If I was broke in 2024, here’s exactly what I’d do… (feat. James Altucher)

He was a hedge fund manager, an entrepreneur. He's written over 20 books, sold companies for tens of millions of dollars a few times.

I remember going to the ATM machine, looking at the same account that once had $15 million in it and had $193 left. Everybody was coming up to me saying, no one's going to invest with you ever again. Like you're admitting these failures. Do we prefer a world where everyone is lying, or do we prefer a world where everyone's just open and honest with each other? Am I ever going to come back from this? Am I ever going to be able to rent an apartment again? Feed my kids again? I would Google how I could myself without hurting myself.

Let's go. I've been a fan of the next guest of the POD for years, actually. He's written I don't know how many books, 20 by now. He was a hedge fund manager, an entrepreneur, sold companies for tens of millions of dollars a few times, and has a list of a million accomplishments that goes on. A couple of them that are fun is like grandma, grandmaster, chess master, Chess master, chess master. This shows you how much I know about chess.

Not quite as strong as grandmaster, chess.

Master, comedian, but one of the main reasons I remember reading your stuff is all of that might seem not that relatable, but when I was in finance, you also really honest about the highs and the lows of life and you talked about your failures. And so I wanted to bring you on today, James Altucher, to talk about not just all the successes that you've had, but the world's getting a little hard. I think a lot of people are struggling and they don't see that many people that have gone really high, gone low, and then been able to come out on the top again and are willing to talk about it. So I'd love to talk to you about that today. I'm stoked to have you here.

Yeah. My favorite. All of my favorite topics. Thank you so much, Cody.

Oh, I was kind of, you know, I was laughing as I was writing out questions. Cause you've been so open with it. Do you ever wish that you hadn't been that open? Because then people. Is it like ptsd? You keep going back to the same.

Subjects again and again that, you know, it's interesting because. No, I'm glad that I've been so open. I feel like. I feel like that's what writing is about, is to be vulnerable and to share a piece of yourself in through words to other people. It's like you share. It's like, you put a part of your life on this boat that goes across this giant sea to other people on the other side, and that's the only way you really can really share a piece of yourself to other people is. And vulnerability is that boat.

It's true. You have a tweet that I've loved, which is that sooner or later, enough bad things happen to you that you can begin to enjoy the best written books, which I think is also the way you write.

Yeah. And like, I remember there's a lot of books, and you probably remember this too. Like, we had to read these books in high school. They were the worst books on the planet at the time. But then when really bad stuff happens to you and you reread these books later in life, you're like, oh, I didn't, I didn't know that's what he was talking about, or she was talking about, really bad things happened to them, too. And, and it's a, It's a. The language of, of the. Our past fears and failures that is the, the real way we all connect. Like, if we all just had, like, a billion dollars and we met at cocktail parties, we're going to connect in this real superficial way. But if, if, if we're saying, look, I had this hard time in a divorce, you had a hard time in a divorce, let's say, then that's, that's an area where people connect at a very deep level. I'm not just talking about divorce. That's just an example. Or go broke or whatever.

Yeah, it's a trust transfer that I think only happens when you open up a little bit, you show the cracks, and other people are willing to do the same.

Yeah. And then, like, finance, nobody was doing that. Like, I realized, like, everybody was perfect in finance. They never were wrong. They were on cnbc like, oh, well, of course they're going to raise, decrease interest rates and the market's going to go up or down. And everybody's, like, just talking their portfolio and arguing with each other, and no one's being honest. Like, the first time I wrote something saying I had gone broke, at one point, everybody was coming up to me saying, no one's going to invest with you ever again. Like, you're admitting these failures.

And.

And I'm like, well, the alternative is to lie, and that's what everyone else does. So do we prefer a world where everyone is lying, or do we prefer a world where just everyone's just open and honest with each other?

Yeah, it's so true. You know, you talked about, I think the company's names were you sold reset for 15 mil ish, stock picker for 10 mil ish. And then two, two years after you were like, the thing is, I'm broke in both cases. That's so just curious, what does it feel like when you hit that zero? Like, what does that feel like, losing 15 mil for somebody that hasn't. By the way, I've lost a lot of money, so no pot, kettle here.

Yeah. So it's the worst feeling in the world. It really is horrible. Like, like, this is going to sound horrible too, but if you lose a close family member, like, for instance, around one of these times, I lost my father. And that was very painful to lose your father, no matter what age you are, to lose a parent. And very, very painful. Very, very hard. But there's a process for that. There's a grieving process. And then you always remember, I always remember my dad. But you move forward, life goes on. That's the normal cycle of things. But going broke feels worse than that because there is no. There's no normal process of going broke and moving on from that. Like, everybody hides the fact that they've gone broke or had failures and so on, so people don't really discuss this that much. And also, you don't know the future. You don't know, am I ever going to come back from this? Am I ever going to be able to rent an apartment again, feed my kids again? You know, should I just kill myself now? Like, that's how bad I thought I would. I would Google how I could kill myself without hurting myself because I didn't want to have pain in the process, by the way. There's no way to really do it, so I wouldn't encourage it. But there was a point where, because I wrote about this, there was a point where if you Googled, how do I kill myself? I was like the number one search result on Google. And then enough people complained that Google had to manually put in the national suicide hotline to. To replace me as number. The number one search result for that.

Which is probably not better, actually. I think, you know, one of the interesting parts is the world's getting kind of hard. We were talking about how we think a lot of tough things are going to happen in commercial real estate. There's a small, like, real estate Twitter group of people where a guy that was well known in that group just killed himself basically because he was going broke. And his, you know, he had kind of issues with debt and how he had executed on it. And so I think one of the reasons it's really important to talk about this is because most people don't. And we all get kind of like, egoically wrapped up into how much cash we have in our bank account and what our title is without even realizing it. So, one, I think it's really cool that you talk about it. Must be really, really hard, especially when you were one of the first ones. What actually happened? I've read lots of different accounts. I've heard about it. In your words, how did you get there?

Yeah, so didn't happen because I was, like, buying big, expensive things. So I remember at one point, look, there was the Internet boom. I sold a company during that time, but then I cashed out. So I remember just hitting reload on my, you know, account and like, there was $15 million, like, cash in there. And I was so happy because it does. You do feel happy. Like, oh, now this whole thing I've had to worry about my whole life. Like, I was born broke, lived broke, grew up broke. And suddenly I had this money, which meant my kids were going to be okay. They wouldn't have the worries that I grew up with or my parents grew up with. And I did it. And. But then suddenly I saw, oh, all these other people are selling their companies in this Internet boom. And I would look at my 15 million and it didn't feel like a lot anymore. Like, this was. This is going to sound crazy, but this is how I thought. I actually felt all of a sudden like I was broke even though I had the 15 million. So I felt, you know what? I'm going to make 100 million because then I'll really have something to talk about. And so I started. So how do you go from 15 to 100 million? Well, I figured investing is the way to do it. And I do nothing about investing. But the problem with making money is you think all of a sudden you're smart. Like, oh, I made money in this one area. You discount the fact that part of it is luck. There's always a luck factor.

You.

You discount the part that there's a lot of people involved in making any one person a success, and you discount the timing and so on. And so I figured, okay, well, I'm smart. I made all this money. I'm going to be. I'm also a smart investor. For some reason, everyone was asking me for investing advice because I made money designing websites. And so I started investing, and I didn't know anything about investing. I invested in the wrong things. I Would not do any kind of risk management. Like, oh, sure, let's put 200% of my money in one stock or one deal and just wait and see what happens. And then, of course, you know, the Internet busted. And a lot of people went from paper rich to paper poor during that time. But I had cash money and I just simply went broke. And I did buy a house, so. Bought an expensive house, which was more expensive than I, than it should have been, then I should have paid. And, And I just kept pouring into the stock market and in private deals. Every single investment I made failed during this period, private or public. And I just had no sense of risk management at all. I put $2 million into an IPO, came out at 20, went down to 19 the first day, and I figured, oh, this is a bargain. IPOs are supposed to go up. This made a mistake, it went down. So I put more money into it, and of course it goes to $2. And it was like a, it was like a wireless device for deaf people to communicate as opposed to every single device now which has texting and so on. So it was useless. And. But I did, like many deals like that and someone worked. Some wouldn't, but over time, most didn't work. And within about a year or so, I was like, dead broke. And I remember going to the ATM machine looking at the same account that once had $15 million in it, and it had $193 left. And my mortgage at that time, because I bought this big place was like $18,000 a month. And it was just, it was just really insane, like, and I was really scared. I had these two babies and I was super scared. And then it was just awful.

So what, how did you get out of that?

I would say there's no one way, but basically you have to, you have to realize that it's not just. No one's going to just drop money and opportunity in your lap, particularly when you're on the downward trend. Like when you're going broke. All the people who are friends with you going up, none of them are friends when you're going down.

Zero. Like, no friends were the same. Did any of them stick with you through it?

No one. Who, by the way, who, by the way, I still work with and talk to every day. Like, he's my, basically my main business partner and that's. This is like over 20 years later. So, so one person out of maybe hundreds. And, and so you have to become. And, and, and if you just, if you're, if you're if you let your brain just go to its own devices, you're going to be depressed every day. You're not going to move, you're not going to. You're not going to want to wake up, you're not going to want to do anything. So you can't really function even. You have to sort of overcome this depression that you. Whether it's clinical or situational or whatever, you're going to be depressed and scared. So you have to put all that aside. And I really became, because I had. If I didn't have kids, I don't know what would have happened. I would have, who knows? But I was really determined to, every day at the end of the day, make sure I was attempting to be physically healthier, emotionally healthier, creatively healthier, and for lack of a better word, spiritually healthier. Which really just means if I can't control it, I can't worry about it. And so this is during this period where, well, how do I be creatively healthier? So I started just randomly writing down 10 ideas a day. And it could be 10 bad ideas a day. Like, it could be a list of businesses I would start. It could be a list of books I want to write. It could be a list of chapters of a book that I want to write. It could be, here's 10 ideas for Cody Sanchez, and I'm going to send them to her all, all of the above and many other things. And so many things happened just from that one practice, like a. I became more confident because, oh, I could, I could suddenly have ideas that I'm excited about. Like, even if they were, like, stupid ideas, I would get excited about some of them. And that would, that would give me enough dopamine boost to survive the day. Whereas before I didn't have the dopamine boost. And then if I sent somebody 10 ideas, most of the time they wouldn't respond to me. But sometimes they would say, hey, could we meet? I love these ideas. Maybe you could do these ideas for me and I'll pay you. And suddenly I started for the first time in years, like, this going broke process was like a two, three year process. And. And suddenly for the first time in those years, people were reaching out to me. Can you help me do something and I'll pay you? And it was just based off of ideas I've given them. And I've been doing this now, writing 10 ideas a day for over 20 years, because I send many of them out. I've been invited to speak at Google, Facebook, LinkedIn, I spoke at Airbnb's main conference. I've been out to Quora and met all of them. And just so many different opportunities were created for me. By coming up with 10 ideas a day, I've been able to sell businesses because here's the idea. The synergies between your business and mine. So you should buy my company and on and on like it's really. Even though most ideas are bad, I'll throw out most idea lists and never use them or look at them. But that process probably lifted me out, didn't make me a millionaire, but it got me a writing gig, for instance, oh, we'll pay you $200 an article, which I was desperate for after having 15 million or oh, I'll give you $5 million to, to manage. Because I became obsessed with learning with what I went wrong with investing. So I was reading hundreds of books about investing and, and success, starting to successfully day trade. So I gave somebody a big hedge fund manager, I sent them my software for how I do my investing and he said, well, I don't get your software, but I'll give you $5 million to manage. And I started a hedge fund out of that. So on and on things happened.

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Yeah. It's funny because I used. When I first heard you say this, I thought, well, ideas are kind of worthless because it's execution that matters. Why would ideas matter? That was maybe the finance side of me. And then I actually.

But you're right. But, but, but. I'm sorry to interrupt. Can I, can I. Yeah, get in there. So execution. Execution. Ideas are A subset of ideas. Like, let's, let's. Let's say I'm going to start a business, all right? I could say, well, I'm going to need to hire someone to make a lot of software, and then I'm going to need a lot of money for marketing, and then I'll know if my business is good. So I need to raise $2 million. So that's one way to execute on an idea. Another way to execute an idea is what's a manual way I can do this service that I'm proposing to do through software? And could I see, can I contact any of my friends and do this service manually and see if it's something they'd be willing to pay for? And then I can test for no money, and I don't have to raise any money just to validate an idea. So that's two ways to execute something. One required $2 million, the other required zero. And the one that requires zero is faster and obviously saves more money and comes up with a better result. So execution ideas are just. Are a subset of ideas.

I think it's actually brilliant. I sent. I sent this to a couple people that I know that went bankrupt back in the day. And because what I realized is. Oh, wait, no. Ideas basically are just sales pitches. They're like sales pitches to you. They're sales pitches to somebody else.

That's a great way to think about them.

Yeah, they're like sales pitches to the universe that you still have this ability to cognitively get yourself out of whatever situation you're in. And, And I used that. I use them now, which people think is weird. But, like, for instance, I met Vivek Ramaswamy at an event we were both speaking at. And it was like, right before he was getting kind of pretty famous for, you know, being a serious presidential contender. And I remember because I now do this idea of practice in a different way than you, but inspired by you that I. I was like, hmm, I want to be of service to this guy. I kind of want to get to know him. I like knowing different presidential candidates that I've gotten to know over the year. I think it's like an interesting type.

Of human, by the way, now, now you know me, I'm running for president. So there we go. Sorry again to interrupt, but if you just go to fec.gov and fill out 10 minutes worth of paperwork, you too could be an official candidate for president.

I didn't even look at this. This is an idea, right? Now, didn't you also try to buy Greenland at some point and get shut down.

Yeah, yeah. So this. So I was. I was doing a couple of different experiments there, but I saw how Trump had tweeted, he wants to buy Greenland.

That's what I want.

And the Prime Minister of Denmark, for some reason tweeted back, it's not for sale. And I'm like, what the hell just happened here? Did a president United States just offer to buy a country on Twitter? And then Denmark, which is this tiny little country, they said, no. What do they have to do with Greenland? So it kind of forced me to research why anybody would want Greenland. It turns out Greenland and China are the only places you could find all these rare earth minerals. And so I figured. And I wanted to experiment with my writing a little bit, so I did an article in the form of a Kickstarter. I made a Kickstarter to buy Greenland, and they kicked me off. But then Indiegogo, I think, let me do it. And I started raising, like, thousands of dollars. It was an interesting way to write about why I would want to do it. And you could become a duke if you can give me a hundred dollars and we'll get a holiday after you. If you give $1,000 and you get an acre if you give more, and. And so on. And so. So that started raising thousands of dollars, but then Indiegogo shut it down because they said, look, we know you're just joking around. We don't want to pay back the, you know, we're eating the American Express card fees, so we don't want to do that.

I remember that. I actually thought that was brilliant. Yeah. One of my friends worked in the Energy Department for Donald Trump, actually, and he left after they didn't get reelected and started a rare earth minerals fund, actually.

Oh, wow.

With this exact reason that they don't own these in any way that makes sense. And we're not allowed to mine them here because of all these environmental reasons, etc. And so, yeah, this is small world.

And by the way, there's a company, I think it's called Greenland Mineral Resources. And so you think, oh, Greenland's trying to monetize the rare earth minerals? No, they sold all the rights to their mining to China. And so people don't realize this is like a big geopolitical issue because we need rare earth minerals to power the electric grid, among many other things. And so what happens when you do these experiments and have these ideas is you go on these little mini adventures that even years later are still stories, and you learn Valuable information. Yeah.

Well, that's the exact thing I ended up when I met Vivek. I was like, the thing is, you seem really smart. I like you better than many of the other candidates that are out there, but your social media is awful. And so I just started writing down all these ideas for how he could change his social media and I gave it to him by the end of the thing and he was like, can you fly out and like talk to my team about how to do this? I was like, I guess so. I was like, I don't. He's like, do we pay you for this? I'm like, no, I definitely don't do this for a living. But yeah, sure, I'll fly out and come meet your team. And now we've gotten to know their team because of it. But it was all because of your idea of, you know, what if I just give ideas to other people that I think are interesting and I see if magic happens. And I think that is a beautiful way to go from broke to really abundant.

And by the way, you did two key things there. First off, you didn't charge like you should absolutely not charge for, you know, if someone just wants to meet or if someone wants you to share your ideas with their team, just go out and you build up so much goodwill with the good. There's zero goodwill if they just pay you because then it's a transaction, then they think, oh, I paid $500 or 5,000 or even $50,000, don't sweat, I don't even have to think about this again. But if you're giving for free, you're still on there, you're equal, you're still having a communication with them that's non transactional. Second, a lot of people think, oh, they're going to steal my ideas, I better get it, you know, get this trademarked or whatever and, or a patent on my ideas. And that's so stupid because first off, no one really wants to steal your ideas. In most, in 99.999% of the cases, no one could give a shit about your ideas. The other thing is, is that, you know, even if they do steal your ideas and you're the idea, you're abundant in ideas, you're going to come up with more ideas. Them stealing ideas is just validates your. In all this time, I've only had one person steal any idea I had that was worth any money and no big deal. And it's just, I'll give an example. Google gives idea that's their business, is they give ideas away for free all day long. Billions of times a day you go to Google and say, tell me how something about motorcycles. Google literally replies, look, we don't know anything about motorcycles, but here are 10 other places that we think are the best places where you can learn about motorcycles. Get out of here. Knock yourself out. Read about motorcycles. And Google measures its success. How fast you leave to go to one of the recommendations and, and, but then where do you go back the next time you need help? Google. That's how they built a trillion dollar business.

It's such a good point. You know, the other thing that I think you've been masterful at is, you know, you go through these periods of hardships, but then you seem to totally reinvent yourself. Like I recall that you lived in a hotel for a couple of years, very like Jack Kerouac of you. But like, was that, that wasn't the Chelsea Hotel, was it?

Did you actually have Chelsea Hotel get out.

Isn't that where like Arthur Miller after he broke up with Marilyn.

Yeah, Marilyn Monroe. Yeah, yeah. I want, whenever, when I left graduate school and moved to New York City, I like loved the building. It was the oldest hotel in New York. It's built in 1884 and it's just a beautiful architecture and you go inside and there's like artwork everywhere. But it was really a gross hotel. Like it was disgusting. Like you go like on the inside. On the inside, yeah. Like one time I was walking down the stairs with my then 5 year old daughter and she actually slipped on the stairs on a condom. On a used condom.

That's so New York in the 70s.

Yeah. And this was like you know, just a few years ago really. But, but then, then there was a period where I didn't want to deal with rent and I didn't want to own a house, I didn't want to deal with rent and I didn't even want to deal with hotels. So I just lived from Airbnb to Airbnb for a couple years. So again, I think doing experiments when you can is a good, a fun way to live where you learn about yourself and you come up with different types of ideas and you have something to, to write about and, and it's just interesting. It's a fun way to live if you can, if you can. You can't always live from Airbnb to Airbnb, but there's always experiments you can do.

Well, I mean, theoretically you could, if you go to really cheap ones too, because that might be cheaper than a lot of the ways people live, you know.

Oh, yeah.

Interesting little tweet the other day that I think is. You're exactly right. There, there's like, seems to be this idea of, well, if you can become an idea, and then there's also some power of experimentation. So just what can you try to do from an action perspective? But then there's also this power of place and like, can you move your physical body? Which you've done a ton of times. And I, we, we tweeted out the other day, so I couldn't think of somebody who had never once left their hometown for like an extended period of time, meaning even college, and become what would be determined as, like, monetarily career focused, successful, like quite successful. And we had thousands of replies. You know what Twitter is? It's like, you elitist, blah, blah, blah. But all these people, I'm like, show me who. They're like Warren Buffett. I'm like, wrong, New York. And went to school outside of Omaha, like again and again. Couldn't find anybody. And then I found one guy, Nathan Barry, who I'm friends with, who runs ConvertKit. That's like, yeah, I went to school locally for college. I've never left. The longest I've ever been away from my home is four weeks. But besides that, I couldn't find somebody. So do you also think there's something to the fact of, like, when you're struggling, like, move physically during the day, but also maybe move place?

Yeah, I think that's true. I never thought of it that way. But you do have to, you know, let's say we don't really. Self awareness is something that's. That's very low for most people for good reason. Like, there's no reason for us to really know who we are. We usually see ourselves through how other people see us. So maybe there's something to the point where if you go to other locations, you now you have much more variety of how people see you. And, and plus, you learn as well by seeing how the rest of the world is. Plus, it's just fun. It's like every time you go someplace, it's an adventure. You can make an adventure out of it. And I always like to think of myself as trying to find many quests to pursue. So a quest is different than a goal and it's different than a journey. A quest might be like something that's impossible, like me buying Greenland. But okay, I'm gonna figure out a way to begin this quest. And along the way, I'm gonna have Adventures. Now, that one was a very quick quest that failed that I had a mini adventure with. But let's say for about six years I tried to be a real serious stand up comedian. Like, I was performing six nights a week, twice a night, and I even owned part of a comedy club during this time. And then I ended up traveling all over the country, all over the world. Like I toured around the Netherlands, for instance. And what an adventure. And then I stopped. Like, that was it. I got to where I wanted to and it wasn't fun for me anymore. But having those kind of quests always shows you who you are a little bit.

I really like that. I haven't thought about that way. So it's almost like an experiment, an adventure, a quest. There's sort of levels to the game. But I actually think you had the best thing ever happen with Greenland. It's like, best case scenario, you show yourself to be an asymmetric thinker. You get a ton of attention and press, you raise awareness to this issue. You probably get a bunch of connections that you never thought of. I bet you got a bunch of emails and social media subscribers and then you didn't have to deal with actually running Greenland. And so, like, might have been a win, you know.

Yeah. And the worst case is, right, like, so all those things you mentioned were like, worst case, plus, I get a story to tell. Plus for me, it started off as I wanted to experiment with writing. Like, like you write your newsletter once a week. It's not always easy to, to write and, and to build style. And it's writing because everybody could write. They just open up, you know, their LinkedIn account and they write a story. Everybody thinks they're a writer, but it's a, it's a hard skill. And so one way to experiment is you write an article in the second person. Like you use the word you, you know, instead of I. Or another way is to write in the form of letters. Like, oh, I'm gonna write an article. That's me and Cody Sanchez writing letters back and forth to each other. But here, now, I wrote an article essentially that was in the form of a Kickstarter campaign. So it's like you get to play and improve as a writer and an artist as well.

It's so true. When we do videos now, because we do a lot of YouTubes, we think about idea and format, which is basically what you're talking about. So you can have ideas on like, okay, the topic is Greenland. Greenland. The format is Kickstarter story about it or the Format is we're going to travel there and we're going to do a Discovery Channel version. And so it's fascinating how there's so many versions of ideas. I really like that. Speaking of that, you have a. You basically turned this movement of ideation into an app, right? Note.

PD yeah, note n o t e p d.com notepad.com But I have to say, despite the fact that over the years so many people have said, oh, you should build this as an app. I would use it. You. You could never believe what people tell you they would use. So, like. But somebody contacted me and offered to build this, so I said yes. And I'm. I'm proud of it. It's got like a couple thousand users, but it doesn't really grow. And I think an important lesson there really is is that when someone says something positive, it actually has no informational value. Like, there could be a lot of reasons why someone says, sure, I would buy your product, or I would use this concept or, you know, build it. And then, yeah, I'll pay for it. But there's. They could be saying that for a lot of reasons. One is they could like the idea, but they don't really know themselves and they're not really going to use. The other thing is, they could be like, oh, I just want to say yes to this guy's idea so he goes away and, and, and so on. But no. Has. If you're building a business. No has real informational value. Like if, if, if. If you buy a Laundromat and someone across the street says, nah, I'm not going to use that Laundromat, that person has some valuable information for you, as opposed to, sure, I'll use that laundromat. I've never used it before, but I'll use it. That has zero informational content. But no has a lot of information in it.

Yeah, I always say no and do. Those are the only two things I listen to. Opinions really have no value. You're exactly right. I always giggle. I went and talked the other day to this University of Texas, little tiny class here, and they were talking about validation of ideas. And they're like, well, we went out, we asked other people what we thought, and so then we determined if we should do X, Y or Z. I'm like, but did you get the cash? They told you they were going to do it. That doesn't mean anything. How often do you lie 400 times a day to yourself, I'm gonna go to the gym. I'm not Gonna eat that donut. You know, I am gonna make a million dollars a year. But you don't. I mean, there's. We're kind of like self rationalizing machines. And turns out we don't actually. In person, face to face. Maybe on Twitter, but in person, face to face. We don't really wanna tell somebody else their baby's ugly. It's not that fun.

No, it's true. And that's why, like, when you have a business idea, I call it smoking crack bias. Like, you, you always, you always have to ask yourself every day, am I smoking crack? Like, is this really a good idea or am I just completely insane right now? Because I've seen so many friends who I haven't been able to tell them that their idea is bad because I don't want to hurt their feelings. Even though that is the proper thing to do is to be as honest as possible. But I would say to myself, I can't believe this guy thinks this is a good idea. Like, this is the worst idea I've ever seen. And you know, it's very hard to avoid that bias.

Yeah, Hysterical smoking crack bias. I'm going to use that and ask the team, I'm gonna ask both the team if they're smoking crack frequently and myself. Equal opportunity.

Yeah. And find out, like, when's there a time when you've been smoking crack? So you start to learn to recognize when you might be. Cause it's hard to know.

Yeah. This one, I haven't wordsmithed enough to do it on Twitter, but I always giggle when people talk about, you know, I get in front of the mirror and I say positive affirmations to myself. I guess you're good looking, you're strong. People like you, I'm like, I actually think what would be better is you get in front of the mirror and you go, you're super mid. You're kind of average like everybody else. And so just, you're gonna have to work pretty hard. And then it like keeps motivating you. Every time I see people shout positive affirmations, I'm like, I'm not sure. You're just kind of misleading yourself to think you don't have to work as hard as you probably do.

Right. Like, I think it's really important to embrace mediocrity. Like embrace where you're mediocre and then, and then work on it, all the areas where you're mediocre, to at least improve a little bit. But it's really hard because if you are in a pattern of mediocrity, which everybody is basically. It's really hard to improve. It's a challenge. But if you think you're great, how many people in the world have been great? Like, I. Like, we always say, oh, Winston Churchill was great. Was he like, well, I don't know. This guy had a lot of problems, too. Abraham Lincoln, you know, had a lot of problems. And George Washington had slaves. So everybody is either bad or mediocre.

At best, and varies by the day, you know. Yeah. I think one of the best ways to not have trolls, which is kind of what I want to roll out, or to not care as much about the trolls, is like to beat them to the punch. They're like, you're dumb. You're like, yep, you know, yeah, sure, I'm wrong all the time. But you have this quote that I love that's like, no matter who you are, no matter what you do, no matter who your audience is, 30% will love it, 30% will hate it, 30% won't care. Stick with the people who love you and don't spend a single second on the rest. Life will be better that way. Are you actually able to do that now?

No. I think when I wrote that, I really wanted to believe that about myself, that I would not care. But it. I do care.

And.

And I've. I've written, you know, so I've been writing almost daily for, like, over 20 years. At first, mostly financial stuff, but then more. Much more personal stuff and. And more opinions and so on. And sometimes I've had really, like, for whatever reason, people will get upset at me, and I would have severe backlashes. And then the last one happened in August 2020, where the backlash lasted for months. And it was. I'm not exaggerating. Like, over a million people, like, lashed out at me. And many more people liked what I was saying, but a million people, including people I cared about, were, like, saying really bad things about me. And it really. I mean, even Jerry Seinfeld wrote an op ed in the New York Times just trashing me, which then Andrew Cuomo emailed to, like, everybody in New York State. And it really hurt my feelings, and I got a little depressed over it. Cause I had other. I had friends who I could see were liking his article and quotes about his article. And it just really upset me for a while.

Yeah.

And that kind of slowed down my writing. It was the first thing which in 20 years slowed down my writing. And I kind of switched quests for a while, and it was painful. I'm Still, I think recovering from that.

I remember when that happened. I think you've been vindicated a lot of your statements in 2020. The problem is you actually said this, too. I think the problem is when you were right, nobody will ever tell you. But when you were wrong, they'll remind you a lot. Oh, yeah, that is true. You have had a lot of takes that were unpopular then that you're now. Like, how's the math? You know, it aged well. You had this one tweet. We can cut this out if you don't want this in here later. But I was just giggling my little titties off as I was reading it this morning, which was. But I still think it's funny. Alyssa Milano writing. Do you know that Joe Rogan has double the viewers that I do on his podcast that you just wrote? You have a. Can you believe you have a podcast? And I just. Because the hubris from some of these people, like, yeah, Joe Rogan's the most. That aged well. Like, that was a tweet that aged well. But I bet you got a bunch of hate from it. And somehow the hate is so much louder than all the love.

Yeah, it is. Like, you know, it's just like. Well, it's just like in. In marriage, like, one negative interaction with your spouse, you know, you have to have, like, six positive interactions. I forget what research says this, but you have to have six positive interactions to make up for it. And it's the same thing with if, like, the mistake you can make is thinking that Twitter is important and that people's reactions on Twitter is important and that it's nothing more than just a place to like, make some fun tweets and laugh about it. And. And also, it's a vehicle for building a platform, like, to drive people towards a newsletter and so on. But, like, when you start, like, there was this period in 2020 when I had written this article about New York City where I was trying to argue with all the million people who were arguing with me on Twitter, And I'm like, no, no, you don't understand. It's not what I said. And why was I doing that to people with anonymous names who were just like, well, you're from Iowa. Why should we listen to you? And I'm like, no, I'm not from Iowa. I was born and raised in New York City. So, like, why would I be even responding to them? But I was.

Yeah, no, it's always better to not. But it's really hard, too, because your trolls are also your biggest Fans. Like, I have one guy that I think like, one out of every five of his tweets is like, something negative about me. And it's actually a little funny because I have a rule now. I don't feed the trolls. I like, don't comment on their stuff.

I just, yeah, that's key.

Let people doing shit. Don't have time for people talking shit. And we're two different groups of people. And never the two shall climb. Applied and. But I have this one guy. I thought it was a great response. He basically was saying something like, you know, Cody Sanchez is not the real deal. She doesn't know anything about buying businesses. You know, she sucks. And so I see that and I go click. And this was early. I didn't have that many followers. I go click on his profile and I see that he's like a house flipper or something. I'm like, first of all, what the does this guy know about bios?

This is.

I've been doing this for, you know, 10 years. So I get all of my ego and then I go and I respond. And I thought it was funny at the time, but my response was, I hope you own more real estate in real life than I own rent free in your head. Otherwise, boy, do I have a course to sell you. And so I thought I was funny. Now when I look back on it, I'm like, you know, that guy's probably. He's probably going through a tough time. One of his business was probably struggling. You know, he lashed out at me because something that I said that triggered him in some way. And, like, the truth of the matter is, why do I have to be rude back to this person? I'm just gonna, like, wish you well. I hope life's good and, you know, and then save myself from, like, all the crazy stuff. This guy dm's me and like, a potential stalker who's gonna try to murder me, you know?

Yeah. And not only that, you lend your completely legitimate, valid audience to him for that tweet. And so he. He can now use that audience for his purpose. That certainly wasn't your intent. So that's why now I'm very careful about, like, every time I. I click reply and I'm about. I even, like, type something out. And then I realize, you know, what do I really want to lend my audience to this person? And I always then get rid of the tweet. But now it's. But at that point, though, I was responding to everyone because I thought, like, everybody I knew was also, like, trolling me. And it was really. It was like a sensitive topic that I. That most people agree. But you, you. The other thing about trolls is that for every one troll you have, it means you have 100 people who love what you're doing. But the trolls have to express themselves for some reason. The people who love what you're doing are like normal, sane people who just go on with their lives. But the trolls stop everything they're doing and they're like, I have to say something rude and hateful to Cody in order to move on with my life. And those are trolls.

So, yeah, yeah, yeah, yeah. And they live under bridges for a reason. But, you know, and I think Twitter just brings out that in humans and obviously brought it out in me too. So that's my karma. That's when I realized that I'm not going to do that anymore because, you know, I don't need crazies in my life. But I think it's really. First of all, I didn't know that that's one of the reasons why you slowed down writing. Because I think your writing is really prolific. And what does my opinion matter? But especially somebody from Hollywood, man, like, I don't know, Jerry Seinfeld. I'm sure he's great. But those fucking people telling any of us what to do is hysterical to me. I'm like, the thing is, you get paid to lie and pretend you're a character for a living. So no bias at all and no basis for you to chat. But I hope you keep writing again because people actually will learn. Like, here's the other thing, James, that I giggle about that guy. So we're. Humans are weird. So somebody reads your stuff and they read James Altrue like I did, and then they go, take action on what you do. You can change somebody's life, right? You can literally make them tons of money, the upsides actually completely limitless. And you can give them habits and tools that will make their life better that day. But if instead you teach them to laugh and give them a hangover, you're applauded continuously. And so it's the weird. We humans are hysterical in that way. The holidays are all about family. But at the Chrysler Wrap up the year sales event, it's all about you. Enjoy every mile in the most awarded minivan in America, the Chrysler Pacifica with the most standard, standard safety features in its class. Available Stow n Go seating and the available Stow and back built in vacuum. Make the most of the holidays with a great deal at the Chrysler Pacifica wrap up the year sales event based on Ward's small van segment. Based upon the latest available competitor information. Chrysler is a registered trademark of FCA US llc.

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Yeah, it's like, why would, I mean, particularly like all these actors who are commenting on like geopolitical events. Like what made them just first of all, what makes anyone qualified to comment on geopolitical events? But probably the least thing is an ability to pretend to be someone else. So it doesn't make any sense. But, but they do influence people and then suddenly you see like this, this like, you know, onslaught of people who, oh, if this person said it, then it's okay to say it out loud publicly. And then suddenly it unleashes like a whole new violent attack against you if it's, if it's, if they said something against you. But yeah, I hope I write again as well. Like what happened was, is I said, you know what I'm going to take. I just didn't even, I didn't make a conscious decision, but I decided, oh, when I was younger, like 30 years ago, 25 years ago, I was a tournament playing ranked chess master. And I think after a 25 year break, I'm going to go on a quest and I'm going to be as good 25 years later as I was then. And this will be a quick and easy quest. I'll have, it'll be fun. And it's been actually really hard. Like aging actually does affect you and we do actually get well. I didn't realize it actually is true that we get older as time goes on and this has been an ongoing quest and it has slowed down my writing, but it's improved me in other ways. Like I've been all over the world now playing chess. I've had dinner with the world chess champion. I've been writing for the premier chess magazine in the world because they heard I was doing this. I've had lessons from the world memory champion. I've talked to nutritionists, brain psychologists, chess coaches and everything. It's been an amazing, a bunch of adventures.

Yeah, you have an ability to turn difficulties into upsides that I think is really cool for you to share. If you haven't listened to the Theo Vaughn Dana White podcast, it's great.

Oh, no, I haven't. I've listened to Theo Von podcast. I haven't listened to this specific one.

Yeah, it's a new one. But Dana White has like the ultimately the ultimate I give zero fuck energy, I think. But he went through all of it during COVID too. Obviously people hated a lot of stuff that he did. So, James, you're the man. Thank you so much for coming on and do this, doing this.

Thanks for having me on. I'm glad we were able to work this out.

Same seven years later. Also, where do you like people to go these days?

I like people to listen to my. The podcast interview I did with Cody Sanchez. So this is perfect right here.

Okay. The James, they should just listen to.

This over and over again is listen to your podcast interview of me.

Perfect. We'll just loop it back and forth. Thanks, James. Welcome back to the Big Deal podcast. I'm Cody Sanchez and this is for those of us who want to be not just rich, but free and do what it takes to get there. This week we are talking about how to not be broke if you are, and how to break a cycle of poverty for yourself and maybe for the country overall. But we'll start with just you. So do me a huge solid and if we taught you something, give us a little love. That's how we spread this message. All right, Appreciate you. We thought long and hard about this. I got a ton of questions and Mikayla, I want to answer your question about how to not be broke, because this one touched me. So she said I made some bad decisions when younger and now my debt repayments each month crush me. No space for savings or investment, forget any fund spending, just being able to buy family birthday gifts is a stretch. My partner and I already launched a business we believe in and we're working really hard. But I see no future and everything creates constant tension for me. How do I get out of this? We're going to break this down in three ways. We first thought, okay, in order to change something, you one have to acknowledge that a problem exists. Then you two have to define what the problem is. Then you three have to set the landscape of what the situation you are surrounded with is. And as soon as you do those three things, then you can start getting to tactics on how to change. But without hitting those three aspects, you can't. And so that's what we're going to go into this week, I think we should define broke, right? Because Tanner basically, who's sitting over here, you can't see him. Tanner said, wouldn't it be helpful to define broke? Because a lot of people feel broke, but they aren't broke. A lot of people are broke, but they don't feel broke. And so I started thinking about, okay, what is the definition of broke? How would I define that? And I don't think it's exactly monetary. How I define broke is this being one negative event away from running out of money to live, eat and survive, being one negative event away from running out of money. And if we think about being broke that way, a lot of people are broke in this country and around the world. I think you should kind of lay the landscape for them really quick on other humans in America who are also broke. So, you know, you're not alone. It's actually relatively normal. And I think there are ways that we can help you get out of it.

First, actually, Tanner had a great stop before I even jump into that, talking about median savings balance. And this does not include retirement funds. Of Americans under 35, that number is 3,000, 240. So that is something to just keep in mind.

So the average American has like 3k in the bank. That's it.

Under 35, 3k, not including their retirement. Correct. Wild. And to understand that the median American worker earns an estimated $54,000 a year, and that's according to the Census Bureau in 2022.

So we now know the normal American and really important that we use median, not average, because average you can skew really easily with really, really rich people. So the average American makes about 50k a year and has about 3k in savings if they're 35. Then we started to think, okay, there's three tiers to poverty, right? There's one. Where do we start? What's like the kid level of poverty? Then there's two current state, like me and you, where are we at? And then there's three elderly. Like, where are we going? And so we've broken down current state, right? So where we are at today, you're going to go to kids, and then we're going to go to elderly. And then after we hit that, we're going to go to what's the solution? How the do we get out of poverty?

Let's talk about adults that are poor. So in 2015, 18.2% of us of the US adult population, which comes to a little bit over 43 million Americans, provided unpaid care to an adult, relatively. So why are people becoming broke? Not only is it really expensive to have a kid, but adults are now taking care of their parents. This is an extreme issue. Like poverty is really killing adults. So for people over the age of 15 in America in the year 2019, there were around 200,000 deaths that were attributed to poverty. Backing up, talking about parents again. So unless your parents are rich, the elderly really aren't here to save you. Baby boomers are going to be leaving behind trillions of dollars in ass to heirs. And total family wealth in the US has tripled from $38 trillion in 1989 to $140 trillion in 2022. Sorry, that even took me a second to even say. Cause I was like, wait, is that wrong?

That's a lot of pennies.

Like, that is insane. So we're seeing all that money getting moved to, like, American adults. Only the 1% will really be seeing, like, a majority of this money. And the bottom 50% of Americans are only going to see 8% of those transfers.

You hear the term generational wealth transfer. We're amongst one of the largest generational wealth transfers in history. We think, small issue, most of that wealth is going to get transferred to the top 1%. And if you're in the bottom 50%, you're going to get about 8% of that. If you're expecting that because a bunch of baby boomers are going to retire, you're going to win. Looks like that's often not the case. And again, this isn't making you out to be a victim. I wouldn't take these stats and think woe is me. Now I'm going to go complain about it, and I'm going to do sad tiktoks. That's not the point. It's that we understand the landscape so that we can change it for ourselves. So now let's talk about kids real quick.

So a kindergartner from the bottom 25% of socioeconomic status with the top test scores of the 25% range has a 31% chance of earning a college degree and a job that makes more than $35,000 by the age of 25 and $45,000 by the age of 35. In the same vein, a kindergartner from the top 25% of socioeconomic status with the bottom 25% test scores has a 71% chance of achieving that same milestone. So that basically means that if you are born into a poor family, you have way less of a chance of getting a college degree and making more money, even if you're smarter than your peers that were maybe born into a higher socioeconomic statistic. And by the way, this data is coming from nces, and it analyzed standardized math tests and different socioeconomic statuses.

Okay, so basically, the thing we already knew, the thing you knew in your gut, which is that if you look around and you don't have much money and other people that you know don't have much money, your future likely looks the same. It's harder than we thought perhaps, to break out, according to the data. So now if we know that, we know if we want to be better than what the average person is, we have to do something that is different than what the average person will do. And, you know, I want you guys to kind of think about this for a moment, let it sink in, understand the difficulty, and then realize that we are going to have tools to change a bunch of this. So this isn't like, you know, slit your wrist time. It's going to get a little bit better. All right, let's hit them with the last one, which is like the ones that horrified me the most. The stats on the elderly.

So 73% of consumers die in debt.

Think about that for a second. That's seven out of ten Americans die not with zero, but with less than zero. Like $61,000 in debt, on average, right?

Yeah, exactly. And 46% of Americans die without $10,000 in savings.

Yeah. So on average, we're dying without a lot of cash to leave behind, which is okay, hey, you spend it all, you max it all out. But perhaps if we want to leave a legacy, we need to do something different. Some of the stats I thought were helpful as I went to reframe this is to realize that most people who become millionaires, more than 76% of them, actually inherited nothing. $0. And so if we can reverse engineer what these people did, then we can be the, you know, 30% that aren't those that die without a lot of cash. And so I think we should go now into how do you break out of a cycle of being broke or poor? And there was, like, one quote I thought we'd start with with Dave Ramsey, which is don't take money advice from broke people. And I love this quote, and I think you should question everything you get asked on the Internet or you get told on the Internet, even me. And so a lot of times, if we're hanging out with certain people and those certain people don't have the things that we want, we get Their advice by default, right? You're hanging out with a group of friends and they might say things to you like, yeah, well, you know, why don't you take that job right now? I don't know if you can get any better. Well, why don't you come hang out with us on the weekend? You're no fun anymore. Well, I have plenty of time for my friends and you don't have any time for your friends. And what I want you to do is realize that anybody who does not have a life that you want in a bank account that looks interesting to you is not somebody that you are going to go to for advice. You can give them love, you can give them time, but you do not need to take their advice. And I want to tell you this because the road to not being the median American is going to be hard. And so what I'm going to talk to you about then, what I am actually responding to is this message right here from Mikayla. I wanted to look her in the eye and say, if I was you, what would I do to change my situation? How could I break the cycle of poverty with almost 100% likelihood of doing it? How could I not be another statistic that dies broke and, and or worse, that dies in debt? How could I, in the next three to nine years become completely financially free then? This is my answer to you, Mikaela. Here's what it looks like. There's two paths. I'm going to lay them out for you. Two paths that I see that are the most straightforward way to break the cycle of poverty. Path number one, I'm first going to say, I assume you have no skill and by no skills you probably have some skills, but if you had a lot of skills, you would be compensated for them. Most people who have high level in demand skills make a lot of money, period, End of story. If you are not compensated right now, it means that you do not have a skill set that is highly sought after. And if you did have that highly sought after skill set, you would never want for money again. And so path number one is going to be skill accumulation. And we're going to accumulate a skill that people don't talk about anymore, which is a skill in the trades. Basically, if you're watching online, you can look at the list of these. But Rachel did a bunch of analysis and pulled what are the highest paying skilled labor jobs out there? And they're jobs that aren't sexy. These aren't tiktoking jobs, but they're jobs in engineering. They're jobs in things like mechanical engineering, there are jobs in things like electricians. And this group of people followed one path. And the path is essentially this. You, for the next year, for the next two years, anywhere from 6 to 24 months are going to focus on getting one trade in any of these positions. And these positions all pay somewhere in the realm of 75,000 to $200,000 a year. List out from really quick, Rachel, what are some of the positions that we found?

Some of the top paying trade positions are elevator mechanic, power plant operator, radiation therapist, nuclear medicine technician, and dental hygienist. And these all make over $75,000 a year with that top one, elevator Mechanic, making almost $100,000 a year according to Credit Karma.

And here's what I want you to take on. These jobs are not going to be something your friends are going to be excited about. They're nothing that you're probably going to want to brag about. They're not something that we as a society have said is cool. But guess what? The average marketing degree after graduating college makes $37,000 a year. And yet we think that we could say we're a marketing exec and that sounds great. That is not going to break your cycle of poverty. Your cycle of poverty gets broken when you accumulate a set of skills that is so desired that people come after you. You do not have to chase after the jobs. So you're going to spend the next six to 24 months in a trade school. You're going to work harder than you have before, you're going to work longer than you have before, and you're going to not make very much money for the next six to 24 months. It's going to be pretty miserable. And at the end of that 24 months, you are going to leave with something so precious, yet so few people pursue it. You are going to leave with a skill that no one can ever take from you. If you left this country today and you were ejected into a third world country, they are going to need people who are mechanical engineers still. They are going to need people who understand electricity. They are going to need people to fix their their teeth and to be their doctor. No one can take that skill from you. Even if they take every single dollar that you have, they can never take that skill. And so path one will be you will do what the mini will not do, which is you will obsess on a skill that is highly sought after but maybe not Sexy. And after six to 24 months, you will start making somewhere between 75,000 and let's call it $150,000. And as you do that over a series of years, you will then apply all the practices we're going to talk about on this podcast for increasing your wealth and keeping the money that you make. But you will start by breaking the cycle of poverty and becoming part of the, let's call it top 10% earners in the US which is somewhere between 75 to 150k. Most people will spend their life as a check cashier or working as a bank teller or working in a manual labor position and not accumulating a skill. You will not be most people. You will change that. That's path one. Now, path two is a little bit riskier in some ways. Path two is you are going to find a job that is not an hourly pay that rewards your ability to execute. That's really important, that it is a job that is not hourly that rewards your ability to execute. And what does that mean? It's a job like sales. For every additional outcome that you have that's positive, you get an additional dollar in your bank account. Your money is not tied just to your time, it's tied to your outcome. And here's what you're going to do. When you choose this job, it requires less skills. You do not have to go to a trade School for 16 to 24 months. You can go today and get a sales job where you get on the phone, where you get on emails, where you go and knock on doors. And you can do these next seven steps. The first step you're going to do is you're going to apply to jobs until you get one of these. Then as soon as you get in the job, you're going to find the number one top performer at the company that you work at. You are going to study them like a lab rat and you are going to do every single thing that top performer does that you're capable of. And then you're going to do the third step, which is more. You're going to first mimic the things you can see, which are you're going to get in earlier than them. You're going to stay later than them. You're going to spend less time on social media than them. You're going to work after hours at home on learning more than they do. You're going to skip a bunch of fun and you are going to put a bunch of focus into growing your funds. And you're going to do that for one to three years in this job. And all you are Going to obsess on is learning and earning again and again and again. And you're going to stay in that job until you have maximized your earning potential and you have maximized your learning potential. And then in about year two or three, you're going to plateau and you're going to have learned and earned almost as much as you can in that position. And you're going to do one of two things. You're either going to go to your boss and you're going to ask them for a promotion where you have more responsibilities, more work, more ability to earn, more ability to learn. And if they don't give it to you, you're going to go to a new job. Because the average salary increase is about 3% if you stay at the same company. And yet if you job hop, it can be anywhere from 30 to 200% increase. So you're going to go to the next place and then what are you going to do when you get to the next place? You're going to obsess on the top performer at that job and you are going to work longer, harder, and you're going to learn more until you supersede them in the next three years. And after anywhere from three to nine years, you are going to have learned, earned and accumulated enough money that you will have broken the cycle of poverty for you. And given some of the statistics that Rachel talked about, you may have broken the cycle of poverty for your family and your kids. And you can do that inside of three to nine years. The problem is most people will not dedicate the front loading of pain, and so they suffer a lifetime of pain. If you are willing to sacrifice three to nine years to a lot of hard work, you can live 50 years without the constant strain, tension and pain that comes with being broke and being really poor. And I know this firsthand because my very first job, I made about $37,000 a year at Vanguard. And I climbed my way through a bunch of positions at Vanguard until I had a job where every call that I made and every increase in sales that I had led to more money for me. And the second that they told me that I couldn't earn more and that I couldn't be promoted, I started looking for new jobs. And then I went to Goldman Sachs. And at Goldman Sachs, I found a place where they paid you for performance to the maximum. And I kept working at Goldman Sachs until they wouldn't promote me. And once they told me that they wouldn't promote me and I'd have to wait here for a year. I went and found my next job at State Street. And at State Street, I looked at the top performer, I looked them in the eye and I said, I'm going to do more than you. And at State Street, I continued to grind until I beat that person. And then I left State street when I finally wanted to get my own skin in the game and run part of my own company. And that took just about, let's call it, eight years for me to do that. And by the end of that eight year period, I was financially free and I would never have to work for anybody ever again. I knew nothing about finance in the beginning. I had no idea what a mutual fund was. I had no savings. In fact, I had negative savings. And I often had that terrible sinking feeling where your debit card is your worst enemy because you know that it's going to be out of money so frequently. And at the end of that eight year period, that was never going to be me again, even through a financial crisis. So you can do the exact same thing if you are willing to front load pain. And all these things that you see on the Internet now about people investing to make money and people skipping the grind, it's not true. The only truth is, is if you front load pain, you will eventually have a lifetime of gain because making money compounds. But it only compounds if you start and if you do the hard work up front. There's no other way around it. This episode is brought to you by Netflix from the creator of Homeland. Claire Danes and Matthew Rhys star in the new movie Netflix series the Beast in Me as ruthless rivals whose shared darkness will set them on a collision course with fatal consequences. The Beast in Me is a riveting psychological cat and mouse story about guilt, justice and doubt. You will not want to miss this. The Beast in Me is now playing only on Netflix. So you're about to make a trade based on a friend's text. But which u do you listen to? Is it we could buy a house in Tulum, get optioning those options. We could lose everything. Or let's do a little research, get your head in the trade and make the investment decision that's right for you. Learn more@finra.org TradeSmart.

I also wanted to say that you had a great tweet that was basically like a TL doctor of this path to your first $100,000. Get a job that pays more if you do more. Mimic everything the top performer does. Get in early, stay late until you can't possibly earn or learn more Then apply for a higher paying job. And I feel like that. That just feels kind of like the cherry on top having that.

Yeah, it's not a fun. It's not like a fun diatribe, you know, because I think everybody wants a little bit of an easy button to life. But the cool thing about it is it is pretty simple, you know, it's not easy. It sucks to work long hours. Like, it sucks to not see the sun for six months. But at the end of it, it's totally doable. And I think that's the one cool thing about working in America is like, this is all so possible. This place is crazy in many ways, but we super reward hard work. That part I think makes a ton sense. Okay, well, one, I think if you guys haven't read the how to Get Rich from Naval Ravikant tweet thread, it's incredible. We'll link it in the show notes. That whole thing is full of so much wisdom. The only thing I'll say about the naval thread is it's like so theoretical. It's so beautifully said, but so theoretical. Like, he says things like, some people focus on status games that hinders their wealth creation. And basically what he's saying is what Dave Ramsey says and I think like a sort of everyday human way, which is people are made poor every day by their need to appear rich. Act your wage. And I f cking, I love that line, act your wage. Like, just because you can't afford a payment doesn't mean you should have a payment. And to keep it really simple, it's learn, Earn as much as possible, Work incredibly hard while learning and earning. Every time you stop learning and earning, move to the next spot and then you can apply the Naval Ravikant. Like how to get Rich. Like really, really rich, but only after you're not broke. And when you're not, you're fucking broke. All you focus on is getting out of Brokeville because you can't really do much else. When you're like super stressed all the time about a roof being over your head, you need to move past that. The second you move past that, you can focus on anything else. But until then, you have one game and the game is get out of being broke.

That kind of ties into like the deal of the week that, that we had here on the table acting your wage. And just because you can make the payment, like, doesn't mean you can afford it. That was that Dave Ramsey tweet. And it totally reminded me of Buy now, pay later, which we can get into in a few minutes. But there are, like, a ton of reasons why it's more expensive to be poor that I listed here, if you want to cover.

Well, you basically talked about, you know, you live in New York, and there's a bunch of segments in New York that are pretty poor and a bunch of segments that aren't. And, like, you were like, dude, it's just so much more expensive to be broke than it is to not be broke. And, like, what were you talking about with that?

Definitely. So there are things like maybe the grocery stores aren't as good where you live, so you're buying food, like produce, for example. Like the grocery store that I go to, yeah, it's the cheaper grocery store, but my food goes fast, way quicker, so I have to go grocery shop more. And there are a bunch of other things, like, I don't have a Costco, for example, so I can't buy in bulk. And not even, like, I could buy in bulk, but I don't have the space. And if I was somebody with a lot of kids and I live in an area where people are living in the same apartment complex as I am with a lot more kids than just me and my roommate, I'm sure that adds up. Having to go to, like, these smaller grocery stores that charge a lot more money than places like Costco for food that goes bad a lot quicker. And that's just kind of like a small look into why it's more expensive to be poor. And I can go on and on and on about that, but that's something that's definitely really frustrating. And you do see it in New York often, and I'm sure you see it a lot in other places as well.

Yeah, well, New York's one of the most expensive cities in the world, so for sure. But I do think that idea of, like, it just goes to show, like, why you have to obsess about not being broke. You, like, that should be your number one thing to change in your life. Literally everything is more miserable when you're broke. It's more expensive to be broke because you cannot maximize like you can if you have money. It's more likely that you're going to be unhealthy if you're broke and it's not fun. So, like, I think you have a moral imperative to get the fuck out of that and do everything humanly possible, and then you can figure out how to enjoy life and whatever's next. But, like, anybody who tells you just, like, stop and smell the roses where you Are like, not really, man. You gotta get out of it and you gotta focus on that super hard right now. One thing we were like kind of going back and forth on was what are the. So we talked about how to get out of it in some way. But there's like a bunch of sneaky little red flag institutions that basically make it their full time job to make you poor. And you don't think about it actually because a lot of them try to serve the poor. But what they're actually doing is there little parasites on the back of people that cannot carry more weight. And so let's hit a couple of them. Like which one you want to talk about first?

High interest rates on cars is just really that you can't even ignore that. That to me is something that number one on the list, obviously student loans. Dave Ramsey has a great tweet here. Maybe before we forgive student loan debt, we should stop allowing student loan debt. Take that as you will, but student loan debt is definitely something that.

Do you have debt?

I do not. I went to college on the GI Bill and anything that wasn't, I got covered by scholarships. But I had financially literate parents.

Did they help you apply for the scholarships?

My dad sent me an email when I was a junior or senior and it was with a giant PDF document attached and it was a bunch of different scholarships that I could apply to, which was incredible. And that helped. And now I have a bunch of siblings and he did the same thing. So my dad was great about that, both my parents. But I'm also in like a weird position where. Not a weird position, but I'm in a super fortunate position where my parents both have college degrees, both have their master's degrees and understood how financially horrible it could be graduating college and having this monumental amount of debt. Especially because I went to an out of state school that it was super expensive, which I'm forever grateful for their knowledge because I think a lot of parents, especially ones maybe who see college as the best way out for my kid. This is how my kid can become. Break the cycle, not broke. Yeah, this is how we break the cycle. They don't understand like the actual financial implications that come after graduating, which is really difficult. And it's not their fault for not knowing. We're telling their kids, like this is the path. And sometimes like when we were talking about trades, for example, something that's really hard, I think for people in high school that are looking at that path of college. If you have people like your entire life saying you can break this cycle of poverty by going to college. And this is like, what your parents are telling you. It's so difficult to listen to anybody else. So of course you're going to go to college rather than a trade school because, yeah, maybe, like we're saying on this podcast, like, yeah, go to trade school. Like, college is freaking expensive. Like, don't, don't, like, avoid debt at all costs.

Yeah.

But it's kind of like you're gonna listen to your parents first. And it's really difficult because, like, their parents don't know how expensive college is.

Yeah.

Or how to apply to scholarships.

That could be like a whole podcast, I think. Unless you can get into, like, the very top institutions and you're broke, like, that's probably not the path. I mean, I had a woman who worked for me, Nikki, who was awesome, and she had like $200,000 in student loan debt, and she made good money, but it was just over her head. You know, she couldn't apply for a mortgage because her debt ratio was too high. You know, she had to make decisions based on having to pay those payments every single month. It's the only time of debt. That's called non recourse, which basically means no matter what, it will follow you for the rest of your life. There's no ability to bankrupt your way out of it. And if you think about an institution that was created specifically in order to, quote, unquote, serve people, that's not it. Like, you know, the government gives hundreds of millions of dollars to financial institutions a year for them to increase prices at 3 to 5x the rate of inflation. And so, you know, if you're listening to this right now and you're thinking grad school, and you're thinking, you know, the next step, unless it is for a massively high increase in salary, a passion that you can't stop, and you're in a good enough financial position or something that you have to do in order to get to the next level. Like, you're a doctor, an engineer, et cetera. It's a no, dude. It's a total no. And go and learn the game of business by playing business. Go and study literature by reading literature. You do not need fucking academics in a grad school situation to credentialize you. You just don't. And the only way around that is if you were like me, and you could go work at a big corporation and they would pay for your schooling. And that's what I did. So you. Your dad served. He went to the military. My husband Served, he went to the military. So he got to go to grad school for quote unquote, free for serving. And I got to go to grad school for free for quote unquote, serving in a corporation. And if you can get somebody else to pay for it, awesome. But if you have to pay for it, it's a fallacy and I just do not think you should do it. I think there are five institutions we gotta be really careful about if we're trying to not be broke. We got to be careful about college, actually pretty much across the board. We've got to be careful about high interest anything. So that could be high interest. Payday loans, you'll find those all the time. Anytime there's anything high interest, they have these complex algorithms behind the scenes and all they are doing is calculating the data to a point in which they are more certain they will win than you will win. It is the same thing as the third institution, which is a casino. And the casino, the house, always wins. You can go for fun, but don't ever go because you think you're going to make money. You will not. It is just a game of numbers. The fourth is anything that's like a pawn shop where you think you can use a watch or a piece of jewelry as collateral in order to get a loan. They've also calculated that and they've calculated the percentage likelihood that they will have an unfair advantage over you and they will get to keep your thing in order for them to resell it and make more money. So I'm a no on those. And then the last thing that I'm a no on is anything that's like buy now, pay later. And that might even be a mortgage. It is not an income producing asset. Owning a house. You have to live somewhere. And at some point, if you want to realize any of the money inside of it, you have to sell. And so be really careful with debt. When you're broke in any way, shape or form, the entire game should be don't play it.

Have you ever had a situation where you've been broke?

Oh yeah, all the time.

What was like the hardest thing or the hardest habit to break?

I think it was. And I'd be curious your take, but mine was just even tracking when I was broke or when I wasn't broke. Like I was always kind of close to being broke. And so it was like, well, I'm just gonna go out on Friday night, I spent a hundred bucks. Cause I had four drinks instead of two and I was only allowed to have two. Because that was all I could afford this week. And now I'm in the hole and now I have a $30 overdraft fee. So now I'm in the hole more than I was before because I don't have enough cash. And at that time I had no credit. So I didn't get a credit card until I was like senior in college or maybe had graduated college because I had no idea that like building credit was a thing that was important. And so, you know, I think the hardest part was just, am I spending too much? You know, most Americans don't budget. I've never been good at it. And so my only answer was to earn so much. Budgeting was never an option. But what about you? Have you been broke?

So when I first graduated college, my job didn't start for a little bit, right? I think I had six months and even then I had a fellowship where I got paid. Really I didn't get. It was an amazing experience and I loved it, but I didn't get paid a lot. So I lived at home and I had like the, I had the luxury of living at home, right? My parents didn't charge me rent when I was living with them or anything like that. So it was incredible. But I didn't have money to go out and see my friends, like even to pay for like gas to go out. I was living in the suburbs, like to go to the city, that costs money, you know what I mean? Even if something doesn't cost money, it costs money. And I think the hardest thing was for me actually get out of the mindset when I started having money to be like, okay, I'm, I'm not broke anymore. What should I be doing with my money instead of just squirreling it away? So when I was super duper broke, I worked. I picked up as many jobs as humanly possible. Even into my first job, I had, I had so many jobs, like I would sell. I got into like reselling all my. I sold a bunch of my clothes on the Internet, called my brother's clothes on the Internet to be honest with you too. Like I was just doing like anything you could do online to make money that was having to do with like social media management. Came to a point where I was running like dog walking companies, social media accounts. I was just doing like anything I could that only involved my laptop and me sitting at my parents house, having to make money so I could afford to move out, move to New York City, which I always wanted to do.

Why didn't you just Get a job.

I did, I did get a job, but I still made $60,000 a year in my first job.

Because you didn't have upside. So if you had actions, could you have made more than $60,000?

No, cut off at $60,000. Didn't get retirement in that and that first job. So I paid my own retirement. I didn't have debt. I was really afraid of debt to going, going into it. And when I moved to New York City, I was making, you can live in New York City on $60,000 a year. Like, trust me, like I again saying this out of like an extremely big place of privilege. I had no debt. Like I am privileged. Like one number one thing. I know 100%. But I was able to live there on my $60,000 a year job while I was working all those social media management jobs as well. And I think the hardest thing for me to stop doing was leaving those low paying jobs that I had. And that was so hard for me because I was like, well, these are the jobs that financially sustained me. Getting to that next level. You're talking about when you hit that level of earning, go to the next thing. I struggled so much with getting to that next thing. It's like, well, they pay me like $50 an hour to run this social media account. Like say I want to quit this job and go to the next thing. And like what happens if I don't have that next thing? And even if I have it lined up, what happens if it's not as good as this? And like, that was a super big, that was just a huge issue. I feel like that I had, you.

Know, I think most people worry about uncertainty more than just about anything. And so we stay with the certain instead of jumping for what we see as risk in the uncertainty. And that might be the biggest reason why actually people stay poor and people stay broke is because you don't take the risk necessary to hit the next level of the game. You know, you can't move forward in a video game unless you can jump over the chasm, fight the dragon, you know, steal the princess, whatever the case may be. And you have the same exact thing in life, which is if you do not do the risky thing and make the next jump, you'll never get to the next level of the game. And so part of it might just be how can you make it institutionalized where every two years and every time you're not learning and earning more, you move. It's just like every time you, I don't know, every time you are in a relationship and you get to a period where you see that he's not going to be the one that you want to marry, you move on. And most people stay in things that are average because they're scared that something might never get better. So maybe we need a whole entire episode on, like, what's the foundation of. Of change? So I kind of want to close it out with a couple of things really quick, which is, I think we answered Michaela's question.

The hardest thing, though, I do want to say the hardest thing, I guess, for me to give up just as a thing, was 100% Amazon. Like, just little Amazon purchases. Yeah, I was thinking about it. Like, what was the hardest thing?

Well, that's true.

Stupid little Amazon purchases that I did.

Well, that's because there's no friction to purchase. So, like, I think the. The tough part about today's world is you can click on something on Instagram, an immediate purchase, and have it sent to you. And what do you get? You get an endorphin rush because you have some positive outcome immediately. And guess what's the opposite of an endorphin rush? Working 12 fucking hours on something that you don't really like to have future payments. And so you kind of have to retrain your brain to, like, awful things in order to succeed.

So it would be like, my hook would break in my bathroom and I'd immediately go to Amazon to replace it. Right?

Yeah.

And. And not being able or not, or knowing, being like, okay, I should really wait to do this. Like, this just is not a priority. That, like, oh, my gosh, like, you're right. It's so such a. Like, it's like an itch. Like, if something's not perfect or something broke and not being able to fix it immediately. Oh, man, I don't know why.

Yeah. You have to remember that you have one goal, and the goal is to not be broke. And anything that is not that goal is not your priority. And if you remember that thing for somewhere between two to three to six to nine years, which is a long time, you will break it like, it is completely possible. But if you focus on the things you want today, on the Sephora purchases, on the dress, on the fun, you may never break the cycle. And so you have to stare yourself in the face and ask what the difference is to you of a life that for six to nine years is pretty tough or for 60 to 90 years is really tough, what do you want? And choose your hard. All right, Mikayla, I think we answered your question. And you have two paths to choose from. And both of those paths are going to mean no birthday gifts for family. And that's not a need, that's a want. And you are going to have to decide what are the needs that you will feed over a multi year period. And I can promise you, you can sit down and have a conversation with your family that goes like this for the next couple of years. I have to focus on getting out of a hole so big I'm almost drowning. And if I cannot get out of that hole, I'll never be able to buy good birthday gifts. I'll never be able to have fun and go on trips with you guys. And so because of that, I'm asking for your permission and for you to be okay with the fact that I'm not going to be doing a lot of birthday gifts that there may be no purchases at all for me for this period. And I guess when I say I'm asking for your permission, I'm kind of telling you I need it. And so this will be a hard decision I will have to make for this period of time. Can you support me in it? Their answer will tell you if you should be buying them birthday gifts in the future or not. Because the truth of the matter is you don't have time for other people's desires when you are broke. You have to focus on you and then you can give after you have cleaned up your own room. All right. I know it's kind of heavy to talk about being broke. It's not that much fun. But I will say that I think if you follow this lesson, you will never have to be one of the statistics of so many Americans who die with nothing. And in fact, maybe you can help the next generation if you like this, give us a little review. Thanks for being here with me this week that I have it, you know.

That I got it.

No need to look all in a bag, stunning like this. Because I work so hard, I'm the best. I only speak facts.