you from an investment standpoint is that if you see a headline or a harsh new article saying that a double-pending recession is coming fall, you have to ask yourself: will that affect me or me?

I have a plan in place, whether the recession happens or not, I have followed the financial order of operations, I have emergency reserves and I have a portfolio that matches my unique risk tolerance capacity, so yes, if there is a double dip recession. I'm going to be fine, I don't have to react and if the market keeps going up I'll be fine, I don't have to react, that's the place you want to be, not the place where you are. You're trying to fight and you make some very disastrous long-term decisions to solve a very short-term problem and I think we have a good segue into number six, which is you don't have to be a lone wolf, yeah.

I think a lot of people look, you're financial mutants, you're watching a financial show, or you're listening to it on YouTube, I mean, in podcast format, or you're watching this on YouTube, so you already have the aptitude to do good. decisions, but I think sometimes those of us who do things on our own are afraid to go out and ask for help. I'm sure you know that's the typical thing you hear about that stereotype that you're trying to get to a destination and you discover that you took a left turn somewhere and man, I struggle with this too.

Do you ask for directions? You know, now you know we all take it for granted now that we have, as long as we have a signal, we can just type it into our phone. It will fix it, but in the past you had to stop and ask for help and I think that's sometimes what we fall victim to in this new world where you can go to the guy from Google or YouTube and you can figure out how to change. the keychain the battery on your keychain but there are things that are bigger than that absolutely and that's the part I'm talking about bo I'm proud of you, you told me now look, I sold it when you bought your new house huh I sold you all my lawn equipment, yes no, once again I'm on the wrong side of a transaction, Brian Preston, it happens every time we do business together, are you still mowing your own lawn?

I'm not going to cut my this is a new change. I loved. I had this beautiful new garden and it was wonderful, but I recognized that, you know, the three hours it took me to cut and prune andweeding my lawn, every weekend I was taken away from things I value more than that. I value being able to do. being there with my daughters and going out and playing in the yard, so I made the decision that I should probably let the neighborhood college kids mow my lawn and it's been going great and I think I'm going to apply this to more financial things, but I'm thinking about tax preparation.

I know so many people I don't know if they enjoy it or if it's just part of getting a good night's sleep because they did a hard day's work doing their own taxes, but I found that when you get to a level of complexity when I was a professional tax preparer , I could usually do it much faster and I could usually find additional deductions that you didn't even know about. and that was a level where it was okay to ask for help, you didn't have to be that lone wolf, it's the same with the state documents that we have, I mean, look, we came up with this even with some of our financial partners, they We're doing estate planning and they were downloading stuff off the Internet and we were like, what are you doing?

No. What are you doing? You have a level of success, you probably need to get a lawyer because that calls into question what you are trying to do. achieving this confidence for your children is more complex than a plate of skittles answer you are getting from the Internet look I am tight too I know we don't like to spend money I wouldn't ask you to spend money Yes I didn't see the value, but there are times when that you're pennywise, but was it stupid? I mean the fact that you are, you're saving a few bucks, but you may be setting yourself up for a lot of headaches later on.

I grew up in that house, I mean, my parents were never big savers, but their idea of ​​investing was CDs. I always think that maybe they would have made someone some money by hiring a financial planner or investment advisor, but how much more money? Could they have had their great habits of living on less than they earned? They did the hard work but they never really put the money to work, they never let the army of dollar bills roll out and start creating resources and wealth. additional for them and I think that's something that would encourage people to know when to turn professional, know when to do it. see when you don't know what you don't know your blind spots that could affect you in the long run yeah, Brian, uh, I think this last one, this seventh, uh, the seventh thing we wish people knew about money. as soon as possible is something that I think is often overlooked and I think is very important.

I think maybe it's the most important when you really start to understand wealth and understand wealth creation and understand the financial journey that you're on. I will realize that money is really just a tool. Yeah, I think we've done several shows about the dark side of wealth. I think if you want to be rich just to be rich and you don't. you have a why you don't know what gives you purpose and what drives that decision making that you will find when you reach that real number like I felt the same thing that happened I thought this was I thought I was going to wake up tomorrow and I feel completely different. that the day before just doesn't happen that way and that's what you look at and a lot of you who are aspirational don't have wealth but you think I would love to have that. problem and I understand it and we will go.

I'm not trying to take away the difficult situation of building wealth, but I'm just telling you that you have to understand what the journey is, why you want to have this and why. You are taking the steps because if you have a purpose, you will understand much more what brings you happiness. You will understand much more what brings you satisfaction because there are different levels. First you turn it in your head. above water, then you will get to where you can be happy, you will receive enough money to be able to pay all your bills, you will be able to start saving for the future and only to that point will you reach financial independence and then you will reach fulfillment.

We like to talk about it all the time. You often hear people talk about impractical applications. What are the stages of wealth? I think most people talk about financial independence. Do I do what I want when I want and how I want? In fact, we've condensed and broken it down to go one step further up the wealth levels to a level five that goes even deeper. It says you know who you are, you know what you value and what gives you meaning when you wake up in the morning. You know why you get out of bed and it makes you a better person, so I have a very close friend who is many, many years older and he shared with me how he was able to continue his journey to wealth. said this is a really practical thing you can do, no matter where you are on your journey to wealth, if you're in your 20s and just starting out or mid-life at 40, think about the level of wealth you want to achieve and what that means, maybe you live in a really nice house with a pool and a car, or you want to go on vacation, or you want to shop at a certain supermarket, or whatever, go ahead and try to visualize that level. what you want to achieve and just take a mental snapshot of it and then work up to that level and keep reminding yourself that that's what you're working towards.

I'm working at that level, that level, that level, so that when you get there, you don't feel like you have to keep going up, I feel like you have to keep swimming against the current, focus on getting to that level and being happy there, focusing on those things that really bring you satisfaction, that really give you purpose, if you can do it. that you won't find yourself in that place where you're constantly chasing the next achievement because we've talked to tons of rich people, he said man, you know I had this goal if I could get my income to 50,000 one year which I might not, that would be Well, if I could make 75, well, if I could take my portfolio to 100 or if I could make it to a million, you'd be surprised if all you're chasing is the number and not the. why behind the number that number will continue to move further and further away the goal posts are constantly moving that is why we always talk about fear, the fight between fear and greed is that there is something strange in human nature and that's why I like you setting goals just like bo said take a snapshot write it down I even like the idea of ​​writing down what those goals are so that that way when you actually achieve them you know you're there and then you can find out if you're tired of swimming against the grain because there is this thing, remember we talked about you're on a journey to create wealth, but there's a whole new and different skill set to maintaining your weight and that's the part, and it's not the easiest part, wealth.

It's one of those slippery things that I've shared with you, yes, 80 percent of millionaires' wealth is first generation, but the sad statistic is that in the second, 70 percent has slipped away, by the third generation, the grandchildren, the 90 percent, the whole cycle repeats itself, so it is Creating slippery wealth and then retaining it is a slippery endeavor, so you need to know your why and what gives you a purpose for that you can enjoy it and actually, like I said, get that satisfaction factor, but also protect it and hopefully use it to help. your family, your friends, your causes, so that you truly turn this into a legacy and not just this fleeting warning.

I think that happens a lot when you talk about money and look, our charge is that we will help you along the way. Not only do we want to help you discover how to grow your wealth, how to move towards financial independence and abundance, but we want to help you discover how to maintain your wealth for the long term. That's why we make resources like the youtube show available to you like the podcast if you haven't visited our website yet, check out moneyguy.com resources, we have tons of free deliverables available to you, from how to refinance my mortgage to what questions to ask if I want to hire an advisor on how I can get my young people excited about saving for the future and everything else, so if you haven't had a chance to visit our resources page, visit money.moneyguy.com resources and make sure that you are using those that will help you on your wealth creation journey, yes, and those resources are free, I mean, this is what I love about free resources, is that they wonder, how does this work?

How can they keep carrying us? Look, this is the cycle of abundance, you come, you learn, you apply, you grow, you reach that level of success, this is going to happen. I can plant seeds. The ship can plant seeds. You are growing big oak trees. Go have this whole beautiful tree lined path, like you see in all your dreams that will happen and you'll say wow, how did I get here? and you'll remember that we planted those seeds with you and that's when you'll graduate and take the relationship to the next level and we'll be here.

We are both young enough to make these dreams come true. We just appreciate you taking this journey. I'm your host, Brian Preston, Mr. Bo Hansen, the money guy.