Earned Income or Passive Income - Grant Cardone

[Music] hey grant cardone and welcome to the cardone zone every monday i come to you to talk about your money your finances your wealth creation a lot of times we talk about real estate investing here but we also cover things like the stock market cryptos and more thank you for joining me this morning if you want to call in 305-865-866-8 305-865-8668 look i want to keep your questions today to passive income earned income and wealth building i'm going to share with you today a very simple thing that i wish i would have known when i was growing up on the come up the difference between earned income passive income and more importantly i'm going to reveal to you the ultimate play what's better than passive income post below if you're watching on youtube subscribe to the channel comment love your feedback if you like this you want more of this let me know whether you're 25 or 55 if you're committed to creating wealth for yourself you've got to know the steps you got to know the strategies and you got to know the hacks for 35 years i've been studying wealth the first 20 years of that 35 year study i made a lot of mistakes because i was getting my information from people who are more interested in earned income how to increase earned income and that's where it starts and i'm not saying that's a bad thing it is a good thing you want to increase your earned income but the problem with earned income and i'll share with you in this show is most people don't understand earned income cannot produce wealth passive income on the other hand can start when it's recurring and dependable and repeatedly recurring and dependable and you don't lose money you don't go backwards and you don't trade time for money is less taxed and can provide an individual when it is accumulated with tremendous amounts of financial security but neither one of these okay neither one of these in small quantities can make a difference and neither one of these can even closely compete with the third thing that i'll share with you toward the end of this show today which is how wealth is created so i'll do this show every monday uh well you'll get a notification when you hit the little bell that we're going live you can call in every week i'm here to support you i'm here to help you i'm here to guide you i'm here to give you what i wanted when i was 25 and was broke and what i desperately needed when i was 33 and i had a million bucks in a savings account i was literally more scared at 33 with money than i was at 25 when i was broke because now i didn't know what to do with the money and i had this new responsibility it's like money's like a baby like like you got a baby man all of a sudden you're like oh i got this new responsibility what do i do well you go into action and you got to protect it you got to feed it you got to service it you got to make sure that baby's safe and more importantly you got to make sure that baby grows up to be a healthy happy child and then an adult hopefully contributing to society and then you've done a good job parenting money is the same way are you parenting your money are you protecting it are you taking care of it and most importantly are you letting it grow up so that it can actually contribute back to the community i've learned all of this i've learned it the hard way and i'd like to share with you today some things that i've learned and all that starts with definitions first thing i want to do here is i'm going to look this up with you in present time there's nothing wrong with looking things up there's nothing wrong with if you understand something understanding it at another level by rediscovering what maybe you don't know okay so let's just start with earned income earned income and i don't know if you guys can see this on my computer because i can't see what they see uh earned income is considered for the year you are filing earned income would include all income from employment gross income it would include wages salaries tips bonuses compensations i'm adding some stuff here any compensations like if you earned 80 000 in a year and i said hey you can stay at my house uh i'm going to give you a bonus of staying in my house that was that actually be a bonus or if i was going to give you a trip off somewhere if i was going to give you a pair of shoes all that's compensation if you won the if you won the lottery that year and the lottery was a 25 000 ticket that would be considered earned income uh not passive income because you bought a ticket to get something back if you bought a stock sold it and made money that would be earned income or compensation and that is heavily taxed by the way earned income includes net earnings from self-employment for the those of you who are uh self-employed when you go out and and this is what i was doing in the beginning i was making a hundred grand a year uh when i was making thirty thousand forty thousand a year i didn't have this problem when i made a hundred all of a sudden i started having a relationship with a group i did not know before called the irs federal and state and they started whacking me i'm like my god when i make a hundred grand and work harder i literally doubled my income i paid more money in taxes than i had earned the previous year in total compensation of earned income and so i got resentful many of you i hear you talking about i don't want to earn more money i think the average person in america let me just look this up average person in america how many days how many days do i work for irs uh the standard basic work week uh this isn't what i'm looking for i'm looking for uh to pay taxes how many days do i work who knows the answer that throw it down in the comments how many days do i work to pay taxes i think it's like 40 of the year this year americans will work the longest to pay federal state and local individual income taxes 42 days payroll taxes will take 26 days to pay followed by state and excess taxes 15. it's actually not that this is not the answer i'm looking for you know it's funny when you're looking on the internet you just keep looking for the answer that you want but anyway i think it's about 100 days of the year or 140 days of the year the average american works almost one-third a little over one-third if i'm correct uh of the year to pay federal state and excise taxes unemployment tax etc okay that's earned income anything from compensation i go out and sell something on the street corner i'm supposed to pay taxes on that i'm supposed to declare it some of you don't i know okay but you should because they're going to come back and get you later if you um take a second job guess what the problem with the second job is you're earning you're earning 60 000 at one job you're probably paying 24 000 a year in taxes on that job whether you know it or not most people don't even know what's being withheld from their taxes okay and let's say we go get a second job this is our first job and i get a second job and that second job pays me 40 grand a year uh i'm going to pay another 16 000 on that see what i'm saying like you're you're sharing you're spending more time you're doing eight hours adding eight hours and you're basically paying 30 to 40 percent of your time is being paid to the government i'm not saying you shouldn't do that you should do that but i'm going to show you a better way today i'm going to show you have to do this in the beginning but you want to be able to parlay it into something that starts offsetting these categories these expenses are killing you it's not what you're spending that's killing you it's what they're taking from you that's killing you and there's a way to work around this okay so let's say i go get a third job in multi-level marketing and i start a new business by the way that is earned income even though a lot of you guys in multi-level marketing talk about this being passive income it is not passive income if you trade time for money to build a team when you build that team it's recurring and that's cool recurring income is not passive income necessarily recurring is is if i'm trading time and i go work with johnny to build a team and that bill's at ten dollars this week ten dollars next week uh and in a month from now it's a thousand dollars and two months from now it's 2000 it starts building because that's still earned income so if you earn a million dollars from network marketing trust me the irs is going to treat that like ei earned income they're not going to treat it like passive income okay so look up the definitions uh earned income let me just go back over that includes all income from employment but only if it is included in gross income wages salaries tips somebody walks up and gives me 500 bucks that's cool the irs wins with the tip so you got to be like i want to thank you on behalf of the irs and myself okay now passive income what is passive income because this is where people can start actually building wealth because you're not trading time to collect money the moment you trade time to collect money the irs is going to intervene at a heavy rate and the wealthy people know man if i could literally not just take that out of the equation you know this equation time is money what if you could remove time and just go straight for the money this is how you do that okay this is a definition passive income is defined as this is investopedia good good uh definition right here passive income is earned derived from rental property is the first thing on their list when i saw this i'm like i got to get some rental property i was 33 years old i was actually 28 years old but i bought my first deal when i was 31 years old three years later and i'm like okay i need rental property limited partnerships i didn't know what that meant i got one of those though figured out what it was i didn't know what rental property was in the beginning so when i read the definition i'm like i need some rental property i need some limited partnerships or other enterprises in which i am not involved okay so what do i do i'm earning 100 grand a year in a business okay i read these definitions because i'm committed to wealth for all of you that are out there committed to wealth and you want to come spend three days with me i don't know if you can show them that link johnny grant cardone.com virtual this is a great opportunity for you and me to sit down for three days three full days that's right it's not four years it's just three days and i'm going to go over how to build wealth okay i'm not going to be talking about how i did it i'm going to be talking about how you can do it and the exact steps you need to take so this is earned income i was earning money i have a tremendous tremendous uh and almost anxiety about increasing this number but every time i increase it i go from 100 to 200 they rob me you ever heard this two steps forward one step backwards that's how i felt man every time i go forward they grab part of it i'm like god dang i thought i had a victory and they cut it in half i thought i won today i did better and they cut it in half okay so that's one way and by the way do not do not misunderstand me you want to increase this as high as you can go in fact if you want to get in the top one percent of the earners in america you want to get that number to 440 thousand dollars you want to get to 44 million if you could if you could think that big but at some point in the future as you build wealth you want to bring this back down to one dollar i don't really want earned income to create wealth okay now when it said when i read hey you need what do you say rental properties you cannot create passive income if you don't get these vehicles it's impossible it says by definition this is the irs definitions this is the wealth definitions this is what you have to do to do this is how the game works so if you're going to try to bypass it you're not going to win this game this is the rules of the game it says by definition rental property it says limited partnerships okay literally within within uh i was 28 years old i just started my first business i was rocking i was starting to figure out the deal i was starting to make some money and it says limited partnership are other enterprises in which a person is not actively involved okay you want to circle that you cannot be actively involved for it to be passive income so you guys are going to go out and buy some real estate right or you're going to go raise money you're going to go raise money for a real estate deal guess what you're going to get bang for earned income and you thought it was passive it is not passive if you're trading time for it you cannot be actively involved for this to work so this is what i did when i was 28 years old i started spending as much time as i could to increase my first income because to do these other two things you're going to need money to do them right or you're going to need partners so while i when i wasn't working rather than goofing off on the weekends my buddies are out going on vacations and and playing golf and doing cool things starting families and i was like no i'm gonna pay the price right now i'm gonna learn about these limited partnerships what is that and i'm gonna learn about rental property and i started shopping the first thing i did was and some of you think i went out about real estate right away but the truth is i got a limited partnership with a guy named scott morgan created a company with scott called the cardone group he did automotive consu consulting by the definition of the law i was not actively involved i was literally like hey you can use my name you can use my products you can use my information and you can use my branding but i'm not going to be actively involved in this business you run it run it up or run it into the ground it's your call and i cut a deal with him i got a percentage of the proceeds and he paid me every month to use my name that was passive income i think i was taxed as earned income in the beginning about two years because i didn't know these i didn't wasn't clear on these definitions but because the way we set it up i should not have been taxed as earned income i should have simply been taxed as a passive involver in this activity and no matter how you're taxed the reality is when you're not trading time for money you're multiplying money so watch what happened we created this limited partnership i think that limited partnership make a hunt made a hundred thousand dollars the first year if scott hears this he's gonna be like we made 400 grand the first year okay whatever and i think i got 41 of that deal okay i made 41 000 of passive income it was treated as earned income because i didn't know what i know today i would have set up the structure difference so that it was just paid as a royalty to me and it was passive okay i was paid forty one thousand dollars on this i went out and made a hundred thousand dollars because of my own work okay i earned 41 i increased my wages by 41 without trading my time i had a multiplier i was still taxed heavily no problem but now i have two companies two flows we talk about multiple flows of income all the time here i have two flows one that's dependent upon me and the second one that's not dependent then i added the third piece the rental property the rental property is this rental property works like this okay i took uh 30 uh 3 500 bought a 78 000 piece of real estate and i was making an extra 200 of cash flow above and beyond my payment i took 3 500 bought a 38 a 78 000 property i have two businesses now and the third one was i'm gonna go buy this piece of real estate i had to find it had to buy it had to negotiate had to get a loan on it that took i don't know took 15 days 20 days 30 days it took a little bit i had to sign some documents i had to know all that i had to hire lawyers probably 1500 bucks i had to do all that stuff and then i had to commit to a long mortgage on that piece of property it was terrifying but my first check was 200 okay and that was 200 a month if i kept that property 12 years it looked like on paper i was gonna make twenty four hundred dollars okay let me just bring you to the story so let's say my income on my first business didn't go up and by the way i got a big surprise for you here in a second how to how to warp speed all of this okay and blow all this up blow everything out of the water when you learn this last trick you're gonna be like dude i'm only gonna get earned income and passive income so i can get this third play because the third play just kills everything so here i am my first business earned income i got forty thousand dollars coming out of my second business earned income even though i was a passive partner i just made a mistake in how i recognized it with irs and the third thing i had was twenty four hundred dollars and all i did was simply sign some documents buy the right piece of property the right time and i put somebody in there that would pay the mortgage the maintenance and give me a little bit of cash flow now which one of these are most important to me first of all they're all important to me every one of them is important to me i can't do the third one if i didn't do the first one i wouldn't have the second business if i didn't do the first business i had to keep doing the first business by the way to keep feeding the second business because the leads from this business came from this one okay the money from that one and this one allowed me to do this one now this was a seventy eight thousand dollar piece of property that piece of property is worth four hundred thousand dollars today as a tear down you could literally scrape the house and somebody to pay 400 grand to buy that house today and probably put a million million five maybe a two million dollar house in its place which one of these is most important to me which one do i value the most which one will last the longest which one is taxed the least okay i did not know this when i was doing this the money that i earned from this deal because i was the active person collecting the rents they banged me all i needed to do was put a manager between me and that and i wouldn't have paid the earned income tax on that passive income so when you guys go out and buy real estate and you're the actively picking up the check for that real estate and you're doing the work and you don't have a manager between you and it you're not a passive investor okay you not in the beginning you're not okay today this third business is worth it's got three billion dollars worth of assets in it this company i still have this company i still had and they all keep producing income for me and my families but none of these none of these are as good as the thing that i want to share with you okay now this is the play and hopefully you're walking out here 305 865 8668 if you want to call up ask questions trying to figure out how to make a move here uh 305-865-8668 and we're going to spend three days with you uh october 22nd 23rd and 24th this virtual i deliver this content to you and i sit with you literally it's a i'm going to have a bunch of screens around me and i'll be able to see everybody in the room with me is a super super technological very advanced way to share can you show johnny what it looks like share a workshop setting with you where i'm going to share a piece of information i'm going to click a button say okay guys do your exercise you've got five minutes and you're going to break up into groups of five people each do that exercise then we'll come back and discuss it okay and hold people accountable so remember earned income this is many years ago okay today that hundred thousand dollars business i never walked away from that business that business probably earns on a bad day 300 grand a day this was a year this was one year this is a day so i'm just sharing with you this i'm not bragging about this i'm proud of this and everything but i'm sharing with you like i never walked away from it i've been doing this this business i've been growing this business for 30 years now 100 grand a year i learned how to make 300 000 a day sometimes 500 grand a day sometimes 700 grand a day we've had multi-million dollar days here okay this money is taxed heavily unless i can do something with the money that comes from it that i'll share with you in a second number one number two uh the cardone group that business that i still have i don't know what it's going to pay me this year i get 41 of the proceeds of that company he does the work i don't uh and he continues to build that brand brand cardone group there's cardone ventures there's 10x incubator there's 10x health systems uh all these all these uh cardone ventures all these are partnerships i think by definition it says limited partnerships or enterprises so i keep adding cardone group cardone ventures 10x incubator we're going to start 10 000 10 000 companies launch them fund them help them with manufacturing and marketing and bring them to the marketplace over the next 10 years if you haven't heard about what we're doing at 10x incubator man you got you got some kind of crazy whack idea about the next piece of technology this is about technology okay 10x incubators the technology company cardone ventures is where we scale what else i got i'm i'm launching 10th 10x health system you'll see that website up this week to offer technology and alternative health solutions to people that want to stay in shape want to reduce anxiety and stress want to reverse aging i don't know if i can even say reverse aging but people say man dude you look like you what's that guy's name i'm benjamin buttons i said no i'm grant cardone and i take care of myself all day long okay uh what else do i have johnny what else do i have going on i got my 10x events that we do there's a couple there's some other partnership that i'm i'm forgetting oh 10x media okay these are all partnerships i'm 50 partner here 50 partner here uh 50 partner here 10x media we'll have a 50 we're gonna actually go produce tv and and and movies is happening okay so this is cool earned income other enterprises but here's the play folks here's the thing that will dwarf it'll dwarf everything and it's called the recapitalization of assets and when you recapitalize when you build assets and then recapitalize them with debt uh let's say my company let's say this company that does 300 grand a day let's say it's worth um and i'm just making this up for you guys you guys on uh uh let me just see here uh you guys on the internet uh that are estimating my net net worth and guerrilla what's their what's what's some of those the legit billionaire uh wealthy gorilla all you want to know about net worth everybody's out there searching my net worth forbes on my net worth you guys can't keep up with what i'm doing like i see what you posted on 2021 results and i'm like uh you guys are a little slow to the game here if you take if you take an enterprise that does 300 grand a day that's 109 million dollars a year without any extra events okay if i go and recapitalize this asset it is an asset it's a going concern an enterprise if you were going to go recapitalize this somebody's going to say this company's worth some number greater than the revenue it produces being that the graph that that it has is like that for not one year or two year or three years but for a decade or longer since 2012 for sure if you take these other enterprises for instance we have one that we started last year it did 14 million a net the first year uh let's say 14 million times four let's say it's worth 50 56 million but if we knew that that business was going to make 45 million this year and on track to do that that company could be worth 180 million okay so let's say this is worth 100 let's say this is worth let's say it's worth 200 to 400 million here let's say this company's worth 180 i could you could you might want to consider recapitalizing your assets when i recap an asset and i know the haters are going to be watching this right now i'm with you guys i love you guys hating on me man if you recapitalize your assets rather than selling your assets i wouldn't sell them okay what i would do is i would re-capitalize assets let's say they're worth 600 million whatever number you want to put you want to put 400 million this happens every day this is how the wealthy create wealth okay what they do is they would go borrow against this 400 million let's say they pull out 200 million dollars and when they pull out 200 million dollars and put debt on their company the tax event of 200 million dollars in cash is zero debt cannot debt by definition cannot be taxed every time you use your mastercard your american express your visa card or you go get a loan on a car you don't pay taxes on that you don't pay taxes on debt you pay taxes on cash that's why i say cash is garbage dude debt is actually your friend if you know how to use it so watch let's say i get an infusion of 200 million dollars if i wouldn't earn 200 million dollars i would only end up with a hundred in this case i end up with 200 million dollars i control the company that pays the debt on it i know the company's doing well this is basically an inside an inside job i want an insight i want the inside i want the answer dude i'm on the inside you and your business are on the inside you and your family can create this wealth plan earned income get it up as high as possible use the cash to buy passive income investments other enterprises and our real estate and the third thing you want to do is you want to recapitalize these investments you could take 200 million dollars and go buy one billion dollars with debt new debt by the way more debt more debt that's what i said more debt and you would buy a billion dollars worth of enterprise value that produced cash flow cash flow that would produce probably on this 10 million a year what's 5 or 200 million is that right i think it's 10 million all this is passive now i'm just literally making deals like that first property i bought that produced 200 of cash flow per month 2400. i'm going to tell you right now i'd rather have 2400 passive than 50 000 in earned income i would rather have twenty four hundred dollars a month a year in passive income than have fifty thousand dollars of earned income truth is i'd rather have them both and you should too okay so let me just put this in here uh to a 200 million yeah it's 10 million okay this produces now another 10 million dollars in cash flow and guess what that's passive income i think today is taxed at 19 until mr biden will probably change things 19 rather than the 39 percent that the average american pays today i just shared with you a little trick folks okay first is earned income then it's passive income then it is ultimately the ultimate goal for you and your family is to recapitalize your assets that's why you see so many companies recapitalizing you see so many companies using debt even when they have cash so there is good debt there is bad debt there are people good people basically using bad debt there's bad people using good debt and i encourage you to figure out this game between passive income earned income recapitalizing assets with good debt let's talk to our callers 305-865-8668-3058 please keep your questions to these concepts i know we talk about real estate a lot here real estate is one of those vehicles you can do this with okay i i know a guy that owns a car dealership right now the car dealership's worth i think the whole enterprise is worth 600 million and he everything's paid off he has zero debt no floor plans owns all his buildings everything i'm like bro go borrow 400 million dollars against those assets i hate debt grant i said this ain't the kind of debt you grew up with okay let's talk to our callers all right we got jacob in utah jacob what's up brother how you doing i'm doing good how are you doing g good man good uh what do you want to talk about well that's a that's a good question i came with a deal oh really but i really appreciated what you've been talking about already yeah so look like your deal does your deal provide passive income theoretically yes theoretically yes okay how big is it two million dollars 2 million 2.4 yeah so what are you going to do with that are you going to flip it uh hopefully yeah well then that's going to be earned income just so you know that is not going to be passive income a lot of you real estate guys out there think you're getting the passive income flippers are not flippers and wholesalers are earned income you're getting taxed at the highest rate not a bad thing not a bad thing i'm just saying that is that is by definition earned income are you going to hold this possibly hold it and keep it that would be awesome as well yeah how many units i guess if i held it and then recap i guess uh refinanced it yeah recapitalized would that be a better play and you're yeah 1 000 like one of the mistakes i made with my real estate is i sold stuff i shouldn't have sold stuff like this car dealer that i'm talking about right now he could pull 400 million dollars of cash none of it would be tax folks all he's doing is reaching into future earnings and dragging it out grabbing it from the future pulling it to him right now he's not over leveraged his car dealerships the car dealerships can service that debt he's going to pay on this debt he's going to pay probably two percent he's going to pay 80 million a year in debt 80 million a year in debt okay but he reached into the future got 400 million let's say the 400 million pays him um 20 million in cash flow see 400. i did this wrong 400 million it's not he's not going to pay 80 million he's going to pay 8 million i'm sorry 8 million in 8 million in interest to grab 400 million from the future pull it to him he's going to take the 400 million he's going to earn what is 400 million i i like to use these big numbers because they make they force me to start thinking big yeah that's going to earn 20 million sorry not 20 million so the 8 million over here that he paid in interest made him 12 million dollars the money wasn't even his it hadn't even happened yet he pulled into the future grabbed it but it's gonna buy him 1.2 billion dollars worth of real estate some of you out there you don't understand what i'm doing right now with the real estate that i'm like why is this guy so aggressively buying real estate because i'm using cheap money two percent three percent money to buy five percent assets okay assets that produce five percent cash flow that car dealer now would have income from his car dealerships and passive income from this other vehicle okay your two million dollar deal how many units is it fifteen fifteen under the limit that's cool what do you so what are you paying per door that's 2 million divided by 15. you're paying 130 where's it located uh lenore city tennessee and what are the rents right now the rents are 990 or about a thousand dollars each yeah okay and and what is it 1995 built [Music] it says to since 2015. okay 2015 build location what's the location um you mean like it's in lenore city tennessee which is a great place like overall the location specifically is like okay okay all right so look the only way you can recapitalize is by increasing the rents if you can't increase your rents it's not a play and and if you can recapitalize the rents do you have the do you have the 400 grand necessary to uh as a down payment no not even close so here's here's my question based on on what you just shared with about the car dealer with you know all that ability to recapitalize the assets and everything i'm a college student with with like no asset yeah i what i do have is a dad who's a doctor and so my play was to go get twenty thousand dollars from his partners each well you need more than twenty thousand to buy this deal you need about you probably need 400 grand yeah and he has 44 partners and so i have i i start with two people who would who i know i have two doctors and that would that would give me the 20 grand at first and i would just roll on that um so i don't know here's my real question for you um because i i'm a i'm a fan of the show i've been watching for a long time if if you're you know and this is a question you get all the time should i focus on number one right now should i focus on you know i'm about to leave college should i focus on trying to get like an investment banking job on wall street earn income first then go invest it or should i just try to raise money and try to go to the real estate game right now what would you do if you were well what i would do if i were you bro is i i would get around somebody that's playing the game i would find somebody i wouldn't go get i mean i would go find i would i would look for who not what and jared found who he didn't find what you know jared was 25 years old he found who who can help you move up the the ladder bro who who's in a vehicle big enough to include you some of you you're going out and getting you you're getting good at a job but man the job doesn't have any distance in it it doesn't have a trip in it there's no there's no way to win in it so if you're a hungry ambitious person go find who is more ambitious than you who has a is got a vehicle that like like imagine finding elon 20 years ago say bro i just want to help you get your dream help other people get rich get close to people that are ambitious that are wealth driven they'll they they want to share with you uh so no telling how many people jeff bezos has been through millions of people have come and go from amazon i'll bet you there's only one or two people that have hung out with him his parents did they put 250 with jeff they're worth 30 38 billion dollars today so find who has the energy like i'm 63 years old man i you know at some point i won't be playing this game but i got when i see somebody 79 years old uh the the i watched the game last night new england and uh tampa both both coaches are 69 years old i'm like man i got six years those guys are still out on a sunday afternoon playing football i got i got six years to become a a a hard ass okay so uh that's what i would do man i would find who can help you get into this real estate game in a big way ryan secco came and found me when he was uh 28 years old uh and i've taught him more about real estate than he could ever learn in a workshop but he's with me every day and he's got to put up with my every day so that's what i would tell you to do man you guys you guys that are watching this right now you're some of you some of you be like oh there's no way if the if the properties are worth 600 million this guy that i'm talking about right now kenny uh i i personally know i've known him for 40 years he has built a business that has worked today he could sell it jared you think somebody would come buy this thing for 600 million maybe a billion dollars rather than selling the asset because if he sold it for a billion dollars he would have capital gains on the billion dollars he would get whacked hard rather than doing that but even if he wanted to do that later he would go grab this money out of that okay he would go sit down with a goldman sachs or j.p morgan and and say look i want to pull 400 million out of my enterprise they would love to give him this loan he would borrow that money at 2 this is what you guys can do in the future the numbers are gonna be different it's gonna be 4 million or 40 million or whatever right he could pull this 400 million out he's going to pay 8 million a year in in interest all of which is deductible not true on your home i think you tap out at 750. 750 grand that's all you can write off in in times 4 percent is all you can write off an interest maybe 28 000. he can write off 8 million in interest that 8 that 400 million he would invest in deals like i'm doing he would earn 20 million you understand he makes 5x on the interest but what happens the way the wealth is created he's my age he would take the 400 million dollars he wouldn't go buy car dealerships he would move into another space that has nothing to do with car dealers he would go buy 1.2 billion dollars worth of real estate with me and this 1.2 billion dollars worth of real estate let's take it out 10 years okay let's say it goes up 3 a year for 10 years that's what rents do okay the 1.2 billion now goes up 30 what is that jared 360 million now he'd be like i want to sell to real estate no bro we ain't going to sell to real estate we're going to recapitalize we're going to recap the real estate it's worth 1.3 billion today we're going to go borrow 75 percent of that 1.5 1.56 billion actually is it 1.5 oh oh yeah oh yeah it's worth 1.6 billion let's just go ahead and exaggerate by 40 million because that's the kind of numbers you're done by now all of a sudden things get ridiculous and all of a sudden everything gets everybody gets optimistic okay and and interest rates go down when you do these big deals one six i'm gonna get a loan for uh 1.2 billion what did we pay for it 1.2 yeah guess what he gets part of time he gets his 400 million back and because he's hanging with me i'm gonna be like bro let's roll it again now he's like man i'm 89 years old i don't give a about this but what about your kids what about your church what about your community roll it again bro this is how the rockefellers played the game this is why they still have like you got you got rockefellers are still all over planet earth man they own they just don't call it the rockefeller bank they call it the bank of america j.p morgan park place jp morgan's been going how long pumping doe every day and he ain't been around for like 90 years okay this is the game folks first get your earned income under control don't spend more than you have or make use the extra to go make investments to get you number two the pi passive income passive income by definition is where you are not where you are not involved okay this is how you create your net worth passive income by definition let me just read that to you again limited partnerships rental properties or other enterprises in which a person is not actively involved by the way i'm going to go back with the irs all that money that we've received from scott morgan at the cardone group that should have been treated as passive income royalty income we've been filing that wrong okay how many can you go back i'm gonna go back as far as i can okay so um man i'm gonna sue the irs and the federal government oh okay um okay uh we got any other callers johnny 305-865-8668 today we're talking about passive income earned income and your wealth recapitalizing assets if you and your wife you and your spouse had this in mind right now if you guys were thinking about hey what are we going to do to buy a yacht one day or to be able to go to to serbia or croatia or south of france and just float in a boat for for a month magic johnson shared that with me last week in an interview if you guys want to grab any of that material if you want to be part of this three-day wealth building boot camp grantcardone.com virtual that's what i'll be sharing with you for three days giving you the exercises necessary for you to go from earned income being a slave no problem i'm willing to be a slave i tell jared this all the time you guys to talk about a job dude i never leave my first job pass earned income to get passive income to some one day recap assets and this is how you create wealth right here you do not create wealth with passive income only you create it massive wealth can be created by recapitalizing assets like magic johnson was talking about he did his game on the dodgers they sold it i bet you he wished they would have recapped it you can do this in franchising you can do this okay a grant cardone licensee we're getting ready to expand our licensee program to include coaches around the world we're going to explode that business uh 10x health systems we're going to blow that into a billion dollar business and we're looking for nurses and doctors that want to help us if you want to if you're interested doctors and nurses that are under attack by the fda right now and the cdc and the who we're building out 10x health systems email um i need an email for that jared grant at 10x healthsystem can you get that set up grant at 10xhealthsystem.com we're looking for doctors chiropractors pts nurses you guys that are in that space you want to get into this we're going to basically create a franchise for 10x health systems and have 10x health centers around the world okay we're going to make some announcements right now i'm not right now but in the in the very near future of some of our new partners and when i mention their name you're going to be like didn't that guy used to play soccer that's a little drop big names man big names are coming nurses chiropractors anybody in the healthcare space okay you want to optimize if you're interested in providing your your your customers with uh delivering cutting-edge technology on on health optimization on uh alternative solutions to taking care of pain repetitive injuries aging reversing the process making sure people look as good as they do and have as much energy as possible email me grant at 10x healthsystem.com 10xhealthsystem.com that's going to be a business i'm going to build that into a billion dollar business and then we're going to go recapitalize it grab money from it and go build other businesses with it 10x incubator i'm gonna build that into a multi-billion dollar business and do exactly what i'm saying or i'm gonna bring it to wall street cardone ventures gonna do the same thing if you guys want to do that in your life i wanna help you do that or you can sit there and just earn income for the rest of your life and get exhausted that's why people burn out man you guys burn out because you don't know this part of the game like you're not going to burn out doing this it is impossible to burn out doing this recap you don't burn out you can't get tired okay you're not trading time for money you're you're trading you're leveraging assets that pay you today and you take the money from the recap and then you earn more money passively let's talk to our callers johnny enough talking enough talking johnny mr rodriguez mr rodriguez i hope you come spend three days with me uh at the cardone grant cardone virtual boot camp grantcardone.com virtual what's up oh hey grant uh thanks so much for taking my call gosh i had a couple of questions and now you're talking about this 10x health systems uh this is actually dr steve rodriguez uh you sent me a shout out a while back and uh and yeah this 10x health systems thing yeah i'm really uh curious about it but uh i'm looking at i'm a pharmacist is what i am and do you have any need for is there a benefit for that i mean is there a one thousand percent bro one thousand like okay when i see what's happening in your space right now how how doctors uh nurses first responders when i see what new york city did the other day with 70 000 people in the healthcare space i'm like we're going to do something about this so yeah i need pharmacists i need doctors i need health care physicians registered nurses uh i mean they're chiropractors chiropractors like anybody in your space that understands bodies alternatives like that doesn't just want to go by the ama let's cut let's medicate uh no i know that's what we need grant that's what healthcare needs they need a disruptor okay yeah i mean i had my own pharmacy for 12 years i built two of them from scratch and i was able to exit at a 10x multiple um and and ever since then i started back into real estate i've been following you for a little over two years been on card on you for two years and now i'm looking at making a a career change and going into sales selling body scans which is preventative medicine which is something that i can totally buy into because make it harder as you know health care is a very reactive industry you know they wait until you get sick and then they start treating it nobody wants to try to keep you healthy and so if i can attach to something that i can believe in well preventative medicine is where it's at yeah steve where do you live the guy i mean where do you live in valley where i live in dallas oh dude see we need to we need dallas as a spot we got i need like phoenix tucson dallas i mean dallas is so big i could put i could put eight or ten 10x health system uh clinics in dallas by itself and here we go the guy the guy that i'm that i'm gonna interview with tomorrow this guy owns these body scanning clinics guess what this guy is this guy is a fellow 10xer okay whenever whenever he's on my resume that that that i'm studying that i'm following i'm on card on you yeah he was like i need to talk to this guy me and this guy met last week and we just hit it let's go and by the way what do we need to do this is you you should email did you get the other one set up they're gonna get it set up just email partners it's gonna probably gonna bounce because you know yeah it's gonna take a second to set this up this is like literally i'm launching this this morning don't email jared no no no no no no don't don't confuse people we got we got grant at 10xhealthsystem.com email me there uh and it just give it about give it about 20 minutes for it to work yeah and then and it's really the next health system yes steve this is a this is a practice that you could set up that we expect we're setting one up in miami we think it'll make without a lot of attention 10 million dollars the first year okay so so are you going are you going to strictly cash model or you're going out including third parties on that networks cash only brother i don't want anything to do with these people i don't want anything to do with the health system right right and that's what you want i mean that's where it's at that's where it's at so you guys like yeah and then i'm gonna be i mean people can see what i'm doing with my health they're like dude the guy's doing something so i've been working on this now for three years uh i started having pain in my body when i was 45 and for me everything everything that i find or discover in my own life i'm going to turn it into a business everything so i took my real estate learned about it became a professional at it became a sensei became a master at the game and then i'm like okay i'm gonna share with other people i turn that into an education platform that then feeds our cardone capital fund i'll do the same thing with healthcare took care of my body i've been working on my body now for what jared three four years really hard probably three years so i've learned a lot about what do i need to eat what does my blood say man my blood my blood not just my blood type my blood what's going on in my blood is different than everybody else's blood what does it need what deficiencies do i have and my you know how would you feel about getting a scan though have you ever gotten a full body scan where they can look into your body and check your heart check your lungs check for masses i love i love the full body scan i love all the tech out there i like the swabs have you done a swab yet i have been swapped yes i have yeah so i mean we can do a 20-second swab in your mouth not the not the nose uh in your mouth like literally like just in your cheek we could send you the package you cheek it out send it back to us and we're going to tell you every deficiency you can you we're going to set up to where we can roll this out doctor where we could take thousands tens of thousands of these swaps and start calling people say this is where you're deficient this is the fact of your what your blood is saying to us in present time yes this is awesome this is awesome you know what was your question though you had a question man we'll hook up on this but what was your question yeah yeah well i had a deal i had a deal you know i've been investing for real estate ever since i sold my business and i've been investing in real estate and i'm trying to get into multi-family and i've got a 26 door deal that it just came across my desk like literally right before the show came on yeah and i'm just like been trying to just crank the numbers out and i just want to just kind of bounce it off yeah but let me just say steve because you're a doctor dude you and i could make more money together with this 10x health system and then and then once we start partnering and working on it remember i'm going to be blowing on your business so i'm going to be blowing on the brand and the more i blow in the brand the easier it's going to be for you to sell your services and and uh to the public in dallas but then once we start creating enough pas enough earned income from your practice then we can start parlaying some of that dough to buy the buy the real estate deals okay okay all right reach out to me all right we got vincent in upstate new york vincent what's going on in new york in upstate new york my friend uncle g what's up come on man how are we doing good i'm doing great how are you doing so i just want to start off by saying thank you for like all the videos you do i've been watching them you taught me how to underwrite like my first deal i've been watching a lot but that is not the reason for the call today can you hear me yeah man look look look did you see this new report man and that this one's good huh oh wow wow there you go i don't know why people been man i i saw one of them the other night i was worth like 300 or something i was like wow man that's that's sad my wife said why are you so depressed i said man google's kind of like trying to take me down we gotta vincent what's up bro all right i gotta i gotta let you know i'm calling in so i don't know breaking up a little bit today you're fine man i work for um a startup company and i wanted to run it by i wanted to tell you what we're about i got my ceo on the line and i wanted to just explain what we're doing maybe hopefully set up a meeting with you another time okay what are we meeting about man cool what are we gonna meet about this is a great article man um so it has to do with real estate uh real estate titling okay email annie grantcardone.com email annie at grant cardone.com i love this man alterman annie a-n-n-i-e grant cardone.com man okay next caller all right we got nathan in kentucky nathan what's up man this is a nice article man finally somebody's nice uh i'm up hello can you hear me i'm up the market's down and i'm up dang what's new what's up what's your question i want to tell you something i want to tell you a little bit about myself and then i got a question for you all right all right so i am 21 years old i own a roof cleaning and pressure washing company in central kentucky there's a lot of pressure washers around here uh i make this is my technically my first full year i started last year i've only made around forty thousand this year which is actually triple what i did last year uh and i'm about fifty percent profit range i want to change the industry on cleaning roofs so you know getting rid of the black streaks on the roofs that's what that's the reason roofs go bad not almost no one knows about this and i want to my question is how do i market to something that no one really knows about and i'm a small guy okay dude you got to get you got to you got to learn how to market have you got our marketing program i just signed up saturday for your uh uh the virtual thing and the reason that i did is because of the marketing mastery you included in there yeah i want to learn how to market so i already sent you the link grab that program and start eating it all and every time every time i say something you're like i don't know if i agree with that that's what you need to do you all need to do what y'all do y'all need to do the stuff that you don't agree with me on not the stuff that you do agree with me on you know it's funny when people read a book they they underline everything that that they're like huh you know the yellow the yellow thing mark the only thing you guys are underlying is the you agree with what you need to do is go back in the book and look at the stuff that you didn't circle didn't underline and didn't highlight because that okay is where the gravy is okay next caller all right thank you sir but i'm not going to say it about myself probably one of the greatest marketers that has ever lived on the planet i mean just saying like humbly saying it by the way humblebrag louisa what's up nothing i'm hanging out at home per usual on a monday afternoon watching you on youtube the reason i'm calling in is because i had a quick question so my fiance is planning on moving out of his first home that he has now it's a three bedroom two bath renovated so it's pretty nice um the question that i had is that you mentioned something that interested me you said that basically if he didn't have a property manager it would be taxed as passive income and i didn't know if you had a little bit more information on that i mean i understand you're not a financial advisor but what exactly what what is the question just give me that one question again i missed it give me the one question you asked what talking your phone though you're you're you're too far away from your phone um i'm not too far i'm right next to it you can hear me yeah yeah but it's just chocolate i had it on speaker is this better take it off a speaker there you go okay thank you that's better so first time rental property now there's no property manager what is the suggestion to go about it about how long should we wait or what are the benefits of the property management well guys by definition yeah by definition if you own a piece of real estate and you manage it yourself that is not going to be considered passive income okay it's not like like you you're going there you're renting it you're collecting the check and there's rules right so uh you need a property big enough and i've said this to you guys for for many years now is you need a property big enough to where you can afford a manager so if you if you have a property if you have a property it's like a business a property is a business if you have a property that earns a thousand dollars a month times 12 months it earns 12 000 a year like how much can you afford to pay a manager the guy's gonna want ten percent to manage the property and then that's only twelve hundred bucks a year so what did you get you gotta go for a hundred bucks a month who is going to manage the property they're not gonna do it so you can't afford a manager which means this is a terrible deal could you make some money on it yeah maybe you take it buy it flip it and that's earned income if you manage yourself that's earned income i would suggest to you that you would go find at least 32 units at a thousand dollars a month or 800 a month that you could raise the rents on 200 a month because if you can raise 32 units if you can get 32 units raise the rents 200 bucks a month you will make a million dollars on that transaction or the value of the building goes up a million by the raise of the 200. you can't do that on one unit and now you can afford a manager or you can even make the manager an equity partner the sooner we get this done the sooner we get here and the sooner i give you your piece okay that is the value of having assets that grow not a business that you grow okay i hope you guys enjoyed the show today grant cardone cardone zone every monday i do this show show them this man i mean i'm making so much noise man i got people saying that i'm making 321 grand a day by the way they got that right okay 13 000 an hour 223 a minute jared do you know i'm 223 million if you got some bunch of video that you want me to shoot today i need 223 a minute jared but you know what i'm not going to do that jared i'm going to do what magic johnson said quit trying to earn another dollar and get you some equity okay and that is the point of the show today folks i hope you walk away with this earned income is cool get as much as you can until you can get passive income okay passive income from assets okay the goal is to accumulate these assets to 10x your assets you might have to 10x your income to get the assets oh i'm frozen uh to 10x the assets because if the ultimate play is to recap and i know some of you thinking i got a job i can't do this that guy's sitting next to me he's got a job and he's doing it because what he does is this he earns income he earns let's say he earns 200 grand a year after taxes he gives all of it to me i invest it and we start buying assets and then he gets income so he's got 200 grand a 200 grand coming from from earned income and then he keeps building 200 grand a year 200 grand a year 200 grand a year 200 grand a year the next thing you know he's got two million dollars worth of assets producing another 200 grand a year right so your first goal would be to get earned income i'm gonna give everybody a goal here it's your family to equal to equal passive income you won't get there i've never been able to catch up with my my earned income because i'm broke all the time so i hustle and my earned income keeps going up it's a it's a crazy game your goal should be to get your pat earned income i'm sorry your passive income to be equal to your earned income your next goal after that would be to have a recapitalization of assets where you get a big load of income and you pay no taxes that is the perfect wealth building plan if you guys want to know how to do this for yourselves i'll walk you through it on october 22nd 23rd 24th go to grantcardone.com forward slash virtual it's live so i'll actually do it with you it's only 297 dollars if you give me the commitment to those three days you save yourself twenty eight hundred dollars all right again you do it october 22nd okay we'll do it later three grand how you doing johnny i am not available do you available to get rich man when somebody says i'm gonna show you how to get rich bruh i'm like i'm available i am available i don't make excuses i make time [Music] time is money you don't make time to earn the money if you don't make time to learn about money if you don't make time to get money to make money guess what folks you're never going to have time grant cardone.com 4 slash virtual thank you for watching today tell your friends hit that little notification button the bell if you didn't like the show today please post in comments because i love love love love that hate if you like the show please send me some love i need a little bit to keep me inflated on myself god bless you guys be great and remember peace love and cash flow [Music]

Channel: Grant Cardone

Views: 31,196

Keywords: grantcardone, grant cardone, 10x, money, finance, business, sales, motivation, yt:cc=on, WeAre10X, 10XNation, 10XStrong, 10XLife, 10XEverything

Id: I3mWzN_j1EI

Length: 69min 25sec (4165 seconds)

Published: Mon Oct 04 2021