The Savings Expert: Are You Under 45? You Probably Aren’t Getting A Pension! Do Not Buy A House! This Is Probably Why You’re Broke! - Jaspreet Singh AI transcript and summary - episode of podcast The Diary Of A CEO with Steven Bartlett
Go to PodExtra AI's episode page (The Savings Expert: Are You Under 45? You Probably Aren’t Getting A Pension! Do Not Buy A House! This Is Probably Why You’re Broke! - Jaspreet Singh) to play and view complete AI-processed content: summary, mindmap, topics, takeaways, transcript, keywords and highlights.
Go to PodExtra AI's podcast page (The Diary Of A CEO with Steven Bartlett) to view the AI-processed content of all episodes of this podcast.
The Diary Of A CEO with Steven Bartlett episodes list: view full AI transcripts and summaries of this podcast on the blog
Episode: The Savings Expert: Are You Under 45? You Probably Aren’t Getting A Pension! Do Not Buy A House! This Is Probably Why You’re Broke! - Jaspreet Singh
Author: DOAC
Duration: 02:29:27
Episode Shownotes
Revealing what hedge funds and multinational banks don't want you to know about building wealth! Jaspreet Singh is spilling secrets and helping everyday people find financial freedom Jaspreet Singh is an entrepreneur, former attorney, and financial educator. He is CEO of Minority Mindset Companies and host of the 'Minority Mindset'
finance and entrepreneurship YouTube channel. In this conversation, Jaspreet and Steven discuss topics such as, the impact of spending more than you earn, how to clear credit card debt, why you shouldn’t buy a house, and the 75/15/10 plan to become rich. (00:00) Intro (02:14) Who Should Care About Jaspreet's Message And Why? (03:21) Figuring Out Wealth: Key Differences Between The Wealthy And Everyone Else (08:11) Jaspreet's "Penny Drop" Moment: When It All Made Sense (13:03) Lessons From Starting Early In Business (17:48) Should You Buy A House Or Rent? (24:20) Understanding Opportunity Cost In Financial Decisions (26:28) Is Rent Really Throwing Money Away? (28:13) How To Know If You Can Afford A House (30:59) Do You Know What You're Really Spending? (32:51) Showing Wealth vs. Hiding Wealth: Which Is Better? (38:04) How To Stop Living Paycheck To Paycheck (44:20) Why Sacrificing Can Be So Hard (47:12) Life Struggles And Reckless Financial Decisions (50:17) Jaspreet's Thoughts On Cryptocurrency (55:52) Developing A Money Mindset For Success (59:45) Negative Stereotypes That Hold Us Back From Achieving Success (01:03:05) The "9 Dots" Trivia: Thinking Outside The Box (01:08:50) Facing Barriers On The Path To Financial Freedom (01:11:14) Escaping Financial Barriers: Actionable Steps (01:13:36) Do You Need To Remind Yourself Of Your Mantra? (01:16:34) Money Is A Tool: What Does That Really Mean? (01:20:37) Why It's Important To Recognize Abundant Financial Opportunities (01:22:50) Why It's Your Duty To Become Wealthy (01:23:56) Should We Change Our Investments With Trump In Power? (01:27:50) How To Get Started With Real Estate Investing (01:30:12) Jaspreet's Best Investment Ever (01:35:03) Choosing The Right People: Steve Jobs' Valuable Lesson (01:43:29) The Power Of An Internal Locus Of Control (01:50:18) Elon Musk's Tax Efficiency And Loaning Against Assets (01:54:47) Understanding The Retirement Crisis (01:56:23) How Much Money Do You Really Need To Retire? (02:02:24) Solutions To The Retirement Crisis (02:10:31) Principles For Success In Business (02:15:26) Be Boring And Patient: The Key To Winning In The Money Game (02:19:52) Best Places To Gain Knowledge And Skills (02:21:42) What's The Most Important Thing We Didn't Discuss Today? (02:22:52) The Last Guest Question Follow Jaspreet: Instagram - https://g2ul0.app.link/UZG34SJiGOb Twitter - https://g2ul0.app.link/32z1S6LiGOb YouTube - https://g2ul0.app.link/G33HmeOiGOb 🚀 The 1% Diary is live - and it won’t be around for long, so act fast! https://bit.ly/1-Diary-Megaphone-ad-reads Watch the episodes on Youtube - https://g2ul0.app.link/DOACEpisodes Follow me: https://g2ul0.app.link/gnGqL4IsKKb Sponsors: Linkedin Ads - https://www.linkedin.com/doac24 PerfectTed - https://www.perfectted.com with code DIARY40 for 40% off Learn more about your ad choices. Visit megaphone.fm/adchoices
Summary
In this episode of 'The Diary Of A CEO,' Jaspreet Singh discusses misconceptions about wealth accumulation, emphasizing that renting can also lead to financial success. He critiques traditional views on home ownership as a path to generational wealth, stating that many people buy homes they cannot afford, leading to financial strain. Singh advocates for financial education, understanding assets versus liabilities, and seizing investment opportunities in stocks and real estate. The discussion highlights the retirement crisis faced by younger generations in the absence of pensions, urging listeners to take personal responsibility for their financial futures through education and strategic investing.
Go to PodExtra AI's episode page (The Savings Expert: Are You Under 45? You Probably Aren’t Getting A Pension! Do Not Buy A House! This Is Probably Why You’re Broke! - Jaspreet Singh) to play and view complete AI-processed content: summary, mindmap, topics, takeaways, transcript, keywords and highlights.
Full Transcript
00:00:00 Speaker_03
We have to get over these money myths that you can't build wealth if you rent where you live. You can't build wealth if you don't have access to millions of dollars. That's not true.
00:00:09 Speaker_03
And there's one key thing that's given much better returns than any real estate, than any stock, and even any cryptocurrency. So let's talk about the real way to build true wealth.
00:00:18 Speaker_02
Jaspreet Singh is the no-nonsense financial guru, realtor, and entrepreneur, whose methods have helped millions of people solve their crippling money problems and unlock financial freedom.
00:00:28 Speaker_03
People don't like when I say this, but I don't say what I say to make friends. I say what I say to help people do better with money. There's a lot of people that are lacking financial education. And we're taught, study hard, get a good job.
00:00:38 Speaker_03
And if you continue working down that path, you're going to become successful. Yet most people buy a house they can't afford and statistically are living paycheck to paycheck. In fact, that's 78% of Americans.
00:00:49 Speaker_03
Because ironically, the key thing that keeps so many people poor for the rest of their life is they're scared to look broke. So what do they do?
00:00:56 Speaker_03
They're driving around in nicer cars, going on better vacations and to the nicer restaurants, but they no longer have money to save. They no longer have money to invest. And the problem is we need about $1.8 million to retire comfortably. Wow.
00:01:08 Speaker_03
So if you are in the financial danger zone, which is you don't have $2,000 saved up for an emergency and you have credit card debt, you have to make drastic changes. Today. So what do I do?
00:01:17 Speaker_03
Well, the first thing you got to understand is the 75-15-10 plan, which is. And now let's dig this a little bit deeper and let's talk about making money. I put my money in five places that has been proven to win. Number one,
00:01:31 Speaker_01
I find it incredibly fascinating that when we look at the back end of Spotify and Apple and our audio channels, the majority of people that watch this podcast haven't yet hit the follow button or the subscribe button, wherever you're listening to this.
00:01:43 Speaker_01
I would like to make a deal with you. If you could do me a huge favour and hit that subscribe button, I will work tirelessly from now until forever to make this show better and better and better and better.
00:01:53 Speaker_01
I can't tell you how much it helps when you hit that subscribe button. The show gets bigger which means we can expand the production, bring in all the guests you want to see and continue to do in this thing we love.
00:02:01 Speaker_01
If you could do me that small favour and hit the follow button wherever you're listening to this, that would mean the world to me. That is the only favour I will ever ask you. Thank you so much for your time. Back to this episode.
00:02:14 Speaker_01
Jaspreet, who should care about your message and why should they care?
00:02:20 Speaker_03
anybody who uses money, which is everybody. The interesting thing about money is we use money every single day. It costs money to eat, and it costs money to feed other people. Yet most of us are never taught about money.
00:02:35 Speaker_03
So most people say, money doesn't matter. I shouldn't think about money. I shouldn't have to worry about money. Money's bad. Money's evil. When in reality, it costs money to eat and it costs money to feed other people.
00:02:47 Speaker_03
And when you don't understand that, now you're the one that's going to be paying the highest taxes. You're the one that's going to be struggling to pay your bills. You're the one that's not going to be able to go to Disney World.
00:03:01 Speaker_03
You're the one that can't pay for that amazing gift for your wife or your husband. And you're the one that can't pay for the health care for your parents. And you wonder why. And in this economic system that we all live in, money talks.
00:03:16 Speaker_03
And unless you understand that, you're never gonna be able to win in this system.
00:03:21 Speaker_01
What is the difference between people who figure out how to make themselves wealthy and those that don't?
00:03:27 Speaker_01
If we put all objective advantages aside, rich parents, inherited lots of money, all these kinds of things, what is like the fundamental difference that you've seen from the many, many hundreds of thousands of people that you've worked with and taught and have consumed your content?
00:03:41 Speaker_01
What is the fundamental? There's one difference.
00:03:45 Speaker_03
One key difference. People that become wealthy understand how money works. And everybody else does not. And I'll tell you where I came to this conclusion. I checked all the boxes. I studied hard in school. I went through high school. I went to college.
00:04:04 Speaker_03
I spent one year in graduate school. And then I went through law school. But I never once learned a thing about money. I never once learned a thing about building wealth. I never once learned a thing about investing.
00:04:17 Speaker_03
I never once learned a thing about passive income. But if you look at the wealthiest people in the world, they don't get there by working a job and getting a raise. They don't get there by working to climb the corporate ladder.
00:04:32 Speaker_03
They get there because they understand how money works, and they understand how to win in the economic system. And the crazy thing about that is we're all taught to trust the system. My parents are immigrants from a state in India called Punjab.
00:04:49 Speaker_03
And like many other traditional Indian immigrants, they wanted me to become successful. Now in my house, that definition of success was very simple. They gave me two options.
00:05:00 Speaker_01
I can guess.
00:05:01 Speaker_03
Well, option number one was Jaspreet, you can be a doctor. Option two was Jaspreet, you can be a failure. And they said, you get to pick which one.
00:05:10 Speaker_03
And this is me when I'm like one year old, that since the day I could start talking, my parents told everybody, not just people around us, they called my family in India, my family all around the country, that Jaspreet is going to grow up and become a doctor because he's going to become successful.
00:05:25 Speaker_03
Now, I had nothing against that because I wanted to become successful too. I saw how hard my parents worked. My dad, if he got a Saturday and a Sunday off, it was considered a long weekend.
00:05:35 Speaker_03
I mean, my parents bust their butt, and I wanted to become successful so I could give back to them. And they told me that if I wanted to become successful, the way I do that is by becoming a doctor.
00:05:45 Speaker_03
Which makes sense, because when you're in school, you get those pamphlets, those career pamphlets, and they show you the different career options you have. And anytime you look at that, the top of the list is always doctor.
00:05:57 Speaker_03
And so they said, Jaspreet, if you want to become successful, you have to become a doctor. And because we came to this country, you have to become successful, so you have to become a doctor.
00:06:06 Speaker_03
Now, I didn't think anything wrong with it, because I liked the idea of becoming successful, so I went down that path. Now along the way, I realized I didn't want to be a doctor. I told my parents that I'm not going to be a doctor.
00:06:19 Speaker_03
My mom almost had a heart attack. My dad couldn't believe it. And so my dad essentially told me that Jasprit, if you want to keep any pride in the family, you have to at least become an attorney. So I said, okay.
00:06:33 Speaker_03
I went to law school part-time, worked on my business full-time. Now, today I am a licensed attorney, but I've never worked a day as an attorney.
00:06:41 Speaker_03
And the reason why I've never worked as an attorney is because it's just not worth my time and it's not where my passion is. And along that way, that's when I learned that we're taught, this is how you win.
00:06:53 Speaker_03
Go to school, study hard, get good grades, get a good job. And if you continue working down that path, you're going to become successful. But if you look at the successful people, that's not the path that they followed.
00:07:07 Speaker_03
And if we take a look at the three things that have built more wealth than anything else over the last century, it's starting a business, investing in real estate, and investing in stocks.
00:07:20 Speaker_03
Yet, along my entire educational path, I was never taught that. We're focused on how do you get a good job? But all wealthy people are focused on is how do I grow my assets? And that's the key difference here.
00:07:35 Speaker_03
As wealthy people are working to own the corporate ladder, everybody else is working to climb the corporate ladder.
00:07:41 Speaker_03
And then the next thing, I'm going to go back to what you said, assuming that you don't have rich parents, because most people assume that you have to be rich in order to do this. You need millions of dollars. You need access to all this money.
00:07:52 Speaker_03
But that's not true. You can start now with $100, $10, but you have to get started. The problem is most of us are never taught how to do this. But unless you start doing this, you're never going to build wealth.
00:08:07 Speaker_03
And that's the way that you win in this economic system.
00:08:10 Speaker_01
So I want to go through all of those three things you've just said. I want to talk about starting businesses. I want to talk about investing in stocks and also want to talk about real estate.
00:08:17 Speaker_01
But I'm curious in your own personal story there, when did the penny drop? Because it's so interesting. In my life, there's key moments where I got to see behind the curtain.
00:08:26 Speaker_01
And when I say see behind the curtain, I refer to my friends when we're speaking privately, I'll say, I'll refer to it as money games. Like the day where I saw these billionaires playing money games that I was, I didn't know existed.
00:08:39 Speaker_01
And I was there working my butt off.
00:08:41 Speaker_01
Working in call centers or building whatever and then I got to meet a billionaire got to spend time with them got to see behind the curtain I was like, oh they just play these money games, which nobody else has been told about right When was the penny drop moment for you you qualified as a lawyer?
00:08:56 Speaker_01
Why didn't you end up pursuing that some something happened?
00:08:59 Speaker_03
Yeah, so when I was in grade school, I began working at Indian weddings. I played a drum called the dhol. It's a Punjabi drum. That's where my family is from in India. And I used to play this drum at weddings.
00:09:11 Speaker_03
Now, my parents didn't like that I did this because anything that was not math or science was like, you don't do this. So I had to play this drum in secret. But I played at weddings and I started to make a little bit of money.
00:09:22 Speaker_03
And by a little bit of money, I mean $50 per wedding when I was in middle school, then maybe $100, $200 in high school. And one of the DJs that I was working with said, Jaspreet, you know a lot of kids in high school.
00:09:36 Speaker_03
How about we host a teen party for some of these kids in your school?" I was like, okay, why not? So we hosted this teen party and it was a big success.
00:09:46 Speaker_03
And at the end of the night, the DJ then starts paying out all the costs because we were going to go in 50-50 on this business venture. And then we pay out the money for the security, for the venue, for the marketing.
00:09:58 Speaker_03
And then he says, all right, let's count our profits. And he has four bills in his hand. One, two, three, four. There's four singles left. $2 for him, $2 for me.
00:10:09 Speaker_03
And I saw that we put in so much work into this business venture, into this idea, into this first party, and we made $4 of profit, which we split 50-50.
00:10:20 Speaker_03
And at that moment, he was really upset, but I was really not upset at all because I was like, this was fun. You know, it was a lot of fun putting this together.
00:10:30 Speaker_03
But in my mind, it was just one of those hobbies that I was doing because I needed to become a doctor. Well, I did a few of those teen parties when I was in high school, and now it was time for me to go to college.
00:10:42 Speaker_03
I was 17 years old, and I get there, and I see everybody partying, drinking, blowing money they don't have, and I was shocked.
00:10:54 Speaker_03
I had no idea that people went to college to party, and I had no idea people got the money to spend money on all this alcohol. I don't drink. I'm not into partying. But now I needed something to do on Friday nights.
00:11:08 Speaker_03
And so now I'm thinking, well, what do I do? How about I take this teen party business concept that I had in high school and now do it in college?
00:11:16 Speaker_03
So I was 17, and I started knocking on the doors of all the bars, venues, restaurants, trying to see if anybody would let me host a party there. And in the beginning, some said, sure, you can host a party here. We just need a $10,000 deposit.
00:11:33 Speaker_03
I don't have $10,000. I was 17 years old. So I kept going. Some said I need a $20,000 deposit. But eventually I found this one club that said, yeah, you can host a party here. You don't got to pay us anything.
00:11:45 Speaker_03
Just pay us half of the cover charge that you generate. Pay us 50% of whatever revenue you generate. Now I'm in business. I made the same arrangement with my DJ. I said, look, how about you DJ for me for free?
00:11:56 Speaker_03
And I'll split whatever profits I make with you. And that was the beginning of my first real business. It was this party promotion company, which then became an event planning company. And it grew pretty big in college.
00:12:12 Speaker_03
I mean, I started off by hosting these one-off parties. Then I was contracted by one of the largest clubs on campus to host their weekly college night. So I was hosting their parties every week.
00:12:23 Speaker_03
We were hosting official shows and after parties, and it grew pretty large. Now, as this business starts to make money, the first thing that I realized is I don't need a license or degree to make money.
00:12:39 Speaker_03
I thought that was something that I needed because I thought I needed these good grades to qualify for this thing to make money. So that was the first kind of shock and realization. The second realization that I had was I knew nothing about money.
00:12:51 Speaker_03
I was making a little bit of money and I was very fortunate that I started reading books about money and business. And I started reading these books.
00:13:03 Speaker_03
And the first thing I learned was the difference between an asset and a liability, which were things I had never heard of before. An asset is something that puts money in your pocket. A liability is something that takes money out of your pocket.
00:13:17 Speaker_03
Wealthy people want to own assets. I was buying a whole lot of liabilities because I was working in this party promotion business and I wanted to look the part.
00:13:25 Speaker_03
So I would make a little bit of money, buy a nice watch, make a little bit more money, put some new rims on my car, put a new sound system in my car, put a new subwoofer in my car.
00:13:35 Speaker_03
I mean, I was blowing money on all these dumb things to look like I was rich. When in reality, I was just making a lot of other people rich.
00:13:43 Speaker_03
And then I learned about this thing called investing, which really started to upset me because I thought I was doing everything right. And I'm reading these books that are talking about how every wealthy person invests in real estate.
00:14:01 Speaker_03
I have no idea what that means. Nobody in my family is a real estate investor. I had never heard of this concept of real estate investing before.
00:14:09 Speaker_03
I don't know what it is, but if wealthy people are real estate investors and I want to become wealthy, maybe I should invest in real estate.
00:14:17 Speaker_03
So when I was 19, I'm now studying to get into medical school because I still think that I'm going to become a doctor. And I was bored out of my mind because I would spend all day, 10 to 12 hours a day in the library studying.
00:14:30 Speaker_03
And this was around 2011. And the reason why I say the year is because if you remember, 2008 was the great financial crisis. That was when we had the real estate collapse in America.
00:14:46 Speaker_03
So real estate prices were decimated, and it didn't hit rock bottom until 2012. That's why I'm saying this. So in 2011, I'm studying to take the Medical College Admission Test, the MCAT.
00:14:58 Speaker_03
And I'm reading these books talking about how wealthy people invest in real estate. And now I'm making a little bit of money from this party business, and I have a little bit of cash in the bank. So during my breaks when I'm studying for the test,
00:15:09 Speaker_03
I started looking on the internet websites of finance. And they all talk about how real estate prices have hit rock bottom, how real estate is being decimated in America. And so I was like, well, maybe I'll start looking to buy real estate.
00:15:26 Speaker_03
And so on August 22, I took the medical college admission test. And then on August 23rd, I purchased my first real estate investment property. It was a small condo that I purchased out of foreclosure.
00:15:40 Speaker_03
A few years prior, it had sold for a little bit over $150,000. And then like many properties, it went through foreclosure. The banks couldn't sell it. And it was listed on sale for $8,400. That was the total price of the condo.
00:15:58 Speaker_03
So I came in with an offer of $4,000, because I don't know how this real estate investing stuff works. And we would bank it forth with the bank. The bank said, we'll sell it to you for $7,000. I tried to negotiate them even lower.
00:16:14 Speaker_03
And then the bank said that they had another offer on the table. So now it's a bidding war. And I had to pay, offer my highest and best price. So I said, I'm willing to offer $8,000 to buy the condo, no more. And they accepted my bid.
00:16:29 Speaker_03
So I purchased this condo for $8,000. I put in a few thousand dollars worth of work. And then I rented it out for $600 a month. And now I start to question things. Why did nobody tell me about this?
00:16:45 Speaker_03
This condo is putting money into my pocket without me having to do something because I own this asset. We're all taught to trade our time for dollars. We're all taught to work to get paid because that's what we're taught to do.
00:16:59 Speaker_03
But wealthy people are not working for a bigger salary. They're working for more assets because that can continue to pay you even when you're not working. And that's that shift. When I saw that,
00:17:12 Speaker_03
that really sparked a fire under me and really made me angry. And I don't know why I got so angry, but I got angry because I felt like I was checking all the boxes. I was doing good in school. I bust my butt in school.
00:17:25 Speaker_03
I was gonna do all the right things, become a doctor, and do everything that I was told. But what I didn't realize is those boxes weren't my boxes. Who created these boxes?
00:17:37 Speaker_03
And why is there this whole world of financial education that we're never taught? Because if this is how wealthy people build and grow their wealth, why is everybody else not taught this?
00:17:48 Speaker_01
So I want to make a distinction here. Are you saying that in order to build wealth, people should buy a house? No.
00:17:57 Speaker_03
If you want to build wealth, you have to buy assets. When people say buy a house, what does that mean to most people's eyes? It means buy my home. I want to buy this nice place for me to live.
00:18:07 Speaker_01
Which is what most people do when they get a bit of money. They take their salary from work, and then they go and buy a house to live in, and then they pay into the mortgage, which means that they are now building an asset, right?
00:18:19 Speaker_03
They're building what many people call generational wealth, which is one of the biggest lies when it comes to money. The reason why, is because your house is actually a money pit. And that's why I want you to think of your house as a liability.
00:18:37 Speaker_03
But I want you to hear me clearly. I'm not saying you shouldn't buy a house. I'm not saying it's bad to buy a house. You have to treat your house like a liability. This suit that I'm wearing is a liability. This watch is a liability.
00:18:49 Speaker_03
My shoes are liabilities. Should I not buy them? No, I got to make sure I can afford them. So when people think about buying a house, what do they think of? They think, I'm going to build generational wealth. I'm going to build wealth.
00:19:01 Speaker_03
I'm going to pay it off. And I'm going to be able to have more freedom in my life because I can own this house. Let's go with the best case scenario. You buy a home for, let's call it $300,000. You pay it off.
00:19:17 Speaker_03
And throughout your lifetime, this $300,000 home grows in value to a million dollars. And now you're gonna say, Jaspreet, I showed you this is an asset. My house tripled in value, more than tripled in value, and now I'm gonna pass it down to my kids.
00:19:30 Speaker_03
So now, yeah, your kid's got a million dollar house, but unless they have the income to support paying for a million dollar house, they might have to find some more cash. Now what do they do? Because you can't just pull cash out of this house, right?
00:19:43 Speaker_03
I mean, it's not an ATM, unless you go to the bank. The bank will give you the cash because the bank says, oh, you have a million-dollar house. How about we loan you $800,000? But that's not an ATM because you have to pay that money back plus interest.
00:19:59 Speaker_03
And now, unless your kids have the income to pay for the property tax, to pay for the insurance, to pay for the upgrades, to pay for the maintenance and the mortgage, they can't afford that house. So maybe now they have to sell. OK, now you sell it.
00:20:12 Speaker_03
You got a million dollars. Great. We're not even going to talk about taxes right now. But you got a million dollars. You're rich. But if they don't have any financial education and you have a million dollars, what's going to happen?
00:20:26 Speaker_03
Well, let's think about this. If you had a million dollars, what would you do with it? If I went down the street and I asked the average person, if I wrote you a check for a million dollars today, what would you do? What are people going to say?
00:20:37 Speaker_03
I'm going to go to the Bahamas. I'm going to buy myself a nice house, I'm going to buy myself a nice car, buy myself some nice clothes, go to the Gucci store, go to the Louis Vuitton store and buy myself the extra guac at Chipotle.
00:20:47 Speaker_03
That's what the average person will do. Now maybe you're a little bit more financially smart. You say, I'm just going to live off of $50,000 a year. But after 20 years, you have nothing left. Not to mention the fact that 10 years from now,
00:21:02 Speaker_03
That $50,000 a year lifestyle is going to buy you half of what it can today. So now let's go back to that situation. You thought you built generational wealth.
00:21:12 Speaker_03
You did a good thing by paying off the mortgage because you don't have to pay the mortgage payment. But is that really the type of generational wealth that you want? And now to fully hammer this home, I'm not saying it's bad to own a house.
00:21:26 Speaker_03
It's actually very great. It's an amazing thing to own a house free and clear because now you can rest assured, you don't have to worry about the mortgage payments. If you have the financial education, that's great.
00:21:37 Speaker_03
But let's talk about now the real way to do this and build true wealth. When I buy my real estate investment properties and my property values go up, the rental values also go up. The rent is what pays for the maintenance.
00:21:51 Speaker_03
The rent is what pays for the upgrades. The rent is what's paying for the property taxes and the insurance. The rent is putting money in my pocket. And this is cash flow that I can use. I can use this cash flow to buy a vacation.
00:22:05 Speaker_03
I can use this cash flow to buy food. I can use this cash flow to pay for my lifestyle. But your house, doesn't do that. You have to pay to live in a house.
00:22:16 Speaker_01
But people think, you know, they're getting their mortgage payments, they're spending whatever they are, you know, spending on their mortgage payments.
00:22:21 Speaker_01
They think they're, well, we're kind of told that that mortgage payment is an investment into an asset.
00:22:29 Speaker_03
Your mortgage payment is a payment to your bank. Banks are not stupid. In fact, they're very smart. Banks do something called front-loading your mortgage.
00:22:41 Speaker_03
What that means is if you go out and get a 30-year mortgage, which is what many people do in America, and you pay $3,000 a month on your mortgage, You're not paying $1,500 to your interest, your bank, and $1,500 to your principal, your equity.
00:22:59 Speaker_03
The way it works is banks front load your mortgage, which means for the first almost 15 years, it's about 14 years and eight months or so, but for almost 15 years of your mortgage, the first 15 years, the majority of your mortgage payment is going directly into your banker's pocket in the form of interest.
00:23:19 Speaker_03
Which means if you're paying $3,000 a month on your mortgage, for the first part of your mortgage, maybe $100 is going out of the $3,000 into your equity. The other $2,900 is going right into your banker's pocket with interest.
00:23:36 Speaker_03
And now, yeah, after 15 years, now half of your mortgage payment is going to your equity and half is going to interest. But if you refinance before that 15-year mark, that starts over. And so this is where banks understand the game.
00:23:54 Speaker_03
Again, I'm not against buying a house, but you've got to understand the game of money. And most people don't understand that.
00:24:01 Speaker_03
And so the mistake that people make is they buy a house they can't afford, and now they're paying all this money into their mortgage, thinking that I'm building wealth. They no longer have money to save.
00:24:10 Speaker_03
They no longer have money to invest into other real assets. And their money is just going to pay down their mortgage, thinking that this is going to build my wealth. But you've been sold a lie.
00:24:21 Speaker_01
This term, opportunity cost, Most people don't know what this term opportunity cost means but it appears to be very pertinent to what you're saying, especially when you just said this is money that you can't then invest in assets.
00:24:32 Speaker_01
Can you explain what opportunity cost is and how it's impacted if you buy a house? Sure.
00:24:39 Speaker_03
If you have, let's make the numbers very simple. You want to buy a $100,000 home and let's say the banks require a 20% down payment, $20,000. You could do a few things. Number one, you can take that $20,000 and go out and buy this house.
00:24:56 Speaker_03
And now that's how that money has been used. But if you use that money to buy the house, you lose the opportunity to take that $20,000 and say, use it to buy a rental property. You lose the opportunity to use that $20,000 to invest in the stock market.
00:25:11 Speaker_03
You lose the opportunity to take that $20,000 and maybe build a business. Now the question is, what is going to give you the best and most growth? Now, hopefully this house that you buy will go up in value. It's not guaranteed.
00:25:25 Speaker_03
We know the houses don't always go up in value, no matter what your banker says, no matter what your real estate agent says, because we saw what happened after the 2008 crash, where real estate prices were slashed in half.
00:25:37 Speaker_03
It was as much as 93% real estate values dropping in the state of Michigan, where I am. So we know real estate prices don't always go up. Stock prices don't always go up. Businesses don't always work. Everything has a risk.
00:25:53 Speaker_03
But now the question is, which risk do you want to take? And which risk do you want to take first? Are you in a situation now where you're ready to go out and buy a house? Or do you want to build your wealth first a little bit more?
00:26:06 Speaker_03
And that's the question that I want people to start thinking is, am I ready to buy a house? And then people say, well, if I go out and invest my money, the problem is housing prices keep going up. I'm chasing this housing market.
00:26:19 Speaker_03
It keeps getting more and more and more expensive. And you're 100% right. It's a risk.
00:26:25 Speaker_01
But there's also a risk the housing prices could fall. I think one of the biases that makes people want to buy a house is that they're currently renting, and they see that as just giving money away.
00:26:35 Speaker_01
So they think, listen, I could spend this money on a mortgage, and I'll own this thing one day, or I could spend this same $2,000 or whatever it is on rent, and I'm never going to own this thing. Well, I'm here in Los Angeles right now.
00:26:49 Speaker_03
I had to stay in a hotel. That hotel payment is paying somebody's mortgage. It's paying somebody's college tuition. It's paying for somebody's stuff. When I go to a restaurant and I eat out, I'm paying for somebody's mortgage.
00:27:03 Speaker_03
I'm paying for somebody's college tuition. I'm paying for somebody's bills. Because when you go out and you rent, that's what everybody says. I am making my landlord rich. Well, when you eat at a restaurant, you're making that restaurant owner rich.
00:27:13 Speaker_03
When you go to a hotel, you're making the hotel owner rich. When I go and buy a mug, I'm making the mug owner rich. And the reality is, yeah, it's good for you to own a house. But are you ready to own a house? Can you afford to own a house?
00:27:30 Speaker_03
And what do you want to own first? I rent where I live right now. I am making my landlord rich today. I also rent where my office is. I am making my office landlord very rich because my office rent is very expensive. Do you feel bad for me? I hope not.
00:27:47 Speaker_03
And this is where we have to get over these money myths that many people keep selling you, that you can't build wealth if you rent where you live. You can't build wealth if you don't get a good degree. That's not the way that the system works.
00:28:02 Speaker_03
See, there's the traditional rules, and then there's the real financial education money rules. And again, I'm not saying it's bad to own a house, but it's bad to own a house you can't afford.
00:28:12 Speaker_01
How do you know if you can afford one?
00:28:14 Speaker_03
Well, there's three parts to afford in a house. You have to afford the down payment, you have to afford the monthly payment, and you have to afford the move-in costs.
00:28:23 Speaker_03
I'm going to go start from the simplest one, which is the move-in costs, because many people don't factor this in. When you buy a house, you got to move in. And I'm not talking about the closing costs.
00:28:34 Speaker_03
You might have to hire movers, which are expensive. You might have to upgrade your furniture, which is expensive. You might have to upgrade the house, which is expensive. Factor that in. Then I want to talk about your down payment.
00:28:47 Speaker_03
People don't like when I say this, but I don't say what I say to make friends. I say what I say to help people be better with money. If you want to afford the house, you have to have at least a 20% down payment.
00:28:58 Speaker_03
That way you actually have some equity, some skin in the game. That way you can actually afford the house. The third part is you have to afford the monthly payments. Now, every bank is going to have a different rule for you.
00:29:11 Speaker_03
Banks have like the 28% rule and these other rules.
00:29:14 Speaker_01
I have- Sorry, just on that last point, why do people not like it when you say that?
00:29:18 Speaker_03
Because it's very hard to pay a 20% down payment. Housing is expensive. You want to buy a $500,000 house? You have to have $100,000 as a minimum for your down payment. And that's extra cash. Now, if we talk about the monthly costs,
00:29:34 Speaker_03
The simple way that I like to follow it is you have to have a system for yourself. You have to know how much money you are allowed to spend, how much money you need to be investing, and how much money you have to be saving every single month.
00:29:48 Speaker_03
Then just factor it in. So the way I like to look at it, a simple rule of thumb. is something like a 75-15-10 plan, which says for every dollar that you earn from here on out, 75 cents is the maximum that you can spend.
00:30:05 Speaker_03
15 cents is the minimum that you invest. 10 cents is the minimum that you save. Now, let's do the math. If you know that you make, let's call it $100,000 a year, that means the max you can spend out of the $100,000 is $75,000.
00:30:24 Speaker_03
So if out of that $75,000, you can afford your mortgage costs, you can afford your food, you can afford your vacations and lifestyle, then sure, you can afford it. But if you can't afford that, then you can't afford that mortgage.
00:30:39 Speaker_03
And the reason why I like to go by this rule is because some people are gonna say, I can live in a small house, I just want an expensive car and some nice vacations. All the people are going to say, I want a beautiful home.
00:30:50 Speaker_03
I don't care about the car and vacations. So now you can factor it all in there. How much can you afford out of that 75% of what you make?
00:30:59 Speaker_01
Do you think people even know how much money they spend? No. I was thinking, I wonder how many people listening right now know over the last six months, the exact figure that they spend every single month.
00:31:14 Speaker_01
Most people, statistically, are living paycheck to paycheck.
00:31:18 Speaker_03
So they're basically spending everything. Or more. OK. 78% of Americans are living paycheck to paycheck, which means I make some money and I spend all of it or more.
00:31:30 Speaker_03
There's a joke that I like to make, which is in the traditional Indian culture, people make $1 to spend $0.20.
00:31:41 Speaker_03
In the traditional American culture, people make a dollar to spend $2 through the help of lines of credit, credit cards, and other forms of debt. And the reason why, I'm going to take it a step back. I don't think you wanted me to go this way.
00:31:53 Speaker_03
I'm not going to go anywhere. Anyway, we live in what's called a credit-based economy, which means if you make $50,000 a year, you don't live off of $50,000 a year. At least most Americans don't.
00:32:09 Speaker_03
We live in what's called a credit-based economy, which means you have the ability to spend the $50,000 you earned plus debt. Because as you make more money, as you have a good job, you become more creditworthy.
00:32:21 Speaker_03
And so as you show the bank, hey, I made $50,000, they'll give you credit cards. They'll give you lines of credit. They'll give you whatever types of debt that they can. That way, now you can go out and spend $60,000, $70,000, $80,000.
00:32:35 Speaker_03
Because that's what grows the economy. The more money you spend, the richer somebody else gets.
00:32:41 Speaker_03
And so now when you live in this credit-based economy, with no financial education, people spend, spend, spend, the economy grows, grows, grows, and most people have no idea what hit them.
00:32:52 Speaker_01
Do you know what's really interesting is two days ago I was having a conversation with one of my friends.
00:32:57 Speaker_01
It was actually, I did a podcast about finance recently and in there I mentioned some of my friends and then they messaged me on WhatsApp and we were having a chat in our group chat and I, for the first time ever, one of them asked me to guess.
00:33:10 Speaker_01
We're very close friends, we talk about money, we talk about how much money we have etc. They said guess who has the most money in the group. So I went through and I did.
00:33:17 Speaker_01
I think this is this person's net worth of my five best friends and I think this is how much cash they have. Now, one of my friends, who is very, what's the word? I guess frugal, lives a very, very simple life.
00:33:33 Speaker_01
As I was going through, I go, do you know what? This friend is this high-flying guy, lives in this amazing apartment. This person has all these wonderful things. This person's been successful in business. This person's successful in crypto.
00:33:45 Speaker_01
But do you know what? I bet my mate, and I won't say his name, I bet he's richer than everyone else in that chat. all of my other friends in the chat. And so I did my little prediction and I said, I bet you've got X figure.
00:33:58 Speaker_01
And he replied and said, this is my current cash position. He was richer than everyone in the chat in terms of cash combined. This guy lives so free. He lives in like a studio apartment. He never balls.
00:34:11 Speaker_01
He doesn't have like a fancy car, doesn't have fancy clothes. And he's richer than the entire lot of my friendship group. And I thought, God, there's something really important here in terms of,
00:34:22 Speaker_01
And it's so crazy if you know the context of what I'm saying, because I've got a friend in that chat who's built like a big business, I've got a friend, like, everyone in that chat runs businesses, is successful, but they're living in different ways, and the one friend who runs the smallest business, who probably has the least income, is the richest.
00:34:43 Speaker_01
And over the last couple of days, it's so funny, I was thinking about all the dinners I've bought this fucking guy, and I'm like, I didn't know you were a millionaire!
00:34:51 Speaker_03
I wouldn't have been paying for everything. But this is really, I mean, if we ignore your friends, it's very easy to look fake rich.
00:34:58 Speaker_01
Yeah.
00:34:59 Speaker_03
Because everybody will give you a line of credit. If I want a Gucci purse and I can't afford the Gucci, guess what? I can buy now, pay later. I can open up a credit card and buy the Gucci and look like I'm rich.
00:35:09 Speaker_03
When in reality, I'm just making Gucci rich. In fact, One of the richest people in the world, in 2023 he was the richest person in the world, is Bernard Arnault. He's the founder and CEO of the company that owns Louis Vuitton. And why?
00:35:27 Speaker_03
Because millions of people pay him to look rich, when in reality, he's the one that's getting rich. And we assume that when you make some more money, you got to start looking the part. And this is that mindset shift that we have to make.
00:35:42 Speaker_03
And, you know, a lot of people resonate who come from the Indian traditional families. They messaged me saying, Jaspreet, I became a doctor, or my wife and I are doctors. We make hundreds of thousands of dollars a year.
00:35:58 Speaker_03
We make a great income, but we have no savings and no investments, and I don't know what to do. And the reason why is we have a Range Rover and a Benz. We have a nice house. We go on the doctor vacations. We have to look the part.
00:36:12 Speaker_03
but we don't have any money left over at the end of our paychecks. And it's a very easy thing to get caught up in, because when you make more money, you become more credit worthy. Banks will give you bigger loans.
00:36:24 Speaker_03
When you make more money, you want to spend more money. And it's very easy. And you have to understand how do you control that spending.
00:36:31 Speaker_03
And that's why if you follow something like 75, 15, 10, one of the simplest things you can do to start is just always, no matter what, whether you're making $10,000 a year or $10 million a year, you always put money aside to invest.
00:36:44 Speaker_03
You always put money aside to save and you spend whatever's left.
00:36:48 Speaker_01
My friend doesn't invest, the friend I'm talking about doesn't actually invest, he just doesn't spend.
00:36:52 Speaker_01
He like just doesn't spend money and he's just stacked up like a million dollars in cash whilst earning less than everyone else of my five friends in that chat.
00:37:03 Speaker_01
And it didn't take a long time, like it took him four years or something, four or five years of just running this small business with a couple of people.
00:37:12 Speaker_01
When I say a small business I mean a really like a small business like a business of maybe four or five employees and he's built up a million million dollars in cash for himself. because he just doesn't spend money.
00:37:23 Speaker_01
And he doesn't have like an ego, doesn't care what people think of him. Yet my other friends who are earning maybe five times more a month have five times less cash than him. It was so inspiring.
00:37:38 Speaker_01
It was honestly so inspiring because it says something about the importance of saving, but who the hell wants to save? If I titled this podcast today, something about saving, no one's going to click. It's not fun.
00:37:50 Speaker_03
Saving isn't exciting. Who wants to go and save $2,000? Who wants to spend less money? We want to buy more nice things. But unless you can control the spending, unless you know how to save, you will never build wealth.
00:38:03 Speaker_01
Do you know for people that are in that paycheck to paycheck cycle, which I was in for many, many years of my life, where I'd get paid for my call center, I'd go and spend the money, I'd pretty much spend all the money within the first couple of days of getting the paycheck, and I was just waiting the next three weeks for the next paycheck.
00:38:19 Speaker_01
What advice would you give them about getting out of that cycle? Because you almost feel imprisoned by that cycle if you're in it. Absolutely.
00:38:26 Speaker_03
Well, before I give the advice, I want to explain to that person what's happening. Because you are the prime customer for our economic system.
00:38:37 Speaker_03
Banks love you because they can sell you payday loans, they can sell you credit cards, they can sell you lines of credit, and they can keep you in debt for the rest of your life, which means you keep making the bank rich.
00:38:48 Speaker_03
Corporations love you because you're not going to think twice when we show you this nice bag, when we show you this nice vacation. You're going to want this stuff, and so we love selling you this stuff.
00:38:58 Speaker_03
The government loves you because you're going to pay the highest taxes. Employees pay the highest taxes. And so when you're in that situation, you are making everybody else rich at your expense.
00:39:15 Speaker_03
And so if you want to break out of this, the first thing you got to understand, you need to make yourself rich before you make everybody else rich. Because when you're spending all your money, you are putting your money into their pockets.
00:39:27 Speaker_03
And you have to stop that. You got to keep that money for yourself. You're in a boat. Think of it this way. You're in a boat. And this boat has water just flowing in, and you are sinking. And you got to start by sealing the holes.
00:39:39 Speaker_03
You got to stop the water coming in. You got to stop the bleeding. And that means you got to stop the spending.
00:39:49 Speaker_03
So if you are in what I call the financial danger zone, which is you don't have $2,000 saved up for an emergency, and you have credit card debt, If you are in that situation, you are in the financial danger zone, and you have to make drastic changes.
00:40:04 Speaker_03
That means right now, no more eating at restaurants, no more vacations, no more doing anything that doesn't put money in your pocket, and no more Netflix.
00:40:14 Speaker_01
No.
00:40:15 Speaker_03
And the reason why I say this isn't because you're going to save $15 a month. It's so you can save two hours of your time a day. The average American is watching more than two hours of television a day.
00:40:26 Speaker_03
And if you don't have $2,000 saved up, if you have credit card debt, you cannot afford those two hours a day being wasted on TV.
00:40:37 Speaker_03
And that means right now, you have to go out and start using the time to learn, start using the time to work, and start using the time to make some extra dollars. So what do you do? Start selling stuff? Stop spending money. Selling stuff you own.
00:40:50 Speaker_03
Selling stuff you own. So if you have a TV that you're not using, sell it. You have a car that you can't afford, sell it. If you're living in a house that you can't afford, sell it. Downgrade. Move smaller. And then work to earn more money.
00:41:05 Speaker_01
I've got to say, the couple of things that came to mind as you were saying that, and funnily enough I put myself in the shoes of 18-year-old Stephen Bartlett when I was in that small apartment with three or four immigrants in Moss Side, Rusholme, and I was, you know, my rent was nothing.
00:41:22 Speaker_01
My rent was £150 a month, which I could not afford and I could not pay. And I was intimately working between call center jobs. And whatever money I got, I spent.
00:41:34 Speaker_01
And part of the reason I spent it, Jaspreet, is because like many people watching, especially men who sometimes feel the need because of the way society is, I was trying to get laid at the same time. And it's hard when you're a young man.
00:41:50 Speaker_01
And I say young men in particular because the stats do support the fact that there is an expectation that men pay. When you're a young man, it's particularly difficult to do all of these things, to cut back and also get laid. And what am I going to do?
00:42:01 Speaker_01
Defer getting laid for 10 years? When I say laid, I'm really saying meeting someone and falling in love and having a life.
00:42:08 Speaker_01
So if I'm living in a shoebox, which I was, I can't bring anyone back there, I can't take anyone for dinner, I can't take anyone to the movies, so what do I do?
00:42:16 Speaker_03
This is why every Indian parents tell their kids to become a doctor so their son can get married. It's the same concept. But here's the thing, you have to pick it hard.
00:42:26 Speaker_03
Either life's going to be hard now, or it's going to be hard for the rest of your life. And you have to pick what's more important to you right now.
00:42:33 Speaker_03
And if we talk about balance, if you want to have a balance of everything, where you want to find a girl, and you want to make money, and you want to stay healthy, you are dividing your attention everywhere.
00:42:45 Speaker_03
I'm not saying it's impossible, but very few people can actually do everything all at once. And if your number one goal is to become wealthy, if your number one goal is to turn your finances around, you have to get serious about it, because
00:42:59 Speaker_03
where you put your attention is where you get the results. And so if you want to be in a better financial situation, you are going to have to make sacrifices and it's difficult.
00:43:09 Speaker_03
I can't come here and tell you it's going to be easy because that's going to be me lying to you.
00:43:13 Speaker_01
I've got to be honest, I did make a sacrifice. And for me, the sacrifice was I started a business. And frankly, that meant that I didn't have time to be going out, getting laid or meeting people or socializing.
00:43:24 Speaker_01
But my story arc ends with it going well, and then the romantic situation taking care of itself many years later, once it had gone well, because I was so focused on myself.
00:43:38 Speaker_01
And it's funny, there is a bit of a paradox to life that the more you actually focus inward, the more you become a magnet.
00:43:45 Speaker_01
And the more I focused outward, the more I pursued and chased and sort of neglected myself, the harder it was to get people interested in me.
00:43:52 Speaker_03
Yeah, and I also want to say that when I talk about building wealth, I'm not talking about becoming a money hungry, just money greedy, this evil person that just cares about money.
00:44:02 Speaker_03
That's not what I'm talking about because I want you to live a holistic life because money is just one part of your life. But the second part to that is I'm not telling you to never enjoy life.
00:44:12 Speaker_03
I'm telling you to make a sacrifice for a period of your life that way you can enjoy the rest of your life and never have to worry about money again.
00:44:19 Speaker_01
It's hard for us to naturally see life as seasons, especially when we're looking forward. When we're looking back, it's very easy to say, oh, that was that season.
00:44:26 Speaker_01
Like I can sit here now and say, oh, that 20 to 25 was that sacrifice everything in my life to make myself something season. And then 25 to 30 was like building and learning. And then I now, you know, can think of,
00:44:40 Speaker_01
It's easier actually now to think forward in seasons, now that I've been through some seasons, but for someone that hasn't been through seasons in life, it's hard to think about life in those terms.
00:44:50 Speaker_01
I now think of my life in these five-year seasons, and that helps me to say to, you know, even have conversations with my partner where I go, this is the season I'm in, and it will last probably roughly this long, and I'm going to sacrifice these things and prioritize these things in this season.
00:45:07 Speaker_01
But it's hard for people to understand this idea.
00:45:10 Speaker_03
It's difficult, and that sacrifice is difficult, especially during a time where everybody's showing off everything on Instagram.
00:45:20 Speaker_03
You look at your friends who have a crappy job, but they're driving around in nicer cars, going on better vacations, going to the nicer restaurants, and you're thinking, what did I do wrong?
00:45:30 Speaker_03
And then especially if you're a guy, you have a girlfriend, you have a wife, she's going to say, how come they keep getting to go to Cancun? They keep going to these nice restaurants. How come you can't take me to these nice places?
00:45:42 Speaker_03
And now you feel like you're doing something wrong, because where is this discrepancy? The reason why I call my show The Minority Mindset is because I'm a big advocate of not doing what the majority of people do.
00:45:54 Speaker_03
The first time I made a million dollars in a year, I was in my 20s. I was driving a car worth $500. It didn't have a bumper on it. It was not pretty. My wife sat in that car with me. And my employees drove better cars than I did.
00:46:12 Speaker_03
So, you know, you got to be confident. And you got to work for something bigger. And you want a partner that's going to understand that. That's my belief. which is not the easy thing.
00:46:30 Speaker_01
It's interesting because confidence is such an internal thing and I just feel like I probably just didn't have it then. Because I think I was scared for someone to know that I was broke.
00:46:43 Speaker_01
I was so scared for someone to know that I was broke that I just didn't entertain romantic relationships.
00:46:48 Speaker_03
And that is the reason why so many people will go into debt to buy vacations, to buy things, to buy stuff, to look rich.
00:46:58 Speaker_03
And ironically, that's the key thing that keeps so many people poor for the rest of their life is because they're scared to look broke. And now when you try to look rich, that's the thing that's actually keeping you broke.
00:47:11 Speaker_01
There's another element to this, which is my life was pretty miserable. So when you have a
00:47:17 Speaker_01
relatively miserable life when you don't have many nice things because you're working in a call centre as I was until 11 o'clock at night time doing overtime every overtime hour I could get then because you're also lonely you're going home alone walking home because you can't afford the bus
00:47:33 Speaker_01
Anything that gives you a little dopamine hit. Gambling.
00:47:36 Speaker_01
This is why all the gambling shops are in the areas that struggle the worst financially, because those, I mean, a lot of people say, because those people are looking for that, you know, that big payday, that dopamine hit from a payday.
00:47:48 Speaker_01
My TV in my tiny, tiny little bedsit room was like half the size of the wall. I was making reckless spending decisions because I think it gave me some kind of hit that I was missing in my life.
00:48:02 Speaker_01
It gave me like a dopamine rush that was, and there wasn't many things giving me a dopamine hit at that point in my life.
00:48:07 Speaker_03
And see, here's the thing. During that time, you are making emotional decisions.
00:48:12 Speaker_01
Yes.
00:48:12 Speaker_03
As many people are. And it's very difficult to speak logic to emotion. But this is where now you have to be able to understand the difference. Because if you're listening to this and you're in that situation,
00:48:25 Speaker_03
You have to understand that if you want to continue being able to live that lifestyle, you're going to have to make some changes today. Otherwise, you're going to be stuck in this lifestyle for the rest of your life.
00:48:36 Speaker_03
And it's only going to get more difficult. And that's the thing is if you want to become wealthy, the first part is just your own mindset. It's your own discipline. And until you can conquer that, I can tell you everything about investing.
00:48:49 Speaker_03
I can tell you different ETFs and index funds to invest in. I can tell you different investment institutions out there. I can tell you which stock brokerages to use.
00:48:57 Speaker_03
I can tell you just invest 15% of your income into this for the next 10, 20, 30 years, and you're going to become wealthy. But until you can get over that mindset, you're never gonna become wealthy.
00:49:06 Speaker_03
Because then what happens in that situation is when you're in that state of, I just wanna look rich, I just wanna have the dopamine, I just wanna have some nice things because I deserve it, I work hard. You know what happens next?
00:49:19 Speaker_03
You're the one that gets caught up in all the get rich quick schemes. Because someone's gonna say, look, Put $1,000 into this, you'll have $10,000 in the next three months. Or I'm gonna show you how you can live the laptop lifestyle.
00:49:33 Speaker_03
You can work five hours a week, make $10,000 a month, $10,000 a week. You're never gonna have to worry about money again. Just buy this program. And now you're a prime candidate. Because now you are driven by this emotion of, I want that.
00:49:49 Speaker_03
I can't imagine if I had an extra $10,000 a month and I don't even have to work for it. Because you can't see past it. All you're doing is being sold by emotion. And so you're the one that's going to get caught up in the get-rich-quick schemes.
00:50:01 Speaker_03
You're the one that's going to make the bank rich because you're going to stay stuck in debt. Corporations are going to love you because they can keep selling you the nicest and newest stuff because you want to look rich.
00:50:10 Speaker_03
You want to show it off to your friends. You want to show it off to the girls. and you get stuck in that cycle.
00:50:16 Speaker_01
So I want to talk about what the money mindset is, but just on that thing you just said there, you said get rich quick schemes. Crypto. What's your point of view on cryptocurrencies and investing in crypto?
00:50:29 Speaker_03
So I'll tell you where I invest my money so you can understand. I put my money in five places. I put my money into my own business. I invest my money into real estate. I invest my money into stocks.
00:50:38 Speaker_03
I invest my money into speculative assets, which includes cryptocurrency. And then I own some physical gold. So starting with my own business, I run a company called Briefs Media.
00:50:48 Speaker_03
We're probably most known for our Market Briefs newsletter where we break down what's happening in the financial markets. So that's Briefs Media. Number two is I invest in physical real estate.
00:51:00 Speaker_03
So I'm going out to buy rental properties that I can use to generate cash flow. Number three, I invest in stocks. This is in the form of investing in individual companies and investing in funds.
00:51:11 Speaker_03
Funds are ETFs, index funds, mutual funds, where you can get investment into a broad basket of companies. Number four is my speculative investments. Notice how I said number four.
00:51:22 Speaker_03
This is one of the smallest pieces now, which are things that I believe can go up very quickly, but can also fall just as fast. So these speculative assets, which make up a small piece of my portfolio, include things like startups that I invest in.
00:51:37 Speaker_03
It also includes things like cryptocurrency. And then I own a little bit of physical gold. Physical gold makes up about 2% of my portfolio. But going back to cryptocurrency, because that's what you asked, I think it is a speculative investment.
00:51:51 Speaker_03
I have made a ton of money in cryptocurrency. And I started buying cryptocurrency before it was as popular as it is today. I began buying it in 2016 or so.
00:52:04 Speaker_03
when Bitcoin was around 3,000, maybe 2016, 2017, when Bitcoin was around $3,000 a coin, and I have sold some. And for me, I understand it can go up very fast, but it can fall just as fast.
00:52:18 Speaker_03
And the issue that I have is when people now want to get into this idea of investing, Because now they're in this tough situation. I'm living paycheck to paycheck, and I hear about this financial education and investing.
00:52:31 Speaker_03
If I just dump my money into Bitcoin or crypto, maybe it'll 10x, and I'll have financial freedom. And that's where I have issue.
00:52:39 Speaker_03
Because you're taking your money, and you're going for your long-term investments into a speculative asset that hasn't been proven. Maybe it will work, and you'll become a multimillionaire. Maybe you'll lose everything.
00:52:53 Speaker_03
But I don't want to gamble with my wealth. I want to build my wealth with something established and then use the speculative assets as something that is speculative and treat it as such.
00:53:04 Speaker_01
In terms of your net worth then, how is it broken down in terms of percentage between these five things?
00:53:09 Speaker_03
So if we look at real estate, real estate is probably close to almost 50% of my investments. Okay. Stocks make up probably right around 30%. Speculative is about 18% of our portfolio.
00:53:25 Speaker_01
Sorry, just the 30%, how much of that is into individual company stocks versus ETFs? It's about half and half. Okay, so 15% each. Okay, cool. And then speculatives? About 18%. And how much of that is like crypto versus startups? It was a lot more crypto.
00:53:40 Speaker_03
Now it's a lot more startups. I sold a chunk of Bitcoin when it was breaking record highs. And I'm going to be using that money to buy some more rental properties.
00:53:48 Speaker_01
Okay.
00:53:49 Speaker_03
And gold? About 2% of my portfolio.
00:53:51 Speaker_01
Okay.
00:53:53 Speaker_03
And the reason why I buy gold, I don't, myself, don't consider gold an investment. I look at gold as a way of saving hard money. Because my theory
00:54:03 Speaker_03
is if I take $10,000 of cash, and I take $10,000 worth of physical gold, and I bury both of these things in my backyard today. in 10 years, what's gonna have more buying power? My theory is that the gold is gonna have more buying power.
00:54:19 Speaker_03
And so that's why I own some physical gold. For me, it's this way of saving hard cash.
00:54:24 Speaker_03
I look at it as a insurance against doomsday, against something really bad happening, against something bad happening to our currency, something bad happening to the economy. That's why I own a little bit of physical gold.
00:54:36 Speaker_03
But the problem with gold is when I own my physical gold, it just sits there in a vault. It doesn't produce cash flow. It doesn't create new value. It just sits there. When I invest in real estate, it produces cash flow.
00:54:50 Speaker_03
When I invest in stocks, the companies are working to produce a better product, to grow their profits. The gold doesn't do anything. What about cash? Do you keep a lot of cash on hand? Cash is definitely a position.
00:55:02 Speaker_03
I don't know about percentage, but I always keep cash. And I want to break this down a few ways because I have one Let's call it bucket of cash, which is my emergency savings.
00:55:17 Speaker_03
This is cash that is there to protect me against an emergency of personal life. I also have a separate bucket of cash, which is my business emergency savings. Then I have a bucket of cash, which is there to be invested money.
00:55:31 Speaker_03
This is money that's waiting to be invested in real estate. And then I have stocks. And then I also have another little piece of cash that's waiting to be invested more into speculative assets.
00:55:40 Speaker_03
So I have cash waiting to be invested in speculative assets, cash waiting to be invested in real estate, cash waiting to be invested in stocks. And then I have my emergency cash. So I like to separate it all out.
00:55:50 Speaker_01
A second ago, you said that unless you have a money mindset, you're never going to be wealthy. What is the money mindset?
00:55:58 Speaker_03
The mindset is, number one, you have to believe that you're going to become wealthy. What I like to say is you have to say, I will become wealthy. Why? Because if you don't believe you're going to become wealthy, it is going to be impossible for you.
00:56:09 Speaker_01
Why?
00:56:10 Speaker_03
I used to guest teach in Detroit public schools. So Detroit is a... It was a very rough, and it still is, rough area. Certain parts of it. Our office is in downtown Detroit, but there are parts of Detroit which are still very rough.
00:56:23 Speaker_03
And I used to guest teach in some of the public schools there. And these are kids, good kids, who were not exposed to some of the best things. And what I mean by that is when I would go into these classrooms,
00:56:36 Speaker_03
You'd first have to go through multiple metal detectors. There'd be police there. You might have to be pat down. And when I get into the classroom, I'd ask the kids, how many of you have two parents in the home? Almost nobody would raise their hand.
00:56:50 Speaker_03
I would then ask, how many of you work a job? Almost everybody would raise their hand. And as I got to know the students better, I also started to realize that these kids, high school kids, some of them are already in gangs.
00:57:02 Speaker_03
Some of them already have been arrested by the police. Some have already been involved in these what we consider bad things, and they are bad things. But to the kids, that's just normal.
00:57:15 Speaker_03
Because when I talk to them about these gangs, what they'll tell me is, I don't have parents at home. I don't have a dad. I don't know my dad. my mom is working, how am I going to eat?
00:57:26 Speaker_03
My brothers, this gang, provide me some comfort because there's people that are around me. They give me food. They help give me money. It's not a bad thing in their eyes. And so when you grow up in that mindset, it's very hard for you to think bigger.
00:57:41 Speaker_03
And so when I would come into these classrooms, I would talk about life, motivation, money, all things. And so one of the things I'd like to do, an exercise that I would do, is try to get you to think about successful things.
00:57:53 Speaker_03
What are the things that kids want? A nice car. So I would ask these kids, what is your dream car? And the responses that I would get were things like a Ford Mustang or a Dodge Challenger.
00:58:05 Speaker_03
And these nice cars, but I would follow up with, why not a Bugatti? Why not a Lamborghini? Why not a Rolls Royce? And they would say, somebody like me can never have something like that. So I can't even dream about having these nice things.
00:58:23 Speaker_03
And that was really shocking to me. I mean, that you are kind of suppressed to the point where not only do you not think that you can achieve it, but you can't even dream that you can achieve it. You can't even achieve it in your own dreams.
00:58:38 Speaker_03
And so when you don't believe that you're worthy of anything more than a Ford Mustang, how in the world are you going to work for something nicer?
00:58:45 Speaker_03
And I'm not saying you have to work just for materialistic things, but this is that mindset shift that if you don't believe that you can do it, you are never going to be able to do it.
00:58:57 Speaker_03
And so this is where the first thing is, you have to say, I will become wealthy. And sometimes you have to be able to find a taste of success and see what that looks like. And there are many ways to go by doing it.
00:59:09 Speaker_03
I mean, you can just go onto Instagram and see what success looks like to some people, but you start to define what is that success and tell yourself, I will become wealthy. Not that I might, not that I can, but I will become wealthy.
00:59:23 Speaker_03
The second thing is money is a tool. And the reason why I say that is because we've been kind of hinting at this throughout this entire discussion.
00:59:34 Speaker_03
But the reason why many people are so scared to talk about money, the reason why money is such a taboo topic is because we are insecure about our own money.
00:59:45 Speaker_01
I just want to pause there before we carry on on the money as a tool point. It's so interesting what you're saying about those kids.
00:59:52 Speaker_01
So interesting because I was thinking as you were speaking about stereotype threats and in my previous book I spent some time talking about self-belief and confidence and this idea of stereotype threats and some of the studies I came across showed that if there's a stereotype that people like you, let's say black people like me, are bad at a certain thing, let's say maths,
01:00:15 Speaker_01
Before they do a math test, if they reminded a black person that they were black, just got them to tick a box saying that they were black, their performance on that test would drop. And they did the same with women.
01:00:24 Speaker_01
So if there's a stereotype surrounding your ability in something, if they remind you of that part of you before you do a test, your performance drops. And really importantly,
01:00:35 Speaker_01
in the studies, when they don't remind the black person or the woman about that particular feature of themselves, their performance is the same as everybody else.
01:00:44 Speaker_01
And it's interesting that you say that when you're talking about money, that we have a stereotype threat there. We exist in a world where we think people like us make a certain amount of money.
01:00:54 Speaker_01
And if the stereotype threat studies are true, that means that I'm going to show up in the world in such a way that's going to bring that amount of money about. But it's not easy to genuinely believe outside of your stereotype.
01:01:11 Speaker_01
Outside of the context in which you were raised. I went undercover in a school in a rough area in Liverpool that was doing very poorly. And I was undercover as a school teacher.
01:01:19 Speaker_01
So I was getting to know the kids and I met this one kid and I remember him saying to me about his plans for the future. And I sat there and I said, do you know any millionaires? He was like, no, there's no millionaires around here.
01:01:29 Speaker_01
I was like, have you ever met one? He goes, I've never ever met one. And in that moment, his mum, which it's on video, it was a Channel 4 documentary I did, he then goes, but I think I want to be a millionaire. And his mum burst out laughing.
01:01:42 Speaker_01
She was on the sofa next to him, and she burst out laughing. And I remember asking her on camera, saying, why are you laughing? And she goes, no, there's no chance.
01:01:51 Speaker_01
So it's like indoctrinated into your context, your family, your roots, your friendship networks, that you can't make it. So it's hard. It is 100% difficult.
01:02:03 Speaker_03
And it doesn't stop in any level. For example, when I told my parents that I didn't want to be a doctor,
01:02:13 Speaker_03
I was told by everybody, I'm throwing my parents' sacrifice away, and that somebody like me can never make it in business because I don't know anything about business. No one in my family is a business person. No one in my family is an investor.
01:02:23 Speaker_03
No one in my family does this. You've never learned this stuff before. You didn't get into business school. How are you going to do this? And I'm not saying this to compare. I'm saying this to explain that there are so many levels to this mindset block.
01:02:39 Speaker_03
that if you cannot break out of this invisible barrier, you will never become successful. When any employee joins my team, the first day, we make every employee, every single one, regardless of their role, do this exercise.
01:02:57 Speaker_03
It's called the nine dots exercise. And you have these nine dots on the screen. And if you go to Google, you can see the nine dots exercise or nine dots trivia, where it's nine dots. We'll put it on the screen. Yes.
01:03:07 Speaker_03
And I'm not going to spoil it, but I will, actually. That's the only way I can get it across. But the way that this exercise works is you have to, in four lines, touch every dot on the screen without picking up your pen.
01:03:22 Speaker_03
You have to touch every dot, all of these nine dots, without picking up your pen. And so when you do that, you might say, well, it's impossible. How do you do that? And so this is where now...
01:03:34 Speaker_01
Oh, okay, not going over a previous line.
01:03:36 Speaker_03
Well, you can go over a previous line, but you cannot pick up your pen. So if there's nine dots, one, two, three, four, five, six, seven, eight, nine, you have to connect all four dots, sorry, all nine dots with four lines.
01:03:50 Speaker_03
You can't curve the pen and you can't pick up your pen. And people will say, this is impossible. And the reason why you say it's impossible is because you have just created an invisible barrier.
01:04:00 Speaker_03
Because now if you go outside of the box, if you extend the pen a little bit further, then you can start to connect all of these dots.
01:04:07 Speaker_03
And now you realize, oh, it is possible if I don't create these invisible walls around myself, if I don't put myself in this invisible box. And that's what we do. We're all conditioned to do this to some extent.
01:04:19 Speaker_03
If you grew up in poverty, it might be that you can never become any level of successful. If you grew up thinking that you're going to be this thing, it might be that you can never start a business. You can never become an investor.
01:04:32 Speaker_03
If you have become an engineer and now in your 30s you want to go out and do something different, it might be that somebody like you can never do something different. But these are all invisible boxes. You see it right there.
01:04:43 Speaker_03
And that's why we make every team member, every employee do that on the first day, because what we say is, look, we've got to come here and innovate.
01:04:50 Speaker_03
And if you want to be able to innovate and do something big, you have to get out of your own mind and you have to be able to break out of these invisible barriers. And so now when you go back to your question, it's very difficult. It is difficult.
01:05:01 Speaker_03
And so how do you do it? And so this goes into now your personal development. What I would recommend is go read five books on self-development, personal development.
01:05:11 Speaker_03
And really now try to implement these things into your life, because until you can start to think a little bit different, and you can start to see the world a little bit bigger,
01:05:20 Speaker_03
you're never going to be able to achieve the maximum level of wealth that you deserve.
01:05:25 Speaker_01
I've just gone on Google and found this nine dots thing, which I've got here. This is the nine dots. You got it. So you're telling me I've got to connect all of the dots without lifting up my pen. Exactly. OK, let me try.
01:05:36 Speaker_03
You have only four lines, and you can't curve. I can only do four lines? Only four lines. Four straight lines. It's not as easy as it looks. Come on, Steven. Show me how to do it.
01:05:49 Speaker_01
Come on.
01:05:51 Speaker_03
So what most people do is they start going like this, this, and then now we freeze up because I don't know where I can go next. But the way that you do it is we're going to break the invisible barrier.
01:06:03 Speaker_03
So what I'm going to do now is I'm going to start the same way I did before. But instead of creating the same cut that I did last time, I'm going to break the invisible barrier, go a little bit further down. And now I'm going to come up like this.
01:06:17 Speaker_03
Then I'm going to go this way, and then I'm going to finish it up like that. You break the invisible barrier. You go beyond what you think you can do, because you blew past your own expectations.
01:06:31 Speaker_03
We have this invisible box around ourselves, and this is what you want to be able to break out of. This is that mindset shift that you have to be able to make, and that's the first part to becoming wealthy.
01:06:44 Speaker_01
When you talked about invisible barriers, it reminded me of a video that actually changed my life. And it was a video of an ant. Some people have heard me talk about this video before. This is the video.
01:06:56 Speaker_01
Shows an ant, and they get a Sharpie pen and draw a circle around it. And the ant now believes that it's trapped in this circle. No matter what it does, it goes around and it checks all the sides of the circle. It thinks that it's trapped.
01:07:09 Speaker_01
We can see that that circle is a figment of its imagination. And when I see this, I think, oh my God, we've all got this sort of imaginary circle drawn around us. And then I watched this video of a spider, so they can do the same thing with a spider.
01:07:20 Speaker_01
But the key moment in this video that really inspired me is the spider's currently trapped by this pen, right? But in this video, there's a moment where the spider accidentally steps over the pen.
01:07:30 Speaker_01
And when it steps over the pen, it can never ever be trapped by the pen again. You'll see it in a second. It's running towards it. So this is like an imaginary barrier in its mind.
01:07:42 Speaker_01
And then if I just bring it forward a little bit, this is the moment here where it gets. Wow. It's like a real wall. It thinks it's a real wall. And then it gets too tight here, it runs over it, and it can never be trapped again.
01:07:59 Speaker_01
I love that because once you break it, you can't be stopped after that. You realize that it's an illusion that was trapping you the whole time. And this kind of feeds into what we've been saying about these stereotypes.
01:08:09 Speaker_01
For me, when I, at a very young age, when I was able to make my first money or start a business or turn an idea into a thing that put money in my pocket, that illusion was broken forever.
01:08:19 Speaker_01
The illusion that the only way to become successful, you said the same thing, was to go to school, get a degree, get a job, And you can't unsee it.
01:08:28 Speaker_03
You can't unlearn it. You can't ever go and follow that same traditional path and do that again, because you saw the other side. And until you get a taste of it, you're going to be stuck. And that's where, again, all success starts with a mindset.
01:08:46 Speaker_03
And that's why I say, I will become wealthy.
01:08:50 Speaker_01
That first point, though, of awareness, just knowing the fact that you're trapped by something. And it's not to say that I've broken out of all of my psychological barriers now. I'm just in a new one. I'm just in a new set of barriers.
01:09:03 Speaker_01
I think that I can have nine figures. I probably don't think I could be a billionaire or whatever at this moment. And all of us, no matter how successful we think we are, are in some kind of circle. Always.
01:09:15 Speaker_03
In every stage of your life, you're in some sort of barrier. Everything that you do now has to be constantly working to shock yourself. When I started my YouTube channel, it's kind of funny.
01:09:30 Speaker_03
I didn't start my YouTube channel thinking that it was gonna be big. And the funny thing was, I always thought that I thought big. I think big, I'm gonna start a business. I'm gonna prove everybody wrong. I didn't start my YouTube channel to make money.
01:09:42 Speaker_03
This was kind of a hobby for me. But I remember, and I laugh at this now, I told my brother when I started my YouTube channel, if I hit 100,000 subscribers, I don't know what I'm gonna do.
01:09:57 Speaker_03
But if I hit a million subscribers, I'm gonna shut my channel down because there's no way, it's impossible that my channel is gonna hit one million subscribers.
01:10:04 Speaker_03
There's not one million weirdos in the world that are gonna wanna watch this random guy on YouTube talk about guacamole and money, right? And the funny thing is, I started making these videos
01:10:16 Speaker_03
I started enjoying making these videos because I started talking about the things that I wish somebody would have told me before. And people started to watch. And people started to actually enjoy it and share it with their friends.
01:10:30 Speaker_03
And then we hit 100,000 subscribers, and I couldn't believe it. We hit 500,000 subscribers, and I couldn't believe it. And then one day, we hit a million subscribers.
01:10:43 Speaker_03
And I was like, oh crap, I hope my brother doesn't remember this promise because I don't want to shut this down. But then we continued growing. And here I was, this guy who had been successful. I'm already investing in real estate.
01:10:55 Speaker_03
I've had some business success. I broke out of this idea of becoming a doctor and started a business. And I'm still putting these limitations on myself that I can't start a YouTube channel. Why did I do that? Because I had never done that before.
01:11:11 Speaker_03
I had never seen this happen for somebody like me before.
01:11:14 Speaker_01
So is there anything practical that someone who's currently trapped in some kind of psychological barriers can do practically to help them be more expansive with how they think about their life?
01:11:27 Speaker_03
What I do, and I don't know if I recommend this to anybody else, is I'm a little stubborn, I'm going to kind of preface it with that, is I do things to stick out and be different. So what I mean by that is, I'm going to go back to what I said before,
01:11:43 Speaker_03
The first time I made a million dollars in a year, I thought, originally, that I would be flying in private jets and balling out and doing all this stuff. But I knew that I wanted something different. I wanted to build this wealth.
01:11:56 Speaker_03
But I didn't want to now start living like everybody else. I wanted to do something different. So I continued living small. That's why I continued driving around in this car, because everybody questioned what the heck I was doing.
01:12:09 Speaker_03
People were wondering, is Jasprit actually successful or is this guy a hoax? Is Jasprit broke? Can he not afford a nicer car? And so I kind of put myself in this position of like hearing this stuff and wanted to really, you talked about confidence.
01:12:26 Speaker_03
I wanted to really build my confidence to be that person that did something different. And I don't know, I get joy, I'm a weirdo. I get joy out of that. When I graduated law school,
01:12:39 Speaker_03
I told my dad before I graduated law school, even before, that I'm only doing this for you. And so when it was my graduation day, everybody, you know, you wear a nice suit and tie and you kind of get all dressed up to go.
01:12:53 Speaker_03
I told my dad, look, I told you I'm gonna get you the diploma, but I'm gonna do it on my terms. So I decided not to wear a suit. I decided to wear a very traditional Punjabi outfit called a kurta pajama, which is a long shirt and pants.
01:13:08 Speaker_03
And I wore traditional, it's called a Punjabi jutee, meaning Indian shoes. For me, I just wanted to do that because it gave me this confidence. And yeah, I mean, people will say, what the heck are you wearing?
01:13:22 Speaker_03
But for me, I needed that burst of confidence that I'm doing this for me, and I get fueled by people questioning me. And you have to find what fuels you.
01:13:35 Speaker_01
On that first point of it's my duty to become wealthy, Is that just something you say out loud? Is there a way you can remind yourself of this?
01:13:45 Speaker_03
So I'm not a big fan of, you know, meditating on this idea of you become wealthy. I'm not a big fan of this woo-woo idea of, I'ma become wealthy, I'ma become wealthy. That's not how it works.
01:13:54 Speaker_03
But what I do believe is you have to keep reminding yourself and giving yourself the motivation and discipline in the beginning as to why you started, some fuel as to why you started. So one of the things I like to talk about is what is your why?
01:14:06 Speaker_03
Who are you doing this for? And so in our office, everybody has next to their desk this tack board where you can put pictures or whatever it might be to remind you of why you're working hard. And in the beginning for me, I was pissed off.
01:14:23 Speaker_03
I wanted to prove people wrong, and I was angry. And I don't try to cuss on camera that often, but here we go. I was angry. And the reason I was angry is because when I made that decision to not become a doctor.
01:14:40 Speaker_03
The thing that I was told was I'm throwing away the sacrifice that my parents made. And I started a business at the time, I was working in the e-commerce world and I started a sock company.
01:14:53 Speaker_03
And so then the comments that we get was, so Jasprit, you were gonna become a doctor, now you're selling socks? And it was this very, just reoccurring, just like,
01:15:05 Speaker_03
Ah, you gave up your dreams, you gave up all the sacrifices that your family did, you don't even appreciate the things, the sacrifices, and now you're just gonna sell socks on the internet. And that was my fuel.
01:15:21 Speaker_03
Because I knew, I don't know how, but I knew I was gonna prove you wrong. Toxic fuel. 100%. It was just anger, just pure anger. I'm going to prove you wrong. And slowly the business started to grow.
01:15:39 Speaker_03
I started to be seen on TV and all these things started to happen. And so I was fortunate that my business also flipped, that now I'm not selling socks. I'm building this financial media company, Briefs Media.
01:15:51 Speaker_03
And now for me, there is a purpose for what I do. There's a lot of people that are lacking financial education. There's a lot of people that are working really hard, that have no idea why they can't build any wealth, that keep hearing about how
01:16:09 Speaker_03
People are becoming so wealthy, investment levels are skyrocketing, billionaires are becoming even richer, and they don't understand and people just get angry.
01:16:19 Speaker_03
When in reality, you can participate in that same game and win in this game because our economic system is designed to benefit investors. And if you don't understand that, you will never be able to win in the system.
01:16:34 Speaker_01
Point number two in your money mindset is that money is a tool. What do you mean by money is a tool? And how is that different from how everyone else thinks about money?
01:16:45 Speaker_03
You have to understand how money plays a part in your life. When I say money is a tool, what I mean by that is money doesn't make you a good person. Money doesn't make you a bad person. It amplifies who you are.
01:16:59 Speaker_03
And what I like to say is that there are four fitnesses in your life if you want to live a happy and fulfilled life. You have to be physically fit, mentally fit, spiritually fit, and financially fit.
01:17:13 Speaker_03
If you're physically fit, you're on your deathbed, you're morbidly obese, having $10 million is not going to make you happy. All you want to do is be healthy again. Mentally fit is about being happy.
01:17:23 Speaker_03
If you're surrounded by toxic people, if you're unhappy, if you're depressed, if you're anxious, if you're just miserable, you're never going to be able to really enjoy life. Having more money is not going to fulfill that whole.
01:17:35 Speaker_03
Spiritually fit does not mean religious. It means having a purpose. What is the reason for getting out of bed every day? What is the reason for wanting to go out and achieve and do something?
01:17:44 Speaker_03
Because if you have $10 million, what's the reason for wanting to get up and conquer? At the very top is financial fitness.
01:17:55 Speaker_03
And once you have the bottom three, having financial fitness gives you the most power and ability to live the best life possible. Because this is all about now being able to solve your financial problems.
01:18:07 Speaker_03
being able to not worry about paying your bills, being able to have the nicer stuff when you want and not have to worry about the price.
01:18:15 Speaker_03
And the thing about this that I want to really hammer home is if you don't have this financial fitness, now your physical fitness can get hurt because you can't afford the nice gym membership. You can't afford the healthy food.
01:18:28 Speaker_03
You can't afford to take care of your body. If you don't have the financial fitness, your mental fitness can get hurt. Financial problems are one of the leading causes of suicide and divorce.
01:18:40 Speaker_03
Financial problems can really stress you out, and they can cause a whole lot of anxiety and depression. Financial problems can also ruin your spiritual fitness, because if you can't pay your bills, you can easily lose your sense of purpose.
01:18:55 Speaker_03
So yes, being financially fit is its own part, but it all comes together in your life.
01:19:03 Speaker_01
Number three to this money mindset. Money is abundant.
01:19:08 Speaker_03
And what I mean by that is you have to be willing to think bigger because oftentimes what happens is we start to think about the dollars that I'm giving as opposed to the dollars that I'm getting. If I pay you a dollar, you are getting rich off of me.
01:19:30 Speaker_03
but I'm not looking at what I'm getting. If I'm getting $2 from you, well, is it bad that I pay you $1? No. And this is where now we need to start to understand there's a lot of money in the world.
01:19:42 Speaker_03
Just because somebody gets rich, that doesn't mean somebody else can't get rich. And the reason why we get this confused is because we assume that money is scarce. And this comes from our childhood.
01:19:54 Speaker_03
Because when you grow up, you're fighting for your parents' attention. And there's a limited attention span that your parents have. If you have siblings, now it's divided. And so you can't have all the attention.
01:20:06 Speaker_03
So if your parents are giving their attention to somebody else, that means you're not getting attention. It's a yes or no. It's a black and white. But with money, that's not the case. You can be rich, and I can be rich.
01:20:22 Speaker_03
But we have to understand that there's a lot of money in the world. I mean, the United States government has 35 some trillion dollars of debt. It's a lot of money.
01:20:31 Speaker_03
And so if you just take a small piece of that, a small piece of the dollars out there, you can build wealth and somebody else can build wealth.
01:20:37 Speaker_01
And why is that particular point in this money mindset so critical? Why is it important to know that there's so much money out there? How does that change you? So if you make $50,000 a year right now,
01:20:49 Speaker_03
What you might start doing if you become financially smart is you might say, all right, I'm going to start living off of 75% of what I make, and I'm going to invest the other 15%.
01:21:01 Speaker_03
That means I'm going to live off of $30,000 and save and invest, we'll call it $20,000. You might now say, ah, I like this idea of investing. I'm seeing the potential. What do I do? I make $50,000 a year. How about I keep cutting back?
01:21:23 Speaker_03
Now I'm going to live off of $25,000, $23,000. There's a limited number of dollars that you can squeeze out of this pie. But there's no limit to how much you can earn. So what if I say, let's flip it up a little bit.
01:21:38 Speaker_03
How about instead of trying to squeeze more pennies out of this $50,000 that you have, Let's try to earn $500,000 a year now. And the first thing that's going to happen is you're going to say, whoa, whoa, whoa, $500,000 a year?
01:21:51 Speaker_03
My boss is not going to give me a $500,000 a year salary. What are you talking about, Jasprit? Well, OK, let's break this down. If you want to make more money, how do you do it? I don't know. Well, let's start learning. Where are you going to go to learn?
01:22:07 Speaker_03
Google? YouTube? OK, let's go to Google and YouTube. How can I make more money? Maybe you start by learning how to ask for a raise. Maybe you learn to get a career change. Maybe you learn to change jobs.
01:22:19 Speaker_03
Or maybe now you start to think a little bit different and you say, maybe you start to build a side business or a side hustle. That way you can start earning more money.
01:22:29 Speaker_03
But until you realize that it's possible to, instead of trying to go from 50,000 to 55,000 to 58,000 to 65,000, let's try to go a little bit bigger. How about 50,000 to 500,000?
01:22:41 Speaker_03
And that's gonna require, number one, you break out of that mindset shift, that invisible barrier, but also understanding there's a lot of money out there.
01:22:50 Speaker_01
And the last point here is, I will become wealthy, which is different to the first point, which is, it's my duty to become wealthy.
01:22:56 Speaker_03
So we discussed the first one, which is, I will become wealthy. The last one is, it is my duty to become wealthy.
01:23:02 Speaker_01
Oh, okay. Why is it your duty to become wealthy?
01:23:05 Speaker_03
Because I believe that it's up to you to take care of your family, to be the one that takes care of yourself, that we can also help take care of your community. That is my belief, that it is your duty to do so.
01:23:17 Speaker_03
And if you rely on the government or somebody else to do it... Well, you are asking for problems. And we've seen this in many instances where you might have heard in the United States, social security is drying up.
01:23:33 Speaker_03
It's never going to dry up because the government can just print more money and pay it out. But it's never going to be enough to live a great life. People that relied on pensions, well, pensions are becoming a thing of the past.
01:23:43 Speaker_03
Some pensions have gone bankrupt, and people have lost that. So it is more important than ever for you to become financially sufficient and financially stable through your own financial education.
01:23:56 Speaker_01
Trump has just been elected the new president of the United States of America. And when you saw that news, did it change your thesis as it relates to wealth creation? Is there anything you're now going to be doing differently?
01:24:07 Speaker_01
Is there any new opportunities that you now see? Are you shifting your capital allocation towards more risky assets or less risky assets or real estate?
01:24:16 Speaker_03
If we take a look at the last 15 presidents in the United States, some have been Democrat, some have been Republican. The stock market has gone up under Democratic presidents. It's also fallen under Democratic presidents.
01:24:29 Speaker_03
The stock market has gone up under Republican presidents. It's also fallen under Republican presidents. So what does that mean? Well, if you were just investing for the long term, who cares?
01:24:44 Speaker_03
But for some investors that will call it a little bit more sophisticated, you might want to understand what the president is going to do in terms of shifting government spending.
01:24:56 Speaker_03
Now, I'm going to make this a little bit technical, but let me kind of break this down. Our economy is measured through a number called GDP. And GDP is a measure of all spending that happens in our economy.
01:25:08 Speaker_03
In the United States, the largest spender is the government. 30% of our GDP, our economy, is government spending, which means that there are certain entities, certain businesses that will benefit depending on where the government spends money.
01:25:27 Speaker_03
And that can then impact those stocks, it can impact those industries, and it can impact those businesses. So now, let's break this down.
01:25:34 Speaker_03
If you're a long-term investor, you're investing in the S&P 500, you're investing in just general ETFs and index funds and mutual funds, it does not matter.
01:25:42 Speaker_03
But if you are, let's say, a little more sophisticated, you want to understand how government shifts that are happening, now we can dig a little bit deeper.
01:25:51 Speaker_03
So prior to the election, we published a whole report in Market Briefs Pro on this, where what we talked about is, if Trump is elected president, here are the things that he has said that he's going to do.
01:26:03 Speaker_03
Number one, he wants to deregulate oil and gas. Number two, he wants to deregulate the financial service industry. And number three, he wants to invest in the military.
01:26:13 Speaker_03
So if you break this down, oil and gas, these are companies that are investing and drilling oil.
01:26:20 Speaker_03
And so if these companies have less regulations and more ability to produce product and sell more product, they could see bigger revenues and bigger profits.
01:26:30 Speaker_03
Number two, with financial service industries, things like the companies on Wall Street, if you deregulate them and give them the ability to do more things, they can make bigger revenues and bigger profits.
01:26:42 Speaker_01
And crypto as well. And crypto. Crypto, since the news that he's going to be inaugurated, the prices have just skyrocketed. Exactly.
01:26:52 Speaker_03
And number three is investing in the military. Now, what does it mean to invest in the military?
01:26:58 Speaker_03
Well, if you're investing in the military, that means that we're gonna be practicing shooting more guns, shooting more bullets, having artillery, having planes and other machinery, and these are then done by private companies.
01:27:14 Speaker_03
And so if the government can spend and choose where to spend money,
01:27:19 Speaker_03
and the government then decides that they want to spend more money or allow companies to be more free to do whatever they want in these industries, those industries then have the ability to potentially grow their revenues, grow their profits, grow the stock prices.
01:27:33 Speaker_03
These can then create what we call a government shift because the government spending shifts, and that can create an investment opportunity for investors that want to be a little bit more sophisticated. But I'm going to say this again.
01:27:44 Speaker_03
As a long-term investor, Forget the eye connection cycles. You're investing for the long term.
01:27:50 Speaker_01
For those less sophisticated investors, as you were when you were 19 years old, you chose to invest in real estate as a cash-generating asset.
01:27:59 Speaker_01
Now, if I want to invest in real estate as my first investment, as you did, what are the things that I should be looking out for if I'm someone that knows nothing about real estate? What kind of properties should I be looking for? How big?
01:28:11 Speaker_01
Does it matter how much those properties cost? Am I looking for family rentals, studio apartments? What kind of things matter? What you invest in is going to depend on what's best for you.
01:28:22 Speaker_03
But the way I like to look at it, for me, because I can't tell you what to do. is for me, when I invest in real estate, is I look for a 7% cash on cash return minimum.
01:28:34 Speaker_01
What does that mean?
01:28:35 Speaker_03
So if I invested a dollar today, I want 7 cents of cash flow after expenses every year for my dollar that I invest. So if I buy, let's just call it $100,000 house. And I'm going to keep it very simple. We're going to have no debt.
01:28:50 Speaker_03
I take $100,000 out of my bank account, and I buy this $100,000 house that I then rent out. that rent after all the expenses should then put at least $7,000 into my pocket every year. That's what a 7% cash-on-cash return means.
01:29:10 Speaker_03
Now, for me, I prefer single-family houses or multifamily apartments. because that's kind of where I got started and I've found more success there. And it's a little bit more innovation proof because we know that offices can go up and down.
01:29:26 Speaker_03
If companies are working from home, offices can be affected. The retail sector can be impacted if companies are moving online and we see that there's a lot of shifts happening in the retail spaces.
01:29:37 Speaker_03
But at the end of the day, you got to find what's right for you and how involved you want to be. When I invest in real estate, I want it to be passive for me.
01:29:47 Speaker_03
That after I find a property, after we do the renovations, I want to give the keys over to a property manager. I don't want to have to worry about it.
01:29:54 Speaker_01
Okay, so you don't become the landlord yourself and deal with the tenants directly?
01:29:58 Speaker_03
I do not. And the reason why is I have other things that I need to do. And I don't want to spend my time managing the property. I want to spend my time acquiring, I want to spend my time investing, but I don't want to spend my time managing.
01:30:12 Speaker_03
What's the best investment you ever made? The best investment I ever made is the investment of myself. That has given me a much better return than any real estate, than any stock, and even than any cryptocurrency.
01:30:25 Speaker_03
And when I say best investment in myself is two things. Number one is the investment that I have made in my own education outside of school. So books, podcasts, classes, coaching. Number two, The failures. I have made a lot of mistakes.
01:30:48 Speaker_03
They have cost me a lot of stress, a lot of headache, a lot of money, but they have taught me a ton. So we'll talk about real estate for a second. If we go back to the first condo, The sunshine and rainbows is I rent this property up for $600 a month.
01:31:08 Speaker_03
But the downfall or the risky part and the bad part is that I made every mistake possible. Number one, I hired a bad contractor. Number two, I hired a property manager, which I didn't realize was a fake property manager.
01:31:22 Speaker_03
We didn't even sign a lease with a tenant. I didn't even sign a contract with the property manager. They weren't working with the tenants and they gave the tenant my phone number.
01:31:31 Speaker_03
So here I am sitting in my organic chemistry class, getting calls from my tenant saying, the property is gonna implode because the light bulb fused. Then we hired, brought in a bad tenant.
01:31:42 Speaker_01
Can I ask you a question there? Yeah. How could you have avoided all of this?
01:31:46 Speaker_03
Well, I could have either, number one, had a real estate investor that I could have talked to, which I didn't have access to. I read a lot of real estate books. So if you say, what could I have done differently? I'm nothing.
01:31:59 Speaker_01
To avoid it. Because there's people listening right now that are going, Jesus, I want to get into this real estate game, but I don't want to go through all those mistakes. You can learn as much as you want. You're going to make mistakes.
01:32:07 Speaker_03
It is a part of the process. You can learn everything you want, but every real estate deal is unique. You are going to screw up. And I have made a lot of screw-ups. But once you get through the screw-ups, it becomes a lot easier. I call it the hurdle.
01:32:20 Speaker_03
But then things get even more exciting, because now I bring on a new property manager. And the tenants move out. And then we think everything is good. And now I get a letter delivered to me, hand-delivered. Well, this is a nice gift.
01:32:38 Speaker_03
It says, Jaspreet Singh, you are being sued. And I said, what? Those tenants then sued me because they claimed that the bathtub was too slippery when the water was on. True story. And now here I have this lawsuit. I'm 21, 22.
01:32:59 Speaker_03
I have no idea what's going on. Jaspreet, was the bathtubs too slippery? Well, I'll tell you exactly what happened. There was a chip about the size of a quarter in the bathtub. The paint had chipped. They filed a complaint with my new property manager.
01:33:16 Speaker_03
Thank God I switched property managers, because what a good property manager does is they're going to document everything that happens. So my property manager documents that, OK, tenant complains of a chip in their bathtub. We send out the contractor.
01:33:29 Speaker_03
So the property manager sends out the contractor. They go there to fix the chip in the bathtub. And you know what the tenant says? Can you come back a different time?
01:33:37 Speaker_03
My husband slipped and fell at a friend's barbecue, and so we don't want you to fix that chip today." The contractor says, okay, we note this down. He tries to then fix the chip three more times, but the tenant denies it every single time.
01:33:53 Speaker_03
And so we thought, okay, just let us know when you want the chip fixed. The contractor is waiting. They never brought it up again.
01:33:59 Speaker_03
Then we get this lawsuit saying that we were negligent, that I'm this evil, greedy human being because I refused to fix this chip in the bathtub, which made the bathtub slippery when the water was on, which caused this person to slip and fall and break their hip.
01:34:15 Speaker_03
And so now we go through the lawsuit process. Thankfully, I had insurance, but the insurance company still has to pay for the attorney. I still have to be involved through all the proceedings.
01:34:27 Speaker_03
And now they're claiming that because I didn't fix this chip, it made the bathtub slippery, and that's what caused this tenant to get hurt. But we had the documentation saying that they slipped and fell at a friend's barbecue.
01:34:39 Speaker_03
And then we go through the hospital records, and we found out that this person slipped and fell at a barbecue. they wanted to get some money out of this rich landlord. I'm a 22-year-old kid, a 21-year-old kid. I have no idea what's going on.
01:34:55 Speaker_03
And so the insurance company had to settle. They paid $14,000 to make the case go away.
01:35:02 Speaker_01
It's interesting, because even when people hear all of that, they think, gosh, I really don't want to go through that. So Jaspreet, please tell me something to avoid some of those things.
01:35:10 Speaker_01
And you know, as you were talking, I was writing down some principles. And the first principle that I wrote down, which could have avoided you a lot of that heartache, is to really, really, really, really take time when picking people.
01:35:26 Speaker_01
And no one does it. No one does it. And I have an investment portfolio where I have 40, 50 companies now.
01:35:33 Speaker_01
And if there was one piece of advice that I'd give to all of those portfolio companies, which I know they are not going to listen to, no matter how passionately I say it, no matter if I bang on the desk, no matter if I scream or show them my scars,
01:35:45 Speaker_01
The one piece of advice I'd say to them is that recruitment is the single most important thing. And you can say that to people, but they still rush the process. They still will just go with their vibes and bias.
01:35:56 Speaker_01
They'll still just go with the person who sounds the smartest. They won't acknowledge the fact that they don't know what good looks like. You don't know what good looks like.
01:36:06 Speaker_01
If you start with this base premise, which most people don't start with, which is, I am really, really bad at recruitment. If you start with that, then you'll put systems in place to alleviate the downsides of you being really bad at recruitment.
01:36:19 Speaker_01
And if you had started with that when you were, I don't know, 20 years old or whatever it might have been, you would have gone to seek out someone else's opinion on which contractor to hire, which tenants to bring in.
01:36:29 Speaker_01
And that could have alleviated a lot of this pain, it seems like.
01:36:33 Speaker_03
I was in a rush.
01:36:35 Speaker_01
In a rush, yes.
01:36:36 Speaker_03
I wanted to get it done.
01:36:38 Speaker_03
And so I'd find the cheapest and fastest contractor, the cheapest and fastest property manager, the cheapest and fastest, or not the cheapest, but you know, the fastest tenant that I could bring in because I wanted to do it quickly.
01:36:49 Speaker_03
I wanted to get there fast.
01:36:50 Speaker_01
It reminds me of people picking romantic partners. I was in a rush, so I ignored the red flags. And it's funny, because you said the cheapest.
01:36:59 Speaker_01
This is actually what plays out in business all of the time, is I speak to the young founders that are starting businesses, and they go, Steve, yeah, I know you say, like, take time and hire great people, but look at the salary.
01:37:09 Speaker_01
This person costs $100,000, and this one's $50,000, so I'm going to go for the one that saves me money. And that is the trap.
01:37:19 Speaker_03
One of the most expensive things that you can do is be cheap. And I learned that the hard way because I was born to be cheap. You know, I talked about how Indian people make a dollar to spend 20 cents. That was my family growing up.
01:37:33 Speaker_03
And that was the way that I was raised. That if you become a doctor, you'll make a nice six figure salary. You can live off of $30,000 a year and save a whole lot of money. And I never questioned it, but this is a very kind of just, don't spend money.
01:37:48 Speaker_03
That's how you build wealth. Because if I give you money, that means I'm taking my wealth and giving it to you and I'm getting nothing in return. And that goes back to that mindset, money is abundant.
01:37:59 Speaker_03
And that scarcity thinking is one of the most expensive things that you can do. And I'll give you a story of this. I told you, if you want to talk about mistakes, we can go for hours and days about my mistakes because I screwed up a lot.
01:38:15 Speaker_03
I had an accountant and I figured that if I'm paying less money in accounting fees, I am saving money so my business can keep more money, I can build more wealth, right? But one of the most expensive things that you can do is be cheap.
01:38:33 Speaker_03
So I had this accountant that was cheap. And all he did was file my taxes. Kind of. I mean, he was late and whatever, but he was cheap. The monthly payment was cheap. So I didn't really care too much because I got the taxes done.
01:38:48 Speaker_03
And then I always wondered why we don't talk about tax planning. What should I do? It's just like at the end of the year, I get this big email, send me all of your stuff. And then I don't hear from him for a long time.
01:39:00 Speaker_03
And then he says, sign this paperwork. And I didn't really think much of it. But then one year, it was January. I'm in my office. And I get a call early in the morning from my accountant.
01:39:13 Speaker_03
And if you get a call from your accountant early morning in January, it's never a good sign. I didn't know that. He calls me and says, Jaspreet, how are you doing? I said, I'm good. How are you? Thinking I'm going to get some good news.
01:39:23 Speaker_03
He said, hey, I made a little mistake on the taxes. Could you do me a favor and wire $18,000 to the state of Michigan by the end of the day? I said, excuse me?
01:39:35 Speaker_03
He said, oh, also, could you also, by the end of the day, please wire $100,000 to the federal IRS by the end of the day? Excuse me? Oh, and the last part, you're going to pay penalties and interest on this too.
01:39:51 Speaker_03
And it took me a minute to really absorb all this information. So you want me to send a hundred some thousand dollars by the end of the day? Whose fault is this? And I remembered this response. He said, it's nobody's fault.
01:40:07 Speaker_03
And I didn't really process what he said, but I had to think through this. I said, whose fault was it? It's my fault. That's whose fault it was. I wanted to blame him, but it was my fault because I was being cheap. And I learned.
01:40:26 Speaker_03
I hired a new accountant who cost me many, many, many multiples more than what I was paying before.
01:40:32 Speaker_03
But you know the crazy thing is it's actually saving me more money now because we do these tax strategizing, which then allows me to pay less money in taxes legally, even though I pay more money to my accountant.
01:40:47 Speaker_01
This is one of the most pivotal things that I learned in the last three to four years of my career, and I've been in business for maybe, well, my first business was maybe 15 years ago, but in the last three years in particular, I just got overly obsessed about hiring and recruitment, and really,
01:41:03 Speaker_01
how much the exceptional person costs is inconsequential to the long-term net impact they'll have on my business.
01:41:10 Speaker_01
Remember I spoke to Jason who's my older brother who works in my company now, he's like super smart LSE actuarial scientist, he's like a calculator. And I'd said to him, can you tell me where my net worth has originated from?
01:41:22 Speaker_01
He said, your net worth is x hundreds of millions or whatever. I said, can you like go upstream and tell me where it came from? And he didn't come back and say, oh, you made this great bet or this investment.
01:41:31 Speaker_01
He said, effectively, what happened is you hired six or seven good people. And those six or seven good people ended up hiring a couple more good people and making a couple of good decisions.
01:41:45 Speaker_01
And those people made a couple more hires and made a couple more good decisions. And it propagated. And it reminded me of something Steve Jobs said.
01:41:51 Speaker_01
Steve Jobs said, people think I've built this, you know, multi-billion dollar business because I'm so smart.
01:41:56 Speaker_00
And he says in an interview, which I'll play on screen, he says, I've built a lot of my success off finding these truly gifted people and not settling for B and C players, but really going for the A players. And I found something.
01:42:14 Speaker_00
I found that when you get enough A players together, when you go through the incredible work to find, you know, five of these A players, they really like working with each other because they've never had a chance to do that before.
01:42:27 Speaker_00
And they don't want to work with B and C players. And so it becomes self-policing, and they only want to hire more A players. And so you build up these pockets of A players, and it propagates.
01:42:37 Speaker_01
So the game of business, I mean, the definition of the word company is group of people, but the game of business is to assemble the best group of people. And if you're cheap, that mission is not possible.
01:42:49 Speaker_01
And you'll get a short-term win, but the long-term pain, which is that January phone call from your accountant when they say, I fucked up. You get what you paid for Jaspreet.
01:42:58 Speaker_03
And you know, it goes back to, we talked about touching the fire, right? Becoming successful means you're going to make mistakes. You have to make mistakes. You cannot bypass the mistakes. You ask me, how does somebody do this without the mistakes?
01:43:10 Speaker_03
You're going to make your own. But the difference between somebody who becomes successful and somebody who does not become successful is they are willing to make those mistakes. See, most people say, I don't want to try to touch the fire.
01:43:21 Speaker_03
I don't want to risk it. But until you touch it, until you screw up, you're not going to know it's hot and you got to be willing to screw up.
01:43:29 Speaker_01
I want to add something to that as well, which I had noticed in you. You just said that unless you're willing to make mistakes, you're not going to become successful. But there was a question I asked you.
01:43:38 Speaker_01
I said, whose mistake was it when I was talking about your accountant? And I was testing you because I was trying to see where you put responsibility today. And I think that point of taking responsibility is actually the biggest indicator
01:43:51 Speaker_01
that that mistake turns into a lesson. So your accountant fucked up, clearly incompetent. But when I asked you whose fault was it, you said it was my fault. And that immediately tells me that you have an internal locus of control, i.e.
01:44:03 Speaker_01
the control of that decision and your belief of where the control lies is within you. So in the future, you can do something about it.
01:44:10 Speaker_01
But when I speak to people about bad relationships, about bad hires, or about any sort of bad personal decision they've made, maybe a bad friend, 99% of the time, they will blame the person. That was a bad person.
01:44:26 Speaker_01
And what you did is what I think is the most important thing, and actually the science corroborates that if you have this internal locus of control, internal responsibility for what happened, you're much more likely to be successful, much more likely to learn from it, much more likely to be happy, much more likely to be rich.
01:44:39 Speaker_01
Which is you, N. It was my fault.
01:44:42 Speaker_03
Can I tie that together now with wealth? When people ask me why is it that so many people are poor and struggling with money, I say there's two things at fault, and there's two ways you can look at it. There's the it's your fault and the my fault.
01:44:57 Speaker_03
And I always like to talk about both of these because you have to understand this because it ties in very well. And I appreciate all the kind words because I really do appreciate that.
01:45:06 Speaker_03
But when I say it's your fault, look, our economic system is designed to profit off of people being financially stupid. Period.
01:45:17 Speaker_03
Banks profit when you're financially stupid because that means you stay in debt and they keep making interest for the rest of your life.
01:45:24 Speaker_03
Corporations profit when you're financially illiterate because that means you're going to keep buying their stuff and not think twice. And they're going to hire the best and smartest MBAs to get you to open up their wallets. to open up your wallets.
01:45:37 Speaker_03
Number three, the government is going to profit when you're financially illiterate, because that means you don't do anything outside of your W-2 job, and you're going to pay the highest tax rates. You profit when you're financially educated.
01:45:48 Speaker_03
So now, what can you do? You can say, they're the reason I'm broke. This company is the reason why I'm broke. My company is the reason why I'm broke. The government is the reason why I'm broke. The banks are the reason why I'm broke.
01:45:59 Speaker_03
Well, that's not what I'm saying. That's just part one. The second part to part one, before I get to part two, is once you understand this, you can learn how to win. You can learn how to use the bank.
01:46:10 Speaker_03
You can learn how to use corporations because you want to have nice stuff. You can learn how to use the resources that the government has. But now let's flip the script. The second part to this that you need to understand, it's your own responsibility.
01:46:24 Speaker_03
Because if you spend every dollar that you earn, you're never going to become wealthy. If every time you make money, you go on a nice vacation, you're never going to build wealth if you can't afford it.
01:46:33 Speaker_03
If you just make money and you make everybody else around you rich before you make yourself rich.
01:46:39 Speaker_01
That's your choice. People don't want to take personal responsibility though. You know, it's a topic I always talk about. Because that's like holding a mirror up to yourself. It doesn't feel good, does it? To say that it was my mistake.
01:46:52 Speaker_01
I'm the reason why I don't have money. I'm the reason why I'm living in this, you know, this little bedsit with these four strange guys when I was 18 years old and I didn't have carpets on the floor. I was shoplifting food to feed myself.
01:47:07 Speaker_01
That hurts to say that it was me. It's my deficiencies. The self-esteem doesn't want to take such an attack.
01:47:14 Speaker_03
And you know what? Here's the thing. It might not be all your fault. There might be a lot of reasons why you're in that crappy situation. There might be a lot of reasons why you're struggling with money today.
01:47:24 Speaker_03
You might have grown up in a very crappy situation. You might have had horrible parents. You might have had a horrible upbringing. You might have had horrible surroundings. You might have been dealt a horrible set of cards. Okay, now what? Now what?
01:47:38 Speaker_03
You were. Now the question is, are you going to take that responsibility today going forward or not? And you have to take that drastic responsibility. You have to take that drastic mindset shift. And that's what you have to do. And it's difficult.
01:47:53 Speaker_03
Who wants to blame themselves? But if you want to change where you are, They're not going to do it. Your banker is not going to say, hey, Steven, you know, you can't afford this car. Don't take this debt.
01:48:08 Speaker_03
Don't take this house, because if they can sign you up, they're going to want to get paid. They're in the business of making money. Not for you, but for them.
01:48:16 Speaker_03
Gucci is not going to say, maybe you should buy some stocks instead of this purse, because they're going to want you to buy their stuff. The government's not going to say, hey, why don't you take a look at our balance sheet?
01:48:30 Speaker_03
I'm going to take this little tangent. The government says student loans are a problem. We've all heard that. Millennials can't buy houses. They can't buy their home. They can't invest because they have student loans.
01:48:43 Speaker_03
The government says student loans are a problem. Really? Let's take a look at the United States balance sheet. Your balance sheet is your asset and liability statement. The number one largest asset on the United States government balance sheet
01:49:00 Speaker_03
are student loans. So here we keep saying, oh, student loans are bad. We keep hearing this from the government. But on the other hand, the government is so rich because of the student loans, because so many people are stuck in these student loans.
01:49:16 Speaker_03
And guess what? You pay the highest tax rates when you were just an employee. I'm an attorney. I'm not your attorney, but I am a licensed attorney, and I spent a lot of time studying the tax law.
01:49:28 Speaker_03
And what I can tell you is that the tax law rewards you when you are an investor. In 2024, the CEO of Coca-Cola, James Quincy, is gonna make about $8 million in cash compensation. He'll also get equity, but about $8 million in cash compensation.
01:49:48 Speaker_03
His top tax rate on that $8 million is gonna be 37% on the federal taxes in the US. Warren Buffett is going to make over $700 million from Coca-Cola dividends in 2024. His top tax rate is going to be 20%.
01:50:07 Speaker_03
He's making way more than the CEO, but he's going to pay less in taxes on a percentage level because he made that money as an investor. We're never taught that.
01:50:19 Speaker_01
This goes one step further, though, doesn't it? Because if you look at someone like an Elon Musk, They never even take a salary, these people. And people don't know about this thing called learning against your assets. I didn't know about it.
01:50:34 Speaker_01
And I think it's a big secret that people need to know about.
01:50:37 Speaker_03
Elon Musk is interesting because he's a risk taker. And he chose to get paid not in salary. And if we look at the tax benefit from this, it's because you are taxed Not on your income. That's not what the tax code says.
01:50:57 Speaker_03
You are taxed based on your taxable income. So now what every accountant, every smart accountant, every smart accountant is gonna focus on reducing your taxable income.
01:51:07 Speaker_03
And so what Elon Musk did is when he was building Tesla, he negotiated with the investors and the board that I wanna get paid, not with a salary, I wanna get paid with stock options. A stock option gives you the right to buy that stock.
01:51:25 Speaker_03
And he was awarded these Tesla stock options at about $6 a share. Which means if the Tesla stock goes up to $7 a share, he could sell the stock option for $6 and profit $1 for each stock option.
01:51:39 Speaker_03
Now, he was given millions and millions and millions of these stock options. And so now when the Tesla stock goes up to $100 a share, now he is rich on paper. He doesn't have any money in his bank.
01:51:54 Speaker_03
He hasn't gotten a salary, so he has no taxable income because he hasn't actually received any money. He has the option to sell this stock for $6 and in return get $100, so net 94. But if he sold that stock, he would have $94 of income.
01:52:12 Speaker_03
Now you have a tax because you have taxable income. So instead what he does is he goes to the bank and he says, hey bank, I have these millions and millions of stock options that are worth billions of dollars.
01:52:26 Speaker_03
Would you like to loan me $1 million, $10 million, $100 million at 3%, 4%, or 5% interest? No bank is going to say no, because the collateral is so valuable. What's the collateral? The collateral is the company. It's his assets, the stock options.
01:52:43 Speaker_03
Which is Tesla in this case. Which is Tesla in this instance. So then he gets, let's call it a $10 million loan from the bank. Now he has $10 million in his bank account, but it's not an income, it's debt. Debt is not taxed.
01:52:59 Speaker_03
If you go out and get a mortgage for a half a million dollars, you're not taxed. If you do a cash out refinance, you're not taxed because that's debt.
01:53:08 Speaker_03
So now he gets this $10 million of loans that he can spend to buy a house, to buy a car, to buy food, to buy vacations, to buy whatever you want. to my Twitter and pay no money in taxes and it's 100% legal.
01:53:20 Speaker_03
Now you're gonna say, well Jaspreet, how does he pay it back? Well, let's just assume that you're going to get a 5% interest on this. If the value of Tesla goes up by, say, 7%, he made a profit.
01:53:36 Speaker_03
So now he can go back to the bank and say, how about you give me an additional $10 million? And he can pay back the old loan, because the value keeps going up. And as long as the value keeps going up, no problem.
01:53:48 Speaker_03
But you can start to see where this gets risky, because if Tesla goes bankrupt, Now we're talking about a house of cards that can collapse. And now you have all this debt that you've already spent, and no more collateral.
01:54:00 Speaker_01
But in his case, he could, if Tesla starts to fall in value, then the bank will call payment. So if it, say, it might be, I don't know, Tesla falls from, let's say, 100, to $10 a share, they're going to call payment.
01:54:17 Speaker_01
He's going to get, what's that called? He's going to get a... Margin call. A margin call, which means that they're going to say, give me the money back quick.
01:54:23 Speaker_03
Yes.
01:54:24 Speaker_01
Or they're going to sell off the asset. to get their money back quick.
01:54:29 Speaker_03
And it's a losing transaction, the bank will lose, because banks do not profit from margin calls. Because once you start making margin calls, that's when panic hits. And now you have to scramble to sell.
01:54:42 Speaker_03
And now the bank is just trying to get pennies back out of every dollar that they lent out.
01:54:47 Speaker_01
I'm going to get old someday. And I think a lot about Making sure I'm wealthy enough so that I can take care of myself when I probably can't work. A lot of people talk about this retirement crisis that the UK and the US are in.
01:55:05 Speaker_01
What is the retirement crisis and why does it matter to any of us and what do we do about it? This is a multifaceted issue.
01:55:13 Speaker_03
The first issue is we have this huge population of old people, baby boomers, that are retired or entering retirement, that have not enough money. This is not just the US. This is also the UK, like you said, which creates a few issues.
01:55:33 Speaker_03
Number one, who's going to take care of them? Number two, who's going to fund that taking care of them? The government doesn't have that money. And the people that are going into retirement don't have that money.
01:55:47 Speaker_03
And their kids many times don't have that money. That's the first issue. And now as we start to dig into that, we have people that are working longer and it creates now this problem in the future that we can see today.
01:56:08 Speaker_03
If you're in your 50s, 40s, 30s, 20s, teens, you can see that there is this problem that's happening. How do we prevent that today? Because I don't know what the solution is for this retirement crisis. I don't have a solution for that.
01:56:23 Speaker_01
The average retirement savings for Americans aged 60 is roughly $500,000, and the average age of death in the US is 77 years old.
01:56:31 Speaker_01
So if you retire at 67 years old, which is the average age of retirement in the United States, then for the next 10 years, you're going to have to live off about $50,000.
01:56:42 Speaker_01
And the stats say that, well, I actually got this from your YouTube channel, the Minority Mindset YouTube channel, said that the average American needs between $1 to $2 million to retire comfortably.
01:56:57 Speaker_03
According to USA Today, we need about $1.8 million to retire comfortably. Wow. And the reason why is every year we have inflation.
01:57:09 Speaker_03
So if you live off of $50,000 this year, you're going to need maybe $52,000, $53,000, $54,000 next year, more the year after that, more the year after that. And $50,000 doesn't buy you what it did 30 years ago.
01:57:28 Speaker_03
And so now when we take a look at all these issues happening, the question is, what do you do today to prevent these issues in the future?
01:57:38 Speaker_03
And starting with in the United States, we have what's called social security, which is a government check that you get when you retire. The first problem is social security, because social security is drying up.
01:57:51 Speaker_03
This is a fact, that if you read the headlines, they'll say social security is going to be dry by 2034, if nothing changes. The problem is people are paying money in, but the government is paying out more than what's going in.
01:58:06 Speaker_03
So from any business perspective, if you have more cash outflows than cash inflows, you have a problem. And the reason for that is, well, number one, the math was wrong. And number two, people are living longer.
01:58:17 Speaker_03
So when the government keeps paying your social security check longer and longer and longer because people are living longer, life expectancy is getting higher, that means they have to keep paying. That's not good for the government.
01:58:31 Speaker_03
Now, on the plane ride here to LA, I sat next to somebody who was telling me, I didn't verify this, but he told me that the government knew that this was gonna be a problem from the get-go, because he told me that the first recipient of the social security program lived to 100.
01:58:46 Speaker_03
I don't know if that's true or not, but you can Google that to see. But that's the problem right now. Social security is running out of money.
01:58:54 Speaker_03
And this is where everyone says, social security is gonna run dry, you're never gonna get a social security check. That's not true either. The reason why I say that is because the government won't let it fail.
01:59:05 Speaker_03
They'll either raise your taxes or they'll just print that money. But the problem with it is you will never be able to live comfortably off of Social Security.
01:59:16 Speaker_03
That was never the intention, but many people are looking at it as, I'm going to be able to live comfortably from this government check. But here's the problem. Let's take a look at what's happening today. Between 2024 to 2025,
01:59:31 Speaker_03
Social Security recipients are going to receive a 2.5% raise for inflation. What they're saying is we have this inflation in 2024. And because of this inflation in 2024, you're gonna get a 2.5% raise. There's two problems with that.
01:59:48 Speaker_03
Number one, that raise is not enough. Things are getting a lot more expensive. Even though the rate of inflation is falling, I mean, 2.5% raise is not gonna keep up with the real cost of living growth that most people feel.
02:00:02 Speaker_03
The second problem is it's a delayed raise. The government gives you a raise in 2025 based off of the inflation you had in 2024. So we already had this price growth, and then you get the raise next year. And guess what?
02:00:17 Speaker_03
We're going to have more inflation in 2025. So relying on Social Security is a losing proposition, which brings the next part of this three-legged stool. So you have Social Security, then you have pensions. Pensions have become a thing of the past.
02:00:33 Speaker_03
I mean, if you're under the age of 45, chances are you're not getting a pension.
02:00:37 Speaker_03
And even if you're over the age of 45 and you're promised a pension, you better cross your fingers to hope that that pension fund does not go bankrupt because there have been many pension funds that have gone bankrupt and people are left with nothing.
02:00:49 Speaker_03
Which leaves number three, your own savings and investments. And this is where we have so much a lack of understanding because people are not doing enough. This goes back to the whole financial education. We make money to spend money.
02:01:11 Speaker_03
That's what the American culture is. I make $1,000, I'm gonna spend $1,000, maybe $1,200. but you're never gonna be able to retire with that sort of mindset. And here's the second problem with that.
02:01:24 Speaker_03
I'm just gonna lay the problems and we'll come up with a solution. You might say, well, I need a financial advisor. No good financial advisor nowadays wants to work with anybody under $500,000 in assets. Maybe $250,000 in assets.
02:01:36 Speaker_03
Maybe if you get lucky, $100,000 in assets. But if you have under that, they don't wanna work with you because they want people that have some money to actually make money off of, right? The financial advisor's gotta eat too.
02:01:55 Speaker_03
So if you don't have the investments, you don't have the education, now you're stuck. And this is where now your financial education comes in.
02:02:04 Speaker_03
Because if you wanna build wealth, you wanna have quote-unquote retirement, you gotta do something different.
02:02:09 Speaker_03
You can't keep doing what the majority of people do, because if you keep doing what the majority of people do, you're gonna end up like the majority of people. And right now, that's broke, in debt, living paycheck to paycheck, fat and unhappy.
02:02:22 Speaker_03
And I'm not saying this as a general term, I mean statistically, that's what the majority of people are, especially in America. So now let's come up with a solution, because we have laid out the problem.
02:02:33 Speaker_03
The first solution is define what is retirement, because I'm going to get a little philosophical here, but I have my issues with traditional retirement. There's a saying that says, those who retire early die early.
02:02:48 Speaker_03
The reason why is because if you work, from the age of 21 to 65, maybe 67, at a job you hate, but you work every single day, and all you're looking forward to is retire at 67. You retire at 67, you have this great big retirement party.
02:03:06 Speaker_03
Now you come home, and you sit on the cell phone, you start watching TV. You start to lose your sense of purpose. And I've seen this very closely with people in my, not my family, but close to my family.
02:03:19 Speaker_03
where I've seen people who were healthy, energetic, maybe didn't love their work, but they had a reason to get up every day, go to work, retire, and literally go insane.
02:03:31 Speaker_03
I mean, you have nothing to do, and now you start to see health issues that you didn't have before.
02:03:36 Speaker_03
You start to have mental health issues which you didn't have before, and all these things just start to happen when you were going to enter your golden years. Even if you have the money to do things,
02:03:46 Speaker_03
So when we talk about what is retirement, I wanna caution everybody, or if you have parents, to start thinking about what do you wanna do during retirement?
02:03:56 Speaker_03
Because if your goal is to do nothing, you might enjoy it for the first few weeks, maybe six months, but eventually you're gonna get bored. So you gotta have something to do. Then it's the financial side of retirement. What is retirement?
02:04:11 Speaker_03
And I have a different definition than most people. Most financial advisors don't like me for the things that I say, but my definition of retirement is the same as my definition of wealth. Wealth is
02:04:25 Speaker_03
for me when my cash flow from my investments exceeds my expenses. It's very simple. If my expenses are $4,000 a month and my cash flow from my stocks and my real estate and everything else is paying me $4,001 a month, I am wealthy.
02:04:47 Speaker_03
So now the question is, how do you actually achieve this type of wealth, retirement?
02:04:55 Speaker_03
The reason why I don't like the word retirement as well, besides the connotation of I'm gonna do nothing, is they assume this, I gotta be 67 years old to hit this retirement. When you can achieve this wealth way sooner, and now you have more options.
02:05:11 Speaker_03
So retirement is wealth. Wealth is when your cash flow from your assets exceeds your expenses. How do you actually do this now? Well, you got to buy the assets. And in order to do that, you have to have the money.
02:05:27 Speaker_03
And many people assume that the way you get rich is by investing for passive income. You get rich by investing in real estate. You get rich by buying this cash flow. That's a lie. you have to have the money first.
02:05:44 Speaker_03
You have to have the money to invest in real estate. You have to have the money to buy the cash flow.
02:05:49 Speaker_03
So if we just make the numbers very round and simple, if I need $70,000 a year to live my life and I can get a 7% cash flow on my investments, I need to invest a million dollars to have that $70,000 a year to fund my lifestyle.
02:06:12 Speaker_03
Now you're going to say, where in the world are you going to get a million dollars? You don't need it today. It can happen over time. When people talk about retirement planning, they're thinking about 45 years.
02:06:24 Speaker_03
So when we talk about wealth, why can't we talk about the long-term? It's not going to happen in two days, but it can happen if you put in that work.
02:06:32 Speaker_03
So now you have to put aside this amount of cash to buy certain investments that can pay you this type of cash flow. The second thing is, well, what about inflation, Jasprit? You talk about this all the time.
02:06:48 Speaker_03
The buying power of my dollar is going down. $70,000 when I'm 65 years old in a few decades is not going to have the same buying power as today. You're right. But here's the thing.
02:07:01 Speaker_03
When you invest your money into dividend-paying stocks, which are stocks that pay you, or into strong real estate, these are inflation-adjusted investments. Which means generally, as inflation happens, rental prices go up.
02:07:20 Speaker_03
As inflation happens, stock values and dividends also go up. And this is where now, if we start to understand this, you'll understand the power of this. Because it's actually a little bit more extreme.
02:07:36 Speaker_03
You've probably heard about the wealth gap in America and how the rich are getting richer and the poor are getting poorer. Well, the reason why that happens is because investment values grow faster than incomes. And inflation benefits investors.
02:07:56 Speaker_03
So you see how we start to tie this all together, because wealth is about owning investments. The way you become wealthy is by owning investments. Our economic system is designed to benefit investors.
02:08:06 Speaker_03
If we take a look at 2019 to 2024, over those five years, household incomes, the median household income, grew by around 18%. During those five years, the S&P 500, the stock market, has grown by almost 100%.
02:08:29 Speaker_03
which means that the wealth for investors has grown almost five times or about five times faster than incomes. This is why you can't earn your way to wealth. You can't save your way to wealth. You have to invest your way to wealth.
02:08:45 Speaker_03
And remember, wealth is retirement. And you might say, well, Jaspreet, that's just because of the pandemic and everything that happened after the pandemic. Well, let's go back in time. Let's look at it a little bit broader.
02:08:56 Speaker_03
Let's look at the five decades between 1971 and 2021. Over those five decades, household income increased by around 600%. Now, mind you, that between 1971 and 2021, we also saw the number of workers in a household increase.
02:09:20 Speaker_03
In 1971, the average household had one person that went to work. The man went to work and the woman didn't. That's how life was in the early 1970s. In 2021, many households had two household incomes.
02:09:30 Speaker_03
So 1971 to 2021, the median household income grew by around 600%. The S&P 500, the largest 500 companies in the stock market, grew by around 4,000%. So again, inflation happens. Inflation benefits the investor. How do you become wealthy?
02:09:49 Speaker_03
It's by investing your money. So if you want to retire, if you want to build wealth, you have to be an investor. And you have to calculate what is that wealth number for you. For me, the way that I do it is I do it through cashflow.
02:10:04 Speaker_03
Most of my investments, my real estate investments pay me cashflow. When I buy a property, I buy it for the cashflow. Most of my stock market investments are dividend paying assets, meaning they pay me cashflow dividends just for owning the stock.
02:10:18 Speaker_03
Some of my investments grow in value. They're more appreciative, they're for appreciation. But when I think about retirement for me, it's cashflow exceeding my expenses.
02:10:31 Speaker_01
What about starting a company? Should people become entrepreneurs?
02:10:37 Speaker_03
Well, I think everybody in America needs to be a business owner, but the majority of people should not operate a business. When you invest in a stock, you become a business owner.
02:10:47 Speaker_03
If you don't operate the business, if I go out and buy a share of Amazon, I'm not working in the company, I'm not operating the company, but I own some of it. Some people should start a business.
02:10:58 Speaker_03
I'm a huge advocate for entrepreneurship for the right person. Who's the right person? I used to think everybody needs to become an entrepreneur. Because when I started to see success as an entrepreneur, I crossed that invisible barrier.
02:11:20 Speaker_03
I said, oh my God, people need to see this. You have to become an entrepreneur. You can do things on your own. And I was preaching this to my friends. I got one friend of mine who was an engineer to quit his job and to then join me.
02:11:39 Speaker_03
He would come to my office and I would talk to him about things. And I said, you know, different ways you can do this. And I realized pretty quickly He is not meant to be an entrepreneur. The work ethic was different.
02:11:55 Speaker_03
When he would go home, he didn't wanna work. And that did not click to me. What do you mean you don't wanna work after five o'clock? There's no stop point. When you're starting a business, you gotta start.
02:12:08 Speaker_03
The second thing was the way you think about risk. It's, well, if I invest $100, how fast am I gonna make the money back? Am I gonna make this money back? It became all these little analyses before you've even done anything. You gotta start.
02:12:24 Speaker_03
And then it's the innovation of what are you gonna do? It's asking for a blueprint. Tell me exactly what to do. Tell me exactly what to sell. Tell me exactly how to sell it. I don't know what you are good at. I don't know what problem you can solve.
02:12:37 Speaker_03
I don't know what innovation you can create. And this is where I go back to I am a big advocate for entrepreneurship for the right person. Who is that right person?
02:12:48 Speaker_03
Somebody who has this entrepreneurial itch, that you have this, I need to create something, this I can't work for somebody else feeling, this I want to build something. It's a very much like, I don't care what it takes. I don't care what I have to do.
02:13:07 Speaker_03
This is what is my calling.
02:13:09 Speaker_01
And as you say there, you're going to have to tolerate uncertainty.
02:13:14 Speaker_01
And when I say uncertainty, I mean comfort as well, the lack of a blueprint, the lack of certainty about how much you're going to make this month or how quickly you're going to make money or if you're going to make money.
02:13:23 Speaker_01
Risk, which is you might have to put a lot of things on the line, including your reputation. And you said hard work as well. So are you willing to work seven days a week?
02:13:32 Speaker_01
And you're right, you know, when people say that they think it's super toxic, but like in my own experiences of starting businesses, but then on every friend that I have that started a business, they'll all tell you that there's absolutely no such thing as nine to five.
02:13:44 Speaker_01
You work whenever you have to work. And if you're at a bar mitzvah or a wedding or an anniversary meal with your partner at any moment, you might get a horrible email and you have to act upon it.
02:13:55 Speaker_01
You can't say I'm going to save that till Monday or not my problem.
02:13:59 Speaker_03
Oh yeah. And I'm going to add one more to that list. The willingness to be criticized. Oh yeah. Any business you start, you are going to upset a lot of people at every stage of the business.
02:14:14 Speaker_01
I mean, this is really important because much of the reason why people want to be entrepreneurs is because they want to be their own boss. But what's so interesting about the story you told about that tenant is you became her boss.
02:14:28 Speaker_01
Whenever I speak to entrepreneurs, there's one problem that always comes up, but today's sponsor LinkedIn has a solution and I think you'll want to hear it. Connecting your business with the right audience can be tough.
02:14:38 Speaker_01
You can spend a lot of time and money trying to get it right and still regardless fall short of that, especially when it comes to B2B marketing. Where you're not doing business with one person, you're dealing with teams making decisions together.
02:14:50 Speaker_01
Through LinkedIn ads, you can connect with an extensive professional network of over a billion members, including 10 million C-suite executives. You can also target specifically by job title, industry, company, and more.
02:15:04 Speaker_01
It's no surprise to me that LinkedIn is reported to be the highest returning paid social platform in the world. To help you get started, LinkedIn is offering $100 credit to launch your first campaign on the platform.
02:15:14 Speaker_01
Just go to linkedin.com DOAC24 to claim your credit now. That's linkedin.com slash DOAC24. Terms and conditions apply. This diary won't change your life, but the habit it teaches you definitely will.
02:15:31 Speaker_01
The most unhelpful advice that I ever received was don't sweat the small stuff. You have to sweat the small stuff. I sweat the small stuff. I always have and I always proudly will. Because small things that are easy to do are also easy not to do.
02:15:46 Speaker_01
It is easy to save a dollar, so it's also easy not to. It is easy to brush your teeth, so it's also easy not to. It is easy to make a 1% improvement. So it's also easy not to. So two years ago, we started the process of creating this beautiful diary.
02:16:16 Speaker_01
And it's truly beautiful. Inside, there's lots of pictures, lots of inspiration and motivation as well, some interactive elements.
02:16:22 Speaker_01
And the purpose of this diary is to help you identify, stay focused on, develop consistency with the 1% that will ultimately change your life. We're only going to do a limited run of these diaries.
02:16:33 Speaker_01
So if you want one for yourself or for a friend or for a colleague or for your team, then head to thediary.com right now. I'll link it below.
02:16:42 Speaker_01
One of the things I really wanted to talk to you about as well is just a word that I think is so pertinent to everything we've talked about today, which I think is important, which is the word patience.
02:16:54 Speaker_01
Because there's some areas of my, it goes to what I said about my friend, my friend who's been in our group chat, who's made more cash than all of my other friends in that group chat. And he's done it by being boring and patient.
02:17:07 Speaker_01
Like, he's just flown under the radar. And when I think about my life and many of the investments I'm making now, I'm like, oh God, what is it?
02:17:16 Speaker_01
I'm looking over there and my friend's buying some like crypto meme coin and he's told me it's gone up 150x this month.
02:17:21 Speaker_01
I'm looking over there and people are investing in, I don't know, the picking stocks and stock trading, whatever, and they're telling me it's gone up 50%. But in my wisdom, as I've gotten older, I've realized, like the tortoise and the hare,
02:17:35 Speaker_01
That boring and patient is such a wonderful investment strategy. It's such like a paradoxical way to think. I have so many seeds that I've planted that are taking forever to grow.
02:17:46 Speaker_01
But I just now know, because I've got enough case studies in my brain, that that boring and patient approach to wealth will put me in a better position at the end of the game.
02:17:55 Speaker_03
Yes. And you have to be sometimes impatiently patient. If we talk about building wealth through investing your money, the numbers have shown that over the last century, the stock market has gone up by an average of 10% a year, historically.
02:18:16 Speaker_03
But many people lose money when investing in stocks. I mean, if you go around talking to people, have you invested in stocks? Yes, yes, yes. How many have made money? The hands start dropping.
02:18:25 Speaker_03
Well, if the stock market has gone up by around 10% a year on average every year for the last 100 years, why are so many people losing money? because we start playing the wrong game. And so now, what happens?
02:18:39 Speaker_03
If you invest your money into the stock market, and by the stock market, I mean, let's just say you buy the S&P 500, which is a basket of the 500 largest companies in the stock market.
02:18:48 Speaker_03
For example, not financial advice, if you invest in SPY, that is an ETF that gives you exposure to the 500 largest companies. We know that historically that's gone up by 10% a year, but that's not enough for a lot of people.
02:19:02 Speaker_03
So now I'm gonna play this game of, I'm gonna try to beat the market. And some people will, most won't. So now some people are gonna try to get into the game of investing in individual companies or maybe trading companies.
02:19:14 Speaker_03
Because even investing in individual companies, if you invest for the long enough period of time, you're probably gonna win. But many people now want a quicker solution.
02:19:25 Speaker_03
So now we start trading, we start finding hot companies, the next Tesla, the next Amazon, we see what Reddit says, we see what Google says, and we start buying these things because we're excited.
02:19:36 Speaker_03
But that excitement is what's killing your wealth because you're investing on emotion instead of investing on financials. And so this is where you talk about what's boring. Just keep doing the market. Keep investing in the market.
02:19:53 Speaker_03
When the market's up, when the market's down, when the market's sideways, just keep investing because that has been proven to win.
02:19:58 Speaker_03
We know that if you invest $100 a month from the age of 21 until your retirement, 65, 66, and you can get that same 10% return, you're going to retire a millionaire. Assuming you only invest $100 a month from the age of 21 to 65 or 66,
02:20:19 Speaker_01
It's so interesting because when I asked you earlier what the best investment you ever made was, you said the investment you made in yourself.
02:20:25 Speaker_01
And maybe we've not spent enough time really talking about how critical knowledge and skills are to wealth generation. Maybe that is the first principle of wealth creation. Maybe that is the furthest thing upstream is knowledge and skills.
02:20:42 Speaker_01
And you can dabble in stocks and whatever else, but really, over a 50-year time horizon, your knowledge and skills, and your knowledge might be of patience, your knowledge might be of real estate investing, your knowledge might be of whatever, your knowledge might be of a philosophy towards investing.
02:21:00 Speaker_01
Really, it's your knowledge and skills that are going to determine where you end up. So, as it relates to getting those knowledge and skills, where's the best place for people to go other than, obviously, the diary of a CEO, you know?
02:21:12 Speaker_01
But outside of this podcast, where is the best place for people to go to get knowledge and skills that they can trust without getting scammed, without having to pay for some calls from some YouTuber who's charging $3,000 a month for, like, you know, to tell them something that reading off chat GPT?
02:21:28 Speaker_01
What is, like, the best place? Well, the best best place is to go out and do it.
02:21:32 Speaker_03
Screw up. Make mistakes. But along with that, start with what's free, YouTube podcasts. Best book you've ever read? The first book, I'll start with that because the best is it changes. The first book I ever read cover to cover was Rich Dad Poor Dad.
02:21:48 Speaker_03
The second book was Total Money Makeover. Rich Dad Poor Dad is by Robert Kiyosaki. Total Money Makeover is by Dave Ramsey. The third book is a book called The Creature from Jekyll Island, which talks about the Federal Reserve Bank.
02:22:00 Speaker_03
Those three books are gonna give you a foundation of money, and different perspectives of it. So start by learning for free, even before books. Start by watching YouTube videos, start by listening to podcasts.
02:22:14 Speaker_03
Then you take the next step, and you start reading books. And what I talk about is, if you go out, and over the next 12 months, you read five books on money management and investing. I just gave three.
02:22:24 Speaker_03
Read five books on personal development and self-development. Read five books on how to start a business. Read five books on leadership.
02:22:32 Speaker_03
and then read five books on how to scale, market, and build, grow your business, you're gonna have an MBA level education for a fraction of the cost. Start with that. And then, go out and make mistakes.
02:22:47 Speaker_03
And as you grow, that's when you can start buying classes and other things, because you'll find people that you might want to get consulting from.
02:22:54 Speaker_01
But start with that. What is the most important thing we didn't talk about today, as it relates to wealth creation?
02:23:02 Speaker_03
The most important thing that I think we did not talk about is we talked about the economic system.
02:23:09 Speaker_03
We talked about the principles, but I think we didn't get into the actual steps now of how do you preserve and protect your wealth, and how do you now continue to use wealth protection tools?
02:23:21 Speaker_03
Because there's a lot of that that every single wealthy person is investing a huge amount of time, effort, and money into. that most people have no idea even exist. We started to touch on taxes, but there's so much more.
02:23:34 Speaker_01
So in those wealth preservation tools, what exactly are you referring to?
02:23:39 Speaker_03
Starting with first your accounting and taxes, then we get into the legal, your estate planning, what types of attorneys, what types of legal protection and shields and tools can you use to structure your business, your investments, to protect you, but also amplify your wealth.
02:23:55 Speaker_03
And then things like insurance, but then also your estate planning, because you talk about generational wealth. Well, generational wealth isn't just the money. It's what your money does after you die. And you can control that when you're alive.
02:24:08 Speaker_01
We have a closing tradition on this podcast where the last guest leaves a question for the next guest, not knowing who they're leaving it for. And the question that's been left for you is, what wakes you up every morning?
02:24:22 Speaker_03
Oh, I'm excited. I don't use an alarm. I'm getting up by the purpose. I'm excited by the mission. I mean, I love what I do. The purpose, the mission, that's what gets me up every morning.
02:24:34 Speaker_01
What about yourself and your own happiness and mental health and, you know? You know, I am happy.
02:24:44 Speaker_03
I've been so fortunate. I've always been one of those people you could put me in a box and I'd have a great time. I would turn the box into an airplane and I'd be flying it around. Before I came here, my wife recorded a video.
02:24:56 Speaker_03
I found these, so we were in a hotel and they gave these cans of water, okay? These two cans of water. I took them, I said, recorded this video.
02:25:04 Speaker_03
I went on the balcony and I did a Stone Cold Steve Austin mock video where I opened up the cans of water and just dumped it on myself. Just, I don't know why. And I sent it to my cousins. I've been very blessed to, I can have a good time with anything.
02:25:20 Speaker_03
I'm a pretty lighthearted guy. I know I talk about serious stuff, but I've been very fortunate on that. And I can have fun in a lot of situations. I'm not driven by materialistic things. There are certain things that I like.
02:25:36 Speaker_03
I will spend money on luxuries. My wife got me into that, into nicer hotels and nicer travel and those conveniences I like. And I wanna keep my wife happy, so whatever she likes. But I'm not driven by fancy cars, fancy clothes.
02:25:54 Speaker_03
That to me is not as important. I like to see... change and I want to help empower people and that gets me excited.
02:26:03 Speaker_01
If you had to bring it down to five things that are driving you, then what are those five things?
02:26:08 Speaker_03
Number one, taking care of my family.
02:26:10 Speaker_01
Yeah.
02:26:11 Speaker_03
Number two is my own purpose and mission and feeling excited, like my personal excitement.
02:26:16 Speaker_01
Yeah.
02:26:17 Speaker_03
Number three is the mission.
02:26:18 Speaker_01
Yeah.
02:26:18 Speaker_03
Is to continue to help people. Number four is to bring light to the community. Number five is to continue giving back and to help.
02:26:32 Speaker_01
Jaspreet, thank you. Thank you so much for being so generous with your time and I've learned so much about so many things and I've had so many sort of ideas reinforced. And sometimes that's it.
02:26:45 Speaker_01
You know, I do these conversations because I've been out there in the world and I've met people who have listened to these conversations about wealth and finance and money.
02:26:53 Speaker_01
And sometimes in life, all it is is just a little seed of information that can absolutely change the trajectory of not just you, but the generations that come after you and that's exactly what you're doing.
02:27:05 Speaker_01
It's exactly what you've done on your YouTube channel for so many people that probably will never get to say thank you to you but it's to give these little seeds of inspiration and information and you never really know which seed is gonna change someone's life but what you do is you just continue to plant them and hopefully those people will water them for themselves so thank you so much for what you do.
02:27:22 Speaker_01
Thank you for being so generous with your time today and please do keep doing it because our education system is a bit of a cookie cutter and optimizes for creating people that are
02:27:30 Speaker_01
part of a system which doesn't seem to be designed with their best long-term interests in mind. And that's why we have these problems. That's why we live in this credit society. That's why we have these retirement issues.
02:27:41 Speaker_01
And that's probably why we have so much mental health issues and depression. But it's people like you out there that are... giving us the information that gives us a chance, a chance to live a different life. So thank you for that, Jaspreet.
02:27:54 Speaker_01
I really appreciate you. Thank you for having me on. It was really a pleasure. Chuck me that perfect Ted. One of the things that I think about all the time, because my life is quite hectic and busy, is how to manage my energy load.
02:28:09 Speaker_01
And as a podcaster, you kind of have to manage your energy in such a way that you can have these articulate conversations with experts on subjects you don't understand.
02:28:16 Speaker_01
And this is why Perfect Ted has become so important in my life, because previously, when it came to energy products, I had to make a trade-off that I wasn't happy with.
02:28:24 Speaker_01
Typically, if I wanted the energy, I had to deal with high sugar, I had to deal with jitters and crashes that come along with a lot of the mainstream energy products.
02:28:32 Speaker_01
And I also just had to tolerate the fact that if I want energy, I have to put up with a lot of artificial ingredients, which my body didn't like. And that's why I invested in Perfect Ted and why they're one of the sponsors of this podcast.
02:28:42 Speaker_01
It has changed not just my life, but my entire team's life. And for me, it's drastically improved my cognitive performance, but also my physical performance. So if you haven't tried Perfect Ted yet, you must have been living under a rock.
02:28:53 Speaker_01
Now is the time. You can find Perfect Ted at Tesco and Waitrose or online where you can enjoy 40% off with code DIARY40 at checkout. Head to perfectted.com.