This Framework Will Help You Reach Financial Independence in 3 to 7 Years! / Garrett Gunderson

because wealth is a game of value creation and dollars follow value so what i want to make sure that we do is first of all build out a framework that if you leverage you can achieve economic independence somewhere between three years and seven years three years if you're already on a pretty good track and seven years if you're addicted to lifestyle and probably have a bunch of money that you need to pay back to someone alright so the good news is this isn't some 30-year trajectory where you set money aside and you budget because budgeting sucks or where you scrimp or save or pinch pennies till you get blisters on your fingers because that's not the road to wealth yet if we read most financial books that's what they want you to believe if you just hand your money over to other financial experts that one day someday compound interest is going to kick in and then you're going to have a bunch of money that hasn't worked [Music] you know i hear the word generational wealth as they kind of introduce me and hear about like what the one percent do and yet i think back because david and i were in italy this summer together i invited him out to our villa when we were there for a few months and the reason i went there was to reconnect with my roots see my great grandfather left italy in 1913 which is an interesting year to choose to leave because the reason he left is because he was being taxed so heavily by the italian government and the mob because he lived in san giovanni and when he left he had to leave his wife who was pregnant with their first child and then he got on a ship he had mozzasoli which is honey bread so that it wouldn't spoil not sure he had enough food to make all the way to the united states in the name of making a better life and being the catalyst for the legacy that i'm now responsible for in my own family once he got here they didn't even understand him because he didn't speak english and they changed his name when he went through ellis island so his last name was iaquinta now it's equinto all of a sudden because he shows up he gets on a train he takes that train all the way to a small town in utah called east carbon where he becomes a goat herder lives in a freaking tent just to save up enough money to hopefully send some home for them to be able to live and at the same time hopefully be able to be a buy a home and then bring them over to live with him again that was a seven year process before he saw his daughter who was almost seven years old and before he saw his wife again and then he became a coal miner i'm from a coal mining town where my grandfathers and even my father were coal miners i decided to mine something other than coal i decided to mine wealth and what i mean by mining wealth is call's a pretty dirty energy but each one of you have your own energy that is very clean and i call that a sole purpose soul it's your values it's your abilities it's your passion it's your purpose it's the best container of who you are and when i heard the investment panel even in the world of investing we can talk about a concept like that because in investing when you heard hey if you had a million dollars what would you do with it and the answer should be different for everyone because they were discussing something called investor dna investor dna is what is it when you look at your own core values and your own core competencies and what really drives you and then focus instead of diversify see the ultra wealthy they're not overly diversified they might diversity when they have so much wealth they need to find places to put it but to get there it was a game of focus andrew carnegie said he put all of his eggs in one basket and watched it like a hawk so see my great grandfather didn't have a lot of wealth to manage necessarily but he did something that was kind of a gift for my family because i realized the reason he had to leave his family for seven years because he didn't understand what i'm going to teach you today that's why it's so important to me to make sure to get this message out there because he didn't have the team he didn't have the insight because here's the bottom line and i would write this one down hard work with the wrong philosophy still equals bankruptcy still equals poverty if hard work equaled wealth these coal miners would be the richest people we know but when you think coal miners in west virginia or price utah we don't think about a lot of wealth we might think about black lung might think about death you might think about a life which it really was so it's really important that we build out the proper framework and that we abolished kind of this i don't know failed financial experiment in the world of retirement planning like first can we just retire that concept of retirement like that's a bad notion the icons that we all look up to that we respect that we admire it's not because they retired they could have retired long ago but once they had even more money they use that to fuel even more purpose and if your purpose is greater than your problems if your purpose is greater than the current financial circumstance then you're going to earn and create a lot more wealth because wealth is a game of value creation and dollars follow value so what i want to make sure that we do is first of all build out a framework that if you leverage you can achieve economic independence somewhere between three years and seven years three years if you're already on a pretty good track and seven years if you're addicted to lifestyle and probably have a bunch of money that you need to pay back to someone alright so the good news is this isn't some 30-year trajectory where you set money aside and you budget because budgeting sucks or where you scrimp or save or pinch pennies till you get blisters on your fingers because that's not the road to wealth yet if we read most financial books that's what they want you to believe but if you just hand your money over to other financial experts that one day someday compound interest is going to kick in and then you're going to have a bunch of money that hasn't worked somewhere between 91 or 98 depending on which statistics and which studies you look at show that americans are not economically independent when they're age 65 and this is what economic independence is it's when you have enough recurring revenue to cover your basic expenses of life that recurring revenue can come from one of two main places one investment income i loved hearing the panel talk about cash flow investing investing isn't about waiting for 30 years that's not investing that's speculating that's shirking and abdicating responsibility that's taking on high risk and anyone that's told you that high risk equals high return is selling you something that's not good for you if high risk equals high return wouldn't we buy lottery tickets and i'll get really wealthy but let's face it lottery tickets are a tax on the poor that's how governments raise funds by having people believe they're somehow going to get something for nothing which is a disease of the mind and look there's this kind of scarcity mentality that happens with a lot of people in the world and scarcity is the greatest destroyer of wealth no amount of luck saving discipline rate of return or financial advisor will save you if you're in a scarcity mentality because it's kind of this disease called the consumer condition the consumer condition is where people look to take more from the world than they bring to it you've seen it it's called the entitlement mentality you've seen it's when people operate out of fear doubt or worry and they are no fun to be around because they absolutely suck the marrow out of life and never give another piece of it back on the other hand i believe that there's a producer paradigm that producer paradigm is where we create more value in the world than we take from it it's one way we believe that even if there's a finite amount of resources there's innovation there's ingenuity there's value creation there's service they're solving problems and the bigger the problems in the world the bigger the payoffs that are available out there for people to actually make more money i mean hey there's never been more money in the economy than there is right now at the second that i'm speaking so it's not that it's scarce it's the knowledge of how to earn it and sustainably keep it and grow it is scarce so we begin with investment income being part of that economic independence the second type of income is entrepreneurial income entrepreneurial income isn't the income when you're actually the technician doing the work and getting paid for that entrepreneurial income is when you have the infrastructure and organization that with some maintenance and monitoring it and a degree of management continues to pay every single week or every single month even if not if you're not there every single moment right so first of all there's kind of this myth there is nothing that's a complete passive income in the world there's just things that are more passive or less passive if you think that there's complete passive income you're gonna watch that just pass you by when other people make money there's maybe short stints of it there's maybe somebody that comes the mailbox if you want that to continue for extended periods of time then it takes some management and some responsibility and stewardship so economic independence this is a game changer because most people are being taught that if they could just save 10 of their income and then put it into some market and try to earn 10 over 30 years because that's what the stock market has averaged since 2000 bc not not really but i mean that's what they say right and averages are all a bunch it's like a lie like if i had two shower heads this morning and i turn one freezing cold and the other one's scalding hot and stand in the middle on average i'm at a cool temperature but in reality i'm miserable as hell right so we have to be really careful with averages i mean if you earn uh 10 or if you lose 10 percent on 100 000 you're down to 90 000 then if cnbc which i got kicked off of apparently you can't go on cnbc and tell people not to put money in the stock market they just cut to commercial and then the feed goes dead and i'm like hello hello and there was never any email so i don't know you just you know i'm not gonna like i if they watched any video they might have known who they were getting on you know they're like oh here's our financial expert gary gunderson what should people do right now i'm like uh they should get and this was in 2008 i'm like they should stop investing in the stock market and then they show the commercial people frolicking on the beach and drinking corona while the market goes up and it was actually spiraling down at the time um but see none of that's a sustainable model this whole notion that compound interest is a miracle the only miracle of compound interest is that we've bought into it because the institutions are the ones that have been made rich on compound interest and i know this may be challenging certain beliefs out there but let's think about it how long does it take for compound interest to truly kick in and do something for you it's a 30-year plan that's pretty far away and then i've even heard quotes and just raise your hand if you've heard this quote that einstein said it was the eighth wonder of the world anyone heard that um yeah that's a complete lie we researched it we got these two guys tom and steven they did the research and he was actually in austria in this conference where he said compounding numbers was the eighth wonder of the world and then security national life in 1927 of all times said that compound interest was the eighth one of the world and misquoted einstein while people got their kicked in this little thing called the great depression right so i'm here to make sure that we get past the myths and misinformation because those are the landmines that absolutely harm and destroy legacy and if there's anything that i'm passionate about because i'm not actually yelling at you it may sound like it i'm just excited nobody's in trouble or anything right now that i know of david if if he's off clean you the rest you guys are fine but it's legacy is what i'm passionate about because when i think about what my great-grandfather did and what that meant he didn't really get to have a great life as a coal miner but he gave an opportunity for me to have a great life and now i got to make sure that i don't raise entitled little brats with my kids it's a totally different thing like when we're in italy we're going to verona and venice and we're going to florence we're going to siena and we're eating and drinking all the best foods and seeing the best places my family never experienced that and you want to know why because they were unfairly taxed and they unfortunately didn't have the right insight and information to do the best things with their finances so you could be so skilled you could be so well intentioned you can be so loving you could be an amazing person but if you don't get your money handled life is going to be difficult so i'm going to give you a very clear-cut strategy and framework that's predictable it's sustainable it's distilled and you can leverage it and if you do you will become economically independent not 30 years from now but within seven years anybody okay with that all right cool i'm in the right room for six of you that's awesome no okay okay cool yes i'm pandering it's fine um see this whole notion of saving 10 percent to try to get 10 is a slow dangerous road so here's the different framework let's get you to a point where 100 of your lifestyle expenses are handled by investment and entrepreneurial income and when that happens every single dollar that you actively earn can give you the biggest insider advantage because you can build more assets at 10 times the rate as the person who's scrimping and saving that actually gets into a mindset of scarcity and unfortunately that hard work is completely destroyed because of one thing you don't shrink your way to wealth the reductionist thinking that has permeated people's minds in the world of finance and then propagated by financial institutions has absolutely destroyed people's wealth to the point where they're being taught that high risk equals high return like i talked about before or that it takes money to make money as i talked about before or all these kind of notions that are damaging and they get people to be so debilitated that they don't take action anymore so first off before you save a single cent or try to wait for 30 years let's go through this framework and begin with the very first lever and i'm using the word lever because this creates leverage in the framework it's not leveraging money and putting yourself at risk i'm talking about leveraging knowledge i'm talking about leveraging ideas and relationships in a way that produce better and more consistent results and the first lever to economic independence is to boost your profits or let me say that really simply keep more of every dollar you make so have you ever heard the statement or sentiment live within your means anyone heard that who would have been so inspired if they're like here comes garrett gunderson who is going to tell you how to live within your means who would have just been like oh yeah i need to make it back early to hear about how i need to live a shitty life so that i can have a bunch of money when i'm too old to spend it with my artificial hip yeah that's like the main notion out there like look that was one of the early books i read was the millionaire next door anyone read the millionaire next door spoiler alert and earmuffs if you don't want to know the ending of that book but i'm going to save you some time the millionaire next door it's christmas season so it's a lot like the first half of a christmas carol if you will be a miserable miser you two can be a broke millionaire that no one likes because you s you don't turn on the air conditioner in the summer because that's going to save you some money oh yeah you know people like this right like i remember my buddy marcus like he lives in vegas and we used to be buddies we're not really buddies anymore because i would go to vegas and he's like dude i'll pick you up at the airport i'm like sweet and then he would roll up and like his hubcap would like roll across the street with like the antenna that was a hanger from his closet you know no air conditioner have you ever been into vegas with no air conditioning it was an experience where i'd rolled down the window and it felt like there was a blow dryer blowing in my face so then i'd roll the window up and it felt like i was in an infrared sauna that had been on too long and i just wanted to punch him in the throat and then we get to his house and think oh god finally some relief and his thermostat was at 86 and i was like bro if i pay you five bucks can we get that all the way down like 79 or something that'll feel like antarctica right but that's that's those people that think that wealth is about what you can stop and reduce and not do when you read the books and it's all about that and what those books miss out is on first of all the magic to wealth is being a freaking entrepreneur it gives you the biggest advantage that's out there because you're in charge of your value creation because as you create more value you can get paid more money and as you serve more people or impact them more deeply or reach more people or solve major problems there could be a windfall of cash that comes in if we're actually capitalistic so the first piece is to keep more money and to live within your means you can budget but budgeting sucks so there's two other ways to live within your means the second way to live within your means is to be more efficient simply there's four eyes to efficiency the first i is don't tip the irs the irs is taking money from 93 percent of you that they don't require but you're voluntarily handing it over because you don't have all the tax strategies number two the second i is interest if people have more than one loan there's an 80 chance that they're paying more interest than they need because they either don't have the right credit score the right collateral or the right connections or the right cash flow reporting and it doesn't even mean that you have to refinance sometimes sometimes you can streamline that or renegotiate that and put more money in your pocket the third eye is investments there's two ways that people become less efficient with their investments that are so substantial that if you could correct these two things you're gonna have a ton more money like in the world of investing we usually get to hear about percentages like they love percentages because percentages make us feel like it's not a big deal like one percent that's that's no big deal unless you're in the world of sailing and you're gonna go like from north america and you're gonna go across like the atlantic ocean and try to get to britain if you're one degree off you're just in the wrong hemisphere no big deal you know it's the same thing in your finances so if you had a hundred thousand dollars you invest that for the next 30 years and they show you this stupid lie called 10 percent in the stock market year in and year out that grows to 1.74 million that sounds awesome now what if you have point eight percent so less than one percent in non-performing fees like non-performing fees like legal fees admin fees 12 b1 fees which are marketing fees that you paid to the mutual fund companies or certain expense ratios for fund managers that aren't doing their job or they're not beating out the other indexes now instead of having 1.74 million you have 1.4 million that's a 340 000 cost because of an undetected unnoticed fee that sounded so small because it was a small percentage but it's exponential if compounding interest is a miracle guess what compounding cost miraculously cost you a ton of money now what if you only get eight percent because you have this in some kind of retirement plan in addition to being in mutual funds and those kind of investments now it only grows to a million so that's a 744 000 cost because of two percent so i've got this whole financial nerd network is what i like to call them because they are financial nerds and uh they are proud of it like they wear it with a badge and they're like human atms they're like financial detectives to find out where those things are so you stop paying for non-performing things and keep that money in your pocket now the second part of the third eye is downside protection do you have a trailing stop loss if you've invested in someone's business dude you have a ucc filing if you've invested in some type of other investment with a private individual did you add some degree of collateral i mean think about the financial institutions when they're up here on the panel they call the stated loan a stated lie loan which it typically is right like oh yeah i didn't make enough money to get this loan so i'll just tell you i make more than i made now that's when the banks get in trouble but when the banks want to be secure they think of a couple things number one what can they do to protect their downside they're not good at real estate they're not trying to get into real estate so what they're looking at first is your credit score then they look at your taxes right then if you're going to get that property they're going to make you pay for an appraisal and even after you pay for an appraisal they want you to put 20 percent down otherwise they charge you pmi private mortgage insurance and i can go on at the ways that they're protecting their money why is it then that they tell us it takes money to make money and high risk equals high return when they're doing the exact opposite it doesn't take money for them to make money it takes your money and they tell us to ten percent's a good return but if you're only getting one percent on a savings account and they lend that money out for as little as two percent what rate of return do they have 100 percent they borrowed your money not even theirs for one percent and they sold it for two percent and if they screw it all up then what happens you pay taxes to bail them out what do you see that there's a completely different set of rules that they're abiding by i'm not saying that they're wrong and that they're evil and that they're bad and that we need to not use them we need to not be used by them rig the game in your favor start earning interest rather than paying them interest start to learn about cash flow banking you got the book what with rock fillers do it's in your bags it shows you how you boost that 400 to 800 percent on return protect it from liability and then increase and boost your cash flows 20 to 50 percent in the future because you use a coordinated strategy with all of your assets should i talk faster do you think i was just wondering so we're three eyes in all right we got irs 93 percent of people overpaid the irs by 11 430 for every half a million dollars that they make if we throw out the big people the people that way overpay the second thing is interest and we have a process called cash flow optimization where we find 2 484 dollars per month of lost money just through not differentiating expenses not understanding what things are destructive to eliminate what things to address and increase and then how to restructure loans and renegotiate the third one was investments we talked about the fees on that and the fourth one is insurance if you have duplicate coverages improper structure um you know this is where people lose money on insurance so of the four eyes let me spend some time on the thing that will provide a huge rate of return for you now you can put these things on the ground in the next 24 hours i'll kind of build the framework inside of that then i'll finish out the rest of the five levers to economic independence so on taxes here's two things to avoid these are the two biggest traps that are out there the first one is deferring your taxes if the government owes between 19 and 20 trillion dollars who thinks in the long term we're going to see taxes go down by a show of hands who thinks 20 30 years from now we're gonna have a lot lower tax rate than we have today zero okay zero people that's a concern to me and if you decide that you're going to put money in a government qualified plan you've just invited the worst partner into your life that exists in the world want to know why they're a bad partner because they say okay you put the money in i'll be your partner i'll take 40 but if you get out early i'll take 50 and in the future i might take a bigger percentage based upon my economic circumstance i don't know what it's going to be but right now i'm 20 trillion dollars in debt who's ready for that partnership show of hands right that's the trap the gut that's the trap deferring taxes is not saving taxes it's deferring taxes don't get caught in that trap the second trap early on in my financial career before i understood what i understood today i remember i'm a newlywed and i tell my wife hey we're gonna get rid of your little red infinity car that you love because there's this obscure thing called the section 179 for vehicles over 5500 pounds where we can write it all off in one year on the purchase price so we're gonna buy a chevy tahoe even though we don't have kids and i just work all the time so we don't go to the mountains or anything but it's gonna be a great idea to buy an appreciating asset to save tax see my wife told me i was a jacket and it turns out she was right i just thought it was hurtful she said that so don't borrow to consume don't borrow to go get a depreciating asset but most importantly don't let the tax tail wag the dog it doesn't make sense to spend a dollar to save 40 cents so don't defer and don't just spend so here's the three things to do around your taxes i'm helping you navigate thousands of pages in just three p three piece fame framework that here's the deal if we can save you 10 20 30 or a bunch of tax per year that's the equivalent of scrimping and saving money for decades to create that same amount of cash flow but let's do that in the next five minutes you guys in i'm gonna go fast take down the notes you've got to have a tax team the first person on your tax team is a bookkeeper the second person is a cpa and here's the deal it's hard to find the right cpa but you need someone that is actually a strategist not a filer a tax filer doesn't help you if you're doing multiple millions you need a tax attorney and if you own your own commercial building you need an engineer there could be up to four people on your tax team now you want to be proactive with them and every single quarter get on the phone with them and have a brainstorming session your job is not to be bridled or limited by the tax code but just throw crazy ideas out there and have them tell you why that could work or why it can't like when i went to italy this summer for a couple months i said i want to write that off he says you can't i'm like okay i'm gonna have a mastermind while i'm there i'm gonna have david over i'm gonna uh i'm gonna film some things i'm gonna write a book i just think better in italy i'm gonna meet with my wife and she's part of my corporation and then all of a sudden fifty percent of the trip becomes right off by the end of the call okay so you wanna brainstorm now the second thing is you want a different set of eyes on your taxes every three years because if you've missed you can go back and amend in 2006 i had two business partners die in a plane crash and i did not get proactive i didn't talk every quarter to my tax team i didn't get any information over to them and i found out in 2008 i had overpaid my taxes 54 000 so instead the government wrote me a check for once and i got that money back so you can amend your returns back up to three years so that's part one of the success framework around tax part two you want to turn all of your expenses that can be legally turned into deductions into deductions here's your number one question how does this relate to my business if it relates to your business documentation is the key let me give you some examples you can pay your kids 6 300 if you have kids under 18 and you don't have to pay taxes on that as long as you can think of things for them to do including a 2500 modeling fee would work if you put them on a website or something like that um or maybe you just have them walk out here on stage with you like ryan did you know like i've done that with my kids so you find ways to pay him another thing that you could do who here knows the augusta rule well my clients that's weird all my clients just raised their hand that's cool all right agusta rule is a big one because if you use your home 15 days or less in the year for business purpose employees vendors clients you can rent that out to your business the business writes you a check you don't have to claim that as personal income but the business gets to write it off so calculate that if that's you know let's just say it was 2500 you're charging per time if you're in austin you do it during south by southwest you charge 7 500 at that time you do it during austin city limits it's another time you just look at what would it cost to get a hotel or what would it cost to get a banquet room and then you charge that there is no tax to you but you write it off in the business so that right there could be worth 12 13 14 15 000 in something that simple as we talk about it today or even simpler things is like having a home office you grow off half your utilities or other simple things that you can turn expenses into deductions for me i set up an intellectual property company now that intellectual property company part of its intention is to put things on video which means i now buy uniforms for that and when i'm at home i sit in lululemon i don't work out and i just sit in it because it's super comfortable you know and then when i'm on stage i wear this kind of stuff and now that's a uniform that i'm writing off turn your expenses into deductions if you have a company you need to have an annual meeting i think better in exotic locations so i always have my annual meeting like at whistler was our last one we've done hawaii we've done italy we write that off there's so many things and the irs says that the majority of you are not taking all of your tax deductions why because you might have an account that says they're conservative anyone have that account that says they're conservative here's what they're saying i'm antiquated i'm having you overpay your taxes because i don't know everything there is to know out there and they scare you into thinking that that's gonna you know you're gonna get in trouble there's gonna be red flags but a lot of this is just so freaking simple that for some reason they're not doing it depeche how many things are your accountants missing you know that you bring to them back in the day so you had to go get a whole new team right like it's just how it works so the third one and this is where you're gonna save a boatload of money is to reclassify your income the way you reclassify your income turn active income into passive income that's really powerful active income into passive income how do you do that if you're not incorporated you can set up an s corporation and differentiate your income you take a reasonable salary which isn't what you're worth but what you'd hire someone else to do that job and then you can take the rest in distributions and distributions don't get hit with self-employment tax that's 15.3 savings even when you max that out it still saves you 3.2 percent on medicare medicaid and it saves you above 250 000 an additional 3.7 so somewhere between 3.2 and 15.3 just because of how you paid yourself even if it was the exact same amount or we heard about captive insurance agencies earlier i have a captive insurance agents per uh agency personally i can put money into that pre-tax if i don't have an insurance claim when i take that out it's a capital gain so i just took ordinary income and turned it into capital gain which almost cut my taxes in half that's reclassification of income other ways to reclassify your income let's say you own real estate or you have a building that you're a tenant in and you own the building charge yourself the highest possible rent because that's going to come through at a lower tax rate than if you're paying yourself a salary if you own real estate that can help you reclassify your income because you can become a real estate professional which doesn't mean licensing it means how much time you spend on it and you get unlimited deductions with that there's so many things that you can do in this realm for example you can set up a c corporation and if you have a new startup business or a part of your business that you have like a division like if you're a doctor and you see patients but then you want to do supplements you can put that in a c corporation and you pay less tax on the first fifty thousand dollars in the c corp than you do on an s corp or an llc or another way you reclassify your income if you're the only owner in an llc you're not being as a tax efficient as you could what you do is you put at least a one percent partner in there even if it's a spouse or something like that and then you move to schedule k it gets taxed as a partnership and it lowers the taxation on that so reclassifying income is a major major way that tons of people can save money like if you live in a state anyone live in a state like california or new york or where you're just paying a boatload of taxes but you have clients outside of those states you could learn about a grantor defective trust called the wing in the vet in wyoming or ning in nevada and avoid state tax on people that are from out of your state that you're serving now there's someone in here that loves budgeting who is it it's cool i'm not going to steal it from you get a still budget if you really want but the rest of us you never have to budget again if you do this simple thing go to your bank set up a separate account call your wealth capture account every time you free up money every time your business grows and you pay yourself more just make sure you're automatically paying a portion of that money into that separate account called the wealth capture that's automatically saving money now most people think they're automatically saving money but if you're putting it into an investment that's not saving that's investing and i'm in agreement with other people on the panel now is the time to start building up a lot of cash because people that that build up a lot of cash are going to be able to take advantage of the change in the economy the people that are going to get wealthiest in the near term are not the ones that are chasing the stock market returns but the people that are sitting in cash that when the stock market finally starts going down and everybody else is like when do i sell and realize that loss and now they get into scarcity now they're just trying to make ends meet and they probably got really addicted to a better lifestyle than they deserved because it wasn't about value creation it was about luck that's when you can pounce and start buying great opportunities businesses are going to be on sale for a different level opportunities are going to show up like when mcdonald's grew massively was during a recession and they started to buy real estate that they couldn't get before the recession when apple started to grow massively is when they started to acquire companies during times when everybody else was cash strapped and they were cash heavy start to build up that cash because rookies always stay invested they invest early always and often they're told to be mindless drones the dollar costs average that wait for 30 years that they're in it for the long haul but instead professionals sit on cash and then they pounce when the opportunity is right i want you to be a better investor i want you to use your investor dna only invest in things that you know and try to avoid the greed gland when you feel like you're missing out because that's about the time everything's going to start happening and turning because that's when the mass hysteria comes in like have you ever heard of tulip mania anyone heard of that there was a time where tulips were the most expensive commodity in the world because of the hype around tulips like that's some dumb but it happened so the third way to live within your means is to expand your means expand your means yeah keep more of what you make that's the first lever the second lever is to strategically engineer wealth which means find your economic independence number what is it reverse engineer and say what's the number one thing you could do today to get there faster what's the second thing you're going to do what's your foundation do you have that handled do you have the right car home liability disability medical life insurance business owner policies corporate structures estate plans and liquidity that's your foundation don't skip that because if you skip the foundational piece you're one incident away from having wealth confiscated from you and all of us are in store for financial surprises yet we can address 90 plus percent of them with proper planning that if that happens or when something happens it doesn't have to confiscate your wealth or derail you see the rockefellers understood this when you read that book and hopefully you do because it's it it's not that pretty of a book killing sacred cows is prettier my son asked me that like that's a ten-year-old's question which book do you think looks nicer dad um killing sacred cows like who cares but yeah but if it just sits in your bag it doesn't do any good if you read it you'll see that the rockefellers are on their sixth generation of wealth most families that wealthy never make it past the third generation and the vanderbilts had more money than the u.s treasury yet nine years after cornelius died they had doubled their net worth and his oldest son died and then within 54 years the first vanderbilt started dying broke because they never addressed protecting their money they never addressed handling these these things that could happen to confiscate the wealth and the more successful you are the more apt the more like you're susceptible to the success tax the success tax is people want what you have or there was times i did so well in real estate that i thought i was really smart but i just had good timing and i had nothing to do with it so all of a sudden i thought if if one's good 100's better right that's a success tax and be careful with all the semantics out there in the financial world because you're going to hear in the next few years about all these losses and retirement plans and in the market and right now we're having this big run up but the money isn't lost be crystal clear about that the money is transferred into other people's hands and the ignorance tax is the worst tax of all so money doesn't disappear or go out in the woods and get buried very often unless like we're in the mob days or something like that instead it goes to people who are in the know and people that are playing a game that is already rigged against them so i want to make sure this framework gives you the game to rig in your favor so the first part of strategically engineering wealth is build the foundation the second part is safety which creates sustainability that might be things like learning about umbrella policies having asset protection trust building up you know an opportunity fund getting lines of credit so you have liquidity that's what that could be and then the third piece is growing it building that cash flow plan to become a better investor the third lever to economic independence the first one was keep more of what you make the second was strategically engineered wealth the third one is to accelerate investment income any money you have right now that's not producing cash flow if you're not economically independent is a huge opportunity to get to that advantage where you can get 10 times the growth because all of a sudden every active dollar could go be reinvested so turn those lazy assets into cash flow if you have retirement plans you can learn about a 72 t distribution that allows you to get that money out with the without the 10 penalty or self-directed iras where you open up to the world of investing instead of just the brokerage houses of investing the fourth thing another big game changer scale business revenue all these books i heard ryan ask a question about tony robbins book and here's the thing about that book it is a great map on how to be better at being middle class i'm sorry it is i don't mean to be mean about it but like he says hey you know owning a business is risky but tony didn't make his money putting his money in index funds or indexed annuities or any of that he made his money being a world-class speaker and owning a whole bunch of businesses and i want you to remember that is don't go invest in other people's boardrooms or other people's visions or other people's dreams before you fully funded your own don't prematurely diversify usually premature is not a good word right like premature babies i can't think of other things that that would go with sorry i have a comedy show i'm doing tomorrow so so scaling your business revenue invest in people processes technological procedure build that find ways that you could build more cash flow without you being directly involved every step of the way you're going to build more equity business is three-dimensional equity cash flow and personal fulfillment because you can actually connect to and course correct in the things that you're doing in that business and the fifth one the fifth piece of this is to make it count you don't get a second chance at a first class lifestyle this whole notion if you you just defer and sacrifice then one day someday you're going to be happy if you learn to be a miser you don't just flip the switch one day and go like oh cool now i'm abundant i'm a nice person not an that just saves every dollar and just thinks about money 24 7. that doesn't work that way what happens is if we buy into the reductionist thinking and scarcity you will never be wealthy even if you have a decent sized bank account because you'll feel like if you utilize that money or spend that money that all of a sudden you're harming your net worth net worth is relatively worthless if it can't be converted to cash flow i know people have had big net worth and have big bankruptcy that went along with it because it was ill-liquid because they didn't understand how to manage cash flow and this notion of retiring by accumulating money wealth accumulation is slow you want to be fast and sustainable it's wealth acceleration it's cash flow it's velocity see here's the old equation wealth equals money times rate times time so if you want more wealth they say add more money that's stupid okay uh if i add more money i'll have more in the future maybe depends on how bad the investments are that you choose right second take more risk who was drunk on wall street that's like let's just tell people high risk equals high return to sell this piece of crap investment right and then time oh yeah just wait longer that's great news and if none of that works they say move to ecuador you know it's cheap there you might have dysentery when it's over but you need to die early you didn't have enough money that's a crappy model here's the different model velocity is the gdp which is the output of our economy divided by the money supply what that means is the more times dollars circulate through goods services experiences the more they circulate the more wealth it's built the wealth isn't a finite pie it's not a zero-sum game if i give you money you get to take that money and utilize it again how often do we utilize that that's investing see when people hear the word expense they usually think of it negatively like it's bad or but your income is someone else's expense and real investors know this sometimes investments show up as an expense on the income statement initially but assets and income for the long term the right employee the right mentor the right marketing program the right resources so keep more of what you make identify that economic independence number and start working towards it find your existing resources and be more resourceful by turning the cash flow on and getting rid of lazy assets scale your business revenue which means invest in yourself before you go invest in everything else and then the fifth thing is make it count which means you have your this this legacy that you're living legacy isn't the amount of money you leave behind because you die twice in your life first when your body dies and second when the last person that knew of you or of your name ever whispers it on this earth i'm here to make sure that my legacy lasts because it's not something that just dies with me but it's something that's the example i live today by having the right family retreats with my kids so that we have distilled our core values as a family so we have a family crest as a family just like we have a logo for our business so that we have a doctrine that we call our family constitution that governs our trust that's dynamic and is distilled and is the core philosophies that i've learned in this world that i want generations to be able to benefit from for years and hundreds and decades to come just like the constitution of the u.s right but for my own family and then a family office the rockefellers had a family office financial professionals that are on the same page have the same philosophy communicate with one another and they're not just paid because they're making some type of commission instead their job is to protect it preserve it and perpetuate it the vanderbilts didn't have any of those things they lost all their money the rockefellers did they donated 50 million to charity this year and their wealth still grew even after david rockefeller died that's what i want for you because my great-grandfather didn't have that and he had seven years where he didn't get to see his family so i'm on a mission to make sure one million entrepreneurs achieve economic independence if you have it you can swing for the fences in your business you can make sure that money isn't your master but you master your money and that you make choices with financial freedom in mind and i use that term very carefully because financial freedom in our world has been a bastardized term which most people think means an amount of money they have in a bank account that's not financial freedom financial freedom is a state of mind where money is no longer your primary reason or excuse why you would do or not do something we have a disease and a plague in our world today where money absolutely governs people's decisions to the point where they are manipulated thinking that because there's a black friday sell that they're actually saving money they're not being about investors they're about consumerism and you have an opportunity to do something extraordinary which is have impact to find what your skill set is bring it to the world in the in the in a form of value creation and the bottom line is dollars follow value make sure nothing destroys your legacy that you get clear about who you are you find the path to making more money and you have the financial team that surrounds you to keep more of every single dollar you make and you'll be able to get there in a short period of time if you follow the five-tier methodology i just talked about keep more engineer the wealth accelerate the investment income scale the business revenue and enjoy life along the way because you are your greatest asset not a stock not a bond not a piece of real estate and surround yourself with good people and get rid of the a-holes it's that simple give it up for garrett gunderson i i want to stay standing with you because energy is high enough and i just want to ask you a couple a couple questions about this i actually want to ask you about about work and life because you travel the world you get a ton of stuff done you have a great relationship with your with your wife and kids you run a great business you help entrepreneurs all over the world how the heck do you stay so centered and present and still get everything done how in the world do you do that okay there's this will be a couple pieces to this question the first one and i think the first time i ever shared it we were sharing a stage on a panel at amazing and i've gotten even more clear about this but what i figured out is i have to categorize people into three categories first is people i'm friends with people i'm friends with i say yes to their invites and i invite them to things all the time people i'm friendly with are the people that don't want to see me succeed they're too indoctrinated in the consumer condition they're negative people that aren't thinking about ideas and impact instead they're thinking about complaining and circumstance so i say no to every one of their invitations and i never invite them to anything and it gets a ton of time back into my life and the third category are buddies but these are people i like but i'd never do business with and by not doing business with them i save a lot of time because i usually end up holding the bag on that the second thing is business habits and rhythms and personal habits and rhythms every day at the end of the day i look at my calendar i say does my calendar reflect the man that i want to be and what did i do today that someone else could have done unless i absolutely loved what i did and then i said rather than being cheap about who i hire i make sure to pay more and hire the very best people so that i could delegate roles not tasks tasks enslave you roles free you up because if you can count on someone and hand it to them and they can do it then you can go to italy for two months and still have your company run and only work for five half days or you could be on the road and have an event we have one of our workshops going on right now when he first invited me to this i'm like i have a workshop and by the way someone that you introduced me to is at the workshop they're like you're supposed to be at capitalism i'm like i'm going uh last night and they're like oh so yeah once again they feel like how are you doing all this but i have a book coming out next year we have 35 000 copies in bookstores in march 100 000 copies out the gate i'm going for number one with that it's because i chose a good team so and i've just gotten more selective i do five things really great and then i say no to a ton of stuff i say no to a lot of opportunity because we always get these distractions as entrepreneurs that are gift wrapped in something that looks like opportunity and i've gotten really clear to listen to my wife because their intuition tells me when it's so uh we both believe that entrepreneurs are the greatest engine that we have to create growth and change and entrepreneurs go into something we get amazing results right away and then we often get constrained by stuff we need to get done by things like payroll by paying taxes you're working at freeing that up and freeing up that capital make sure it stays in the hand of entrepreneurs rather than governments what do you think is the number one mistake that people make that gets them constrained the number one mistake is that they can't differentiate the three measures of worth so there's price which is what we pay there's cost which is our economic impact and there's value which is our overall feeling of satisfaction and most of the world they live in the world of price and when we try to save money we end up expending and taking tons of energy in the name of that savings it constrains us and then all of a sudden we have less energy for everything else but if we can understand cost i would pay 10 times more for my tax attorney than i pay him right now because my economic cost goes down so much having him in my life so the value that i have knowing that i'm gonna pay less in tax is i feel good because dude my my great grandfather was run out of a country because of tax and then he got to the u.s in the year we came out with the u.s revenue act i'm pissed off about all types of taxes ignorance tax success tax you know employee tax because i'm here to make sure that people legally and ethically pay the very minimum so they can put that back in their life and if you're not willing to invest in yourself and let other people support you because you have a mentality of if you want it done right you got to do it yourself that is your constraint and you're never going to get truly wealthy what are you investing in right now or what do you what do you see coming how are you managing your wealth differently or is it the the same path forward in these economics a little different one is i am stuffing every dollar the government will allow me into my overfunded life insurance plan right now because i want massive liquidity i could pull that money out at any time it's i have to do better than 9.9 to put it somewhere else and that's a pretty amazing storage tank and the second thing is i started to look at investing not as products but let me give this equation and then i'll answer the second half there's this equation who in here wants more money just by a show of hands here okay all right if you don't earmuff this okay so financial capital is a byproduct it's a byproduct so if you think you have a money problem you never have a money problem it's actually a problem of two more precious forms of capital one being called mental capital which is your knowledge your wisdom your insight your you know tools your strategies mental capital if you've ever heard it's not what you know it's who you know that's not true because ryan doesn't hang out with me and i don't hang out with ryan if neither of us brings anything to the table or just someone we'd make fun of each other essentially right so what you know matters in today's world and the second piece is relationship capital which are people networks organizations mentors family friends and if you want more financial capital it's you're either an idea or relationship away from that next level of prosperity so i am bullish and aggressive on investing in quality relationships i'm bullish on investing in the right mental capital and attending and spending time with the right people i put a lot of money in that every year because it always pays off in a big way for me so that never changes regardless of the economy but i stopped looking at investments as products and i started looking at investments as what are my biggest skill sets how can i package that up and start bringing that to the marketplace not only to customers and clients but even to other financial people and in the last two years by looking at that half of my income comes from licensing what i do and i consider that my number one investment and i can get six figure and seven figure like payouts in short periods of time i can't do that with any other investment unless i would have gotten into crypto when i was first told about it want to master your money want to figure out the things that you could do to improve your finances click here and check out more videos like this on money matters

Channel: Garrett Gunderson

Views: 3,730

Keywords: Garrett Gunderson, Wealth Factory, Wealth Building Strategies for Entrepreneurs, Financial Freedom, Financial Independence, Getting to economic Independence, what would the Rockefellers do, business, success, entrepreneurship

Id: kjrX000bRTo

Length: 51min 31sec (3091 seconds)

Published: Mon Aug 15 2022