Financial Advisor Reacts To Finance Tiktoks

Hey there, real quick, before we jump into the episode, listen, if your earnings treadmill hasn't set you free yet, running faster won't either. Listen, hustle without principles just going to burn you out. So here's what I want for you. I want you to join me for my money machine experience live. It is three free trainings. Deep dive into how to escape the treadmill and build a money machine that actually works for you. All right, grab your spot here by going to moneymachinelive.com and I'll see you in the free training. Well, if you've been on social media, TikTok or anything at all, you have probably seen some of these TikToks, some of these financial gurus that are out there giving you advice in their TikToks, their Instagram and all that stuff. Now, I know, I do it, too. However, you need to look at the advice they're giving you, the perspective they have and the bias they have. All right, so is it good information, bad information, ugly information? Well, if you're unsure, you're in the right place, because in this episode, I'm going to break it down for you. We're going to look at a handful. I'm going to give you my perspective.

All right, this one's going to be fun because it's a little different episode and the team asked me to do this and everything. So we're going to jump back and forth to looking at a couple of TikToks, reels and just advice out there on the interwebs around finance, around investing, around wealth. And I'm going to give you my perspective, my take from decades of a journey, building millions for myself, my clients, and even working to create financial freedom in their lives. All right, so let's start with the first one. I'm going to jump to it, and we'll just start with the first one here.

One, learn the language of money. You walk into a room and everybody is speaking a totally different language. You're going to be, okay, listen, room is not for me.

Let me get on out of here.

In order for you to have a chance of mastering your money, you first got to learn the language. Two, create a budget. Most people in life don't necessarily create a game plan for their lives, and then finally, you gotta pay down debt. There's a lot of us who are skipping to investing.

All right, I love this. I love this one. He's an NFL player. Clearly he makes good money. Many of them do. Some of them don't keep it, though. But this guy's got it going on, and he. He is truly. I think he hits some. Some big points. You need to understand the language of money. But just like any other language, it's. It's a learnable skill. It's a learnable language. We're just not born understanding it. And so many times I think that the thing that becomes the obstacle for people is the fact that they don't know how to have the conversation. And so if they don't know how to have the conversation, they can't educate and skill up to be in control. One of the reasons I wrote my book building your money machine is really to simplify it, to give you the pathway to. To make it happen in a way that. That you can take control. You don't have to be reliant on it. It doesn't have to be complicated. It doesn't have to be complex. And so. So I think that he really hits this. Hits this really right on. Okay. I. I am with him 100% on this one. All right, let's see that. Let's see the next one.

You need to completely rethink your personal financial strategies in your 20s.

I know so many people who are, like, trying to hop careers to gain salary.

They're going to get an MBA to boost their salary. You know, you should not be doing this. You should be focusing all of your assets and time and money to get on as many game shows as possible to win money. We all watch Deal or no Deal, Family Feud, Survivor, growing up.

None of us actually go and do it.

I called my friend yesterday. Very successful.

Hold on a second.

This guy's strategy is to get on game shows? Are you out of your mind? Oh, my God. All right, all right, right. This has to be a joke. Okay, listen. If we're trying to create wealth, our job to create wealth is to create sustainable wealth. Something that has the opportunity that we can replicate it over and over and over again. Not getting on some game show or some gambling or some game of chance that maybe you win a big prize. It makes no sense. It makes no sense because the odds are against you. Trust me. Here's the thing. Just like the casinos, they don't build these big, lavish towers. They don't build these big, lavish towers if they were losing money. Everything is on the house side. And so rather than that, I want to make sure that you're making sound good investments that will last a lifetime. All right, all right, we're gonna. We're gonna go. Go to the next one.

This is how Much debt I have.

At 25 years old. Okay, so let's go over the biggest.

And scariest one first.

I owe the IRS $34,000.

What? Hold on a second. Let me just stop. I. I gotta stop right there. All right. She owes the IRS 34,000. Okay, listen, the IRS. The IRS has collection tactics and powers beyond any bank, beyond any other credit collector. This is not something you want to deal with. Once they get their hooks in you, it's tough. And so clearly something happened here. She's probably making money as a 1099 contractor, meaning that she is not paying taxes in through withholdings. She's supposed to be paying them through quarterly payments, and she's not. And then she gets slapped with a huge tax bill at the end of the year because she has no taxes put aside and she's spending every other dime. And now she has a problem. The IRS is the worst bank in the world. Let's see what else. Yeah.

Okay, next we have my car loan, which I owe $23,295 on that.

And then I have six credit cards.

And across all of them, I owe $7,465.

So that brings me to a total of about $65,000.

Which, at 25 years old, big number.

But it's 25 years old.

Look this. And I feel bad for her now. Is it insurmountable? No. She needs to be on a plan. She needs to be on a plan. But the first thing is she's aware of it, otherwise she wouldn't have done this video. She needs to be completely aware of what is going on in and out of her money. But more importantly, and I think this is the thing that we tend to not think about, is she needs to be really aware of the emotions around it. So one of the things that we do when I have people journal and track their spending is I want them to track what they spent and what they spent it on. But I also want them to track why they spent it, but more importantly, the feelings around why they spent it. Because if we start to see that stress is a spending trigger, or anger is a spending trigger, or some other emotion is a spending trigger, we then have the vehicle in which we can adjust that trigger and reduce the spending. Because there are things going on in her space, in her life to get her to spend that much, to not be financially responsible, to owe 30,000 plus to the IRS, a $25,000 car loan on a depreciating asset. I don't know what her income is. So I can't tell. But the fact is that if she had enough income, she wouldn't have all this debt. So I feel bad for her. But she needs to be on a plan, and the plan needs to be in place before you think about spending. Every dollar that comes into your life needs to have a job description before you earn it. Otherwise, you are susceptible to the marketing out there, the media out there, emotional decisions around money, and none of that ever works out well. All right, let's go to the next one. Instead of you scrolling on your phone like an idiot, let's make some money with our phone. I'm 19 with half a high school degree. Does 10k a day interest you? Cool. I've done it twice this week. So how can I set you up so you don't fail? Phone check. Everything starts on Weeble. The app is code. Make some trade rules to protect your money. Ever heard of trading View my Boy Scout it charting is the most important part. I've made over six figures off this website. By far the most important part. I could be like, get on YouTube, go study. Do this and this and this. Y' all know I keep it a bug. You kind of have to be in the discord from the live trading to the. All right.

There'S so much to say here, but first things first. He's talking about trading, and trading is a job. It's not investing. It's not what we're talking about here. If you truly want to build build sustainable wealth, then you need to use an investing process that is proven over time. Trading is a challenge. I do trading so I understand what he's doing, but I don't do trading to build my wealth. I do trading here and there to build cash flow and do certain things. So I trade options. I do all those things. So I'm not speaking from someone that doesn't do it, but I do it in a very particular way that doesn't expose me to risk. Maybe he made $10,000 twice two days in a week. But can he do it every day? Can he do it long term? When you look at the stock market, it goes up 8 out of 10, 10 years. When you look at the stock market, when you invest for 10 years or more, you got a 90% probability of it being up. You have an average rate of return on the stock market S&P 500 between 8 and 11%. Okay? That's what we want to work with. That's how we want to build it. Okay? Trading, we might win, but a lot of people Lose. Especially because one of the things that happens with trading is your emotions get involved, your adrenaline gets in, you get your dopamine hits, you start to chase profits. If you make some bad decisions, it becomes the gambler's mentality if you're not careful. My guess is, honestly, I think this guy's selling a training course and, or he's getting affiliate commissions off of trading View, which I use and, or Weeble, but I wouldn't be trading. No, not until you have critical mass import in your portfolio in a way that you can sustain a loss. And then if you do it, you do it with a very small sliver. I do it with a very small sliver of my wealth I use for trading. All right, let's go to the next one. Let's see, let's see what else we got here.

Let's say you have $100,000. I said, hey, it's good that you leverage the amount. So you're going to put 25,000 down on each house and you're buy four houses. And it's great because you're going to have multiple properties and you're going to have appreciation in multiple properties and you're going to have a nice return because of the leverage. But what sucks, and it sucks, what happens after you spent $100,000? You're done, you're done investing. See you later. Thank you for investing. Well, there is another strategy. It's called acronym is Burr. Buy, renovate, refinance, repeat. What you're doing is you buy the house cash, you renovate the house cash, and then you go to the bank and you say, hey, because you created value, I created value. Go to the bank and say, hey, this house is worth $125,000. Give me a 75% loan. Now they will give you 100% financing. And now you get your hundred percent of that money back. And now that a hundred thousand dollars until infinity keep you investing and buying new properties. So super powerful strategy must be implemented.

All right, he's not, he's not entirely wrong here. It is a strategy that can be used and it is a strategy that is used over and over again where you're borrowing out the equity from a property and using it to buy another property. You're parlaying it, you're, you're compounding it. Here's the challenge with that is that if you're not careful and you over leverage and there is a slowdown or you can't get it rented, then you have a lot of debt service and the assets are illiquid. This is exactly what threw a lot of people into bankruptcy and losing their properties in 2008 is that they played that game. Borrowing the equity out. Borrowing the equity out, Barring the equity out. And so really the assets that they had were all, were all in debt. And so in order to pay that debt off, they had to sell the properties. If they couldn't sell the properties, the properties went into foreclosure. It's also the same exact thing that, that actually put Dave Ramsey into bankruptcy. He talks about it. Okay, so it is definitely a, a strategy. It isn't as simple as he makes it sound. And there's some limitations to borrowing and that kind of thing. And it does have some risks if you continually are kicking the can down the road. Good one though. All right, let's look at this one. Did you know that with one small investment of just $20, you could literally create a full time income for you and your family? I'm not saying you can just join up and start making money. There's work to do. But we've made it as easy as possible. We've taken all the techy stuff away from you so that you don't have to do that part. We even give you the content so that you don't even have to come up with that. We've made it as easy as possible so that you can succeed. Because if you don't succeed, we don't succeed. We've put the onus on ourselves. All right, so this is clearly some sort of business opportunity. Could be a franchise. It's not a doubt. It for $20, it's most likely at network marketing, direct seller, MLM type of thing. I don't know it from anything, but if you look at the data on network marketing and MLMs, majority of people do not make money on it.

These are for those that don't are unaware of it. These are the kinds of business opportunities where you're selling products, but you're also selling people into selling products. So you're bringing in other sellers underneath you. And there's a cost to doing that for them to do that, to keep inventory and all that stuff. And some people make a lot of money doing it, others end up spending a ton of money. So this is a biz opportunity. I can tell it's not an investment, it's something that you're looking for, an income stream. Maybe it's a side hustle without going deeper into it. I can't tell. I'm not a fan of it. Just on the way it's perceived. It's just saying, hey, for $20, you can have a full time. Tell me what it is, Be transparent, tell me everything about it. And because he has not yet told you, told you we've taken care of the tech, we've taken care of everything, but he hasn't told you what it is. Be upfront about it. All right, let's look at the next one. Oh, this one, this one ought to be interesting.

If you're a u. S. Citizen with a 700 plus credit score, listen to me right now, because you're missing out on one of the biggest opportunities of your life. You could be living in a beautiful.

And what is that opportunity from a shirtless dude in a pool, beautiful villa.

On a gorgeous island like Bali, Indonesia, like I do, or wherever you want, much quicker than you realize. Now, there's a common theme amongst most people that I notice in terms of investing. A lot of people want to invest, but they either don't know where to begin or they don't have enough money to do so. I also noticed most people save up money, save up hard earned income and use all cash to invest. The reason you don't want to do that is because what are you going to do when all your cash is gone at that point? Instead, you need to take advantage of the biggest life hack of the century. It's called business credit. The difference between business credit and personal credit is that business credit does not show up on your credit report like personal credit would. So if you make a charge on a personal credit card and you have utilization and enough balance on your personal credit card, that will then drop your score if you do not pay it off in time. On the other hand, with business lines of credit, you can rack them up with investments. Take as much time as you need to get your roi, your return on investment, pay them off and your score will have never dropped. Business credit will never get reported to your personal file. Also, you can get approved for business lines of credit with 0% interest for an entire year. So during that first year of your investment, while you're waiting for it to make your money back, you won't accrue a single penny of interest. Stop investing.

All right, okay, so I'll give this guy a little bit of, a little bit of credit, which no pun intended. But the fact is, is that he's, he's right about the, the business credit and the utilization and those kinds of things. He's even right about the possibility of doing business credit. But it's still debt, no matter what debt it is. Debt has two personality traits. One is it costs. Now maybe you do get a 0% for a year. Okay, that's a teaser rate that, that, that interest rates coming to you sooner or later. But all debt costs and then all debt stresses the stress of having to pay the debt down, stresses your psyche and stresses your finances. No matter whether it's business debt or personal debt. I get where he's coming from on it. He doesn't tell you what to use the debt for. Here's the challenge. If you get a business loan, business debt, it is for a business purpose. If you use it for another purpose, there's a potential they call the loan. If you use it for other investments and they know it, they're probably not giving you the loan. Okay, you've got to be careful with doing these things. And if you do it and you say, well, I've got zero percent interest for a year, what happens if the investment doesn't cash flow in time for you to pay it back or to make the payments? And now what happens? All right, I would caution you to use debt as the vehicle, as the primary vehicle to get into investments. Not until you have the level of critical mass into your wealth that can carry you if something doesn't go your way. All right, let's look at the next one.

Rich people buy one thing that the poor never even think about. And that's why they stay rich. Rich people buy time. They pay for services, they buy tools, they build teams that allow them to get more hours out of every day. Poor people buy stuff, gadgets, clothes, things they don't really need. Ambitious people buy education. These are books and mentors and courses and things to help them level up. And lazy people, well, they buy distractions. These are video games, Netflix, endless scrolling. So the real question is, what are you buying?

Oh my gosh, I love everything about this. Listen, this is what, what I've always been saying. We should be measuring our wealth in time, not dollars. The reason we need the money is not to have a big bank account. The reason we need the money is because then we can have choice in life to decide and have agency on our time to do the things that to do with our time the way we want to do it. He's totally right. But the marketing messages we get barraged with the keeping up with the Joneses, the things like that get us to buy stuff. Distractions, if you will. This is why it's so important to have a detailed plan. One of the reasons we do the Money Machine master plans is to give you a very detailed plan. Now some people will say, oh, you mean a budget? I said, no, I mean a plan. A plan that gives you permission to spend on the things that move the needle in your life the way you want to move it. And not an emotional spending, not because you saw something on the Internet and you swipe right and buy it. Okay. It is really about having a plan to make the vision for your life become a reality. And then when you use that as the means to craft the path, now you got something going on. And that's what the wealthy do. And that's really what he's talking about, is that we're not allowing the distractions to take us off that path to the dream life that we're trying to create. This is a great one. All right, let's look at the next one.

Say this affirmation in the morning to attract in more money throughout your day. The morning is a perfect time to prime your subconscious mind to seek out certain things. We are essentially giving the subconscious mind direction and an open mindedness to search for certain things and patterns. A great way for us to do that is through spoken word. I want you to take a deep breath, put your hand on your heart space. Repeat after me. I set the intention to be open to any and all opportunities that may lead to more financial wealth and abundance.

Please open my eyes and.

Okay, okay, now I might rub some feathers wrong here, but listen, you can contemplate all day long. I love affirmations. I love positive thinking, positive psychology, I love all of that stuff. But there's three ingredients to building your wealth. One is mindset. This can help.

Two is, is money and three is movement. You got to do something if all you do is, is this affirmation every single morning and the abundance and the hand over the heart and everything. I got news for you. You might feel like it's good, but it's not going to change. Change the needle for you. It's not going to change your life without adding action to it. Again, it takes me back to the fact that, that I need the plan and the path to take action on to get the results that I need to get. Simply thinking about this, simply speaking it out aloud, that doesn't make it a reality, but your actions do. All right, let's go to the next one.

I became a Millionaire at 28 and Best Financial advice I got was from my dad actually after I became a millionaire. So the first thing that I purchased was a Ferrari. This Red Ferrari that I bought at the age of 28 years old. We went to dinner, me, my mom, my dad and my brother, I believe they came to visit. My dad literally said, okay, well, what's next? What are you going to do next? And he said, listen, if you can't afford to buy it twice, you can't afford it once. That kind of stuck with me. And he was absolutely correct. Could I afford to spend quarter million dollars on a car twice that I have $500,000 sit in account? The answer was no. So I couldn't afford to buy that car. That financial advice stuck with me. And that's kind of how I live my life today.

Oh, this is so good. So good. If you can't afford to buy it twice, you can't afford to buy it once. I love that. Here's the thing. This is the challenge with. I see it a lot with, with athletes, with.

Actors, those kinds of folks that come into money really fast and then they spend it really fast thinking that there is no end to it. But there is and there can be and there will be. What happens if you get injured? What happens if you fall out of favor as far as.

If you're an actor or whatever? The thing is that if we start to make decisions based upon, can we make this same decision over and over again? Can we buy it twice? Then maybe it makes more sense. I love this. I love. That was a really cool way to put it. Let's see what this next one is.

My name is sora Lee. I'm 34 years old. I make about $400,000 a year. I live in San Mateo, California.

I know I've had a pretty unhealthy relationship with.

San Mateo is an expensive area to live money.

Growing up, looking back, my father constantly talked about money and I was pretty obsessed with money. I don't think I'm completely free of it now. It's something I think about constantly. I've been making conscious efforts to have healthier relationship with money.

In March, I bought a necklace to celebrate hitting the 100,000 followers milestone on Instagram. My rent is 49.50 and I split it with my partner. And my son is in pre kindergarten right now. And I pay all of it. Right now my car payment is $1,000. So that is one financial mistake I've done. During divorce, I bought a brand new Tesla Model 3 Performance. It was about $70,000 and I'm still paying off it. A thousand a month is a big deal. And if I had put that into Something else, I would have been making more money, and I regret buying that full price, brand new.

All right, I. You know what? I can, I can feel for her. First, she's making really good money, but she lives in a very expensive area. She's spending a fair amount of money. But here's the thing. She said it right up front. You have a relationship with your money. We all do. I. When I first started coaching, mentoring, and helping people, I thought I was going to. I'm an accountant, okay? I thought I was gonna give you the columns and rows and the math behind wealth, but I realized really quickly that if we don't deal with the things in our head, the stories, the mindset stuff, and what's going on in our heart, we can't deal with what's going on in the pocketbook. And she's deep into it, and you can tell and I feel for her, but she's actively making sure that she's being deliberate and intentional and aware with what she's doing with her money. The awareness to say, I probably shouldn't have bought that car is huge. It's a depreciative, depreciating asset. $1,000 a month car payment is probably too much. You know, we look at cars and I don't want you to. I don't want you to finance a car for more than three, three and a half years max. But you're always going to want to make sure that, that the amount that you're making in payments on the car never exceeds what you're putting into investments. The car is a consumable.

Investments are building your money machine to give you the flexibility down the road, choice in your life. All right? Because what's what, what that money machine is going to do is going to separate your. Your earnings from your efforts to earn it. That's where you get freedom. All right, I think we have one more. Let's give one more time and let's see what this is.

If you want to build wealth, you actually have to confront what you don't know about money. You have to understand where to put your money once you make it. How does it grow without you actually being the one that's putting your energy and effort into making it grow? There are so many different ways for you to do that. And most people never get rich because they never bother to actually learn how it works. If you actually want to learn about money, start turning on the news and you listen to people talk about money at first, you are going to have no idea what they are Saying every time they say a word that you don't understand, like comment, compounding interest, or the inflation rate, you look it up. And so you start to learn the language of money because you're making it a habit to actually fill in your knowledge gaps as soon as you notice them. Continue to learn about money and read.

Okay, I love this, and I love that this is the one that we'll finish up on, on the, on this series. But here's the thing. We weren't born understanding money, and, but we were born into a society where they said, don't talk about money. It's taboo, but it's one of the biggest stressors in our life. And so we have this big stressor that we're told not to talk about. How do we solve it? Well, we solve it by talking about it. We solve it by educating ourselves. We solve it by being proactive with it. Building wealth and money is a learnable skill. There was a time in your life where you couldn't tie your shoes. I bet you do okay with tying your shoes now. So if you're in a time in your life, maybe you don't understand wealth or you don't understand money, that's okay. In a year, you can be totally different. In six months, in 90 days, you can be totally different. You just got to take an active role. And so here's what I would say with some of this, is that I want you to think about your journey.

With money, with wealth and everything. They call it personal finance because it's personal. It's your personal journey. It's not my journey. It's not my brother's journey, my neighbor's journey, or Warren Buffett's journey. It's your journey. And ask yourself, what kind of journey do you want for your life monetarily? Wealth wise, freedom wise. Okay? And I get it. You might sit back and say, hey, my age, my stage, my circumstances are different. They, they may be, but I, I came from nothing. I'm, I'm the son of a. I'm an immigrant. My father was an immigrant that came here at 17 years old with nothing to get an education, became an engineer. And so I get that you might feel like you're in a hole if that's the case, but that doesn't mean that we can't get out of the hole. Just because it doesn't feel easy doesn't make it impossible. We need a process. We need a plan. We need a system. And then you have to add the diligent, disciplined action and over Time. You'll get there. All right. This was a fun episode to do. I hope that you found. Found it valuable and fun to. To go through. I think that there's some. Some good stuff out there. There's a whole lot of bad stuff out there. And so I invite you to. To subscribe. Stay with me on this channel. Remember, I've got. I'm not selling you investments. I'm not selling insurance. I want to sell you on your dreams. My job here is to be in a season of service, okay? And as you look at the other folks that you might be seeing on TikTok, just ask yourself, what's their bias? Ask yourself what's their background? Not did they do it once, but have they done it consistently over decades? Have they done it for hundreds and hundreds of clients? Because that's the proof you're looking for. It has to be replicatable and it has to be something that's been proven and ran for years on end to be able to do that. So I hope that helps. I hope you found it value. And then know this. I think that financial freedom is your birthright. And it's about us figuring out how to go claim it. And my job, my crusade, is to light that path to financial freedom for a million families. And I want one of them to be you. All right? So until I see you on the road to your financial freedom, always, always strive to live a life that I will live here. I'll see you in the next one. Thank you for listening to the Affluent Entrepreneur show with me, your host, Mel Abraham. If you want to achieve financial liberation to create an affluent lifestyle, join me in the Affluent Entrepreneur Facebook group now by going to melabraham.com group and I'll see you there.

And that's it for this episode of Building youg Money Machine, where we help you learn how to master your money, eliminate financial stress, and live a life of choice. If you found this valuable or helpful to you, here's what I'd love for you to do. If you do me a favor, go to Apple, Apple Podcasts, or wherever you're listening to this podcast and rate and review the show. It helps us tremendously to keep us at the top of the list so we can continue to get this information and this message out to people. Because I truly believe that financial freedom is your birthright, and I want to help each and every one of you claim it. Thanks so much.