The Wealth Triad: Cash Flow, True Wealth, and Business Growth

I want to teach you my favorite investment strategy for both cash flow, long term wealth, and growing your business all at the same time. I call it the wealth triad because I'm in the Illuminati. So the wealth triad looks like this. You know, I know a lot of entrepreneurs who are good at making money, terrible at keeping and growing money. I also know a lot of people who think about investing in passive cash flow. And what they really want is just to have enough passive cash flow to be able to pay for their life. So they can live on a beach somewhere or do whatever they want, but they don't actually have a tactical plan for getting there. And that's what I'm going to give you. And I also know entrepreneurs who either sell their business or they get a big windfall of profits and then they have no idea what to do with it. So this is the format through which I look at my total financial strategy and it's these three parts. First point, if you ever listen to Jim Rohn, one of the best speakers that ever lived, he will say very famously that profits are better than wages. So the first part of the wealth triad is very simply to get your first source of cash comes from profits rather than wages. That's the first piece. So at the top of the Illuminati triangle is your business or your profits rather than what you're paid at a job.

So I don't care if this is flipping houses or if this is building a physical products brand, which is one of the things that we teach our students. We've had hundreds of super successful students come through our trainings and build physical products brands. Whether it's that or whether it is affiliate marketing or it is selling stuff on ebay, or it is flipping houses or whatever it is, if you don't have an income source that is not from being a W2 employee, you are not building your own freedom. You are not building the asset that can be bigger than you, that can grow beyond you, that can give you profits, and profits are better than wages. If you need help with that, go over to capitalism.com boot camp or sign up for one of our free training classes so you can learn how to build a physical products brand, which we think is the most predictable path to a seven figure business. So this is the first piece. Now when you get to the point in your business where you start to take home pay from your own business, because there's going to be at least a few months in which you're putting money into the business before you take profits out. But when you start taking regular pay in the form of a paycheck from your business, what I recommend people do is take 10% of their take home pay and put it into a long term.

Investment that that is going to cash flow and appreciate that we never touch it is there to be our long term wealth piece. So the next piece of the triad is where we're building wealth. So we're going to take 10% of our take home pay. So let's say we're making $100,000 take home like salaried from our business. We're going to take $10,000 or about $1,000 a month and we're going to put that into long term assets that we don't plan on touching. So if you listen to your traditional wealth advisor, they'll say just buy a S and P index fund. I like dividends, actually. First, let's put wealth here.

I personally have two sources that I really like here. One is dividends.

And the other is insurance.

That's weird. Why insurance? First of all, we have trainings all about dividends that there's a very specific way to do dividend investing and most people get it really wrong. But dividends over the long term are actually a fantastic asset class to be in. They beat the market a lot of the time. They cash flow, they grow. It's something that I believe in and we buy a lot of. And then the second is insurance. What insurance? What is that about? So if you've read Tony Robbins books like Money Master of the Game, he talks about certain investments that go up when the market goes up. So they're attached to the market, but when they go down, you don't participate in any of the downside. So they can only go up and they go up at a modest amount. On average it's been between 6 and 8% per year, which is modest, it's not terrible. It's tax free, which is really exciting. And it doesn't go down, which is also exciting. So you kind of get a twofer there. So there's a podcast that I would encourage you to listen to. It's called why the Rich Use Infinite Banking. We'll link to it somewhere around this video. So if you go to freedomfastlane.com iTunes or if you just search Freedom Fastlane, which is the name of my podcast, and you search Freedom Fastlane, Infinite Banking, you'll find the episode All About Infinite Banking and some of the resources where you can find out more about how that strategy works. So first, make your Money and your profits. So if you're watching this video and you don't have a business yet, that's where your attention should be. So when people are like, what's the first step to getting rich? Or I need a new life, what should I do? Ryan, why are you talking in this weird voice? We say, go start a business. I failed at my first business, go start another business. Failed at my second business. Try it a third time. I still failed. Maybe you don't want to be an entrepreneur, but the primary source, the vehicle for cash flow comes from profits. We take 10% of that, put it into long term growth. That long term growth comes from things that we're not going to worry about touching. We're going to worry about it growing over the long term, but it's going to pay us dollars in the form of cash flow and appreciate over time. But we're going to sit on that for a long time, not worry about touching it. And the two sources I like are dividends and insurance.

This is our long term play. If nothing else happened, we would be better than most people because we're putting 10% of our profits into a.

Long term asset that's going to grow in wealth and grow in cash flow and pay us money over time. So now we have multiple streams of income. Now if we have profits at the end of the year after paying ourselves, this is our paycheck. If we have distributions.

So let's say our business made a million dollars. Woo. Yeah. We paid ourselves 100,000. We put 10,000 of that into long term dividends and insurance or whatever asset class you like that grows over time and gives you cash flow. What do we do with the other 900,000?

Well, we could put it back in here, but that tends to be really tense because it's like, I got $900,000. Do I really want to go buy a bunch of dividends right now? Do I really want to put it all into the market? What if it goes down? What should I do then? So we focus here is 100%, I call them high yield, low risk, cash flow.

Now if you look at the Warren Buffetts of the world, if you look at the really successful 001 percenters, most of them make their money in business and in appreciation. But there's downside to that too. If you start a business, business could go under. You buy something, hoping it goes up, could go down as well. So I focus on those here. That's the first part of the strategy. When I'm investing my profits, I Don't want to put that at risk. I want it to pay me dollars. So sometimes in investing you're making a trade for you can either take your profits in the form of cash flow. I'm just going to get paid over time. Or you can buy something that we're hoping goes up in value. Now the things that would tend to go up in value over the long term might eclipse the wealth that we might get than if we were to just put our money into cash flow. For example, if we were to buy government bonds, Government bonds are a fine investment. Government bonds pay us tax free dollars. It would look good right here actually. But bonds don't typically appreciate over time. There's a trade off. We can either get cash flow now or we can get wealth over time. Which do we want here? We want wealth over time here. I want cash flow. So what are our sources of cash flow? One of my favorites is real estate.

Another that I really like is funds. So a fund would be like, I don't want to invest in real estate because I don't want to be a property manager and I don't want to fix toilets. So instead what I'm going to do is I'm going to give my money to a fund that does all of that, that buys the real estate. They're professionals at this and they're gonna go buy the real estate and pay me money and it's just gonna show up in my mailbox. So I'm an investor in that. I just get my cash flow and I'm out. Like I get my money.

There are other things, like there's municipal bonds, just call them muni bonds.

And if there's one other way around into real estate, if we don't actually want to own the real estate, they're called real estate investment trusts.

The only downside with real estate investment trusts is it gets taxed at normal income. So we don't get the ability to.

Write off that income or we have to classify that as normal income. If we can get a twofer here and get something that gives us tax benefits.

We'Re much better off that way because then if this is tax free money, that's best. Obviously who wants to give the money to the government? So that can come from real estate, it can come from funds. Muni bonds are a good source of that. So all three of those can have tax free money depending on how they are structured. So what this does is this here, this cash flow piece is going to be what we live off of. It's going to be how we expand our lifestyles. It's how we determine how much can we live off of what kind of house are we going to buy? And that way we have a way to build wealth over the long term. We have cash flow coming in that's paying for our lives and that frees us up to build more businesses, to spend more time in our business, to expand those profits. Because now we don't have to have this tenseness around our business about this has to make money or what am I going to eat? We eat here and we're freed up to go build a business that really matters, that makes a difference in the world and that what we really believe in or start new businesses or invest in other projects we believe in because we're set. We have our wealth growing, we have our cash flow growing. There are two podcasts, podcast episodes from Freedom Fast Lane that you would benefit from learning more. One is about Infinite Banking. If you search for Freedom Fast Lane, Infinite Banking or click the link around this video to listen and there is one about using funds and why some people consider funds as a way to get what we call mailbox money of just kind of automated tax free income. So that'll clear up some of the confusion over what this piece looks like. And of course at Freedom Fast Lane and that podcast, we're always talking about building businesses and investing their profits. So if you need help at the top of this process of building a business that is profitable, that you're proud of and that builds over time, go to freedomfastlane.com iTunes to subscribe to the podcast and you'll see every episode as it comes out. We do case studies, we do what's working now. We do updates on businesses that we're running and case studies from our community. At capitalism.com we have helped hundreds of people build seven figure businesses because we have a strategy that we believe is the most predictable path to a seven figure business. And it's building a physical products brand. So that's what we focus on@capitalism.com if you need help with that process, we can help people get funded, get marketing, get plugged into people who can grow your business. We've helped people get into retail, we've done it all for our students because we believe that entrepreneurs are the way that we'll solve all the world's problems, including people's problems, families, communities, the world at large. And we need more people who are thinking about that. Thanks for watching this video. Send it to someone you know who would find value in it and subscribe to the Freedom Fast lane podcast@freedomfastslane.com iTunes and subscribe to the channel so you see more of these. Thanks for watching. See you on the next one.