[Music] the signs were everywhere but now it's official we are in a recession the law of gravity hit Wall Street today and financial markets around the world for that matter as stock prices plunged even more than they did on Black Tuesday of 1929 recessions markets losing money stock market is down real estate goes down unemployment thousands losing their jobs around the world stock markets fell faster than a sky dier without a parachute business is going out of business fear bankruptcies life savings are lost pensions vanish at leman's European headquarters in London they're carrying out their careers in boxes nobody wins but that's not true if recessions were so bad why would Warren Buffet say that he wishes for more recessions massive companies like Disney GE IB M HP FedEx Microsoft Airbnb Uber Instagram WhatsApp Groupon all started during a recession and are thriving even today while some see recession as a period of turmoil others see it as a golden opportunity if you are as curious as I am and also want to profit from the recession watch this video till the [Music] end so in today's video I wanted to talk about four things and it's actually a step-by-step process step one is understanding the rules of recession step two is preparation step three is the collapse and step four is profiting so is Canada in a recession and the answer lies in all the news articles that you have been seeing um now a technical definition of recession is that if there are two consecutive quarters of negative GDP growth then we are in a recession and we saw 0% growth of GDP for the second quarter and that basically means that we are on the brink of of a recession now besides the GDP numbers have not grown since May and that's not a good sign we have also seen layoffs happening not just in the tech sector but other sectors as well and RBC has projected unemployment rate to reach 6.6% by 2024 and they are expecting insolvencies to Jump by 30% over the next 3 years and we have also seen a lot of big retailers going out of business it started with Bed Bath and Beyond and we'll probably see a lot more of that happening in the next couple of years so the question is what causes a recession and the answer is we don't know because the economies are so complex that anything can trigger a recession and in 2018 it was a subprime loans that were given by Banks to people who did not qualify for loans and this time it's a mix of coid and a lot of money being printed out of turn and on top of that we had a couple of wars that is not helping our cause now let we understand recession and know that we are going into one let's understand the rules that surround a recession the first one is nobody can predict or time the market because if you were able to do that everyone would be a millionaire now yes we are going into a recession but we don't know where the bottom is is the real estate market going to crash more probably yes but can we wait to enter the market till we hit the bottom we don't know we just don't know where the bottom will be hit so for instance I invest in the stock market every single week should I stop investing into the stock market because the recession is coming and I know the market is going to go down probably I can but it's very difficult to time the bottom and where to enter next and therefore I have stopped timing the market that's rule number one rule number two is the market will bounce back even if you buy at the peak and I'll actually show that with a graph even if you buy at the peak long-term 10 20 30 years it would not matter and one thing that we have learned in a recession is yes the markets go down all asset classes go down but good asset classes and good companies and good Investments always bounce back and number three and that's probably the most important thing is you need a money plan even if you have half a million $1 million if you do not have a money plan of how you're going to invest in a recession all that money will be of little use we'll touch upon these in the subsequent slides as well but let's understand the second point which is preparation and I'll talk about that in my context the first one is stop spending so me and my wife make it a point that every first Sunday of every week we actually look at our expenses from our last month and make sure that we are not spending money on things that we don't need budgeting is really important in any Market but especially in a recession you need to know where your dollars are going yes there is Black Friday coming but do not spend money on things that you do not need only buy things if they are absolutely necessary the second part of preparation is buildup Capital if you are in a job right now maybe start a side hustle so that you are able to get a couple of thousand more every single month now I understand everyone who is watching will not be in a position to do that but what me and Simon did last year was that she changed to a contract job and I doubled down on my business and any Access Capital because we we were not spending any money on anything that we didn't need in any Access Capital we actually have in our bank accounts right now to capitalize on the recession it's really important right now if you're sitting on cash to keep sitting on cash and be patient because there will be enough opportunities that come your way in the next 6 to 12 months and in case you find yourself in a situation where you do not have enough cash that's okay too as long as you have good income you'll still be able to capitalize on recession especially if you want to dollar cost average into the stock market the third part of reparation is avoiding debt no unpaid credit card bills no line of credits no expens cars right now and the fourth one is building up your credit score and that's very important because when the opportunity strikes when you have to buy a house you need to make sure that you have enough credit in order to buy that house at a discount and last but not the least educate yourself you watching this video means that you want to educate yourself educate yourself on different asset classes should you buy gold or not should you buy real estate or not when should you buy real estate what kind of real estate to buy I'll talk about that a lot in the next coming uh weeks as well so do subscribe to the channel by the way and if you want to invest into the the stock market have you picked the stocks right are you doing ETF investing all that is really important and you need to educate yourself I have made a lot of videos on this channel on this so do check those videos out and I'll be talking about this in the subsequent slides as well so that's preparation stop spending build up Capital avoid debt build up your credit score and take these three months to educate yourself so that you are able to make the Right Moves now let's talk about the third thing in a recession which is the collapse when do you know that there's a collapse happening we already have seen step one happening which is people are losing jobs so that's something that has happened in the tech companies Moree but we are starting to see that in other retail-based companies as well can entire low Shopper Drug M all these big companies are also laying off people right now and it's not just the tech once people lose jobs what happens is homeowners actually feel the stress and they are not able to pay their mortgage and they Def and they start defaulting on mortgages even people who are not homeowners they are tenants and if they lose their jobs they can't make rent and therefore the owner of that house the landlord is not able to make payments and therefore the mortgages cannot be paid so there will be stress on mortgages that we'll see in the next few months third thing and we have already seen that but not just the big businesses but the smaller businesses are also struggling because there's just not enough spending power for instance let's talk about clothing I as an individual if I'm struggling in a recession I'm not making enough money I lose my job I'll not buy the fancy clothes that I don't need and as much as this recession impacts you it impacts those businesses as well and therefore all these businesses also start to collapse that has always happened in a recession and this recession will be no different and what we'll see is a lot of panic in the market everyone will sell everything and that's where you come in because you have educated yourself we can actually profit off this Panic so let's talk about the fourth step which is profiting so me and Simon has saved almost about $250,000 in our bank account to profit from this recession now first I was not very comfortable putting this number but I really want to be transparent and I want to show you how I'm planning for this recession now like I discussed in the previous slides money is not enough you have have to have a money plan that was one of the rules in a recession in Step number one so what I am doing with this $250,000 is that I'll be putting $50,000 towards stock now I already invest about $2,000 a month which is $500 weekly I've talked about this in a lot of videos but over the next 12 to 18 months I'll allocate an additional $50,000 towards stocks and the how part of it I'll discuss in the next Slide the second part of my equation is real estate because I understand real estate well I'm in the market I get access to Deals therefore I have allocated 40% of this budget towards real estate that means that I'll be buying one piece of real estate in the next 12 months and the rest of the 40% goes towards business now let me break down these three asset classes one by one first let's talk about stocks now I'll highly recommend that you read this book called Rule one investing by felt toown the reason why I say that in a normal circumstances I would ask you to invest into ETFs where you can invest your money slowly and it grows at 6 to 10% depending on the ETF that you buy I've made several videos on this but rule one investing by Phil toown is a more advanced form of investing where we talk about reading a cash flow statement reading a balance sheet where you have to look at return on invested Capital sales growth rate earnings per share growth rate Equity growth rate and operating cash flow growth rate for the last 5 to 10 years in order to make a decision whether a particular stock is a good stock to buy or not this is basically value investing where you're trying to decipher what is the right price for the stock to buy in a recession now generally speaking I'm not a huge fan of doing active investing into stock market but this time I've actually gone back to the book I read this again and now I'm more confident of making a few moves in the market now while you're investing in the stock market remember the first two rules nobody can predict or time the market so do it slowly do it consistently and do it over 12 to 18 months and not doing in the entire 10 20 $30,000 whatever you have budget towards the stock market put into one stock or a couple of stocks at one time do it consistently over a long period of time and the second one the markets will bounce back it's okay if your stocks go down in a couple of months don't be obsessed with where the market is going just be focused on doing it consistently in stocks that have long-term value and make sure you do not panic and hold that stock for a long time because again the markets will bounce back but honestly if you are not into Stock Investing if you don't understand numbers well enough you don't really have to go through the book that I just talked about and you don't really have to invest that way and you can still make a return of over 8% in this particular market and I can prove this to you based on the historic numbers of S&P 500 which are the top 500 companies in the us aggregated together so this is the trend of S&P 500 from 1990s all the way to today now if you entered the market just before the Doom bubble in September of 2000 which is the peak of the market at that time and you invested $1,000 every single month from September of 2000 all the way to today every single month $11,000 into the S&P 500 one index $11,000 a month every single month without increasing or reducing that amount very straightforward strategy you would still make almost 10% of year- on-year return you invested at the peak and let's say you invested at the bottom let's say you were able to time the market and you were able to do that on September of 2002 where it was actually the bottom no one could have predicted it it was just the bottom then 2 years later you would end up with about 10 and a half % of year- on-year return so it's not very different over the long term so you don't really have to complicate matters all you can do is just start investing today and do it slowly over a long period of time and you will win now you might say that this is a one-off case and this might not be true but let's talk about 2007 and 2008 subprime crisis let's say you started investing in September of 2007 again I don't know what's up with September but you know that's where repeat September of 2007 again and if you invested every single month again $11,000 you you would still end up with almost a 12% return year on year and this is again one index S&P 500 over a long period of time every single month consistently $11,000 and let's say you were able to time the market and you entered the market on February of 2009 which was actually historically you know pretty low um part of the market you will still end up making not more than 12 12 and a half% return again if you do it over an extended period of time consistently the returns will still be pretty amazing and you do not always have to get into the complication of going individual stocks now I will be making a lot of portfolio moves over the next few months so if you want to follow my ETF and stock portfolio you can actually follow me on Blossom which is an amazing social media platform for investors it's completely free to download you can actually connect your trading account as well you don't have to if you don't want to but if you do you can actually look at all your portfolios you can look at analysis and not only that you can check out my portfolio what I'm investing it the move that I'm making and the best part is at least for me that I can actually follow other influencers and see what they are doing with their portfolios it's very very transparent Brandon Bas is someone that I've always followed I also follow someone called Joy Yang she's also there on Blossom and Canadian n t-shirt I'm pretty sure a lot of you know this and he has over 22,000 followers on Blossom all these guys have shared their portfolio all these guys share their insights so I highly recommend that you are on this platform if you are interested in investing the link to download this app is in the bio and do not forget to follow on Blossom as well now if you have been following me here you know that I did a financial literacy Workshop a few weeks ago where I talked about investing in one of the modules and there we talked about which vehicles to use to invest into the stock market and which ETFs have outperformed both in the US and Canada over the Long Haul if you miss this Workshop I will be launching it again on my website it will not be a live session it'll be a pre-recorded session but that will come in the next couple of weeks so stay tuned for that now let's talk about the second asset class where I'm investing which is really estate $100,000 in the next 12 months and I've made several videos on this I've made a video on how to buy your first rental property step by step so the link to that is in the description that is probably the most risk averse way of investing those $100,000 I've done some riskier stuff as well I'm potentially looking at us to invest those $100,000 because there will be a lot of deals that will come into the US I've made a video on that as well and I've also made a much more riskier way of investing that $100,000 which is INF Phils which is also there on the channel all these three videos will be linked in the description below and there'll be one more video that's coming up next week on the best way to buy pre-construction That's The Fourth Kind of investment that you can potentially make in the next 12 to 18 months I'll talk about that in my next video so make sure that you subscribe to the channel so that you do not miss that video now let's talk about the third thing which is business and that's my favorite part right now because I am launching grow Nation I actually did a workshop already and I'm investing back into my business I'm doing a mega event which is a networking event of over 400 people my coaches my mentors my business partners my clients everyone will be there in person in Oakville Ontario I'm super excited so I'm actually spending a lot of money on this particular event and the reason is that I want to Brand myself very differently not only this but Simon left her job recently and the reason is that we are building an app which is a grown Nation app and this will be launched early next year so I'm making some really critical and important moves in my business in the next 12 to 18 months and this business will be an absolute win-win not only will this business help me increase my net worth it will also help a lot of people who are part of this ecosystem to increase their net worths as well and no grow nation is not only about mortgages now I do have one last slide where I'll be talking about how to think of a six figure business if you want to build one and use this recession to scale a business but I highly recommend that you read these two books the first one is 100 million offers by Alex hzi I've used the blueprint that he used in this 100 million offer first to launch the first Grown Nation Workshop where I was able to raise $330,000 in just 7 days there's no rocket science all I did was read this book and implement it within a month and the second book that I'll recommend is 100 million leads I've again used the same blueprint to launch grow nation that you will see in the next 6 months now I'm not saying that it'll be easy when you read these books to implement in your business because you might not have a business right now but still I'll highly recommend that if you want to scale a business if you want to start a business I'll highly recomend recommend these two books and you should download these the link again is in the description below and there's one more person that I absolutely love for the last 12 months I've been following her it's Cody Sanchez and she talks about building boring businesses and I absolutely love her I would highly recommend that you follow her as well now my last slide and this is something that I discussed in my financial literacy Workshop as well in one of the small sections now this will be up on our website next week I think I'm hoping I was actually going to launch it on my birthday which was yesterday uh but I was not able to uh but hopefully in a in one week's time this will be up you'll actually be able to see the entire workshop and consume all the content but this is one slide that was actually very helpful in that Workshop a lot of people actually like this so I'll talk about how to think of a sixf figure business if you want to invest into one number one is that you need to look at the problem are you solving a frustration for instance financial literacy is a frustration amongst a lot of new immigrants and that's where I really want to help people and that's solving a frustration or are you solving a scarcity so in my experience in Winters I don't see enough towing companies when there are so many accidents I don't see a lot of snow shoveling companies for busy people like me who really doesn't want to shovel their snows and the third one is solving rich people problem for example financial planners would want to solve a problem of how to invest people's money same way Real Estate Investors and real estate developers have to allocate funds of their investors into different projects and that's solving rich people problem and those are the three things that I see have worked really well in the market my rule of thumb is that we first need to identify how many sales do you need to make $10,000 a month because I really feel that $10,000 a month is enough to not only leave your 9 to5 job but also to give you stability in your life and in your business so let's say these are gross sales of $10,000 a month obviously you have expenses and taxes after this now if you are making a $5 cupcake let's say you make absolutely lovely cupcakes and you charge $5 for the cupcake you'll have to sell 2,000 of these every single month that's really hard to do especially when you're first starting let's say I have a course of $100 I have to sell 100 of these courses every single month now it might be a little bit easier for me to do it with my audience however it's not always easy to do when you're are first starting out without a lot of social influence however for me one mortgage is close to $5,000 in Gross commissions so I only have to do two to reach my target of $10,000 now I'm not asking you to be a morgage agent please do not please watch my videos on what it takes to be a a mortgage agent I would not recommend it's a highly competitive industry for anyone to join um I'm not trying to discourage you here but I don't want this to lead you into something that you don't like uh and that's why I'm putting this disclaimer but again you need to think of your business as what can get you to a certain amount and how many sales do you have to really do to reach that Target number that you're looking for $10,000 in this case and the second thing that you need to think not just the price point but the second thing that you need to think is do you need 2x resources to reach $20,000 let's say you want to scale a business of $10,000 to $20,000 do you need to put double the time for example if you're doing ubering if you are you know doing Uber Eats or you're doing you know Skip the dishes in order to make double the money you'll have to double the time that you are spending so that's not very scalable however in my case if I'm doing mortgages or if I'm selling a course I can actually hire sales people to do all the sales for me and I do the Fulfillment that's very scalable and I don't necessarily have to double my resources to double my income for example people people who build apps if you build one app if you build one system once and you sell that system to a person on a subscription you actually can make the money even if it's a small amount over a long duration of time I'm not saying it's a easy thing to do but people who have built really good apps with reconing Revenue they don't have to double their time or their resources to double their revenue they can actually just double their resources and 10x their revenue that's extremely scalable and the third thing is your goto Market strategy for me it's a three-part strategy that has worked for me and a lot of people that I know the first one is a free gift for example I'm making this YouTube video as a free gift you're watching this I'm not charging you any money the only cost that you pay is your time then you need a product to prospect what I mean by that is let's say you have a coaching business or you give job coaching let's say and let's say you are doing a consultation call for $30 for 30 minutes that's your product to prospect for instance if I have a course on my website that's a product to prospect because it's just $100 $200 it's not my core product offering it's just something that can get you into the ecosystem that I have built for example for financial panners selling this insurance or a 1hour financial consulting call will be a product to prospect however all these financial planners actually have a different core offering which is they invest people's money which is usually in hundreds and thousands of dollars sometimes into millions of dollars depending on how experienced the financial planner is and that's where they make the most money off for example for me mortgages is my code offering because mortgages is where I make the most money in so whenever you're think of any business whether it's a physical business or a service based business you need to think of a go-to strategy and these are the three things if you have that in your business you increase your likelihood of success by a lot that's all I have for today I hope you got some insights around how to profit from this session and hopefully you are able to take a Le from how I am diversifying my investments into three different asset classes over the next 12 to 18 months so do subscribe to the channel if you have not done that and do hit the like button because the algorithm only works that way it will show this video to more people like you if you hit the like button and I would really love to know from you what you like the most about this video in the comments below video [Music] bye-bye
