If You Need $100K For Your Lifestyle, Never Sell THIS Asset

You need to withdraw $100,000 from your portfolio this year. Now, maybe it's for travel, maybe it's to help your kids, maybe that's simply what your lifestyle costs. So then you look at your portfolio, you find an asset that's up, and you sell $100,000 worth, and then you move on. And for most people, that feels completely normal, right? Buy low, sell high. But if you had just sold an asset that you expected to compound for the next 20 years, that $100,000 withdrawal could cost you far more than you realize. So today I want to show you which assets I put completely off limits for normal lifestyle spending, and what should fund your lifestyle instead. You ready? Let's go. First off, let's just start with, you should never sell assets to pay for your lifestyle. Let's just start with that. In the game of money, the goal is to grow our asset base, grow our balance sheet. And so we want to earn money to buy assets. We never want to sell assets for money. It's the wrong way to go. So if you have assets and you need money, you kind of have 2 options. You have option one, which would be, how do I take some of the assets that I have and turn them into productive assets that can produce income? So that could be obviously dividend stocks. It could be, you know, Treasury bills. It could be more exotic, newer type assets like stretch or SEDA, for example. And so I can take those assets and turn them into assets that can provide me cash flow without spending down the capital base of those assets. That's number one. And that's a great way to do it. That's what most people do. The problem with that for some people is that they don't have enough assets for that to produce enough income for them. Typically, you're going to go into dividend-paying stocks or Treasury bills, things like that. It's going to be 3%, 4%, or 5%. And if you need more assets, then you don't want to put your money into that. You want to put your assets into— your assets that you have, your capital that you have, into assets that will compound faster. So if I'm holding assets that I want to compound faster, then How do I get liquidity against those? Well, you have 2 options. Either one, like I said, you could sell that high-compounding asset to put into an asset that produces cash flow, or another strategy altogether that you've probably never heard before. And it's something I call renting liquidity, or as I call harvesting appreciation from the asset using credit. So how do we harvest appreciation with credit? Well, if I have an asset that's compounding rapidly, so let's say, for example, again, Treasuries, The goal of a Treasury is to provide the cash flow, but it doesn't really go up much. Same with like if I bought something like Stretch or SEDA, it gives me a higher yield, but still it's not designed to go up. There's no capital appreciation of the asset. If I buy something like rental real estate, for example, that will provide me— hopefully it provides me some, some cash flow and there might be some capital appreciation of the property. But typically the median US rental real estate or the median real estate is about 5% a year. So it's a low compounding growth asset. But it provides cash flow. But I could buy something like Bitcoin, which is rolling right now. The current 4-year rolling average is about 30% return. So I could go into something doing a 30% return versus a 5% return, which is better if I'm trying to grow my capital stack. But the problem is Bitcoin doesn't have any cash flow. So now I'm forced to sell it to actually get the cash flow liquidity I need. But if we want to harvest some of that appreciation, the growth of that, we can do that without selling the asset. And I can do that by issuing credit instead. All right. Now, real quick, there's a link down in the description down I'll put a QR code on the screen right here. Hopefully you can see that. And if you want to see how these types of strategies apply to your own specific situation, if you'd like my team to like walk through your numbers like I just showed here and help you build a personalized wealth operating system, just go ahead and scan that QR code on the screen right here or the link in the description, put in your application, then come right back because I've still got more important parts of this video to get through. Now before I get into what that means, I want to explain why we would even do this. And it should be pretty obvious to you. If I have an asset that's going up at 30% a year, I want to allow that to continue going up as long as it possibly can. If I sell that asset today to get the money that it's made me, so for example, I bought it for $1 million, it went to $2 million, and I sold it, and I got $1 million of profit. Amazing. I can go now pay off my house and I can pay off my debt. But what I've done now is 2 things. I've now lost the ability for that asset to compound into the future. I've also had to pay a big chunk of that profit. To taxes. There's a third thing, and we're going to call this optionality. We're going to come back to that. But the first one, the real cost of selling— again, there's 3 costs, but the real cost is the future growth. So at a 30% CAGR, compound annual growth rate, that means the asset is doubling about every 2.5 years. So that means it goes from $1 million to $2, $2 to $4, $4 to $8, $8 to $16, $16 to $32, $32 to $64, $64 to $128 million in only about 2.5 years. So that means that in about 20 years, If I sell today for $1 million, in about 20 years, I'm giving up $30, $40, $50 million. So while it looks like on paper, congratulations, you made $1 million and you paid off all your debt, if you could have just waited 20 years, you could have made $20, $30, $40, $50, $60 million. That's the future cost that I'm giving up. But it gets even worse than that. Because not only am I giving up the ability or the future value that it could be worth, I'm also paying a big chunk to taxes. So I'm not even getting my full value back. But on third, I'm giving up the optionality and the ability to continue to grow my wealth in the future because Bitcoin is not only— or whatever asset that you choose to put in the blank here, it could be Nvidia stock, it could be, you know, your favorite AI play, it could be Google, whatever it is. But what I'm doing is not only am I giving up the future growth of that asset, I'm also giving up the ability to use that asset in my portfolio like a tool in my toolbox. So I want assets that provide lots of different things. And some of those things I want is liquidity. I want assets to become collateral that can fund more tax depreciation for me to get my tax bill down or buy additional assets for me to get compounding. And so if I sell that asset today, I no longer have assets or collateral. And in a debt-based monetary system, we get credit based on the assets and collateral that we have. And so if I have this asset that's not only compounding, but now I can use it for liquidity in my system, for collateral to buy more assets, I've given that up as well. So if I did need the money, the first thing I'm going to try to do is figure out where can I get the money from my assets without selling them? So where can I get liquidity against those? Now, assuming that I just need to sell something, which one should I sell? Well, then how do you rank that? Well, there's a plan that Dave Ramsey teaches called like a debt snowball, which is how you should pay off your debt. And I would think about that with my assets, but in opposite order. So what assets do I own? And which ones can I afford to sell? And typically that would be just like paying off debt. I'd pay the one, the debt off with the highest yield. If I'm selling assets, I'd probably want to sell my assets with my lowest yield. So which assets do I own and which ones are the fastest horses? Now, in the investing world, there's an old adage that says, cut your losers short and let your winners run long. And I would say to let your winners run long, but if you are forced to sell some of off, sell the slowest winners, the ones that are running the slowest rate. And that way my stack can continue growing and compounding for a period of time. And I'd sell the ones that are going up the slowest. So the real question is that if I need the $100,000, how can I just get it from the assets that I have? If I need $100,000 to fund my life and I have assets, how do I get it? Now, traditional financial planning would tell you that you could typically sell about 4% of your assets per year without really running that down. But I might look at it a little bit differently because if I'm buying assets that have a higher compound annual growth rate and I'm engineering them into a vertical stack to increase my entire portfolio's return, then that means I could get a bigger piece of that back. So for example, most people, again, financial advice would say about 4% of your portfolio, but in an engineered portfolio where I'm using credit to provide the liquidity that I need to pay for my lifestyle, I might be able to get closer to 10% of my portfolio value, maybe up to 15% of my portfolio value. And this changes the number altogether. So now I would need much less capital, much less asset base to provide the funding than I normally ever would with a traditional financial plan. And so the key is, is what assets do I have? How fast are they growing up? What is the rate of credit or the cost of the credit that I can issue against them? And when you run those numbers, you'll see that your calculation for your lifestyle spending looks completely different. Now protecting your compounding assets is one part of the system, but the bigger question is whether all your assets— liquidity, taxes, debt, and income— are actually working together. Now, in the next video, I want to show you why having more assets is not necessarily making you wealthy, and I want to break down the 3 engines behind the wealth operating system. And that video is on the screen right now. I'll see you over there.