5 Ways to Build Wealth While You Sleep: A Real Estate Success Story

Wealth Breakthroughs is an exclusive video series where millionaires break their silence on their usually hidden secrets on how to stack up great wealth.

It's like eavesdropping on the private conversations rich folks have with each other behind closed doors. But I partnered with the series creator, Jeff Hays, to bring that VIP pass to you right here today.

In this episode, you'll learn the number one skill for getting rich, How to fix your money mindset, the step-by-step process to pile up money while you sleep, and timeless investing strategies. Get ready to uncover your strategies for success and accumulate massive wealth.

Enjoy. Hello and welcome to episode 9 of Wealth Breakthroughs. Let's get right into it today. We've got an action-packed episode. First up is Michael Bernoff, founder of the Human Communications Institute. He's going to show you why 99% of people will never become wealthy no matter how hard they work. He's also going to show you how to make sure you're part of the 1% that amasses significant wealth. And he's going to reveal the number one skill anyone seeking real lasting wealth should master. Your personal wealth breakthrough could be in this interview with Michael. Watch it closely. Well, Michael, having seen you speak multiple times before, I know we're in for a very lively conversation.

This is gonna be fun.

So let's talk about how did you— a boy from Jersey, you know, like me.

Two of us.

Two of us, right? How did you end up doing what you're doing? What was your path?

Pain.

Pain. I say it all the time to people, pain. I went into business for myself and I thought it would be easy. I had a couple of great parents that, you know, mom's a Teacher, dad's an engineer. And, you know, they said that everybody that did well had a business. Nobody showed me how to do it. So I went into business with their whole attitude of, you know, work hard, be a good person, and failed miserably at it right off the bat. So when I—

did you go to college?

Yeah, I went to college. I went to college. But in college, this is crazy. So I had a guy introduce me to direct sales and network marketing at 17 years old. I got started as an entrepreneur right in college. One of the guys that actually founded Under Armour is the guy that introduced me. I didn't realize it till years later. This guy, Asim Wood, he one of One of the founders of Under Armour introduced me to a direct sales company and I was hustling stuff. You know, I knew how to talk.

I knew the shtick.

I could get people to do things, but I didn't really have the long-term stick in what I was doing.

So then you got out of college, you went into your own business, failed miserably.

I was almost not going to finish school. Someone gave me Rich Dad Poor Dad book and literally looked at it and they're like entrepreneur. It was really for me. So it was like one semester left, ADD, have my own little business on the side, still failing miserably at it, but wanting to figure out how to do it. And I had to like force myself to finish school. When I finished, I never really wanted to work for anybody else. It was one of those things I've always said I wanted to figure it out. So it was a teacher in college that changed my life. I remember I failed out of Arizona State for a semester. Did a good job, went for, you know, it took me 5 and a half years to get out. And at Mesa Community College, I took an interesting sales class. See, couldn't get into the business school at ASU, never got in. I graduated with a communications degree. But one of the teachers handed me a book, a list of books. You could read anything from The Wealth of Nations to this, and one was How to Win Friends and Influence People. And literally got the book. I'm a single guy. How to Win Friends, Influence People. I'm 19 years old. And that book opened myself up to the idea of you can actually learn yourself better. I had no idea that I thought I was stuck with what I had in life. I thought I'd work hard. And that book taught me the biggest shortcut in the world that you can learn from others how to get what you want. Wow.

So where'd that lead you then? So you're failing in a business, failing in business.

Had a couple of businesses, didn't work out. And then when I found personal development, when I found the ability to work on myself, to understand the problem was up here, that the reason I wasn't making the money I wanted, the reason I wasn't getting ahead the way I wanted, was sitting up here in my head. It was one little meeting that I was at in California. There was a gentleman named Tom, and he was a pet safety guy of all things. And he walked up to me and he goes, that was a great presentation. I'm like, actually, it was a sales pitch, because you guess didn't work well because nobody bought anything. He goes, you got a great presence. Have you ever heard of neuro-linguistic programming? And he goes, I used to work with, you know, this guy back in the day. Are you— you got a great thing about yourself. But I wasn't listening to him. And he, he's the guy that geared me towards understanding communication. So he has never actually went extremely far with this stuff, but he's the guy that actually got me started with two people. One was a book, and number two was a guy just nudged me. And sometimes the littlest things nudge us and they wake us up.

So you're talking a lot about Headspace now, saying that you discovered that, you know, this is— your Headspace can really change your life, your outcomes, etc.

Changed everything.

So do you think that the primary determinant of the ability to create wealth is headspace.

I would say the primary ability to create wealth in your life is based on a little something which I would call your average. And I think most people in life, they are living an average life. And I don't mean you versus somebody else. I believe that you get to a point in your life, even when you're doing well. I've seen people that make a lot of money, but they're not wealthy.

Right.

And I've seen people that are broke and they're definitely not wealthy. And what I've recognized is most people are the way they've set up their life, their automatic autopilot they have for their life is to get about what they have right now. And anything else they want is a dream, is a hope. Up as a wish and wanting it is so exciting and turns them on so much wanting it that actually having it isn't really in the equation.

Meaning that they're always just pursuing.

They're pursuing and the idea of wanting it isn't part of their current identity. Wanting it's part of their current identity. Actually having it, getting over the wall to literally get from where you are to where you want to go is people's biggest challenge. And it's the mind, it's our actions, it's our attitude. But most people aren't aligned to be able to actually do that.

So how do they get aligned? So somebody's watching this saying, you know what, I'm where you were. I'm struggling, you know, I'm failing miserably, but I feel like I want to be an entrepreneur. I want to, you know, create good income or wealth. And but I find these blocks. How do I, how do I clear them out? How do I get my head?

There's a few things to work on. I always sort of figure if you're going to be put in a box, you might as well have a metaphor of what that box really is. So for me, I always think the box is the I'll never go back there again box. And I think the reason this thing typically gets created, it's a really good idea at first. You finally make a little extra money. You get out of a relationship you shouldn't be in and you say, I'll never do that again. I believe people build our wall of what we want a little too far out instead of recognizing that we need to get where it is we need to go. But this is where the biggest challenge comes in for most people. It's in our identity. It's how you see you that is the biggest challenge. So number 1 is to really change what your identity is and how you see you and how you perceive what it is you're doing. I think most people are wanting to do that. And I know the whole law of attraction and just wish it's going to be there. That's cute and all. But to actually get yourself to be a person that does it, there's a few things you have to change. And one of those is accept that you actually have people in your life right now that cheer you on for being who you are. The biggest thing I'd say is this one, one very simple word: most people getting what they want is negotiable. And one of the terms I use all the time is non-negotiable. So getting what you want has to start to become non-negotiable. And part of that is actually working on what it is that you want. So I know the whole personal development space is don't talk about the word want because want means not having, but you actually have to work on what you want and understand there's a major disparity between what you have, what you want, and what are these like dream board dreams that are way out there. I feel that if most people actually were getting what they wanted, maybe not their ultimate dream, they'd be satisfied, right? So what we need to do is to enhance our identity of how we see ourselves and start getting pieces of what we're looking for in our lives.

So does this tie into the idea of what's your average?

That's the whole average. Yeah, that's, that's my whole average thing. I mean, that's the whole average sucks. I mean, that's That's the point of everything. And I wear my shirts all the time that say the average sucks. And people look at me like, they look at me and they say, you know, so you're telling me like, you know, you're right, average sucks. You know, I'm better than them. It has nothing to do with me versus you. It's you versus your average. Like, so the question is for most people, like when someone says, Michael, like, how tall am I? And I'm 6'6". And years ago, a buddy poked me. He goes, how tall are you? I'm 6'6". He goes, you really start to act like it. And he goes, most people really act about 5'6" and they're maybe 5'10" or they act 5'1". And the reason is we're only playing a piece of ourselves and we're getting away with it. And the reason is we're comfortable. We're comfortable with where we're at. So by raising what your average is like, most people's income is about the same every year. They get about the same amount of money. And what's fascinating is anyone watching doesn't have to work as hard as they are. They'll wind up in the same place anyways, right? You could sit on your ass for 9 months of the year in the last 90 days of the year, your gears will kick in. You'll start to do it. You'll get super excited about it because, you know, that's who you are. You're the person that actually does that thing, earns that amount of money. To get the amount of money you want means you're going to have to learn to change your average. And part of that is really starting to create new non-negotiables for yourself, starting to put things in your life and make them necessary for you to do.

Give me an example, like some non-negotiables that somebody might change. Like income sounds like one thing.

Yeah.

You know, I'm used to making $100,000 a $100,000 a year and I find a way no matter what, whether I lose a job, I'm in a business, you know, ups and downs of the economy, I still find a way to get to that $100,000. And you're right, it really, I think people do somehow migrate to an expectation that they have consciously or unconsciously. So how conscious is somebody's average versus, you know, unconscious averages?

I don't think anybody really thinks about it. People weigh about the same amount of weight every year or within the course of 5 years or 10 years. Everything averages out. It's fascinating. You have just about the same amount of fights every year. It's based on what your conversations are, what you're doing. So to answer, to answer the question and keep it simple, just give an example. Like, let's just say we got cameras around. Let's say somebody's watching this, says, you know, I've always wanted to be a photographer. I got a job, I work at a, I work at a company, I make decent money. Well, you got a dream of being a photographer. You don't have a camera, you don't have any clients, you have nothing. One of the things we need to learn is how to jump over the metaphoric wall to go to the other side and start actually doing what it is you want to be doing. Years ago, I had a guy that worked at Motorola, give it an example, and he came to me, came to one of our events, and he said, Michael, I want to start to be a photographer one day. I'm like, you got a great income. I said, do you own any equipment? He goes, no, I don't own any equipment. So I said, why don't you go do that? So he jumps over the wall, buys equipment. Now he's a guy that actually owns a camera. And then one day he says, hey, I want to shoot a birthday party, make $100 shooting a kid's clown party. So he jumps over the wall, shoots a clown party. It's non-negotiable. Eventually, unfortunately, this guy got laid off. The economy went down. Motorola laid off a bunch of people. The guy now is forced to actually have to make this work. So now he's doing parties and weddings and bar mitzvahs and everything. He's working on it. And he started to make it non-negotiable for ourselves. We need to work on what it is that we want and stop dreaming about it. And we have to be willing to do the little teeny things along the way. So when I think of wealth, wealth creation for most people, I think the relationship with money is part of their challenge and the relationship with their average. I mean, I told a guy once, I said, you're not going to save your way rich, but if you start respecting money, like the fact that you avoid Starbucks, you know, it's $7 a drink. Here you are wanting money, but you're going there 3 times a day. I had a limo driver. He wants to go see his dad over in Africa, right, for the summer. I said, where do you spend your money? You know, you're not able to go. And he goes, well, I go to Starbucks. He goes 3 times a day, plus the pound spending $50 a day going to Starbucks, this guy. I said, "Why don't you just transfer $20?" It's changing. This is going to get you rich. But transferring $20 from your checking account to your savings account, that's all I'm going to ask you to do. Make the transfer every single day. Just have it automatic that it does automatically.

So, on a savings basis, the changes is average, right?

It changes his average. He comes to me a couple months later. He goes, "Michael, I have $1,600." I said, "It's not going to change everything but it changed your relationship with money." you're actually starting to respect it. And most people don't have really respect for money. They don't have a great relationship with it. They don't understand it. They don't know where it comes from. It's not important to them. Most people that aren't doing well financially, they have zero books in their house on wealth. They have zero friends that are making the amount of money they want to make, and they're not surrounding themselves with an appropriate relationship when it comes to money.

So those are, I think, two important dimensions. One is, like you said, you know, what are you reading? Meaning what are you feeding your mind? And then two, who you're surrounding yourself with. So, so can you speak a little bit more about each of those?

Yeah. I mean, what you're reading. I mean, that's the thing. I mean, I remember Jim Rohn was one of my earliest mentors. I had years ago when he was, when he was alive, he was like my dad. And then that was like my business dad. And he would teach me everything about money. And he said, you actually are living the life that you're choosing right now. And I realized I had no money. And he said that that's your choice and that's That's what you're doing. And a lot of times that's a hard pill to swallow.

So did you resent that at first?

I hated it.

Okay.

Yeah. Because if you were like— if somebody's watching us right now, yeah, we're saying to them, you know, you don't— you don't want to be rich, you don't want money. And they're like, what are you talking about? So how did you receive that? And when did you finally realize he was right?

I get it now. It's hard to accept that when you're in a situation. I always tell everyone, if you had more money, you'd have nothing to bitch and complain about, right? So, and then you'd be bored because people's favorite thing is to bitch and complain, right? So it's their favorite thing. I mean, if I asked you to eliminate complaining for— well, not you, you don't complain and I don't complain either because we like to talk about big things. And that's the thing, wealthy people, they talk about big things. All of our friends that we know, they talk about big things, stuff that's happening in the world that's making it happen. But if you stopped complaining about your problems for a month, right, you'd have no friends left because that's what people talk about, they complain. So So when I first heard that, I didn't like it. And then I recognized that in order to make more money, I needed to first accept I didn't have enough. And that is one of the most painful things for people to do. But once you get through that pain, like Chapter 2 of our book is on adversity, and we say that the biggest challenge in the world today is people aren't very good at dealing with everyday adversity because life has gotten super easy, right? Little House on the Prairie back in the day when Pa was out there, I don't think he was bitching about going to the gym. He was complaining like, I'm having trouble getting a Lifetime Fitness. Because he worked out, he was out there. He had to learn how to survive. You people, people who don't have adversity, life's easy. Kids are getting food delivered to the house, get delivered to their school these days. So life has gotten real easy. So is marketers' ability to take our money. So it's very hard to get ahead. So we've got a lot of info against us, so we need to empower ourselves better. So backtrack to what I was saying a minute ago about what Jim originally said, that you're living the life that you're choosing to live. It was hard to hear. But he also said, how many books do you have on being wealthy? And I had Think and Grow Rich and I was broke. I had The Magic of Thinking Big and I thought small and I like to complain a lot. And I realized that I didn't understand Think and Grow Rich. I didn't understand that the book is in the title. You don't even need to read the book, right? Change your thinking, right? You've got a chance to grow rich, right? Change your thinking. You can get wealthy.

Yep.

Okay.

So that's interesting saying, hey, you know, what are you reading?

What are you—

what are you putting in your mind? And that helps really create mindset. Books have totally changed my mindset. It just reads. Now talk about who you hang out with, because the old adage, you are like the 5 people you hang out with most. Is that true?

It's massively true. And it's their expectations you take on. You take on their expectations, you take on their standards. And a lot of times we, we play to the weakest link and to the strongest link. So I like to be the weakest link. And that's why I attempt to surround myself with as much as possible with people. They don't have to be wealthy. There's different levels of wealth. I have friends that are billionaires. There's some of those fun people in the world, and they're very cheap, some of them. Yeah, I have friends that are absolutely horrible with money. They make $300 grand a year and they spend $450,000 a year. I have friends that make millions and they've got good lives. Some of them are married, some of them are happy. But the wealthiest people, the ones that have what it is you want, and their relationship with money is the one you want it to be. So if you don't have somebody like that in your life, one of the first things you could do is you can have audio mentors. You can watch things like this. You can get around those people and start modeling their behaviors. Figure out what they're doing. That's a big step in the right direction for people.

You speak a lot about persuasion. You're really an expert in that world. I've heard you present on that.

It's one of my favorite things.

Yeah, well, and you do it— I mean, it's, it's an extraordinary presentation that you have on that, or series of presentations. Is there a relationship between wealth development and persuasion?

The only way to get what you want in this world is through communication. Money comes from other people, and money comes from relationships. That's where it comes from. So let's get really clear that communication is the most underdeveloped and underutilized asset we have as human beings and is the fastest way to get what you want in this world. If you need a loan, you have to communicate with the bank that they need to give that to you. If we're selling right now and you have a business you need to sell, I need to communicate why my product has value. As a doctor, you need to communicate why they need to come back again, which brings in money. So all money comes in a form of communication. It is the most underdeveloped thing in the world. A big sign at my office says, "Your future hinges on your ability to effectively communicate." Really think I should change that to, "Your wealth hinges on your ability to effectively communicate," right? To get what it is you want. And I believe we're very misspoken. I had a guy come in the office the other day, young kid, just graduated from college, entrepreneurship. I said, "How many classes have you taken on communication?" "One." "One in 4 years?" I ask doctors how many classes they've taken on communication and they're having trouble financially. No classes. You can graduate from Palmer or East or West or any chiropractic school in the world and not take one class on influence and communication, which is the most fascinating thing in the world. So I believe that people can get there a lot quicker if they can learn how to influence other people but also influence themselves. So this guy comes into the office and the person doing the hiring in the office asked the question, what type of income are you currently accustomed them to. Kid says, I don't know, what do you want to pay me? She turns around and says to him, whether we hire you or not will be one thing, but whoever you ever talk to again and they ever ask you that question, let me help you reframe that. Because the difference is whether you're getting $25 grand a year or $100 grand a year is how you answer that question.

Did it sink in?

He got it. And waiters and waitresses are a great place to practice. You know, what kind of tip would you like? I don't know, whatever you feel like giving. Very obvious. Like, guys, it's $100, I'll give it to him. This is $1,000, I'll give it to him. I've done that before. It's a wealthy mindset.

Yeah. So here's what's interesting. Now, you talk about communication. Persuasion, I guess, is the cousin or the— they're closely related. So here's the question. You hear terms like, well, he's got or she's got the gift of gab. What I'm hearing from you is that, no, this is a skill that can be developed and learned. It's not like either you have it or you don't. Is that accurate? What's your premise?

I mean, there's a lot of things that happen from birth. You could walk out of the womb and you're— I came out with my legs were crooked. I was born with casts on my legs like Forrest Gump when I was a kid. And I got out of that. You know, some people, they breathe correctly when they're born. Some people wind up being more effective. You grow up in Jersey, you got to talk just to speak. It's hard to get a word in my household. You have to. But the funny thing is people don't recognize in their hometown. I mean, if you want to get ahead, you go to Toastmasters, you can spend $100 a year. You can probably convince the guy to let you come for free, or clean the floors, to spend 50— imagine 52 weeks a year you did that. You want to get ahead. Like, most people don't recognize that if you even were a better communicator at your job, you'd make more money. You could take that extra money and create wealth with it, buying real estate, doing something on the side, reinvesting that money. He or she who communicates effectively— the wealthiest companies in the world are communication companies. If you think about Steve Jobs, he created a communications company. That's all Apple really is. All Microsoft is is a communications company— how to get material out people. Telmex, the wealthiest guy in Mexico at one point, is a communication company. So I believe anybody can learn communication, but you have to know it's a problem first and not just say to yourself, well, you know, my problem is I'm not good with people. You don't even need to be good with people to be a good communicator. You have to understand people and be willing to understand human psychology.

So are there some fundamental things that, like, let's say, okay, I've never taken a course in communication— most people haven't— so likelihood is most people watching this haven't either.

No, most people haven't.

Yeah. So what are some of the— maybe the basics or fundamentals? Like, are there maybe like common mistakes that people make or some principles that they should learn?

Most people have to understand life is not about getting people to like you. And that's where I think most people go wrong. And if you want to get ahead in sales or business, it's about willing to risk the relationship. If you want to get ahead in your own relationship, you have to be willing to risk and say, will you marry me? You have to be able to— I'm not you personally, But you know what I'm saying? Will you marry me? Or being able to walk up to somebody and say, "I think you need to buy this product." And what that is, is momentarily the relationship gets risked for a chance for it to be even better. You got to risk your muscle to make your muscle better. You have to risk your money to make your money better. It's not about a home run. I had years ago, a guy wasn't communicating with me correctly. I came into a little bit extra money. I was maybe 22 years old. I had 30 grand and I thought I was rich. You know, $30 grand now is like, you know, you could blow that on a weekend in Cabo, right? And not even on drinks and just being out there, just going to stay in a nice place. And I went to call the financial guy and I said to the guy, I said, can you make this money into more money? And he said, well, what are you planning on wanting to do with it? And he said— I said, can you make it more? And I'm a young kid. I'm like, can you just— I heard that there were people that can get me more money. Can you? He goes, I have a fiduciary responsibility. I need to know what you want to do with it. Do you want to save it to pay back loans? Do you want to buy a house one day? I'm like, no, just make it more. And he goes, I cannot take you on as a client. And I realized I don't think people have a clear path of what they want to do with their money or they want—

what—

how little people need to impact themselves. Like most people want to get like 100% return on their money, like 1,000% return. If you could find a way to get 8 or 10% every 8 years in your money, your money doubles.

Yeah.

And that's the part most people don't realize. They looking for this large thing instead of realizing the secret is inconsistency and getting okay with being peaceful with the idea that 8% for most people over a course of a long enough period of time, you could double, triple, quadruple your money overnight. Bam, bam, bam, bam, bam. And then you have extra money when you find a big opportunity that can make you 1,000% return, do something big. You have the cash ready to do it.

All right. What are some of the bigger lessons you've learned then around money? I guess that's one of them saying, hey, you know, it's more of a consistency game than trying to make big hits.

The big hits will get you killed. I've never— have you ever met anyone that the big hits really worked out for consistently?

No, they got me.

I've had big hits.

I've met people who got lucky, and I've gotten lucky sometimes. Yeah, but you know, I thought I was smart, and that was the problem. Like, my— the first time I bought a piece of commercial real estate, I almost, you know, better than tripled it within about 4 years when I sold it. I'm like, I'm a real estate genius. And then I could— then I lost on the next 3 deals. I'm like, oh, I was lucky.

Yeah, I see that all the time. It's like being out at a town— like, I remember being younger and being out one night, like, hey, let's reproduce, let's reproduce last night again tonight. And you try as hard as you can, night 2 sucks. Yeah, you can't reproduce it. So looking for the home run is one of the biggest issues. I believe the biggest thing is education and educating yourself and taking a minute to understand wealth and understand what wealthy people do. They do different things. They have— I remember watching this thing on Warren Buffett. He's got a free calendar. He spends a lot of time thinking. Yeah, he's very, very concerned with keeping his thoughts clear in his head and getting around the right kind of people and keeping a really open schedule to hear about opportunities. And he's listening all the time to high-level opportunities. He's also got the right voices in his head. So when you ask me, when it comes to wealth or it comes to creating finance for yourself, I've recognized that there isn't just one way and you have to look at the overall picture. So I'd say the first is really to change your relationship with money and stop having it be something that you want and start being something that you're beginning to create. And how you create it is just looking at where you're at. I mean, just accepting, like, taking a minute. And like, if you're not willing to take 5 minutes and go, here's where I'm really at, here's how much I have coming in, here's what I have going out, I never wanted to do that. But if you don't take a minute and figure out where you're at, how on earth are you going to figure out where you're going?

It's no reality in a sense, because some people Like it's like, you want to ignore that. I don't want to know.

Not going to balance anything.

Yeah. It's like almost in a sense, the example you gave of the driver who was spending all this money on Starbucks probably wanted to ignore how much money per day he was spending on Starbucks.

$50 a day putting it right here in his belly.

Yeah. So, so it's like, you know, coming face to face with that, it's like saying, okay, now I have to change my relationship here. I got to become conscious basically is what it amounts to.

It sounds like if you want, if you can respect your own influence and understand that you have a chance to impact the people around And as parents, we have an obligation to teach our children who are doing anything about money. We have messed them up completely just by life being so easy. We should make it harder for them. But we have an obligation to people. If you could accept the power of your own influence, that your kids do what you do by being able to risk the relationship and saying, you know what, we're not getting a Starbucks today or we're not going out to dinner today and being able to reallocate that money is enormous.

And that's what you mean by risk the relationship, risk the relationship that you might upset somebody. It's not like you'll never talk to your kids again, but saying I might cause somebody I care about to be upset by doing something that is going to be positive for their future.

Yes.

Yeah. Or for their mindset or for their headspace as far as saying, hey, they need to— they need to get out of being numb and become more conscious of what's going on around.

We're pretty numb as people and we're following the wrong group. Yeah, it's not complicated. Just follow the wrong crowd. I mean, I'm just going to tell you, like, if you look at what wealthy people do, like when the economy was shot, We'd go to Mastro's and a nice steakhouse and it's busy all the time.

Yeah.

Chili's isn't filled up.

No.

But Mastro's is filled. You know, $1,000 dinner and people are still going to Napa. They're still spending money. Maybe the fake people are not. The ones that hit the one home run, like the commercial real estate geniuses that both of us have been, maybe that person hit a home run. But the people that created consistency, they weren't even— they weren't even like— didn't bother them. But I think also we get obsessed and the wrong kind of obsession. I think people get where it's something that they want so bad that they build it up in their head and they build it up as this big thing. For years, Inc. did an article on me and I talked about perception and people talk about what they want with their life, especially wealth, and they talk about this big house on the hill, you know, big home, big house, you know, overlooking the ocean or the ski slopes or whatever it is, and they picture their kids being happy in the nicest Gucci attire and Lamborghinis in the driveway, and I'm like, well, where are you in the picture? Picture, they're like, "Didn't think of putting myself there." I said, "What, did you die and they got the life insurance money? I mean, what happened?" And being able to put yourself in the picture, meaning being there with it, and also building some of the challenges in advance. I like to build that stuff in. Like, so when I build a timeline for my life, I build trampolines and trapdoors. I build like, how am I going to get rid of this job down the road? How am I going to get rid of this thing that's going to bother me? A trampoline that's going to get me over one of these hurdles. And I build out timeline of— and I like to see my challenges in advance and me beating them before I get through them. So when they show up, yeah, I destroy them. And that's what big companies do. They have contingency plans. And I think most people aren't prepared for a contingency plan. So one thing shows up, boom, knocks them over. But if you could be ready to go, oh, that's what Patrick was talking about. My real estate deal, I screwed up on one of those. Look, I'm halfway there. Then you're one of us.

Yeah. So given that backdrop that you just gave, What is your definition of wealth? How would you describe wealth? What does it mean to you?

It's changed. It's changed massively. You asked me when I was 22, was $100 gazillion. You know, I didn't have, you know, all these kind of stuff. Now, wealth to me is not worrying about money, getting to a point where way more than enough is coming in and structuring my life to make my life work for me. And that's the thing. So your wealth amount could be $200 grand, right? Your wealth amount could be $35 gazillion. I have no interest in being Bill Gates. I have no interest in being Steve Jobs. That used to be my dream. I have no interest in traveling that much. I don't even like being on a plane that much. But what I do like is not having to worry about money and my life working the way I want it to. Time with my kids, never missing a kid's sport. Even my life, I'm very wealthy right now. I have money in the bank and my money makes money. We did very well last year. I own buildings, I own real estate, I own properties. I got 7 or 8 mechanisms going all at once that are producing producing wealth for me. And my job is to— how can I do what I love all the time and have money coming in regardless?

Was it a gradual change going from— because very similar in a sense of, you know, in younger years, the ambitions as far as, you know, those things, you know, yeah, you know, the billionaire ambitions, right? And then, uh, but over time, that really does— at least for me it did, and it sounds like for you it changes quite a bit. And it sounds like you know, having some sense of security and having fulfillment is really, you know, kind of the dimensions of wealth for you at this point. Was there a sudden realization or was it kind of a gradual process for you?

I'd say it was gradual. I matured. You know, you get married, you have kids, things change. I mean, that's the one thing people don't recognize. And having children immediately changes. Then your needs change. The things that matter to you change immediately. So back when you're single and you want to impress impress everybody. I wanted money to impress people. Now I want money for lifestyle and to leave a legacy and to be an example for my kids and to be able to support them in a way that they can have what they want and have what they need and help them out. So, it changed over time but in the last 7 or 8 years, I've been married 8, 9 years and almost this year will be 9 coming up. And what's interesting is after being in a relationship and having a relationship with money We're on the same page. And that's another thing. I think people have to be willing to have the relationship with someone they love, have that tough conversation to get on the same page. You want the most detrimental way to lose. And Napoleon Hill does talk about in Think and Grow Rich, be married to the wrong idea with the wrong person. It's not even the person you need to get rid of. You need to get clear with them so you're on the same page. She's outspending, he's outspending, you're outdoing. Get clear on your vision together is big. So my, my gradual progression I would say it came in when I started to get serious about investing. I went from a saver to an investor.

Yeah.

And I had a lady that was vetting us for years to help us with our money. And I met her at a seminar, very wealthy. And she only works with people in our industry, people that are making a difference. She fired all of her corporate clients she hated. She only works with people that are high level and that are, that are care, that she enjoys working with. And her first thing is, Michael, I want to get rid of things you don't need to be spending money on. Let's clean it all up. Let's teach you about the benefit of life insurance. Let's teach you all these things. So wealth came in with me starting to educate myself. But also, I would say in that move changed everything. Went from an investor to now owning commercial real estate to doing our events in our own buildings right now. Instead of having to go rent hotels. So now make— saving hundreds of thousands of dollars a year. Reinvesting that money. So it wasn't a decision to just get consistent and really care that was a weird breaking open that I had.

It sounds like one of the principles that I've heard, you know, through doing this series is that you earn your money by, you know, the work you do, your income.

So what I—

but you become wealthy through investing.

100%.

And so you agree with that premise?

You'll never get wealthy. I hear it all the time. I sat with a guy the other day and I know this. He's like, oh my— I said, looked at the guy, 33 years old, he's making $10, $15 million a year, investing everything back into in his business. I said, are you saving some of it? He goes, yeah, you know, I got a couple hundred grand on the side. I said, look, I know you want to invest back in your business for the 400% returns you're getting, but what if something happens here? You have nothing set up over here. And he's like not listening. And that used to be me. Yeah, I did that 100 times. And now I'm realizing I'm building multiple entities in financial wealth management for myself that are making a big difference. So you got to, you got to put in your sweat equity. You got to put in your 10,000 hours. You got to get good at what you do if that's what you want. But there's also a great way to get ahead. I've seen people, you know, work on paying off their home quicker, and they pay off their home quicker, they stop eating out, they pay off their home quicker, they wind up saving $2,000 extra a month, reallocate that into real estate, rent it to their neighbors, 10 years later they're a millionaire.

Yeah, amazing how that can work, right? And it's not as hard as one might think.

Decision. And that's the hardest part we have as human beings. Decisions are tough. Being something different. So like, if you woke up tomorrow, let's change your hats. You're not you anymore. You don't have the wealth you have. You don't have the beautiful stuff you have in your life, and you got a nice job and you're doing okay in the world, or you want to get ahead, how comfortable would you be changing your identity to the people around you that you are actually working on this and you meant it? At the beginning, it's easy because either they're gonna listen to you or not. But are you willing to go through 6 months to a year till everybody sees you differently?

Yeah.

Within 1 year, I promise anybody that you really commit to this, people will start asking you advice.

Yeah.

And that's the real ancillary benefit. They'll ask you advice, then you become the expert.

So you talk about influence. One of the things that's coming through to me and everything that you've been describing, and I could see the threads of influence in it all, but I guess the most important person influences to influence yourself. And that's really because it's one thing, you know, my mother used to say to me growing up, you know, when you talk to yourself, watch 'Watch your language.' And that's good. Yeah, it's not good.

Mom gets credit for that.

Yeah. And I remember her saying that to me as a kid. If I'd say something that was self-deprecating, whatever she'd say, 'When you talk to yourself, watch your language. You're listening.' So now, you know, wow. Yeah. When I'm looking at, you know, how you're talking about communication and influence through communication, but then I guess you got to turn that into in the mirror also, I guess, and say, okay, what— because you're talking about identity So, you know, so how do you influence yourself to create a new identity or to move towards a new identity?

Okay, so this is interesting. This is like high-level, but everybody can handle this conversation. We warn our children about stranger danger and watch out, out people out on the street, right? We don't warn our children about the internet to the levels that we need to, that there's all kinds of stuff out there that you gotta be careful what you look at because you can't unlook at that, right? Look at what you saw. In our minds, we have the ability to Everything we have that's ever happened to us is stored in pictures, sounds, and feelings inside of our brain. Everything. The first time you get into an accident or your first time you're falling in love, how you store that and where you keep that in your head is completely up to you, but nobody tells us that. How much you make it matter. So your file for wealth is inside of your brain, but the question is, is it one that you got from someone else or is it one that you want or what do you want it to be? So when it comes to influencing yourself, the big question you have to ask yourself is like, are you gonna accept that you're controlling the communication inside of your head? Are you one of these people that says, I can, maybe, sort of, I don't know how, or are you making it necessary for you to do? So when I go back to the word non-negotiable, like, are you really working towards what it is that you want? And the pictures, sounds, and feelings you have inside of your head, are they aligned with what it is you're doing? And really taking a minute going, wait a second, I got some stuff I I need to clear up. Like, I need to think about this. My dad always told me I wasn't good with money, or you always screw everything up. Do you want that voice in your head? You don't have to have that voice in your head. You cannot have that voice in your head if you want to be wealthy, or allow that voice to drive you.

Yeah.

Okay, that's the question. So how much are you really going to accept the power of your own influence over yourself? And once you accept that power, that's, that's where the creativity comes in. So there isn't an exact answer that I can figure out in the next 15 seconds. If you want scenario, I can probably give you a solution for that, but I believe that it's your communication with you that's gonna make it the easiest.

So now somebody's been watching this, you know, and seeing the progression of these thoughts and ideas, etc. The conversation ends, and now they have to take a step. What's the step they should take?

First step you're gonna have to do is decide and not talk. Decide. And a decision is very different than talking. And I would say watch your people's feet move. Because if you're bowling, you know the direction of their feet. You can always tell, like, and as a chiropractor, you can tell like what direction people have been walking based on their shoulders and everything. You bowl and your foot's looking that way, the ball's going that way. So you're gonna have to move towards what it is you want. I'd recommend, if you want to change your relationship with money, number one is how much do you have? How much do you really want? Accept the disparity between those two, and the difference between them is you being a a different person. And really accept, "I'm here and I want to be here." It is not about a location you're going to wind up. It's a state of being. How do you become that person? Well, the first step in the right direction, like I tell anybody, if you're not willing to right now transfer $5 automatically a week, a day, a month, a year from one account to another and take 5 minutes to do that auto on your thing, I won't even give you lesson 2. Lesson 1 is that. You do lesson 1, you let it sit there for a week or 2, I'll give you lesson 2. Lesson 2 is we're gonna change your relationship with money. We're gonna start figuring out what we're spending, what we're buying, and where the money is. Yeah, and you're gonna get it from other people.

Got it. Well, I have to tell you, I feel like we could talk about this for years, years, and I really appreciate you sharing your own personal journey, but then also kind of the wisdom that, that came from that, that you can share with the world. But the mindset of wealth is something that I think is, is really a complex or can be a complex area. But I think you just simplified it a great deal. So I appreciate you sharing it all.

Look at it as a relationship and look at it as one of those things and start respecting money. And I think people have a lack of respect for it. Start looking how you spend it. You'll see how much you respect it. You start respecting it, it respects you. Yeah, it's like a great relationship. Buy it flowers sometimes. Take care of it.

I had it. This is— this is because people say, you know, love of money is the root of all evil. I said, what do you mean by love? Not lust, but love.

You don't have to lick it. You just have to have a relationship with it.

Love is respect. Love is buying it flowers. Love is paying attention.

Visit it.

Yeah, visit it.

Spend some time with it. Figure out what you have. Spend some time with it and ask yourself, if your relationship was $100 and you wanted a million-dollar relationship, would you just settle with your $100, sit down with a beer, and have a relationship with it?

No.

You'd nurture it. You'd figure it out. You'd bring in friends. You'd help it, you'd help it grow, you'd help it do more. It's just changing your relationship with it. Read it a bedtime story, read it a book, let it watch the video.

Awesome. Michael, it's been really stimulating and entertaining. Me too.

Yeah, thanks so much.

Yeah, thanks so much for doing this.

Absolutely honor and a privilege and love to help any way I can.

We're so excited about the momentum that's been building through the free viewing period of Wealth Breakthroughs, and I want to say a special special thank you for those who purchased the series. It means the world to us. It helps us get this information out into the world so people everywhere can have their wealth breakthrough, and it really is something that is gratifying. And sincerely, I want to be able to say thank you for purchasing this series, and I hope that it changes your life. Hi, welcome back. Next up, we have Aaron Kennard, probably the most famous passive income coach in America today. He's going to show you exactly— I'm talking step by step— how to replace the income you get from your job with income that piles up while you sleep. Warren Buffett said it best: If you don't find a way to make money in your sleep, you'll work until you die. Here's Aaron with the whole story. Aaron, very much looking forward to this conversation about passive income.

Totally. Me too.

So let's get to your background first. What did you do as far as your career, your business as an entrepreneur, or before even?

I started buying houses in 2006.

Why though? What got you to start buying houses?

Read a book, went to some seminars. Essentially, it started in— well, it started earlier, started probably 2002, reading Rich Dad Poor Dad, playing the cash flow game with my friends and family, learning about cash flow really, and kind of feeling drawn toward that, seeing the appeal to that.

Were you at college at this point?

I was in— I had dropped out of college. I was like doing sales. I ran a couple sales organizations, door-to-door sales crews. In various states and at the time. So I was making decent money doing that, but had a— was just drawn toward real estate, drawn toward passive cash flow from kind of those sources that I mentioned. And then, and then I ended up flipping one house, like did a spec home, and that worked out well amidst where it shouldn't have. Maybe.

Were you following what you learned in the books or were you—

Yeah, I mean, I was trying to apply that stuff. You know, in the sense that, oh, learning about passive cash flow and hey, let's go get an asset that throws off cash flow. Well, I kind of followed the stuff but didn't really because I went and flipped a house the first thing, which is not passive at all. That's like just generate a bunch of money.

You just took the words out of my mouth. So when we say passive, because that's what we all want to create, passive income, I see them working their butts off. I don't see anything passive about it.

A lot of us get into the mode of, and I did, let me go make some money. I thought I had to go make a bunch of money so that I could then invest it to create passive cash flow, passive income, right? So that's why I went and like flipped a house at first. And then it luckily it worked out. But when I, in 2006, when I started doing like real estate full-time, it was because I read a book that tipped me off to the fact that I didn't need my own money and that I could create and buy assets with other people's money. And I just, it was like a revelation to me at the time. I didn't realize that I was good at sales, but I realized, oh, I can just go raise capital. I can just go do that kind of sales. And so then I quit my sales job at the time. I was kind of burned out on that and I just started buying houses. I started raising capital and buying houses in the Denver area.

And so how did you raise capital?

Just first person is I called my dad. I was just like, hey, you have any money that's not earning 10 or 12% interest? And he did. And then I did a deal. I had a deal in mind. I actually had a deal under contract, right? I went and found a house to buy. I looked at the numbers, did that, and found out, hey, if I can get this money, I can flip it. And I just called him and did a deal.

And so what was the— what was the deal, though? In other words, okay, so do you have money? So here's the pitch.

Yeah.

Do you have money that's making 10 to 12 or less than 10 to 12% interest?

Yeah.

And if they said, well, actually, I'm making less than that, what do you— what have you got?

What would you I just be like, well, do you want to make 12% secured by real estate? I'm going to do a deal. I'm going to buy this house. You'll be the lender. You'll be like the first position mortgage. So if, if the deal goes bad or if I die or whatever, you've got the house as security collateral. You're going to make— I told you it was 12% at the time. I said, you're going to make 12% interest. I'm going to buy the house and fix it up, and then we're going to sell it. You're going to get all your principal back plus your interest for the time period.

And how did that deal work out?

That deal— I mean, all the deals with the lenders I did worked out good for them. I, over the course of time, I bought hundreds of houses over the years where some of them I lost money and some of them I made money. So I don't remember that specific deal, whether it worked out good for me or not. It worked out great for him. All, all of my lenders always made really good money. Yeah. So that was, that was good.

So then what happened? So you got that deal done, that worked. Then what was next?

So that turned into wanting to take over the world suddenly. And like, I ended up getting a business partner, getting an office, getting staff, and just going on a fundraising rampage. And I bought like 30 houses that year. And we were going to buy and hold a bunch of—

In one year, 30 houses?

Yeah.

Wow. Okay.

Yeah. Like, and, and I was in charge of like raising capital and finding the deals. And I got a partner who was kind of in charge of managing it.

Did you raise enough capital where you Were you just using that capital for down payments or were you using it for—

No, I was raising it for everything. Like, I would buy, I would borrow enough to buy the house and renovate the house. Wow. And so I learned very quickly that, like, actually, before I had borrowed money from my dad, the very first deal I did, I used all my own cash. Like, I flipped that first house and then I went and did another one all with cash, like a $70,000 house. And I was all cash-strapped. And I decided from that point on, I was never going to use my own money anymore because I hated being cash-strapped. I hated being like, And so I just committed. I was just using other people's money. So I just borrowed the whole purchase price, the whole repairs, everything, and then fix it up, flip it, or hold it depending on the model.

So you got a partner, you got office space, you did 30 deals, so you had a booming business.

Yeah, except that that was in 2008. The market crashed, everything started to go haywire. We— and also, not only did the market crash, but we were We, I, it was foolish business management really on my part. Just, we were basing it on the best case scenario. Like, oh, we're gonna make $100,000 a month if we do this and this. Well, pretty quickly we had an overhead of $50,000 a month and we weren't making $50,000 a month. So I had this train wreck kind of waiting to happen and the market crashed, which made it so that the houses we had bought were worth less and we were gonna have to like not make profit on those. So anyway, it was, I ended up having to like exit the business partnership, pay off my partner, fire everybody, move into my house, and go on like a rampage of buying and flipping houses the next year. My initial, my initial model was to buy and hold, to build up passive cash flow. And during that, through that train wreck, I had to basically eject on that model and just go full— I went into tons of debt to stop from paying, to stop from defaulting on all these loans. And I had to get personal debt. I was taking out like credit card debts. To like finish these deals because of the cash flow crisis that I was in.

So now you— so yes, you're negative equity at that point, I guess, and you got with other people's money.

Yeah, it was really stressful. Yeah, a couple million dollars of other people's money and scrambling to come up with enough to do the rehabs, to finish them, to get them sold and stuff like that.

But now you get rid of your partner also. So you guys didn't do it together, you just, uh, basically had to split up the relationship and you took the responsibility.

I took everything. Yeah, it was, it was more like I had to basically pay him off and then, and then just went, like, worked my butt off to like 2 in the morning so many days and buying and selling more houses to flip and pay, like, to make cash.

Were transactions happening after— right after 2008?

This is when it got crazy awesome. So, so it crashed and I had all this overhead. I needed to basically get rid of that overhead and get rid of those deals. But also now it became prime buying time. Because, because the prices were plummeting, right? And we're in Denver, we're buying houses for $20,000, $30,000, $40,000 for these houses, and that were just moments earlier selling for $70,000, right?

So, but did you have the resources or the, you know, the, the, the money vehicles to buy those houses?

I just went and borrowed more money. I just went and raised more capital.

So people— yeah, so you're already at stress with your current—

I was stressed, my lenders weren't stressed. They weren't like— I wasn't defaulting on anybody. I had just built a cash flow issue and I was able to weather that because I was able to get enough debt, personal debt, to kind of weather that storm. And so I never defaulted on anybody. So everybody, everybody's loved my deals.

Let's talk about the psychology there, though, because that's a— that's kind of a gutsy move. You, you know, you basically you're sitting there saying, oh, the momentum has gone completely against me. Yeah, I'm now, you know, and you've got to be strung out from not sleeping, you know, from the sounds of it. And instead of just trying to find a way out, you double down. Yeah, you basically go out and raise more.

But I changed the model. Like, at the time I was— the model was flawed. What I was starting with was all buy and hold. Those first 30 houses, I was attempting to buy and hold and create a cash flow portfolio, right? But my interest rates were too high. I didn't have— it wasn't— it was kind of a flawed model the way I was building it. And so when I doubled down, it was, I'm not buying and holding anymore. I'm flipping, I'm flipping to make cash, right? Pay off this debt. And so that model was different and it was— there was tons of flip deals available.

Right.

So I was able to get lots of deals, renovate them, flip them, and generate cash.

And you didn't default on any of your obligations as far as your loans?

Yeah, thankfully. I feel super fortunate. It just— it was super stressful. But then just putting in the work to keep doing deals and generating and actually making profit and cash flow, I was able to kind of like ride through that.

Were you a single guy at that time?

No, I was married, had 2 kids.

Wow.

I think I might have got an ulcer at that time. I don't know. It was pretty stressful.

I was gonna say, so, and because that had to be very tough on the relationship.

We had our third kid actually, 2008, July. Wow. And then it— that was like a low point in life for me because that was right when everything was crashing and this business was going haywire. I was like 30 pounds overweight and I remember a shift like 2009, January. I just decided, I'm just like, I'm taking care of myself. I had just so much stress with all that. I had made this decision, I'm gonna work out first every single day before anything else, and it kind of shifted my whole ability. I mean, that's kind of underlying my capacity to actually do that was taking care of myself physically, spiritually first, because it put me in a mode of like, of mental strength. Right?

Rather—

and so I had that every day. I just get up and work out and then I was clear-headed and then I was able to like take on the challenge and feel good and confident.

Well, so now this becomes sort of interesting for, you know, the themes that we're looking for, right? Because that sounds like an inflection point.

It was.

You know, basically, you're in a low.

Uh-huh.

3 little kids, relationship, a lot of debt.

Yeah.

Everything went against you and What happens, you, you get up one more and decide, I gotta take care of myself.

Yeah.

Um, and by doing so, that was the— would you say that was the foundation?

Definitely a foundation for everything that came after that. Like, if I wouldn't have done that, I wouldn't have the wherewithal to probably weather that. I mean, I was just going downhill. I was gaining weight, I was stressed. It was just a bad cycle, right? I didn't— and so then I had the— it's like doing that, I then had the daily capacity to to just think differently, be more, uh, be proactive and make better decisions.

Well, let's talk. Yeah, so because that's really what sounds like is that, uh, you know, it's, it's the clarity of thinking or the, you know, that's required navigating. It's easy when you got momentum and everything's great, right? And you know that you— but really you're tested. And if you want to talk about, you know, breakthroughs for wealth, yeah, uh, you know, you're really tested, uh from a psychological standpoint almost more than anything else. Because if I were to look at your predicament, right, what would I see? A guy that's, you know, business is in trouble, the market's against him, he's got a lot of debt, he's stressed, he's gaining weight, he's unhealthy. That's not a type of scenario I'd want to put money into or invest in. So you basically said, yeah, get down to your own foundations first, and then from there when you can get clear-headed you can make better decisions.

Yeah.

And it's interesting now that you're bringing that up. I remember now between January and February 2009 was when I had this huge breakthrough on capital raising. I was still kind of stuck. In fact, that is— that is— I'm remembering the story now. I actually— I had that breakthrough personally, which gave me the confidence. And at the time, I had a real estate coach, but he had— I was struggling to get more capital. And you can imagine why. I mean, I'm in everything you just explained, right? My confidence was low.

Not to mention a lot— not a lot of people wanting to deploy capital right then.

Yeah, I mean, it was a crunch time, right? But it was in February. I remember now I had this breakthrough with my coach where he, he helped me kind of reframe some beliefs around raising capital, where I had, I had these internal beliefs that I was begging for money and that it was like me taking their money or something. And he helped me reframe it like that. I was actually— they needed me big time. Like, people are making 1% interest, 2% interest, and here I am, I have an opportunity for them to make secure 10% interest, and I'm like, I'm leaving my friends and family out cold by not offering that to them. So he flipped the script on me, helped me realize the actual reality of the situation is that I had so much to give to people, right? And it's, and it's just a mutual awesome relationship, business relationship that flipped the script. And suddenly within— in February, between February and like March, I raised like $2 million of capital. I had— I remember I had this vision that I would write. I had like affirmations at the time. I was like, one of them was, I have $2 million of capital to invest. And by the end of March, I had that. And it was coming from— maybe I had a few hundred thousand or something before that, but that's what springboarded my capacity to then buy flip deals, right? I was— I had $2 million and I could go buy pay $100,000 or $70,000 to buy a house for $50,000, needed $30,000 in renovation. And so pretty quickly I had 20 houses in the inventory that I was then flipping. And then it was— then it became a management challenge to get those things renovated and sold and stuff.

But especially, it seems like you didn't have a lot of staff around.

Yeah, all I had was an— I kept an assistant. I had kept an assistant, but then eventually, like the next year, I got a project manager. But that whole year, 2009, I was running around like like crazy. And I had contractors, right, that were managing that. So luckily I had some good contractors in place that would get the work done. But I was trying to run around to 20 properties at a time, all the same time while buying new properties. And I think I bought and sold 54 houses that year.

Wow.

2009.

Yeah.

So, so what emerged from there? So you sounds like you got turned around.

Yeah. So I made a lot of cash that year. It was a really good year. And then it led to having a project manager for the next year. And I kind of got in the mode of flipping houses for the next few years. But it became this cycle of like, it's like the very next year, I remember looking at these numbers. I sold 54 houses in 2009. In 2010, I did that again. Except in 2009, we made a bunch of money and paid off a bunch of debt. 2010, the tax credit the government was giving for first-time homebuyers ended, and my contractor went bankrupt on me. And I had about 30 houses in inventory at the time. The end result of that for that year was I lost like $200,000. Sold 54 houses in 2010 and lost $200,000. Like, I should have— you should net at least $1 million, $20,000 per house, right?

Right.

Like, I ended up losing— like, I went into debt more in 2010 after working the entire year flipping 54 houses.

Why was that?

Because I mismanaged the whole thing. I was not the best manager. I'm good at raising capital and doing deals. Management is not my forte, right? It's not my— and so I was like bored of it. My project manager, obviously, I didn't manage him tight enough. I allowed my contractor to like— I paid my contractor tons of money because I trusted him, and then he didn't do the work. I wasn't checking in on the properties. I wasn't doing good. I wasn't being a really good financial steward, as it turns out, a good manager of the money, right? And so my contractor goes bankrupt. And I'm left with houses that haven't been renovated, but I've already spent the budget. And then the market tanks and all the equity goes out. So it just, it was a bad recipe. It was a bad year.

So just when you thought you're free and clear.

Yeah. Then I went farther into debt.

Wow. And so how did you turn that around?

The same way I did the first time. I went and did more the next year. I did it smarter, I thought. And I did for 2011 and '12. Then I was making money again. I didn't make those same mistakes. I managed it tighter, but it was like this cyclical thing of churn, making money and risk. Like some deals I would make money, some days I would lose money, and all of it was not my original intent, which was to create wealth, right? To create passive cash flow. I'm now on this like rat wheel of like flipping houses and flipping money and some years losing money, some years making money and never feeling like I'm getting closer to my actual goal.

So was there another, uh, you know, inflection point or pivotal moment, you know, that, that said, okay, uh, I'm ready to do this in a different way?

You know, yeah, there's probably a lot. Um, the— I mean, in 2012, I kind of got burned out of real estate because of that, and I actually started a whole different business. Like, I started writing personal development books, and, and which then turned my real estate kind of into more passive. I had my project manager running most of it, and it kept going. It became kind of like a passive business for me, and it still went pretty well. But I had this hiatus where I was writing books and teaching and had a whole other kind of course of life. But meanwhile, in 2015, I finally like said, no, I'm done with the flipping business. And that was the real inflection point, I think, was the flipping business. I realized it's so risky. 2015, I was about— I was losing money again. Finally, I said, I'm stopping this, because I realized that I actually, over the course of time, from 2006 to now, it's 2015, I had been forced almost to keep some of these properties. And I had built up a portfolio of about 30 rental properties, all of which were just kind of maintaining. But in 2015, I I went and looked at the numbers and I like refinanced some of them, restructured, raised some rents, and all of a sudden I realized I had enough cash flow to live on. It had just like built up in the background.

Is this your— well, is this your definition of passive income, or, you know, how do you define passive income?

Yeah, I mean, I would say passive income is income coming in without you having to do work on it.

Would you characterize that as passive income?

That was not completely because I was managing some of it. Right. I mean, I guess some people would classify that as passive income. But if you're sitting there doing the property management, that's work, right? If you've got a house or you've got properties that are completely managed out by somebody else, I consider that passive income because I'm not doing any day-to-day on anything. It's just the money's coming in and I'm managing that.

But you're not completely ignoring it either, right? I mean, you have to pay attention.

Well, but yeah, I guess there's different levels of passivity, if you will. But that's pretty passive when you have— for the most part, by 2015, I'd got most of my properties managed out by a partner or a manager. And so it was just passive. All I was doing was looking at the numbers coming in every month and answering his questions if he had any, you know, on the bookkeeping or whatever.

And so now if we carry that forward to where we are now, yeah, because, you know, I understand, you know, you're around a group of entrepreneurs at a mastermind and and they're talking about different things and suddenly you start talking about how you're supported through, you know, completely supported through passive income.

Yeah.

And they start to lean in and say, well, tell me more about that. So what is it like now for you? You know, what is your means of passive income and what's your life like?

So it's essentially since 2015, I got to the point of having enough, like my house portfolio was like more than my expenses to live on. Like my passive income after management. And then in the last 4 years, I've just parlayed that into bigger deals and greater passive cash flow. So it's like been selling houses when I have opportunities, moving it into mobile home park opportunities with other partners, moving into bigger deals that are all passive. Like for me, sometimes raising capital and putting that— I mean, I mean, in a partnership with him doing that. So now, as a picture of today, now I own I still own houses that throw off passive cash flow, but now I own part, like part ownership in lots of different mobile home parks that are throwing off even more passive cash flow with greater tax benefits. And so my, my cash flow has grown over the last 4 years, although I haven't had an active income per se. It's just been like moving, kind of moving capital around.

But you're— and I guess it's— I guess this is the thing, is that, uh, you're still got a pretty good amount of business activities to go create, you know, all that, right? As far as, you know, the deals, examining them, you know, the partners, you know. Not really making it like it's— but tell me then. Yeah, because it's not sounding that passive to me.

So like, no, like when I— like really it was just, just for example, my buddy came to me with it with the opportunity to get into mobile home parks, and he's— and so I had to just do my due diligence on that deal, which was upfront was maybe a couple of weeks of not full time, but just looking into it. And then it was investing my money. And that's it. And then now for the last 3 years, that's just money coming in every quarter. I don't do anything. I just get reports.

Right.

So it wasn't, it wasn't a lot. And, and then like the next year, the work was, oh, tell my agent to sell these houses. Right, so we sell the houses and I have my property manager, my contractor, just go and make sure this stuff's ready to sell. Money comes in and then I reinvest that into this other deal. I actually haven't done tons of lots. It's not like I've been spending time doing deals during all this time that's happening. From 2016 to 2019, I was actually doing a completely other business. I started a software startup. So the passive income was all like really pretty passive. There's stuff to do here and there, sure, like, but none of the day-to-day. And as soon as the investment was made, it's all just like, I have an op— there's an operating company, my partner's company, that runs the whole thing and it just distributes the checks. So that, that actually put me into position to be able to go invest. And I co-founded and co-funded a software startup, which just didn't work out. 3 years later, a couple hundred thousand dollars, and I ended up quitting, walking away because I realized that it wasn't working out. And so that, that was a whole other thing.

Were you able to support those losses through your passive income?

Yeah.

And I knew that going in. Yeah. Like I had, I had that money upfront, meaning I, I had the couple hundred thousand and going into that business, I said, this is what I'm willing to lose, $200,000. I knew going in that it's a super risky deal. I mean, creating a software startup is just risky. There's nothing like real estate. It's like super risky, potentially huge returns, right? But really risky. And I knew going in that, that I could lose it all. And I was willing to do that. It was a small percentage of our net worth. It wasn't, it wasn't like I was putting all our chips in that basket. It was, it was something that I was passionate about for various reasons doing, and it felt good about it. And anyway, at the end, 3 years later, I finally said I'm done. And I was glad that I didn't go over I mean, it was just kind of my plan to be willing to lose that much from the get-go, and we lost it. I didn't like it. It was a huge gut punch. I hated it, actually. But it was, it was, it didn't— our net worth continued to rise the whole time.

Like, so you're able to manage through that?

Yeah, our cash flow kept going up, our net worth went up. It was not a— it didn't stop anything. And that's a huge— I guess you asked, what's the picture like today? Like, because I have assets that throw off cash flow, that are growing up in value, you know, I have the freedom to do something like that without stress. That software startup wasn't actually really stressful for me. Like, it could be highly stressful if you're trying to make money and you don't know where the next meal is gonna come from. Man, I could only see the ulcers that would cause from somebody who's starting out in software. I was not stressed in any way during those 3 years. I was backcountry skiing like 3 times a week, 4 times, well, 5 times a week sometimes, so to the chagrin of my wife. But anyway, I had a pretty free lifestyle even doing that software startup because of having assets. The peace of mind, the security, the stability of knowing like my net worth is rising, my cash flow is good. Yeah, I'm investing this. It was an investment at that point of my time and my money, but it wasn't stressful. It wasn't stressful in the way that I was like worried about our money and our finances, you know.

So let me ask you where you are right now.

Yeah.

Is there— if the real estate market were to go down, does that matter or not really matter? Because you're renting these properties, they're producing cash flow.

It mostly matters if you're trying to sell, right? If you're going to hold for the long term and it's cash flowing, then the only effect of it going down is, okay, do the rents go down? Are the rents going to go down on the most affordable housing in the country?

I think demand probably goes up.

It probably goes up because you have foreclosures or whatever happens. So that's why, that's specifically why I moved from houses. I had, I had like some of my houses had gone up 5 or 6 times in value or 7 times from when I was buying them at $24,000, right? And then so I'm selling and taking the equity off the table of these houses that are in a more volatile state, moving it into a more stable place that cash flow is greater. That was my intent. That was why I moved into, into mobile home parks and different things like that. So it's a, it's a more stable thing. Coming up against a recession.

Well, because you, you know, from your first story, you know, on the 2008 crash, basically, you're now got some years of experience and wisdom behind you. So how are you prepared now for another crash or another, you know, correction if it comes?

Well, it's, you know, keeping more cash reserves in the bank.

Mm-hmm.

So that it's having assets that are throwing off cash flow that can support us, that are in that are more recession resistant, right, that are in a stable place in the face of whatever's coming recession might happen. That's basically it. I mean, I've just from the, from the passive cash flow standpoint and then also from, you know, maybe a mental and like a— in the event of a crash, I want like I'm in a better cash position to take advantage of that. Cash position and also just networked position to go and do deals with people and understand and have capacity to then take advantage of a crash, right?

And that's what I was going to ask you, is saying that, you know, if you have cash in reserve when something goes wrong like that, you can go bargain hunting, right?

Yeah, it's just the best. I mean, yeah, you want to definitely want to have cash. I mean, it's like Warren Buffett when the 2008 happened. He just like doubled his net worth or something. Over the course of 2 years because he had all this cash, right? And he just bought everything for pennies on the dollar.

Ted Turner, right? Uh, you know, became a huge landowner because his, his whole thing was staying cash until something happens. And yeah, you know, the— because most people are sitting there in a compromised position like you were in the last crash, and then the people with cash can come in and make really great deals.

Yeah, yeah. If you compare where I was in 2008, like, I still— I didn't sit on the sidelines. I actually took advantage of that crash even though I didn't have any personal money.

You were able to raise But I did it.

I wish I would have done it differently. And if I do it in the future, I'll do it differently. I'll take advantage of building wealth because I kept about 30 houses in that process. I could have kept 200 houses and that would have been a much different wealth story, right? If you're— if you have 200 houses that go up 5x, right, as opposed to 30. So it's— next time around, I will definitely do it with like a more of a wealth-building, long-term cash flow. I won't be so strapped for cash. Personally that I will need to like get into flipping and churning.

So at this point for yourself, so it sounds like your, your comfortable living expenses are all covered.

Yeah.

Through the passive income that you're generating. Do you still have ambition to go build a growth, grow more, or are you kind of like saying, hey, I enjoy my backcountry skiing and my life with my family? So what's your plan?

Yeah, my plan is to grow and to serve and to give, right? Like I went through this mode of Actually, I went through a really stagnated mode these last 3 years. When I built that software company, I was engaged. It was really with the desire to really serve people, right, and to create something that was of value. And it didn't work. It didn't do anybody any good. And so in the last 6 months, I've been in a huge funk from just not contributing, and it's not a good place to be. And when I was skiing like 6 days a week, I— everybody would be saying, oh man, you live a truly amazing life. In fact, that's the name of my other brand, is trulyamazinglife.com or whatever. That was— and they would tell me that, and at the time I was like, I was actually more depressed or more down than I'd been in a long, long time. I'd be skiing like 6 days a week, and that part was fulfilling, but it was like way out of balance. I wasn't contributing, I wasn't growing, I wasn't— I mean, I was just skiing a lot. And it was not fulfilling in that it wasn't— that's a really important piece of life, right? Like getting adventure and fun is great and fitness, but it's like if it's your whole life, then it's not a good way to live. It's not bad. I don't like it. I didn't feel good. I wasn't as happy. So my plan, I guess, to your question going forth is, is to be more balanced, but to grow for sure. Like, I, I'm like really, really excited right now, just even in the last few weeks having just kind of had some mental breakthroughs with some friends that have kind of helped me kind of realize more that I have a lot to contribute, a lot to give, and there's a lot of people that could really benefit from my advice, coaching, stuff, which is why I've become, I kind of turned myself into a passive income coach over the last couple of months. And that's, it's just like, it's less about the money growth. It's more about the, the contribution, right?

Well, this is where it gets fascinating now because it, it almost is like a paradox, um, where what's the whole point of creating passive income? The whole point of creating passive income is so I can go skiing 6 days a week, right? Well, it might be, but, but, you know, and it might be, but no, this is very interesting because if we look at the trajectory of your experience, you, uh, had a, uh, yeah, when, when you were literally in survival mode.

Yeah.

Uh, it was like, hey, you know, you weren't thinking about contributing and everything else, at least probably not so much.

I was trying to survive.

You're just trying to survive and keep your nostrils above water.

Yeah. And I wasn't thinking about backcountry skiing or anything.

No, no, you can— you couldn't, you know. So, uh, so you said, boy, I would love to be in a position where I could go skiing 6 days a week. But what's interesting is that you get past that whole survival level of existence and the responsibility of of honoring your obligations from people who trusted you when they invested in you. You get through that whole arc, you get to a point where now you don't really have to work, your family's taken care of, and you have all the latitude to go skiing as much as you want to, and what happens? You don't find yourself fulfilled.

Yeah, no, seriously, I became in this mode of just, I was feeling depressed and like—

So what's wealth to you then?

You know, that's an interesting— that's a real interesting question. What's wealth? Mm-hmm. It's, it's balance, right? For me, for me, it's freedom. It's financial freedom, but it's also spiritual. It's contribution. It's love. I think at the core for me, it's love. Like, living in a state of love is the ultimate wealth. And financially, a lot of people are blocked from living in love because they're living in survival mode or they're stressed. And so finance— money is a really fascinating thing to me now, and how it always has been. I've always loved— been intrigued by the topic of money, but there's so much like internal stuff going on around money, and I feel like I have a lot to contribute on that to people because, yeah, because I don't know, I started talking about other things. You asked what is wealth, to answer your question, or does that Yeah, I mean, I'm trying to understand because people say, well, I want to be wealthy.

So, you know, what I'm hearing is you achieve that from the monetary standpoint. You know, if you look at your balance sheet and say, hey, you have a lot of assets, you've got cash flow that doesn't require really much attention from you. Yeah, maybe that's a lot of people's definition of wealth. But if you're saying that I've got that, but I'm depressed. Yeah, maybe you reconsider what wealth really means.

Yeah, I mean, and it wasn't like I was always depressed, and I couldn't— I might be using that word like I was not saying clinically depressed.

Yeah, but I was down. But I just— you just weren't happy.

Yeah, I wasn't. Yeah, but at the same time, I was grateful, super grateful for that wealth, for that monetary wealth, right? For the passive cash flow. It wasn't like I wanted to get rid of it, and I was super grateful for the financial security because a lot of things about it were peaceful. Right? There was a lot of peace and security in that, of which I was super grateful, but I was missing the contribution. I was missing love. I was just missing a piece. So I guess the point that I take from that, the point that I see from that for my own life, is we— and I have, and you— it's easy to get the goal being passive cash flow, right? And that's not really the end goal. That's just one piece of of life that's valuable.

And this is what the interesting thing is. I mean, for most people, especially most entrepreneurs, you know, the holy grail is saying, I get to a point where I've got income generated, I'm highly leveraged, I have very little work activity to do, everything is basically by my own choice.

Yeah.

And I'm living the life and the lifestyle and have the security, etc. and say, okay, I made it to whatever that it is, that destination. Destination.

Yeah.

And, uh, and what's fascinating is you can get there and decide, hmm, this isn't it.

Yeah.

So here's a thought experiment question. If something came along now that said, wow, this is a high contribution thing, something that would like, you know, if this really worked— and maybe the software was kind of like that to a degree, but, but it was measured. But if, if you— would you be willing at this point, if something came along that really aligned with you spiritually as far as what you want to do in the world, how you want to contribute, and it put at risk your security and your being supported through a passive income, would you take that risk?

No, not for my— no, because it's like I would be neglecting my family. I'd be neglecting my duty to take care of the people that I'm in charge of, right? To put at risk our financial livelihood to go contribute in a bigger way? No, I don't think so. I mean, I can contribute without putting that at risk. And if that came along and if it was like, hey, a huge risk to like help a bunch of people at the expense of maybe stressing my family out or like, no, I'm going to take care of my family. I'm going to make sure they're protected. And I don't think that I need to make that.

Well, see, and the psychologist is very interesting because many entrepreneurs and myself included at times will push in their chips. You know, they get passionate about something and they'll push their chips.

Yeah, they'll put it all in.

Yeah.

Yeah.

And, and it may— or let me put a good chunk of it in. That, that's not saying, hey, it's gonna— it's make or break, but it's like, if this doesn't work, rather than saying, oh, that sucked, but I, you know, it doesn't really matter, uh, it's, it's crippling. It sets you back, and, and suddenly, you know, you don't have the freedoms that you had from a financial standpoint anymore. And it— so it's interesting because Here's what I'm hearing is if you look at your values, right, you're saying, you know, getting to the point of being— having passive income and being fully supported from that is my value above a potential venture that I have passion around that is risky or could threaten that.

Yeah.

And the other side, the risk-takers say, you know what, I value— I value taking that risk more than I value having my security right now. It's interesting psychology when it comes to wealth.

Yeah. And I wonder if most people are even thinking through that though. I mean, I don't know. It's like—

In hindsight, I have to say maybe I probably wasn't thinking too clearly when I look at it for myself.

Yeah.

So, but, and as you said, you know, there are things along the way that you kind of said, wow, if I look back on it, I wasn't really managing well. I wasn't doing this very well.

When I was doing the real estate company, my value, it was called— our company was called E3 Spectrum, empower, enable, enrich, right? Our value was to enrich our investors and to empower our people. It was like very much value-driven, and it failed and crashed and burned in my face. And I mean, to that extent, and it put my family in stress. It put me— made me not a good dad, as good of a dad as I could have been, as good of a husband, made me unhealthy. So having viscerally gone through all of that, like, I think that leads to why later, like when I did the software company, That's a hugely risky thing, more risky than doing real estate, right? But I contained that so that it's not gonna make me, like, not capable of doing my highest duty, which is my highest value, which is to my family. That's number one for me. So I think it was probably just because of my past experience that I, like, I screwed it up the first time, right? I went— I did go all in. I was too risky probably that first time, and I did— I didn't do it as measured as I could have, and I probably do better now, hopefully.

So now, maybe based on that, imagine I'm a somewhat starry-eyed young entrepreneur, or maybe even somebody's been out there for a bit, and I come to you and I say, okay, what's the best advice? I want to, I want to create a passive income and create that lifestyle that you're describing. What are the, you know, 2 or 3 best pieces of advice you can give me?

Man, that's hard because you're talking— there's a lot of variables about this person who's coming to me. So, I guess you're saying it's somebody who doesn't have any net worth yet? Just starting out?

Let's say that they're either from just starting out to maybe they've gotten a little bit down the road or they're making a living.

And they can make decent money.

And they're ambitious and they can make some decent money but they don't have a lot of excess cash flow. Let's say I'm making $70,000 a year and it costs me almost that much to live, but I want to work my way to where you're going. And then we'll take a different scenario.

Gotcha. First, it's getting clarity, I think, on how much you're spending, how much you're— it's getting financial clarity and capacity to live within your means. Like, that's number one. It sounds like that person, maybe they don't have a lot of savings, maybe they don't have a big security blanket, 6 months, like there's certain fundamental financial principles of security and peace that I would say are like step one. But it's, it's almost like have, have a plan.

Get—

that person needs to have a plan of what's the goal. Okay, the goal is to have $100,000 a year of passive cash flow, right? To get to a point where I have enough cash flow to live off, right? Okay, the plan, it starts with baby steps of like, I think, getting clarity on where you are, how much you spend, and how much you you earn so that you aren't overspending. First of all, first and foremost, because then you can create all the passive income in the world. You're not good at managing it, then, then you'll just spend $120,000 and make $100,000 and you'll be back. You'll be in the same boat, right? So anyway, fundamental financial principles, getting that clear. What would be next?

Look for your first deal. Would you advise now buy and rent, not buy and flip?

Get the mindset around assets and cash flow. So that can be a lot of different things, right? But it's the right mindset because if you go into buying a house with the wrong mindset or, and you don't have enough security blanket, that can be really stressful. You could lose the house. There's all sorts of variables that can go wrong, right? So I think the principles would be understand you've got to live within your means, then understand that you want to own assets that throw off cash flow, that go up in value. Like, that should be the goal from a financial security standpoint. Most people that I— most, like, if you go on the internet and you go to like personalmanagement.com or all any of these sites that like tell you how to manage your net worth and grow that, all of them are like, okay, hire this financial advisor. Oh, and we'll tell you exactly what to do, and we will put all your money into these stocks and these different things. We'll take a percentage per year and we'll manage your assets.

We'll grow your wealth.

This is wealth. I'm kind of anti all that. Like, not that I think that's 100% bad. I just think that it's fundamentally flawed. Like, in my opinion, cash flow is so much more important. Cash flow and assets are so much more valuable, so much more appealing, so much more— like, just so much better than the financial markets. People do generally have done well over the last 10 years in the financial markets because the markets are booming. Well, then they're going to tank and people will have their— but it's not— they're not producing cash flow, right? Like, it's like when you, when you have the mindset of I'm going to acquire assets that throw off cash flow and it's financial freedom, it's independent of like some advisor somewhere, it's independent of the dollar crashing, it's independent of like— so what happens if the dollar crashes and all those people who have their wealth managers are making 1% per year and it's all in stocks and the market goes crazy and the businesses are going out of business and they lose 50% of that. Well, that's not very stable. That seems pretty risky to me.

Not to mention you're not— there's really no cash flow stocks.

There's no cash flow.

They're paying dividends, but it's not going to be—

it's like everybody's doing this for some long-term, I'm going to get there sometime later. So that's why I say the, the mindset should be around like, now think about creating cash flow. What is your— what are your expenses every year? Or month, however you want to look at it. If you're, if you're making $70,000 a year, if you're, if you're spending $70,000 a year to live on, you're making $6,000 a month. Okay, start— your mindset should be, how can I own assets that produce cash flow that makes $6,000 a month? And start with $100 a month, go to $200 a month, get it to $300 a month, start building. And the key being getting an asset, something that's there that's throwing cash flow there. Right? And put your effort toward that. Now, the tactics of what that could be, well, a simple way is a house, right? You could go and buy a house. You can get a loan, you can put a down payment, or you can do like I did and you just go get other people to give you the money. Like, I've bought hundreds of houses and dozens of them I've bought with, like, all of— I don't buy any money down. You can go get money from other people. You can find a deal, put together a deal that then puts $300 or $400 a month in your bank account every month. And has an asset that's growing up in value, building your net worth. So like houses is probably the easiest from a person at that level starting out. Houses or condos, lower-cost real estate. It's probably the easiest, most— it's the simplest way to get in the game. I think that's how I got in. I saw tons of people get in the game and it's simple and you're getting cash flow. It makes sense. Now all of a sudden you've got $500 a month coming in. Well, now you only need $5,500 more. Just do that once a year and 10 years later. And plus those houses are going up over time. Now, it may not be passive, right? So I say that, but like, okay, you might be doing work on those. It may not be passive initially. Who cares? Like you're building the potential for passive cash flow. So put the effort in upfront. If the cash flow is not that big, you don't need to be doing nothing right now. The goal is to build up a passive cash flow stream, but that doesn't mean you can't work to get it there. Like, mine weren't passive originally, but then later on I had the ability to have them all managed out. Now I've got assets. It's all passive. It built up over time. And so do the work to build up the passive. It doesn't have to be passive from the get-go. But, but then when, when you're at a higher net worth and you have more income, you can just put your money into passive stuff from the get-go. That's like when I moved my money, I'd sell some houses, I'd put it into a mobile home park fund with my partner. I didn't do anything else, and it's instantly throwing off tons of cash flow, giving me other tax benefits. So that's, I guess, why the qualification— higher net worth or higher income people. I should say higher income because I tend to— I'm kind of put myself in this position to help higher income people. There are a lot of higher income people that are not high net worth people because they just keep spending as much as they are earning and they're not putting into assets, right? They're throwing off cash flow. Anyway, I'm just a huge— as you can tell, like, it's all about cash flow. For me. Like, I don't— that's why I'm not into the— like, stocks are fine, I guess, in a percentage. But you read— I just read an article the other day, this, like, it's like 5% of your net worth maybe should be in real estate. The other 95% should be in, like, stock mutual funds. That was literally the article. And I was just like, are you kidding me? Like, let's flip-flop. For me, maybe I'll put 10% in mutual funds. I don't have anything in mutual funds. I just don't even care to have them in mutual funds. I might invest in this, in index funds, or index funds, but really I just like real estate better. And I have diversified in various real estate, right? So like, why do I need to go in— why, why do I need to go in the stock market for anything? It's not, it's not a requirement. Most people just— and I'm not saying it's bad, I probably could make tons of money in the stock, tons of people, it's just not my expertise. But I don't like it because it doesn't produce cash cash flow, right?

In general, it's a couple times now you mentioned mobile home parks. Yeah, you seem somewhat excited or enthusiastic about it.

For sure. Yeah.

So why?

Well, and I call them mobile home parks— they're actually manufactured home communities is the technical term— because they're not even mobile, right? Like, they're not— it's just what we know them as, I guess, is mobile home parks. But I'm— I like that asset class for various reasons, but the cash flow is fantastic. There's enormous tax its benefits for being in that. And also, it's recession resistant, in my opinion. I just see it as I feel comfortable, confident. And the results from the last two decades have shown that when every other asset class gets hit with volatility, and like apartment buildings or commercial have all taken dips in these recessions, mobile home parks have basically straight lined up. And it makes sense because they're it's the most affordable housing and everybody needs a place to live and people are getting foreclosed upon. Well, they're losing their house, they gotta live somewhere, right? I mean, it's just, it makes sense on a lot of reasons.

And are these rentals? Yeah. Yeah, so basically you, you own the—

well, I own the land generally, right? And the people own their house on the— usually the people own their own mobile, their own manufactured home.

Okay, so they bring that in and then they're paying rent for—

or it's just there and they bought it from somebody. Sometimes we own own the actual house as well. And then we have income on the land and income on the house, right? But I also like it. It's really a good financial— it's financially really fantastic. But I also feel like it's socially really great because it's— there's an affordable housing crisis and it's preserving these communities from getting developed out. Like as an investor, as an owner, as we're building them and developing them and getting and improving them, It's stopping them from being developed into luxury condos, which there's a huge divide happening right now in real estate and housing in general where affordable housing, it's really a crisis right now. And so it's cool to be part of preserving what we can in that, I think.

Is there a particular part of the country that you invest in these?

We are mostly in the middle of the country, like where I'm at is mostly the middle of the country. For Bakes, that's where we been able to get the right kind of deals, but they're all over. I mean, I know people that are all over, and I might be invested all over because I'm looking into other, other groups to invest with as well. So it's not like it's limited to one spot.

In the twists and turns that these interviews often take, you've got me fascinated by this mobile home park investment. There was a late night talk show host who started ripping into people who invested in—

it was pretty funny, actually, but it was also disheartening. I mean, it was like from somebody in that space, he classified everybody as kind of villains who were, who were doing, who were owning mobile home parks and investing in that space.

Because you can compromise people, right? Because so if we understand this, if I understand this correctly, basically you're saying we own the dirt.

Dirt.

There's people, most of the time they own the home sitting on the dirt.

Most of the time, yeah. Sometimes we own the home as well and we're renting that.

Pure, it's a pure rental. But in this case you're saying, hey, I've got the land, they need to park their home or, you know, on a place, on a plot of land, they own that. These are typically going to be very low-income people.

Well, it's the most affordable housing.

Yeah. So, so it's, so we're starting, you know, with people that don't have probably hardly any discretionary income whatsoever.

But their rents, their total rent is like less than an apartment, you know, hundreds of dollars less even after they get the financing on their home, right?

But if they want to move, on average, what would it cost to move one of those homes to a new park?

Yeah. So it's probably $5,000 to $10,000, which they don't have, which most of them probably don't have. And so you have a really low turnover rate as a result. Like, but it's also— that's part of why there's not turnover. Part of it's because these parks usually have a community feel, like people stay there for a long, long time. But part of that is— a huge part of that's probably because it would cost a lot to move their thing. They could sell the— they could sell the home to somebody, right? It's not like they're limited to just moving it. They could move somewhere and sell the home, right?

But if the rental on the dirt to keep their home there goes up, it's not an attractive sale either.

Yeah, maybe not, right?

Yeah.

And the person in the park is respons— has the control, the owner of the park can raise the rent whenever. It's like month-to-month rents usually.

So it's not like a lease that's got, you know, basically saying it can't go up by more than 5% a year. It's— they're there month to month.

Yeah.

The owner of the park is, in your case, collecting month to month.

Yeah.

So a real, I guess I could say, immoral mercenary can go in there and say, let's lure all these people in on a low rent.

Yeah.

You know, and they've budgeted themselves based on that.

Yep.

And once we got them, we can just keep raising it. Let's keep raising.

And that's what he kind of— that talk show host did was expose like some big corporate— I mean, lots of big corporations are buying these things and then just kind of like raising the rents. And it's really— there's no competition because you can't build new mobile home parks. So it's not like people, even if they wanted to move, it's not like there's lots of other spaces to move their manufactured home to.

Right.

It's not like there's new parks going up all over the place. And so it's kind of a contained and actually a dwindling supply. So it's really favorable to the person owning it, right? And they're in a lot of control, which is— it's a fantastic investment, right? But you could also have— you also have people that don't have the best morals, I think, and ethics that can take advantage of people at that space. Like, on the flip side of that, what we're doing is preserving The people that I work with, the partnerships that I'm in, in mobile home park space are specifically intentioned to preserve affordable housing, right? And so yeah, we go in and we optimize when we buy them. We're optimizing, we're going and putting in capital repairs to the place, we're making them better, we're fixing the roads and just improving upon the place. And then sometimes we'll need to raise the rents, but it's not like we just double the rents overnight. And so It's being conscientious of those people and still trying to preserve the affordable housing space while also making a good business model. And it can be, it could be a challenging balance, right? It's not like, and it could, I can see where the temptation would be for big corporations and people just to go in and take advantage of that and raise it so much and just try to squeeze every, try to squeeze everything out. It's sad.

How many, how many manufactured homes would be in a typical park?

Well, they range from 20, a small park of like 20, to big parks of 500.

Wow.

Yeah.

Well, so, uh, or more, 1,000. Yeah, they can really vary.

Yeah.

And I guess especially, uh, you know, when you start saying 500 or 1,000, there's a real community there.

A lot of big community. Yeah, that's a huge community, right? 500 homes, it's pretty big.

Yeah.

Yeah.

Well, Aaron, you got quite a story and a pretty amazing perspective. You seem very laid back and relaxed about all this stuff. I guess so. So maybe that's a part of what it means to have passive income that supports your lifestyle and gives you that security. So final thought for anybody out there who says, you know, I want to achieve this.

I guess just to say that you can for sure. It's totally achievable. It's— I think it's really get your mindset wrapped around assets and cash flow. And maybe I'm plugging like the Rich Dad thing, but like his whole game Cash Flow, it's like I just started playing that with my kids. I'm not plugging because I have any interest in that, but I started playing with my kids again, and it was enlightening to see that those principles are really valid. And I realized I used to play that game with my brothers and sisters like 20 years ago, and that informed kind of my direction to great benefit, right? So I'm grateful for that, really grateful for that teachings I learned from him and And I would just pass that along that like really get your, get your head into cash flow and get out of like the save for later, right? Start getting cash flow now, start taking control now. And I think that's the— and doing the things and realize that you can do that now. You don't have to wait for later. There's lots of creative ways to think about creating cash flow now, even if you don't have money. And that's the other final thought I would say. So many people are like, I got to save up and I got to get— well, no. You can literally— there's lots of people with money who aren't making any interest on it. And you know tons of them. They're your family and friends. And you can be like, guess what? I'm going to go buy a house. Let's split the deal. Let's both own assets with cash flow. Like, there's things people can do without having to save for years because you can just work with people who have already saved for years.

Yeah.

So final thoughts?

I think that's great. So listen, really informative, and I really appreciate you sharing all that with us.

Yeah.

My pleasure.

Finally today, we have Jason Katzenback and Michael McClary from Amazing.com. They're going to show you how you can create your first product to sell on Amazon without needing your own manufacturer with very little startup capital. I mean, a 24-year-old made $100,000 per month using this strategy. The bottom line is to become truly rich, you need to work for yourself, not someone else. Here's Jason and Michael to show you how. Jason, Mike, thanks for taking time to sit with us and have this conversation. So the joke is almost too easy and it's probably not even funny to you anymore, but you have an amazing story, right? So So let's talk about, you know, your lives maybe before Amazing.com and then we'll get into what you're doing right now. So Jason, why don't you start? Tell us your background.

Yeah, so originally I was going the corporate route with life, but back in 2003, I remember the CEO decided to abolish all bonuses that year and I just realized that I needed to stop working my butt off to line other people pockets, and it needed to be more about what I could spend my time on to give me the most ROI. So I started my first business back in 2005, and it was a pretty cool success. You know, that first year we did over $3 million, and it just really got me the bug for the internet. I went from, you know, working for a corporate company where I was working all these hours to try to improve my lifestyle. And I found I just had to work more and more hours and it didn't seem like I had any freedom. And then I started my own business and also I could work from home. I could travel as long as I had an internet connection. It was good. Now back then, Wi-Fi wasn't like it was now. So the freedom wasn't quite the same.

Was it a related industry or was it—

Well, what I did initially was I started with little ebooks. So I would research topics online and I would figure out what people people were looking for, whether it was learning to get your driver's license, health issues. And then I would hire ghostwriters to write the content, and then I would use SEO, a lot of article creation, article marketing, to, to just dominate the search engines. And I started doing really, really well. So then I started teaching that, and I launched a product in 2005 called Portal Feeder that was based off of that— how to build websites to be able to promote affiliate programs, products, anything like that. And that's when I realized the feedback I got that I was very good at teaching because I was very— I had a lot of empathy with the people. I would really work hard with them. I cared a lot about customer support. We got a lot of feedback on that early, that it was our customer support that made the difference because we really followed through with the customers. And so I started refining that membership model and teaching model. It was always based on the business businesses I was doing. It's like I had to be a success in the business I was teaching. And so initially, starting back in 2005, it was focused on SEO and PPC, but all Google related. And then in 2012— not 2012, 2010— that's when all the penguins and all those things came out from Google with the different algorithm changes. And I realized I was kind of doing the same thing again. I was working for someone else. I wasn't creating an asset because I Because building business is always based on hacks and, you know, how you can trick the search engines, rank on the search engines. But then suddenly the search engines decide to change their algorithm, it's like you have to start over. And that's when I met Matt Clark, actually. It was in— I'm not sure if you've heard of the Mavericks. It's a mastermind group.

Yanik Silver.

Yeah, yeah. And so we met in that. I joined that in 2011. And me and Matt got into a mastermind group. And so he was— here's this young 24-year-old kid at the time doing like $100,000 a month selling his own products on Amazon. It was just mind-boggling to me. It's like, how can you have your own manufacturing? And he's like, well, I private label it. And I knew private label from the context of content, you know, like for someone to, you know, to repurpose content. But he was actually doing it with products. So he started teaching me that. And so when I launched my first product, within 4 months I was doing over $100,000 a month profit.

Wow.

And that was because I was able to take all my SEO skills, all my marketing skills from Google, and translate it on to Amazon. Now I also had a little bit of a helping hand because at that time Dr. Oz was really pushing health supplements like Garcinia Cambogia, raspberry ketones. My first product was a raspberry ketone. And so that really helped. But the cool thing was, is the product I started selling was the exact product that my manufacturer was selling. But because I differentiated it, used all my marketing skills, I was selling my product for 3 times as much as my manufacturer. And I was ranked number 1 and they were like number 30, kind of thing. So it was— so the bug hit and we started teaching people the Amazon model.

Can I ask a question about that? I'm really curious. Sure, sure. So you're manufacturing— so basically you, you were being— you were white labeling from your manufacturer, and, uh, when you started outperforming them on such a significant basis, did they at least like take notice and say, hey, maybe we should copy some of what you're doing? Or were there any conversations around that?

No. Interesting enough, as much as I thought that it would actually hurt me once they figured out who I was, the opposite, because Manufacturers, most of them, that's their business model is the manufacturing side. They're not marketers, and so they almost just dabble in that kind of stuff. But, you know, a lot of our students have asked that, like, what about when the manufacturer finds out that you're selling the products? Like, well, that's not their business model. It's like my business model isn't manufacturing. Now, sometimes sellers will start to develop so much they build their own facility to manufacture it. I don't want to get into that. I don't want to have more warehouses and employees and those kind of things. So no, I mean, in fact, they, they— it was more of a partnership. They started giving me better deals because I was such a high-profile seller, and they kept dropping the price on me. So it was just— the only problem was, the one drawback of that industry is I didn't like selling that product. I mean, you know, and that's something with any business, like, I think You know, it's great to start a testing business. Like when you're going into business, you always, you know, like don't look at it like I'm going all in on this. Like, you know, test the waters, make sure. And that's what we tell a lot of our students is, you know, pick a product and learn the business model, learn the system, and then start building a real business.

Did you think there was gravity there? In other words, you said Dr. Oz was promoting this, so was that what got your attention? Said, hmm, I think I know his research.

It was really, it was just following our strategy. Of figuring out what are the best sellers on Amazon, how many reviews do they have, how much competition does it look like they have, is this an emerging market? Because Amazon, you know, I had in the mindset at first it was like Google, like if you're not number one you're nothing. But it's not like that. Like on Amazon, people browse, you can direct traffic to it, it's very different that way. So it was never that, it was all about, no, this opportunity says let's see. And as I started doing the business model, I started feeling kind of— I didn't like selling people a weight loss supplement when their responses— when I'd, you know, because I tried following up giving them value, saying, as you buy this product, you know, here's some exercise tips, all that. And I get responses like, if I wanted to exercise, I wouldn't have bought your product. And so you just start feeling guilty. It's like, well, you know, as much as they say it works, this isn't really good for you. So I've actually gotten out of the health industry, and now I focus primarily on the house and home.

But so I could see the trajectory into Amazon for you, and we'll get more, more specifically into, you know, those aspects. But I wanted— I want to know, Mike, you know, how did you arrive here? Sure.

Well, I'll go back even a little further, and probably people know this, but I actually sold paint right out of college.

Paint?

Yeah. So I put myself through college by working at a paint factory that my dad worked at, and in the early '90s when I graduated The job market was not there for anyone. And luckily the factory called me back up and said, you realize we have more jobs other than just factory jobs. We have professional jobs. And luckily I was able to take a job with them. No idea that I was going to be selling paint, but I took that and moved to Alabama. And then within a few months, they realized that computers were now all the rage in the early '90s. And Mike, the, you know, 20-something kid out of college, must know computers.

Didn't.

But I vowed to learn them. And so I moved to Chicago, really got into the whole data analysis with the company as computers were taking off. And that led me to another job of— once I realized like data and computers was where I wanted to go, I got into consulting business. Then I started traveling, consulting. I found a client that I was doing a lot of data analysis with, telecom company, and they actually got me involved in the finance side of it. And so shortly thereafter, I became a finance director for a large telecom company.

What does that mean to be a finance director? Like, what kind of stuff did you do?

Yeah, so I focused a lot on the revenue recovery side where a business, you know, you get so big you don't realize where you're leaking money, right? You don't— you just look at the numbers, the top line, the bottom line. You don't realize that there's all these little gaps and holes in your system. So my job was to find those gaps and plug them, and we did that with data. And I always loved research. I love, you know, analyzing what's coming in, what's going out, and where's the delta between those two, right? I really found that that was a great spot for me. And so after doing that for them for a while, I I loved the work I was doing, but I felt chained down. I was this guy that sat in an office. I had a team working with me. We're always looking, you know, it's, it was mostly cable at the time. Cable did not have a really good, you know, perception among people. And so I didn't have this feeling that I was bringing joy to people's lives or doing anything like that. Definitely not my own life. I had a lot of stress in that job. So it was a great, you know, great group of people, but I wasn't really feeling fulfilled. So then it was about 2012. I realized I wanted to do something different. I didn't want to have this corporate job with this week or two of vacation every year. You know, I was making good money, but I was stressed out not seeing my family. And luckily, you know, I saw an email come by, talked about, hey, there's a great opportunity on Amazon. It must have been months after, you know, Jason and Matt had started really, you know, finalizing and fine-tuning how to build a business on Amazon. And I was one of the first people to get this email. And it just really, you know, stoked something inside of me to realize this seems like a good opportunity. And I remember, you know, hearing about the training and it all just clicked. You know, why, why go out there and try to invent a brand new product? Find something that people already want. There's already a demand, right? That's half the equation of selling. If you know that there's a demand for something, then create something that fulfills that demand or something that even does better than that. And that's what the model taught me. And so I jumped in. I took this, you know, I learned how to build my own business on Amazon, how to build a brand of products.

I had no idea.

Products I launched, my first product was a leather conditioner. I didn't own anything made of leather.

I'm actually looking for one of those right now. Maybe I'll have to talk to you about that after this. Yeah, good.

But I knew I could source in the United States. I knew there was, you know, a low quantity to get going with. The price was, was right. I knew I could make a good profit margin. And most of all, there was a demand for it and not too much competition at the time. So I started off with that. And lo and behold, a year later I was making enough that I could actually quit my corporate finance job in order to pursue this full-time. And it's just kind of taken off from there. And a lot of other things happened since then as well.

Yeah.

So, and I want to get into that in a moment, but when did the transition come from you being a customer, you know, of the company to actually coming into the company?

So I'd say probably start about 6 months after I started, you know, doing, you know, learning how to build a business. And we actually met in Austin for the first time. There was a live event for all the people learning how to this new business model. We got to meet for the first time. At that point, it wasn't just virtual community, everyone talking on Facebook or in a private group. It was 500, 600 people in a room face to face meeting Jason, meeting Matt, and then talking about all of our successes, our failures, what was working, what wasn't working. And what was amazing about that— not to use amazing again— was how much everyone was sharing with each other. Yeah, we had 500, 600 people that you thought were competitors of each other, but they're all helping each other out because the world out there is so big. There's so much demand for everything. There's no point in trying to keep it all to yourself. And so when I started sharing more and more of what I was finding out, because let's face it, you know, two guys can't figure everything out and do it all the time. They're, they're running, you know, a large business, bringing all kinds of students. They need other people to help. And so I came in as more of a mentor in that role. There's probably a handful of us in that. And then after another 6 months of doing mentoring, then they realized we need someone to help with training.

Right.

And so I came in and started doing training about 6 months later. And then a few years down the road, as it was really building the rapport, the relationship, we're all, you know, we realized we're in this together. We're helping change the world. We're changing lives. We're building a great business that's expanding beyond Amazon and beyond just e-commerce. Realized it was, you know, a better idea to bring me in full-time to really help, you know, with the business and the customer support and also the building of the products to make sure they're as good as they can be.

Yeah. If I just want to add one thing on that. So, you know, he's talking about our events, when our first event, what really surprised us, and when he talks about changing people's lives, was that fact. And that's one of the reasons we pulled Mike in too, because he has a lot of empathy for people. And because it's, you know, one thing to teach people, but if you're not relating to them, if you're not understanding them, you can't help them. And at the end of the event, we had, you know, the whole room was lined up around the room, and it took us an hour to go through of everyone wanted to take a picture with me and Matt, shake our hands, and tell us how we changed their lives. So it was this spark that went in my mind. It's like I found my passion.

Mm-hmm.

We're changing people's lives. And it's, you know, oftentimes you hear about passion, follow your passion, find your passion. And I used to get stuck in those mindsets of like, how can I be passionate about something? Like, I got to find my passion. And you see people that are health experts and all that, but it's when all of a sudden you to find it, and it was changing people's lives, the energy it gave, and just the spark that we saw in Mike and how he wanted to affect people's lives. And so he's definitely been an asset. He's a very successful seller of his own brands, but he's got a real knack for being able to relate to people and help teach them. So it's been a really good partnership.

So Amazing, you know, is legendary in the digital marketing world because the size of some of the launches you've done. You know, it's people know about them and it's this whole concept of the virtual world. But what gets my attention is you decide to have a live event, which is like the, you know, kind of like the other direction a little bit. So what was the internal dialog saying? You know, hey, this is all about how to be virtual and, you know, really build a good business, a profitable business virtually. Let's get everybody together live. So what was the impetus behind that?

It's about camaraderie. And sharing ideas. And the fact that, you know, over the 7 years before that, I went from being in an office to working in my home and going through a lot of ups and downs. Working from your home can have a mental challenge at times. You know, you get depressed, you feel alone, you don't have people around you that can relate to you, can bounce things off. So it's really about creating that community. And we also knew that we wanted to have experience. So not only to help people create a community, but also to help connect people that can help one another. One of the biggest things that me and Matt did originally was we created this mastermind group. And so I started selling in October, we had the mastermind group in November, and then every one of us in that mastermind group by February were crushing it. And so it really opened our eyes too that you have to be sharing. As Mike said, there's there's just too much to teach. And so it was really just about how do we create community with people, how do we make people feel they belong, and how do we get that camaraderie so people feel that they're not just on an island by themselves doing this business, that there's actually something more to this. And it just worked. It really did.

Did you have— I guess this is really a question for you because you're there at the point in time, but when you got together with Matt and you said, you know, let's, let's put together this product and this project and let's go launch this. Did you anticipate the size it would be?

No, you know, I was going for, you know, my target was the John Reese, Frank Kern kind of million-dollar launch, you know, the Mike Filsaime kind of thing. And what we did originally, what we launched was 3 products in 1. It was originally called the Amazon Money Machine, and then Amazon let us know that You can't do that. So we quickly changed it. And thankfully at that time, you know, we were nobody. So like we had time, we changed it to The Amazing Money Machine and then The Amazing Selling Machine. John Reese actually helped us change that. But when we started, we were focused on private label, wholesale, dropshipping, and Kindle because those were the 3 aspects of Amazon. But after the year of doing that and all the community testimonials, we were looking like, yeah, people were making a few thousand dollars a month with Kindle, some are doing okay with private label, with wholesale. Private label, we have people crushing it. We had one guy, David Paul Doyle, actually was one of our first guys that he's right now NatureWise, and he's one of the biggest health brands on Amazon. He was one of our first success stories, and we just looked at this, it's like, so by having this training, we should probably get rid of the, you know, look at the 80/20. What's getting us 80% of our results was private label. And then so when we did that, and now we had these testimonials, you know, you go from the first year launching the product doing $1 million to the next launch we do, just the launch itself in 9 days doing $7 million. You know, it's kind of like, whoa. And then the next launch you did $10 million, next launch you did $16 million, then you do a $22 million launch. And it was just— it was two things happened. Number one, we were the first to market. We were the first real established system. But the other cool thing is all of that pre-training I did of creating communities, courses, all those kind of things just fed right into that. So it was just really all those relationships from affiliates and everything that I had. It was like the perfect storm. And, you know, it plays with your mind too when all of a sudden all this success comes. It's like winning the lottery. It really— there's a lot of challenges that come with that. A lot of challenges. But no, I was hoping for like a $2 or $3 million launch. I had no idea it would do what it did.

And the biggest launch was the $22 million, was that the— Yes. Yeah. So that's a lot more than one.

Yeah, it was pretty incredible.

But with all the people now that have come in, because obviously you opened up this kind of new frontier, that's an opportunity. You know, when I look at it sometimes I think in terms of It's almost like learning franchise, you know, as far as saying, hey, there's, there's kind of a turnkey business method here that you can adopt. But franchises, you need a lot of money to be able to engage in. Here you need very little investment to be able to kind of get a product, get a business, get the whole structure together and be able to go to market. And then you— so if for some reason it didn't work, you don't really have a downside or much of a downside. And if it does work, it's a terrific thing.

And we actually teach that where some people will You know, there's one person we were just talking to that put like $16,000 in their first inventory order, and it's like, what are you doing? Like, that's absolutely— you want to start as risk-averse as possible. And the idea is start with this, you know, you, you want to start with about, what, 200, 300 units?

That's about—

that's all you need for really to get going. Yeah, you don't, you don't need to spend thousands of dollars. As a matter of fact, you only started with $500 worth, you know, got me about 100 bottles of leather conditioner. But, you know, and talking about risk, you know, we're in— you're building a business. There's risk involved in it. But I like to think of it as calculated risk.

Yeah.

You don't just go out there and blindly spend money on something you don't feel has a proven way of working out for you. And one of the things that, you know, probably the biggest thing we built up is all this credibility, social proof, all these success stories of people who've made it work and all the reasons why people who didn't weren't able to.

So we know what not to do as well as what to do, which is really important. You know, it's not just do this, do this, but you don't do this, it can be the difference between success and failure.

And that's why we have— one of the challenges we have, we have to keep it up to date all the time. And e-commerce is changing every single day. Amazon changes every single day. You can't open the paper, not read an article about Jeff Bezos or about Amazon, right, without seeing something in the news about them changing or expanding to new business or shutting down a part of the business.

Right.

We have to stay on top of that because we don't and we teach someone to do something wrong that could hurt their business big time.

In line with that, because there's a question I have relative to that. Because one might think, okay, well, now you've done this for some years now. You've had all these thousands of people who've come in are doing it. Is it saturated? Is there still a lot of room for people to come in? Where, you know, where do you think you are in that particular part of the arc?

Yeah.

If you look at it, saturation is a state of mind. Yeah. There's, there's absolutely no way that a business or an entire section of the economy that's growing so big could become saturated yet. Amazon or e-commerce in general only has a fraction percentage of all retail sales. I think it's not even over 15% of all retail yet.

So it's an expanding universe, right? Absolutely.

You know, and the way that it's growing, the number of sellers can't even keep up to pace with the way that the amount the market is taking over. And Amazon still does only about 50% United States right now. They can still grow there. They're expanding into other markets, other areas, and there's always new products coming out. It's a constant, you know, continual flow of new, new ideas, new products, new methods of marketing that you can just take advantage of, you know. But one thing is, the sooner you get in, the more time you have to take advantage of. That's why I always want people to get in as soon as they can.

And people make the mistake of thinking this is an Amazon business. It's not. It's a physical products business, but you're leveraging Amazon to get started. And the whole idea is, once you have a proven brand, once you have your proven products— and there's so much opportunity on Amazon, Amazon, like you said, you can expand internationally so easily. Then you create your own e-commerce store, you start going on different websites and you expand how your product reaches. But the world's changing. I mean, I was just telling about an article I was reading where it listed all the stores closing this year. You know, people are going to go somewhere to buy. And then people say, well, what if Amazon starts selling all their own products? Well, then would you buy on Amazon? You know, if you know, if I only go to Amazon and you can only buy Amazon brand products there, I'd start looking elsewhere, right? You know, because Amazon doesn't want that. Amazon admits 50% of the revenue is from third-party sellers. So there's so much growth, and it's just like a hockey stick right now with how quick that Amazon is expanding. And some people think that it's oversaturated because I think it's a fear, like they want to talk themselves out of it where they're looking for opportunity but they, they almost seem to red flag everything. And no matter what business model I've been teaching, that's the number one thing. Oh, is it oversaturated?

It's over— like they missed it.

Yeah, they feel like they missed it. And it doesn't matter that the first year we started selling Amazing Selling Machine, the, the number one question was, is it too late? Is it too late to get into it? And the, the, the only thing that determines success or failure, in my opinion, the number one thing is mindset going into it. You hear mindset, some people say, oh, it's irrelevant. It's like, it's not. And every success story we talk to, the people say right away, I knew I could make this work. And so it's really believing that if you're going into this and saying, this isn't gonna, you know, the word try, I think sometimes people misuse, like, oh, I'm gonna try that. Why don't you just do it? Don't just try it. Do it. Implement it. Like fully go in. And it's even incredible sometimes people buy our course and they'll send me their— Because they'll be struggling. I'll say, "Let me see what you've done." It's like, "Well, you haven't followed the training." It's like, "Well, why are you doing this? Like, is this a hobby for you?" Because if it's a hobby, then I'll step back and it's like, "You just go have fun." But if you want to change your life, if you want to be a real successful business, then you can't just try, you have to do it. And it's all about mindset. And at the end of the day, there is so much room on the internet for e-commerce. Whether it, you know, Amazon right now is the behemoth, but you remember when Google took over Yahoo, people were like, there's no way, like, Yahoo's gonna be it. And then Google came along. Like, there'll be something come along. But the thing is, people are always gonna need to buy. There's always, you know, whether it be, you know, and I love it now, like, just The other day I ordered a bottle opener because it's like, oh, I got to go buy a bottle. Wait a sec, you know, order it and same-day delivery, you get it, you know, in the beginning. So it's like, I'm just going to do more and more of that, and I think the world's turning that way. So it's really, if you want to change your life, if you want to do a business, um, look for the reasons why to do it. Now be cognizant, like obviously if it's, you know, you want to look at the market share and all those different elements, but at the end of the day, if you want to change your life, You just got to take action and really believe in yourself. I'd say that, you know.

In line with that, who's the avatar for you guys? Like, this is the ideal person or the ideal 3 types of people that really are our customer.

It started with this guy. With really— and the idea was because it worked for, you know, mid-40s, middle-aged kind of person that had some disposable income to be able to to buy some inventory, not a lot, and they were looking for something else. It was somebody that was stuck in a job and they were just feeling like, I have to commute to the office. It's really like the commute could summarize it. Like if you're sick of the commute, but it was more of the middle-aged person that was an executive that was looking to get that freedom. But it's since changed a lot.

Yeah, now we see people from all walks of life do it. I mean, I think anyone who wants to make a change in their life and has a, has a reason why they want to do that, you know, and money very seldom is the reason why. It's what you want to do with that money. But if you have a reason, if you're wise, you want to spend more time with your family, you want to travel, you want to, you know, buy nice things. There's nothing wrong with that at all. Just understand what it is you're doing this for. If you have a reason why you want to make a change, that's our ideal person. Because having a good reason why you want to make this successful will help you be successful. And I know, like, number one thing that got me successful was as soon as I started and made the decision that I was going to build this business, I didn't, I didn't, you know, wonder what's it going to be like when I'm successful. I started visualizing I've already made the step, I've already made a change, I'm already successful because I've already taken that big leap.

Now, you're full-time as an executive when you started, you said, right?

Yeah.

So because that's one of the big questions that come up, how much time do I need to be able to make this work?

I was nervous. I was starting out thinking, how can I build an entire brand and a business while, you know, having two young kids at home, having a wife that, you know, she needs attention from me and vice versa. So I couldn't just, you know, ignore all those things and having a full-time job that I travel to. Luckily, I was able to do it within an hour or two a day. So the way that, you know, the training— when I, when I took training to learn how to do this, it was laid out where you could watch it anytime you wanted to. It's online, it's virtual support, the help, the mentorship, that's all virtual online. So anytime you wanted to go watch it, I usually— my plan was work all day, came home, I had dinner with the family, then I would go downstairs and I'd watch some training for an hour or two, and then I'd come back upstairs and hang out with the family a little bit more. And then 10 o'clock, I'll go back downstairs and spend another 30 minutes to kind of plan out my next day. So it's never more than a couple hours a day.

But I think what's important is that you had a kind of a structure around the training. In other words, uh, it's probably not a 'I'll get to it when I have time' because that probably never shows up.

Yeah, those are the people that a year later, they're still— we have people from ASM 4, they say, okay, now I'm starting, you know, and that was 4 years ago because you get lifetime access. So once you join, you'll keep getting all the upgrades. And so we'll have people starting now say, now I'm gonna commit. And it's like, you know, it's just mind-boggling at times when you hear that because it's like, why didn't you make this financial investment back then? But it's— you have to be able to do that. You have to be able to dedicate— we recommend a minimum of an hour a day. But really, like, if you want to make it work, 2 hours a day is probably more realistic, like, really to be able to get it done in 6 months. Where if you dedicate 2 hours a day, in 6 months you'll have a dramatic transformation, and you'll know at the end of those 6 months you either— because that's another thing, one of the things that we believe is that everybody can do this business, not everybody will want to do a business. You know, a lot of times being an entrepreneur, there's a little bit more responsibility in life because you're more responsible for everything in the business. And so after 6 months, we do occasionally have people that say, no, this just really isn't for me. So we actually offer a guarantee on that, that if you're not— you follow our system after 6 months, if you're not, you know, if you've done everything and you're not happy, we'll refund you still. Because sometimes people fall into that victim and Very, very small percentage of people do that, but it's just an interesting phenomenon because some people, they think that they want to be an entrepreneur, but then they don't.

It's not for them.

It's not for them. Yeah.

So another category of person I wonder if this is right for, which is on my mind. So I've got a 22-year-old son who's a senior in college, you know, finance economics major, who, you know, looking at going out into the job market saying, hmm, I wonder if I, you know, How do I go look for jobs? What am I looking for? But then he just comes back from a trip to London and says, you know, I found a small gin over there that they don't import over here. I wonder if there's a way I can figure out how to import that over here. You're thinking about ways to take products from one place, bring them and distribute them to another audience. Is someone like that that's like maybe ready for the job market?

Even just the Dysons, like they're 29 years old now and they're doing what, half a million a month? Half a million a month?

In sales.

You know, half a million a month. And these are— so who are they? Who are these people?

Channing and Justin Dyson.

Yeah, we just had them in Hawaii for some videos.

Are they college, like you just out of college or—

Well, Justin dropped out of college once he realized how well the business was doing.

Right.

And I think that Channing, she now owns a beauty shop that she still does some part-time work in, but now they're really just running their own business, selling all kinds of, you know, children's apparel and different types of products that for them, they have young kids. They realize that, you know, 'Could we make something better? Could we make something that we would want to buy as parents?' And knowing that there's hundreds of millions of parents out there, they were similar to what your son was. They wanted to bring something different to the market that they knew there was a demand for, and that gave them their passion to really dig into this business.

One of our early success students, John Gill, who, you know, quickly became an 8-figure seller, one of the things that he was most dedicated to us for is how this transformed his family, because he taught his son the business model, and now his son does better than him. And he's like, I feel safe now, like my son is taken care of. So absolutely, you know. And the neat thing about this business is, you know, we recommend that you start— you know, when we teach you, we try to teach you the most effective way to get the fastest results possible with the least amount of risk as possible. Now, there's always some risk, but the reality is, if you only have $100 to start with, you can start with $100. It's just, it's going to take you a little bit longer to find the right products because some types of products will have minimum order quantities. So you might have to have $1,000 for that product. So keep looking for another part because the idea is just get started with a product. Find a product on Amazon that fits certain criteria so you know that it's a good seller. And if it's proven on Amazon, that's why we also sell— like, if you're just starting out, don't start with a brand new product. Don't say I have I have this idea, it's going to do well. Well, if it's not selling on Amazon, you have this whole other hurdle that you're going to have to figure out. So what you do is you find a product that's selling well. First of all, you try to figure out how to make it a little bit better.

There's steps in this process. So is that the first step?

So finding the product's the first step in the process, the most important one, because your product is everything. I like to think of it as the base of the entire business. And that's why we're very, very careful about the criteria we use. We want to make sure that it's priced a certain amount of price because if it's If it's too low of a price, you won't make enough profit. If it's too high of a price, you can't afford enough inventory. Right. You also make sure that the competition is at the right spot on Amazon, because if you have too much competition, you can't compete with people that have unlimited pockets to outspend you. But there's not enough competition. There's a reason for that, that the product probably isn't in demand out there. You also want to make sure that it's not too heavy because let's face it, shipping is a cost of business nowadays. And if you can remove that from the equation, then that makes it much easier to get going. And then you also want to make sure that you can private label it. That's a big part of what we talk about here. So it's much easier to take a product, a generic product. Think of a thermos instead of selling the Thermos brand thermos. Create your own brand of it. Come up with the Mike and Jason's Thermos or whatever it is. Jason, Mike and Jason. And brand that yourself because if you own the brand, you own an asset.

Asset.

And you're bringing cash flow every month and you're building an asset that at some point, if you choose to cash out and retire, you have that built up. If you sell someone else's exact same product, you're building their business.

Right.

But if you make your own, you're building an asset for you.

Yeah. And that's a really important point. A lot of people ask two things like, why don't I just sell somebody else's brand to start off? Well, with Amazon, you're allowed one listing. So let's say, you know, whatever it is, AB Acme spatulas. There's only one listing on Amazon. And then you'll you'll see underneath the buy box where you, you click the buy button, other sellers. So then all of a sudden you'll notice that there could be 50 others competing. So what's happening now, everyone's driving for the lowest price, right? So now it's a commodity product. But when you're your own seller, you're the only listing. You might have Amazon because it depends on how you have things set up. They can resell your used stuff. So if someone returns something, but that's the only time you'll have a competitor. So it's, it's just you get all the profit, you get all this sale. And so people think, oh, it's easier to start this way. It's not.

Do you ever have a manufacturer decide to acquire somebody who is white labeling, saying, hey, you know, this is really good, I like this brand of my product, I think I'll buy you?

So I haven't had that, but I had had them want to partner with us and several other people as well. So once they see, like, like your example with your, your raspberry ketones, where they could have very easily came to you and say, Jason, let's partner on this, we'll give you a better deal, let's share in the profits. I had one of my suppliers came to me after seeing the growth and wanted to partner on a whole new line with them. They do want to do that sometimes. You don't have to do that. I mean, again, they're, they're really happy being a manufacturer, knowing that they have someone out there knows what they're doing selling their products because that's what they do best. They manufacture, they distribute them to their third-party sellers, and then let us do it.

We'll stay in their lane. So now, okay, so step one is finding the product. What's step two?

Next one then is speaking to manufacturers, finding them. And this is what blew my mind when I first learned the business model. I thought that if I was buying any kind of product out there, that whoever made— maybe it was a Rayovac lantern. I thought Rayovac made that product. They had a plant somewhere in St. Louis and they're, they're churning out lanterns. Ends up there's, you know, 100 plants in China all making similar lanterns and they're private labeling and branding for you. So the first thing is to find a supplier from usually overseas, or if you're selling like a beauty product or some kind of health supplement in the United States, you need to find those suppliers that are looking for you. And I didn't realize you could even do this. I didn't know there's a possibility. I wasn't aware of private labeling at that point in time. But nowadays you can go online to sites like Alibaba.com, even Google, and search for private label products, and you will see hundreds, if not thousands, of different suppliers that actually are looking for you to sell their products for them.

And it's so much easier today with freight forwarders. And, you know, a lot— that's a big big concern people have. Okay, well, how do I get the product from China to here? It's so easy. It's really just a matter of picking up the phone, talking to the freight forwarder. They ask all the right questions. I don't even know if all of them need a phone. There's probably online forms now. And they'll take— they'll make sure it goes from the manufacturer right to Amazon. So it really— we don't recommend this, but you could start and run this business without ever touching the product yourself, ever. Now, we always recommend get a sample, make make sure you check the product, but you really don't need to.

It's—

yeah, yeah, yeah.

I don't see any of our products anymore.

Not at all. When we're creating the products, I know for our brands, like, we obviously— I'm sure you do this too— you look at the product, you buy the competitors, you compare them, you feel them, you see how you can make it better, and then that's it, you know. And then the only other time is launching a new product. Launching a new product. Yeah, yeah. You don't have to have a warehouse or anything.

So that's step 2. What's step 3?

Step 3 then is your piece of property or real estate on Amazon. Like Jason mentioned earlier, every product has a listing we'll call it on Amazon. It's like, it's almost like having your own mini website on Amazon. What you want to do is you want to make sure that as many people as possible that go to Amazon, if they see your product, they want to buy your product. And so there's very specific criteria. You want to have the best images possible. You want to have the best title possible to make sure that it gets a lot of traffic and but also doesn't look spammy. Looks like a product that I'd want to buy at the store. You want to make sure that you have plenty of details in the bullet points, those 5 points right below the name of the product.

Right.

And you want to have a good product description as well.

And there's, you know, there's— it's not overly complicated, but there's a formula for making sure you have all 4 of those in place. And there's a 5th one that's kind of a secret one that most people don't— when you're buying on Amazon, don't realize Amazon in the back end has these hidden search terms that if you want your product to show up for other searches that aren't in the title or on your listing, you can put them back there too.

Oh yeah, we had at one of our live events, we had someone come on stage and be vulnerable because they showed us their product and we looked at it, audited it. It was actually Mike that did it. He suggested, oh, do this in your back. And the next day sales were up 20%.

Wow.

Just by optimizing it right. And one of the things with the—

they say thank you, or they're very successful now too.

They have— and it's really cool how how now that with their success, they're paying back and they're treating in third-world countries people with eyesight issues. So there, it's a very cool story. But with the, the one thing to keep in mind when you're creating your listing on Amazon is when people can go into a store and touch and feel the product, you have to try to figure out how to give them that experience virtually. Yeah, so your pictures have to be— we call them lifestyle images. Think of the person, and a good way to do this is look at your competition for a of all and see what people are complaining about. And if you can create a picture that negates that— so let's say someone, it's a spatula, and someone says, "Oh, it broke on me." Well, if you had a picture showing them bend it, for example, you know, unbreakable. But really, you just want to get in the person's mind, try to get that person able to visually see themselves using the product, and it makes a huge difference.

And if you use video also to that, you can now.

Amazon has allowed that. Video is obviously super powerful.

Sure.

Yeah.

What's step 4?

The final step is then launching your product. So this is where we can really beat the big brands. You'll think the major brands out there like Nike or Adidas or whoever is selling on Amazon, you think they'd have these huge marketing departments that go out there and they do a huge launch on Amazon. To them, Amazon is just another channel, another sales channel. They just put a product up there and they hope that people come by because of their popularity. Well, the way that Amazon looks at products nowadays is that there are certain triggers, certain levers you can pull. And if you know what those levers are and those triggers, you can get your product ranking very quickly, usually within a week or two. And it involves— it's not overly complicated either. It involves, you know, getting your product live on a certain date, getting some targeted focused traffic to the product, really focusing on people that you believe are more prone to want your product.

Do you drive that from outside of Amazon or within? Both.

Both internal and external. I mean, Amazon has— Amazon's investing $15 billion this year in tools for sellers just like us.

Wow.

And those tools allow you to really narrow in on people buying on Amazon based upon their interests, their age, their demographics, the type of products they want. But in addition to that, Facebook makes advertising so easy too. You can also drill down to the demographics to your exact target customer. And once you find that match, you have a product, you have a person that, you know, wants that product, that traffic will convert. And then as soon as Amazon sees the product converting, this is where that— it's a snowball effect. If someone goes to your product and buys it, Amazon says, wow, this is a popular product, let's move them up in search rankings. That happens again, they move up in the search rankings. And if you know how to make those, those triggers get pulled and activated, it's pretty simple now to rank a product on Amazon within a couple of weeks of launching it.

The big thing though, the crux of this all, is you have to have a good product.

Yeah.

And it doesn't mean— like, a good product doesn't mean it's the most expensive product, but it's just look at what you're giving the user and make sure you fulfilling on that. So whether it's a spatula or something much more complicated, just make sure that it's a solid product. Because if it— no marketing can help a bad product. You might launch and do really well, but then once the negative reviews come in, you're done. And another tip too, especially for people who want to start from scratch, is start with a simple product. Because if you're like— let's say you want the difference between a spatula and, I don't know, a phone, like any kind of electronic, is one of them is gonna give you a headache because you're gonna be dealing with all these different departments for manufacturing. You're gonna be dealing with reviews because of, oh, this electronic part doesn't work. But if you start with something simple, it helps you get going, learn the system, implement it. And then from that point, that's the other thing— you might start with a spatula and end up selling baby supplies.

Yeah, and that's a really interesting point or a question I have. What's the experience typically when somebody's succeeds with a single product, are they normally then moving to build the next one and the next one?

Or sometimes people focus on the first product is a curse. Yeah, because people can get— I don't want— I hate using the word lazy.

That's complacent.

Complacent.

Or they think they're better than they are.

Yeah, that too. Like, that is actually, you know, it's— and we have people with one product doing hundreds of thousands a month, and we keep asking them, when are you gonna add your next product? And, you know, they just they're doing so well with their lifestyle and it's like, that's a risk.

It's all about calculated risk again.

Yeah.

You know, so there's 3 ways to really grow. You can sell more of that same product, you can launch more products, or you can expand in other markets. And the easiest one is to sell that same product and people kind of fall into that trap. And it's easy to do because the cash comes in quicker than the other way. But the first step I would do is if you've started— if you've started a product that you know there's a demand for, simply expand into that same category. Come up with a complementary product. Instead of a spatula, come up with a fork.

Because I'd have to imagine on the— sort of on a decay curve, you know, if you've got a single product that you've been selling a lot of for some period of time, it's got to decay over time.

Yeah, absolutely. I mean, lifecycle. Yeah. And sometimes people get lucky, they get a long, long time out of it. But I know all of the products that I started originally selling now are not my top sellers. Some of them we don't even sell anymore. And that's another thing. People seem to make this mental commitment that I have this product, oh, it's gonna be forever. And it's like, no, you can't look at that. Like, it's a business you're building and you want to build. And that's why we say build a brand, because if you've got, you know what, if it's a spatula, we'll build a brand about that so that you can start relating, you know, build that home improvement brand or the kitchen brand, because then all your communications, you start because you got to build an audience. Yes, the end of the day. And if you're trying to sell a spatula plus, you know, some kind of baby equipment and then some kind of outdoor, you've got this disjointed message. But if you can keep everything within one kind of niche, it's just so much more effective.

Would you say the value then is more in the brand than it is in the product?

Long-term.

Absolutely.

Long-term. Because now you can launch other products under that brand and then you have existing customers that you can convert into the new product.

I can't tell you how many times that we've launched a new product and before doing any marketing, we start selling them. Because you have a brand, you have an audience who trusts you. You know, as long as you have quality product, you provide stellar customer service, you will build some raving fans out there that'll be advocates for you. I love people who respond to a negative review that are customers of mine even before I get a chance to, because they want to say, hey, have you contacted the company? Did you tell them about your problem? Did you give them a chance to take care of it? 9 times out of 10, they haven't. Yeah. And it's nice to see advocates. You build up that camaraderie with your own customers.

Yeah.

So as we're having this conversation, in my own mind, I'm sitting here thinking, hmm, I could think of 3, 4, 5 different things that this could be kind of fun. And incidentally, this sounds like fun to me. Sometimes I hear things that sounds like work, and of course effort and work is involved in anything that's going to be successful, but this sounds like kind of fun too. Like I'm getting tickled by some, you know, I wonder if this would work, I wonder if that would work, you know, different products, different passions, what have you. So what's a proper expectation? Like somebody's watching this, they're saying, hey, this is a whole new universe to me, and it is really. This a universe of its own, right? I think I got an idea or two, I should start researching, etc. What's the right expectation for somebody saying, I'm starting at square one right now, you know, what should I expect as far as outcomes? Of course, you've talked about some pretty extreme examples of successful people, but let's talk typical.

So I mentioned 6 months, and that's kind of how we designed the course. The idea is now you get lifetime access to it, always upgrades but the course is delivered over 8 weeks. But we realize in 8 weeks, you know, you probably don't even have your product in inventory yet because, you know, the first few weeks is all about finding your product. And then once you order your product, depending on where you get it from, if you get it domestically within the United States, for example, you could have it in a week. But if you get it from China, sometimes the lead time, depending on the time of year, you could be, you know, up to 8 weeks. It can be a couple of months. So really, we figure about 3 months from the time you start to have you have your inventory, and then the next 3 months launching the product. So that 6 months is really a good time frame, but that means 6 months of working 1 to 2 hours a day, right? And I think that's very realistic. And at the end of those 6 months, no matter what the level of success, you'll know whether this is working for you or not because You're right, it is fun, you know, and it's, it in a way, it's kind of like the stock market in a way because you're watching these graphs and you're buying and selling stuff and just watching how it improves. And, you know, it's all the science, the analytics behind it. Really interesting.

So yeah, I can't tell you how many times that like on the weekends when I, you know, get together with family and friends, I'm talking about this business.

It's addictive.

It really is. And we talk about it all the time. You know, we do a lot of training, but we still talk about product. Products and ideas and new launch strategies. We're always thinking of something new to help out people to get better results. And then we, we spend a lot of our own money and time testing things out. Yeah, we've wasted a lot of money testing things out, but there's a reason.

Yeah, we call it tuition. Yeah.

Now, someone wants to realize, like, you know, after 6 months, what can they expect, like, financially? The way that we try to narrow in and give people advice on where to, like, start with the product— don't go for a product that's going to make $1 million a month. Don't go for a product that's going to make you $10 a month. You want something very reasonable and realistic and achievable. So we target products that should get you anywhere from $10,000 to $25,000 in revenue a month.

What's the typical margin on that revenue?

25%.

Okay, so that's great.

We don't want you going any lower than 25% because then you've got marketing costs and things and you want to be able to put money in your pocket. The other important thing on that too is we recommend give it a full year. And if you like, if you're working already, can make your plan to work the whole year. Because what you want to do initially when you sell is reinvest 100% everything back into it. Because you want to, you know, you're gonna— once it takes off, it's gonna take off. You're gonna run out of inventory, you're gonna be panicking, all these kind of things. But it's like, settle down, that's part of the process. But the thing is, if you're trying to spend all your profit right away, you're not going to be able to reinvest and grow. So that's one thing to keep in mind. But yeah, within— I'd say that's pretty reasonable.

And the biggest successes we've seen are those people who've taken their profits They realize potential this business has, and they put it right back in the more inventory. They do that a couple times around, and then they put it into a new product. And then after a year, year and a half, then you can really make the decision: how much do I want to pull out for myself, for my lifestyle, for my why?

Right.

And then how much do I want to continue putting back in the business so that continues that steady climb upwards?

Yeah. And it's important to realize this isn't a hack. This isn't any of those short-term things. You're building a brand. You're building your own physical products brand, and we're teaching you how to do that by leveraging Amazon to explode it, you know. And so you're building a real business. So any business takes time, but if you look at the comparison of trying to start a business anywhere else outside of Amazon compared to on Amazon, it's incredible. It really is.

I have to tell you what excites me about this is there's so many times I speak to people who want to become entrepreneurs, you know, sometimes called wantrepreneurs, right? You know, they'll take some training, they'll learn some things, but there's not really a good path for them to leverage things, tools, Amazon environments, what have you, where they have the money, you know, the investment that they can make to get something moving or at least test something to see if it's even viable. So what excites me about this is like, sure, if I want to open up XYZ franchise, yeah, you know, you got $1.5 million, $2 million, you know, and you can get approved for it, etc. You can go and get your franchise and it's a pretty good turnkey business model, etc. But in this case, it's like, yeah, I don't need, you know, I just need a little bit of capital and some time to get this started to see if I can throw my hat in this ring and get it going.

And a huge component that we're seeing exploding right now is selling businesses. So the Amazon, there are so many people looking to buy Amazon businesses that we're having, you know, 4 or 5 times multiples easy of people who are getting, you know, high 8-figure buyouts of a business that they started on $1,000 because they've created this only a year or two ago.

Yeah.

And they're only selling on Amazon.

Obviously. Now that's even more fascinating then because, and I think a huge benefit because it's one thing to say, hey, I, I'm able to build a cash flow business means I get to make some money over time that I can pull out of it. But if you're saying that you're also building an asset that's, that's saleable, that's extraordinarily attractive. Especially because if you got some, some good history and financials, you can get good multiples on a business like that. Yeah.

And so what I'm doing right now personally with my physical products brand, I don't take any money out of it. I focus it all 100% back in because my plan is in 3 to 5 years I want to sell it for cash out so that it helps me my next phase of life.

So, and that's, uh, maybe I'll call it a real business versus a lifestyle business. And there's nothing wrong with either. You know, it's not lifestyle businesses aren't bad, but you know, if you're if you're really looking to be a business builder, then on tax side, I guess you're paying capital gains on that as compared to regular income when you make that transaction. So, you know, there's a whole bunch of benefits to that.

The great thing about this, too, is you don't have to make that decision right away, right? You don't have to go in wanting either cash flow or lifestyle or a combination of both. You can decide that as you get into the business. We do know a lot of people who want the lifestyle business, right? They're okay making an extra couple thousand dollars a month in, in pure income so they can travel, they can pay their house payment, and get an extra car. And in order to maintain that type of lifestyle business, you can keep going just on a couple hours a week. Once you have your product up and selling, it's really just keeping track of customer, you know, questions and making sure inventory is in stock. If you want to grow it and turn it into a brand that you want to sell as an asset, yeah, you have to put more time into it. Yeah, it's a real business. Yeah, that's what I love about it. It's a real business. You can have both components.

And I just— one caveat I want to add there. So for example, right now I work 90 minutes a week on my Amazon. That's it, because I have employees. Now, you can't do that. I don't want someone listening to say, oh, I can work just a couple hours a week. Well, no, no, no. You'll get to that point. When you start, you have to invest the time, you have to get things in place, you have to then get the employees involved. But then it gets to a point, you're right, that's all you have to do is a couple hours a week. You know, it's always wise to know what's going on in your business business, but it's one of those things you can set up, hire outsourcers, employees, family, whatever you want. It's very doable.

That's awesome. One of the things that we're offering as a bonus for Wealth Breakthroughs is something that is new for you. This, this book that you have created that really gets into the details of what we just talked about. So let's talk about that book.

Sure.

This is the first time we've actually done this. We've created a book that, you know, talks a lot about what we talked about today, the basic training, how to start your own Amazon business. But it goes into much more detail. We'll go through all the exact steps, all the pitfalls to look for, the ways to, you know, other tricks and tips that we've learned over the years. You know, we, we don't always teach tricks and tips, but we've included in this book because we know these are little things that will help you along, get going faster, even better. We've included that all in the book. Everyone's going to get that for free, and it'll walk through the entire process of finding the product, finding a supplier, creating that perfect product listing on Amazon, and then launching it so you can start making sales immediately, all in one book that you'll get shipped to you.

I think this is a phenomenal high-value bonus for Wealth Breakthrough, so I really appreciate you offering that for our audience.

You're welcome.

Well, I have to say, this has been a really great peek into a universe of real potential for people that maybe don't have other paths open to them. So your enthusiasm is palpable, so I appreciate you coming here and sharing it and sharing it so openly. Openly. So thank you very much for this time.

You're welcome.

It was a pleasure to be here.

Hi there and welcome to your episode 9 bonus interview. Mark Lichtenfeld from the Oxford Club is here to show you why every investor should invest for income first and build the rest of their portfolio around this simple, timeless strategy. If you think this is going to be a snoozer of a conversation about blue chip dividends, you're in for a big surprise. Here's Mark.

So, Mark, thank you so much for being with us this morning.

Yeah, thanks for having me.

So tell me a little bit about who you are and what it is that you do.

Sure.

So I'm the chief income strategist at the Oxford Club, and I run our income franchise. And that consists of Wealthy Retirement, our free e-letter, the Oxford Income Letter, which is our monthly newsletter that's focused on generating income. And the goal, the main goal of the Oxford Income Letter is to generate more income today than we did last year and more next year than we will this year. So, it's all about income growth. And obviously, we are striving for capital gains, too, but it's really about increasing the income that members receive year after year.

So, I want to get into that specifically, but how in the world did you end up here? Was this your career trajectory?

Not at all. I had a very unconventional entry into finance. So when I was in school, I wanted to be a sportscaster and I can see that. Yeah, that was the plan. And then I got out of school and realized what I would have to do, the kind of dues you'd have to pay. And I wasn't— I grew up right outside of New York and I wasn't, I wasn't willing to be the number 3 weekend anchor person in, you know, in a city I'd never been to and then hope that you can then get to a slightly larger market and a slightly larger market. And I knew people in the industry and saw what they had to go through and some very talented people who are then 40, 45, 50 years old who still—

and Des Moines.

Yeah, exactly. And nothing wrong with Des Moines, but, you know, I either wanted to be, you know, big time in New York and doing NFL games or I didn't want to do it. And I just didn't see a path that I could be happy with. It just— there are certain things in my life I paid my dues and very willingly done it, including in finance, which I'll get to in a minute. And that wasn't one of them. And luckily I realized that before I got too far into it. So from there, I actually decided I'd be an actor. And I was spending all of my free time studying the markets, though. I became fascinated with the markets. My grandfather had had a seat on the New York Stock Exchange. And even though when I was in college, I had no interest, as soon as I got out of college, I did have a lot of interest in it. And really, I would read everything I could get my hands on. I would spend hours on the weekends in the library. Back when people went to libraries because there was no internet. And eventually, after several years, decided to make my hobby, which was investing, into my career and make my career, which was acting, into a hobby. So I switched it. But as you can imagine, there weren't a lot of job openings for 28-year-old actors, right? On Wall Street. So at the time, I was living in San Francisco, and I found there was a company that— they were a trading firm, a very small trading firm. It was a 10-minute walk from my house, and they needed an assistant on the trading desk. So I went in, handed my resume, guy looked at it, had absolutely no relevant experience. And I could see what was happening in the room. There were 4 traders, and at the time, the traders didn't They didn't enter their own orders. That's what the assistant was for. And they didn't have this assistant. And so they're yelling orders at the manager, who was trying to talk to me and enter the orders at the same time. So I could see that they really needed somebody desperately. So he looked at my resume and said, "Okay, well, we'll call you." I knew they weren't going to call me. So I said, "I'll tell you what. I'll stay here." This was on a Monday. "I'll stay here today." work for the rest of the week for free. If you don't think I can do the job on Friday, tell me, don't come back. I can see you need somebody, so I'll help you out for the week. It was an offer he couldn't refuse, so I did it. And on Friday afternoon, he said, all right, come back Monday. And I think I was going to make $500 a week. And that was the entrance to my career in investing and trading.

So you started out in the fire.

Oh, yeah. So I had these traders screaming orders at me. So not only do I have to enter the orders, confirm the orders, then at the end of the day, I had to do the books, make sure that the orders are right. And if I made a mistake, it cost them money. And these guys also became my friends. It was a small office, about 4 or 5 people. So if I did make a mistake, I felt terrible. I mean, luckily, it didn't happen very often, but there was one time where I cost a good friend of mine several thousand dollars. And yeah, so I was in the fire for sure. But it taught me so much about the markets. I can't imagine a better education for the markets had I been a finance major or accounting major, anything. This was the best way to learn about what actually happens in the markets.

Yeah, some of the best traders I've ever met didn't have school. It's, it's, um, you know, I used to do Golden Gloves boxing, and we— before that, I had taken judo and karate. And, you know, you can practice in a dojo, but I learned more in a minute in a ring in Lubbock, Texas, with a kid actually trying to hit me in the face, that where all, you know, it's accelerated learning. And that's a Picturing that with you, you know, entering a trading floor. So how did you get from there to specializing in income?

So I was— I kind of came of age during the dot-com boom, and it came of age, you know, professionally. So I was living in San Francisco during the dot-com boom. That's when, you know, the stock market became the national pastime, and Stocks were going up every day, and people were quitting their jobs to trade dot-com stocks, and you couldn't lose. And it was really very much a bubble. And I was pretty aware of it, but still caught up in it. Bubble popped. I ended up moving to Florida. And then I was there during the real estate bubble. And South Florida was one of the hottest markets in the country. As far as the real estate bubble, and the same thing happened again. And this time, I was keenly aware that this was happening. And I really wanted to find a strategy where this wouldn't keep happening, where I wasn't going to— not only me, but readers weren't going to get caught up in these bubbles and get blown up. And the more I studied, the more I realized that Dividend-paying companies, particularly companies that raise their dividend every year, they outperform the markets. They are safer than the broad market. And they provide a nice little buffer in bear markets because you are getting that dividend. And they just, over the long term, as a long-term strategy, you can't beat it. I wrote a book called Get Rich with Dividends, and in the book, I I did a study. And if you look at 10-year periods, rolling 10-year periods starting in 1927, the market as a whole has gone up 91% of the time over 10-year periods. And you really had to have sold in the heart of the Great Depression or in the Great Recession to not make money in the broader markets. If you look at companies that— raised their dividend every year, you never lost money over 10 years. So I believe that investing long-term in the markets is a great strategy. And then you're basically kind of accelerating your returns if you're investing in companies that raise their dividend every year. And again, kind of once I saw the data and the numbers, I knew that this was a strategy that I wanted to invest in personally, because I've seen the ups and downs of of trading hot stocks, which I still enjoy doing, but for the long-term strategy and for really growing your wealth, that's the best way to do it. And it's a strategy I feel very comfortable recommending for most investors, because it's safer than a lot of investing strategies that are out there.

Going from the trading desk to suddenly —being—writing for the Oxford newsletter, what happened in that interim period?

Sure. So during the dot-com boom, I went to work for a dot-com startup that was all about financial news. We were a little ahead of our time. We were trying to be CNBC on the web, doing streaming video and audio. Problem was, nobody really had broadband back then. We were a little ahead of our time, and like a lot of dot-coms, we didn't make it. But I was doing financial journalism, and from there, I became a sell-side analyst. That was one of the most— besides for the time on the trading desk, that was one of the most important parts of my career. I don't know what that is. What's a sell-side analyst? A sell-side analyst is— if you hear that Goldman Sachs or Morgan Stanley is initiating coverage on a company or upgrading a stock to buy or downgrading it to sell. Those are the sell-side analysts. So the buy-side are the mutual funds, the hedge funds. Those are people that are buying stock. Sell-side are the Morgan Stanleys, the Goldman Sachs. They are trying to sell stock. So either, you know, they make the recommendations, their brokers tell their clients, they tell their institutional clients as well that they should buy the stock. And there's a lot of conflict of interest. You might remember during the dot-com boom, a lot of the dot-coms were recommended with buy ratings while the analysts were secretly saying that they were garbage, because they were getting investment banking fees. So there's a lot— and that still exists today, despite there's supposed to be rules and regulations that there's supposed to be a wall between investment banking and research. That's garbage. It doesn't exist. The firm that I worked for did not have an investment banking arm and was known as a very contrarian firm, which means they really went against the grain. We were only allowed to make a recommendation if it was against the Wall Street consensus, because we were small. If Goldman Sachs is saying buy Cisco Systems and we say buy Cisco Systems, well, why is anybody why are they going to pay attention to us? So we would only cover, let's say, Cisco Systems if it was a sell rating, if everybody else was saying buy. Now, just to be clear, we didn't be contrarian just for the sake of being contrarian. But when we found something that went against the consensus— and the other thing to understand about the sell-side analysts is they don't have a lot of incentive to stick their necks out and make a bold prediction. So if you're an analyst at Morgan Stanley, and there are 10 analysts on Wall Street that are saying buy Cisco Systems, and you say sell, and you're wrong, you're going to have a lot of explaining to do, because everybody else got it right. So being at this boutique firm where we were fiercely contrarian really taught me how to research a company and really question management and question the financial statements and not accept the Wall Street consensus. And again, understanding that there might be investment banking conflict of interest. So to really question everything. So now, when I make recommendations, it's still with that eye. I mean, that training that I got at this firm called— it was called Avalon Research Group. You couldn't ask for better training. I don't know how I could have possibly I couldn't have possibly gotten better training anywhere else in the world. The director of research was brilliant and just this ubercontrarian, questioned everything. And anytime I came in to him, I mean, I had to— and wanted to make a recommendation, I had better be prepared to defend it very, very hard, because he was going to poke every hole he could into it, just like he would any other research report coming out of Goldman Sachs. Then from there, I had another quick stop at thestreet.com, where I wrote basically using this contrarian outlook, and I wrote some columns on a bunch of stocks really poking holes and made a lot of enemies there for a short period of time, not at The Street, but at some of these companies, and then came to The Oxford Club. Perfect training. Yeah, it really was. I'm so lucky. I mean, so much of life is luck and what you put into it. And I was so lucky that I ended up at this one firm to really open my eyes and show me kind of how companies and Wall Street really works versus kind of what you see on CNBC or in the mainstream media.

So it's funny, sometimes we get lost on our path to where we want to go. And what people really want in their retirement, in their building their wealth, the target is really income. That's what affects your life, the money that you can use for your life. But we think we have to build this massive pile of assets to somehow get the income when you can actually just go straight after the income.

And the income also can, if you're at the point where you're still growing your wealth, where you don't need the income today, if you're working, having that income compounds the wealth-building machine if you're reinvesting the dividends and whatnot. So it's a great way of growing wealth too. It's not just about getting that check and being able to cash it. If you're still working, it's a great way. I mean, it really, it really accelerates the wealth-building machine, essentially.

So let's look at a couple of scenarios for people that you're writing for. Let's look at kind of an outlier, somebody who's smarter than I was at 30 and actually wants to assemble real wealth over his lifetime. What would be a what path you'd set them on?

So I would strongly recommend that they invest in these, what I call perpetual dividend raisers, companies that raise their dividend every year. And you reinvest the dividends automatically. And I don't want to say set it and forget it, because I don't think you can ever just be blind to your investments. You can't do that. But you really don't want to overtrade. And one of the things that that I try to do with a lot of the companies I recommend, a lot of them are a little bit beaten up, and sometimes for very good reason. But these are companies that still generate plenty of cash flow. They are paying and raising their dividend every year. So perhaps their business isn't white hot at the moment. For example, a number of years ago, I recommended Darden. They're the restaurant operator of Olive Garden and a few other restaurants. And Olive Garden was kind of like the butt of a joke at that point. And their traffic was down. And it just wasn't going great. But like I said, they had plenty of cash flow. The business was— it wasn't great, but it wasn't terrible. And they were paying and raising the dividend every year. And I said, if this company ever gets its ship righted, this is going to be a monster. And sure enough, it took a couple of years. And that's one of the things I try to emphasize to the readers of the Oxford Income Letter. We're not looking for huge gains in the next 3 months. If it happens, wonderful. I'm certainly not going to turn my back. You'll take credit for it. Yeah. But that's not the goal. The goal is to buy cheap stocks and get paid those dividends. And if we're reinvesting those dividends, and they stay cheap for a while, then you're just getting more and more shares. So the idea is eventually, at some point in the future, you do have this pile of assets, you have a ton of shares because you've been reinvesting the dividends. And then hopefully, then you can turn off the reinvesting machine, just collect the dividends as your income, and hopefully not touch the principal. And if you do have to touch the principal, then hopefully you're selling a lot less of it than you would if you weren't reinvesting the dividends for all those years. But I mean, I've seen the numbers. And if you can reinvest dividends for 10, 20, 30 years, is you're talking about a real shift in your lifestyle and your comfort level and being able to sleep at night and worrying about retirement. And I've seen the numbers. I've talked to people who've done that. One of my dad's good friends who's well into his 90s, when my book came out, he said, oh, I've been doing this since I was 40. And he said, I never touched my principal. And he doesn't live like a king. He goes out to dinner whenever he wants to. He goes on vacation when he wants to. And he can do it forever. Yeah, because he's never touching his principal. He's just living off the dividends, which have been compounding for— I think in his case, it was about 30 years.

So let's look at another use case that— and somebody who has waited too long. They're 58, they're 62. Who suddenly retirement years are looming, and they may have gotten wiped out in real estate, they're just, they're not where they thought. Is it too late for that person? No, not at all.

So, there's a couple things you have to look at. One is risk. So, if you, I always say, if you can't afford to lose any money, then it should not be in the markets, no matter what your situation. And if and you feel like you have to make up for time or previous losses, if you can't risk it at all, it shouldn't be in the markets. And unfortunately, if you can't take risk, your return is going to be extremely low, especially in today's low interest rate environment. But if you can't risk it, you can't risk it. As I mentioned, investing in these kinds of companies tend to be safer than the broader market. But we do have bear markets from time to time. And if a lot of people panic when markets go down, and sometimes you just have to withdraw the money for whatever reasons, and if the market's down 30%, even if you weren't planning to withdraw, but now you have to, that can be a real problem. So you have to understand the risk and be able to be invested for at least— I say if you need any money within 3 years, it shouldn't be in the market. So at least 5 years, preferably longer. That being said, if you can invest that way, then investing in these perpetual dividend raisers— because even if you are compounding, if you are reinvesting, great. That helps build your wealth a little bit faster than you would normally. But even if you need the income today, like I said earlier, you're still getting more income today than you would last year. And what I shoot for with the investments, generally, I'm looking for about 10% dividend growth every year. Not every stock has that, but that's the goal. So if you can get a 10% raise every year, or even if it's 8%, and inflation is still fairly low, you're increasing your buying power. And that's really the goal of all of this is just increase your buying power after inflation every year. And if you can do that, then you're in better shape than you were yesterday.

So, you know, I like the idea of somebody else doing the research for me, and, you know, like, I like the, you know, the thought that you're in your room on your computer studying and picking these out. But how could somebody— these type dividend stocks you're talking about— how can somebody research and find them on their own?

What's— so there is a a list called the Dividend Aristocrats. Now, these are S&P 500 companies that have raised their dividends every year for at least 25 years. Not all of them have great yields. I mean, some of them might have actually very small yields because the stock has gone up or they just don't pay a very large dividend. But that's a good place to start because there are a few of them that do pay 3%, 4% yields. And again, these are S&P 500 companies. So, if you want to go smaller, you can do a search. There are some other places. There's a website. It's a free website. It's dripinvesting.org, dripinvesting.org. And they have an Excel spreadsheet that they publish every month that lists all the companies that have raised their dividends for 5 years or more. And that's an excellent place to start. And it has a lot of information. Probably more information than most investors need. It's a pretty long Excel spreadsheet. But at the very least, you can see the list of companies. And there's several hundred companies that have been raising the dividend every year for at least 5 years.

And is that kind of the target that you're looking for, is 3% to 4% dividend?

At least more towards 4%. So, the goal of the Oxford Income Letter and in my book, I created a system called the 10-11-12 system. The idea is that if we're collecting the income today, that we want 11% yields within 10 years. If we're reinvesting the dividends, then we're shooting for 12% average annual total returns over 10 years. Doesn't mean you're necessarily going to get it in the first year, but because of the compounding over 10 years, you should get it. So, to do that, it's a combination of a starting yield and the dividend growth, plus the assumption that the market is going to go up by the historical average, which is about 7.5% a year. So, you know, if you're starting at a 3% starting yield, you need that dividend growth to be fairly high. If you're starting at 4%, 4.5%, then the growth can be a little bit lower. So, I tend to look for at least 4%. Yields because there's not a lot of companies that are growing the dividend or that I can expect to grow the dividend, let's say 15% a year over 10 years. There are some, but not a lot. Whereas at 4% starting yield, I can usually find some companies that are going to raise the dividend 8%, 10% on average over 10 years. So, it's a little bit easier.

These companies that you look— are these names that we would recognize Are you looking at Johnson Johnson?

Yes, [Speaker:EVAN_CARMICHAEL] absolutely. I mean, a couple of companies in my portfolio right now are AT&T and IBM. They have huge yields, especially AT&T. That's been beaten up for a while. So, if it's a well-known name like that, chances are it's been beaten up for a little bit. And that's why the yield is high. And that's why I'm willing to take a chance and sit with it for 5, 7, 10 years. But there are plenty of names that most people have probably never heard of. There's a company that I recently recommended called Spartan Nash. They are a grocery wholesaler. And one of their main clients is the US military commissaries. It's a small-cap company, has a nice yield, good dividend growth, also a little bit beaten up. Not every stock I recommend is beaten up, but a lot of them are, especially 10 years into a bull market, it's tough to find companies that have strong yields. If they do have a strong yield, chances are it's because the stock price has not gone as high as a lot of their contemporaries.

Are you doing any options strategies with these to increase income, or is that out of your model?

Not for the Oxford Income Letter. That's a straight stock buying newsletter. We do have some trading services that where we recommend options, but those are more for speculation as opposed to income. But I do like that strategy if you're not planning on holding a stock for 10 years. That's the other thing too. If I'm buying, let's say AT&T, and I expect it to be— and I think it's a great value right now, they're going to grow their dividend and and I want to hold it for 10 years, I don't want to write options on it because I don't want that stock to get called away from me. So that's one of the main reasons I won't do that. If it's a company that I'm not planning on holding for 10 years, that it's just, hey, this is a good stock, I'm fine with owning it for a little while, collect the dividend, and there's a good opportunity to write a covered call on it, and if it gets called away, no problem, then I think it's a great strategy. And then I also do like writing buying puts on companies that I would like to own at a lower price. But for the Option Income Letter, not all of our subscribers are sophisticated enough to especially write naked puts. So, this is really just a stock buying service.

So, how many recommendations will you make? How many companies will you find and recommend during the course of a year?

So, we try to do one per month. Month, because it's a monthly newsletter. So really, that's the goal. Sometimes, there might be more, usually not less. And then throughout the year, I'm also selling some stocks. Again, the goal is to hold these for a long time. But sometimes, the fundamentals change. Sometimes, we'll put a trailing stop on a stock so that if something happens either in the markets or the individual stock, we don't take a huge loss. Every situation is a little bit different. So, we are selling some stocks through the year, but not a lot. I mean, really, the goal is to hold these for as long as possible if we can.

So, yeah, so you're not just looking at what's coming up, you're still managing your own portfolio and what you've recommended in the past and how— Oh, yeah.

And I send out updates every week. Usually, the structure is every Thursday, I send an email highlighting one of the companies in the portfolio. And then there's a couple of their blurbs on some of the other companies. We also have a mailbag. So I get a lot of questions about, hey, what's going on with XYZ? So we're constantly monitoring and communicating with the readers what's happening in the portfolio.

If I want to build a portfolio out of these stocks, over the next couple of years, how many should I want to have in my portfolio? I'm assuming I need more than 1 or 2. Yeah. What's a good portfolio for somebody my age? I'm 60. What to have in?

Yeah, I'd want to see at least 10, possibly more if you can handle it. And now that actually there are most of the brokers are not charging commission, at least the discount brokers, that's not really a problem anymore. It doesn't eat up your returns. So, 10, 15, even 20. And it kind of depends on the type of investor you are. If you're the kind of person who's going to watch every tick of your stocks, then keeping track of 20 stocks might be a little overwhelming. If you're the kind of person who's just going to look at your statement once a month, or look at the newsletter when it comes out, then I think that's a little bit easier. But you do want to have diversification. That's a very common recommendation in investing. You want to be diversified. And for me, it's not just diversified among sectors. So, it's not just that you want some energy, some technology, some telecom, some healthcare. You also want diversification in geography. You want diversification in value versus growth, you want diversification in market cap size, you want some small caps, some large caps, because there's always some part of the market that's outperforming and some part that's underperforming. So you want to always make sure you have some exposure to whatever's working. And so that's why I think you want to have at least 10 stocks, so you have a little piece of everything in there.

Any other advice that you'd give to somebody who is new to this, but but likes the concept?

Yeah, I think a lot of new investors are overwhelmed or concerned that this is really complex, and that you have to be a financial genius to make money in the markets, and you really don't. I mean, you have to know how to read a financial statement if you're going to do the analysis of a company yourself. That to just invest and make money, as I mentioned, markets go up over the long term. We know that. Yes, there are blips. We had the Great Recession. That was painful. But it came back pretty quickly. You made your money back if you stayed in. You made your money back within, you know, in way less than a decade. I think it was about 5 and a half years. So all you have to do is invest for the long term, be confident you're going to make money over the long term because we know markets go up And as I mentioned earlier, again, these dividend companies outperform the broader market. So, it is a fairly safe way of investing. And you just have to keep your eye on the prize of long term and not get worried every time the market shakes and shimmies, because it will. The Great Recession happened. We're going to have run-of-the-mill bear markets. Great Recession was awful. And a lot of people still bearing the scars of that. But we have general bear markets that go down 20%. And then they come back. But people even get freaked out during those periods. So if you can just know that recessions happen, bear markets happen, over the long term, if you're invested in good companies at good values that are raising their dividends, you're going to make money. And you'll probably make a decent amount of money doing it this way. Just don't get scared, because that's the easiest thing to do. And it's natural. It's natural for people to get scared when things turn south. But all you have to do is look at the history and the data. And this is not recent data. This is going back to the early part of the 1900s that we know that these markets go up over the long term.

[Speaker:JOHN DEL VECCHIO] In doing these interviews, I've interviewed a number of editors of newsletters, and that was— some of that was new to me. I didn't realize there's this much information out there, and basically an industry providing information for people to control their own investments. Compare that for me with somebody who's just been advised, you know, put your money in a mutual fund and ignore it and check on it every few years.

Well, it depends on who's told you to put the money in the mutual fund. If it's your broker, your full-service broker, then you need to understand why he's recommending that particular mutual fund. Is he getting a commission on it? Is the brokerage paying a bonus for sales into that mutual fund? You know, there are some brokers, there are plenty of brokers who really do everything they can to do right by their clients, and then there are plenty of brokers that are trying to make as much money as they can for themselves. So you have to question that. If you're talking about, let's say, you know, investing some index funds, that's a perfectly reasonable way to invest, especially if you are going to be kind of a set-it-and-forget-it investor. Put your money in a bunch of Vanguard index funds. They're cheap and they're going to perform in line with the market over the long term. And that's fine. You'll, you'll do well over the long term if you want to do better than in line with the market, if you want to beat the market, then I think you want unbiased advice. You want people who know what they're talking about, who are not incentivized to make any specific recommendations. We do not accept compensation from any companies to recommend their stocks. We're not allowed to own the stocks that we recommend, so it's not like I'm getting into some small cap and hoping I can get $10,000 readers to buy it. So it's very unbiased research. And the only way we make money is if our subscribers are happy and renew their subscriptions. So, you know, I think you always want to question where you're getting your information and what the motivation is for the person making that recommendation.

Delighted that you are doing what you're doing. Not saying you wouldn't have been a great sportscaster, but I know this helps a ton of people. Thank you very much.

Oh, thank you for having me.

I appreciate it. To see the next episode in the Wealth Breakthrough series, check the video right there next to me.

I think you'll love it.

Continue to believe, and I'll see you there. The wealthiest aren't always the happiest, but they're the freest. They have the ability to move wherever they need to go or do whatever they need to do. They have the ability to quit a job if they don't like their boss.

They can go on vacation here versus there.