918 Become the Chess Player

This is five minute Friday. Tony Robbins if you don't know who he is, for the past three decades he has served as an advisor to leaders around the world, a recognized authority on the psychology of leadership negotiations, organizational turnaround and peak performance. He he has been honored consistently for his strategic intellect and humanitarian endeavors. The Kia Sportage Turbo Hybrid has a bold design, a spacious interior with 232 horsepower and a 12.3-inch panoramic display to keep the adventure going and fit with the way you live. And with SiriusXM, every drive comes alive, bringing you closer to the music, the sports, the talk and podcasts that you love right in your vehicle or on the Sirius XM app. Every SiriusXM equipped Kia Sportage Turbo Hybrid includes a three month trial, so the experience begins the moment you drive. Learn more@kia.com Sportage Hybrid Kia Movement that inspires this message is brought to you by Apple Card Apple Card members can earn unlimited daily cash back on everyday purchases wherever they shop. This means you could be earning daily daily cash on just about anything, like a slice of pizza from your local pizza place or a latte from the corner coffee shop. Apply for Apple Card in the Wallet app to see your credit limit offer in minutes subject to credit approval. Apple Card issued by Goldman Sachs Bank USA, Salt Lake City branch terms and more@applecard.com the School of Greatness is sponsored by Capital One. Nowadays, most people subscribe to everything music, tv, even dog food. And it rocks. Until you have to manage it all, which is where Capital One costs comes in. Capital One credit card holders can easily track, block or cancel reoccurring charges right from the Capital One mobile app at no additional cost. With one sign in, you can manage all your subscriptions all in one place. Learn more@Capital1.com Subscriptions Terms and Conditions apply.

Well, the first thing you want to teach anybody, a child, a kid, anybody is that you'll never earn your way to freedom. You just don't. You look around and you see, you know Curt Schilling, if you remember, from Boston Red Sox, made $100 million a year. He's broke, bankrupt. As Warren Buffett I said, what made you the wealthiest man in the world? And he smiled. And he said three things. He said, living in America, great opportunities, having good genes. I lived a long time. And he said, the last thing is compounded interest. And we all know about compound interest. But I give the example a book of this guy, Theodore Johnson, worked for UPS, never made more than 14,000 in income in his entire life. In a Year and in old age, he's worth $70 million. And how did he do it? All he did was he took a percentage of his income. His percentage was 20%. Now, his family said, we can't save any money, but he met a friend who said, if you pretend there's a tax and the tax just took the money away from you and you never see it, the money just comes out of your account and goes into an investment account, you'll be financially free. So he was disciplined. He didn't look at it. It happened $70 million by compounding. So people's mistake is, and kids don't know this, adults don't know this, that you won't earn your way there, but you can compound your way there. What I wanted to do is say, where do you put that money?

That's a trick, right?

It's like secret. Well, the first trick is actually doing. Almost nobody does, right. The second trick is you really have to understand where you're gonna get hurt, because the fees. The fees are just destroy people.

You have a whole chapter about the fees. I was like, this is incredible.

Isn't it wild?

It's nuts. I mean, there's so much money just on the fees.

Well, just so people have an understanding, 96% of all mutual funds never match the market. They never beat the market. So I was just on a morning show this morning, and Michael Bloomberg's one of his guys in the house, some of his money. So why I'm, you know, this is the only industry I know of where people think they could be a doctor. They think they could be a financial planner. And I said to him, I said, well, look, the statistics. Warren Buffett taught me this. He said, ray Dalio told me this. David Swenson, who took Yale from 1 billion to 24 billion in two decades. These are people telling me this. Nobody beats the market except a couple unicorns that nobody has access to. And I said, I didn't say, you're not one of them. But I said, here's the truth. 96% of mutual funds don't match the market. That means 4% succeed. Now, what are your chances of picking the right mutual fund? People don't know what they're doing. They put their Money in a 401k, they pick a mutual fund not knowing what it is. If you play blackjack and you and I play, and you get two face cards and your inner idiot says, hit me. I want to give one chance in a million. When I get ace, you have an 8% chance of winning. If you try to get a mutual fund, you got the 4% chance of winning. So what I show people is not only do you not get the result, thinking logically, if I hire someone else to do it, they'll do better than me. But in addition, you pay around 2000% more than it's worth, meaning you get the same exact product, the same stocks. If you own the index, right, you own a piece of all of America's best companies. Say the Vanguard 500 index, 500 top companies, that costs 0.17%, like less than 2, 10 of a percent, versus the average mutual fund is 3.17. But first, just hear that. So you're just like the average car sold in America is a Honda Civic. It's $20,000. You can get the Honda Civic for 20,000, or you can pay 350,000. That's the difference between 0.17 and 317. But if you look at it over a period of like, how old are you?

31.

31. Okay, so let's assume you and a Buddy is at 35, managed to put aside 100 grand, and you manage not to add any more money, but to grow it at 7% in spite of ups and downs in the market. And you're 65. How much money do you have? Well, if you paid 1% in fees over those 30 years, your 100 grand became 574,000 bucks. Not bad for never adding another dime. If you had 3% in fees, had the same growth, but 3% in fees, you now have 324,000, almost half as much. Quarter million dollars, 77% less money, and you had the same return. It was just the fees. So the world, most people, you ask them, what are your fees? They have no clue, right? So I've created a site where people can go, they can type it in, you find exactly what your fees are and what you should be paying, and it's just, it's highway robbing. Where in the world would you pay 2000% more for the same exact product? You can only do it because the financial industry makes things so opaque, so convoluted, and people feel overwhelmed and hard to understand.

Very hard to understand.

That's why I try to come in here and go, look, time to become the chess player, not the chess piece. Let me teach you so you understand what's going on. It's not that complex. They use all these big words. But when you know what's going on, you don't get screwed. And more importantly, you take advantage of the system instead of letting the system take advantage of you.

Hey guys, if you enjoyed this inspirational clip from a past episode of the show, then you'll love the free book giving away right now. It's called the Millionaire Morning. It includes some of my best tips for starting off your day with a Millionaire mindset. Get your free copy atthe millionaire morning.com and just pay shipping.

Again.

Check it out right now. The millionaire morning.com.

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