Episode 171: Drive Profitability in Your Personal Wealth with Priya Malani

I know you, you like a lot of food. We've yet to go to a restaurant, so Kelsey and I, once a month and I suggest this with any team, we go out to lunch and just do a recap of what's going on now, you know, we get that going too with Ron. We do it maybe once every three months. We got to do more frequently. But you eat anything?

Yeah. Besides weird meat. I don't really.

Yeah, I wouldn't.

I'm much pickier eater.

I'm going to India in about two months.

Yeah, you probably shouldn't eat meat.

That's what I said. It's a vegetarian country. Do not eat the meat. That's only for the foreigners. It's not prepared, you know, sanitarily, necessarily.

Yeah.

Be careful because it's so flavorful. You don't need it.

It is. Yeah, exactly. They know how to make vegetarian food.

Yeah.

You know who else knows how to make vegetarian food? Who? Wright Networks.

Oh, man.

The Vegetarian Galore company. Now really, they actually don't do that. They do something else. I have your attention now, right? They put your business in the cloud. That's right. Right Networks help you securely transition your accounting based desktop applications into the cloud, regardless of which version you're using. You know, if you're using QuickBooks Desktop, it is an awesome application. The only problem is the second you go home or on the road, you're screwed. Until now. Right Networks gets it on the web for you. Anything as a partner you can trust. Right Networks takes away the burden of it so you can have more time to focus on your business from anywhere. Literally work from anywhere at any time. And the Right Networks support team is there for you around the clock. What do you do to get them signed up or get your system on the web today? You call them at 1-888-469-5905. Listen, if you're still on QuickBooks Desktop, they're like, they probably don't even know how to go to a website. Let's just give them a simple number to call. Call 888-469-5905. Say Mike, Christina and Kelsey sent you and you'll get nothing for it. Except for our gratitude. Except for our gratitude. And you'll finally be on the web with that app that you love.

You are listening to the Profit first podcast.

This is the episode we've been waiting for. 171 My Voice 170171 it's like Peter from the Brady Bunch.

Oh man.

Welcome everyone to the Profit first podcast. I'm your co host, Christina Bola.

And I'm Mike Michalowicz, the author of Profit First. That's right. And some other books. Oh, the new title for my new book came out. I'll tell you guys about that later. It's changed. I've been announcing the wrong title because of my publisher, but it's been for the best. And you, my friends, you are listening to the Profit first podcast. This is a show where we explore everything about profitability. We want you to be more profitable than ever. This is the show that'll get you there. By the way, I'm joined in studio by the co host of the co host, co host Kelsey Ayers.

Hey, everybody.

It's so funny. I asked Kelsey, I say, kelsey, my coffee is like freezing cold. I don't know what to do. And it was so lame. She's like, do you want me just to warm up the coffee for you? And I'm like, yes. I still have the guts to ask. So thank you.

You're welcome.

And well, there's more to share with you, but where can they find us on the web?

Well, you guys know where to find us, of course. Profitfirstpodcast.com also iTunes, Stitcher, TuneIn radio and Google Play.

And I forgot to get an icebreaker record ready for today. I wrote down all this stuff on my phone. It's in my phone. I don't have it ready.

I have a shout out.

Unless do that.

But I have a member shout out actually. So I want to give a special shout out to Debbie Biello. She is kicking ass taking names. She is. And she, like, she's just on fire. She's one of our bookkeepers. She's amazing and she's really, really successfully growing her businesses. Or her business.

Her clients, singular.

Yes.

Yeah. And her business clients. So if you're listening and you need a great accountant bookkeeper, you need a profit first. Professional Debbie Biello. You can find her through our website. We'll tell you how to do that in just a little bit. Damn it, I forgot I had always funny questions written down. It's just gonna take me too long to look them up. So we're gonna skip that for now.

Okay.

I was listening to some of our past episodes. They're pretty good.

We are pretty good.

They're pretty good. Do we make shout outs?

We do have regular shout outs. So this actually was emailed into us. But if you do want to hear your voice on our podcast and we want to hear from you, call our shout out hotline. 844-876-7221. Record your 22nd profit first testimonial and we'll play it for you on here. But this one came in from Gary. He said, by the time I finish your book, we now have 5k in our profit account. He lost a business last year and have never seen. He's never seen profit before. Five years in business. So this is an exciting time for them as our remaining business was suffering due to loss of our main business. Debt is now being managed and expenses are cut. So he says thank you to Mike. You're a life changer.

Oh my God, that's so wonderful. Thank you for that.

Thanks, Gary.

Thanks, Gary. Gary, Gary, Gary. I told you guys, I said the highest morning I was, I presented at a Hidic Jewish conference called LT TB. Great conference. There must have been 3, 400 people in the room. And at the end, this one guy comes up running. Well, kind of waddling. No, nothing's wild. You kind of navigate through the crowd and stuff. And it's kind of when a shimmer, a shake, shuffle, shuffle, a shuffle.

He was shimmering through the crowd.

Who's that man shimmering over there? You with all the gaudy jewelry on? Because that's what shimmers, right? A person doesn't shimmer.

Unless you're a vampire.

Oh, that's true. Yeah. So anyway, unique gate. Let's just say that.

Okay.

And he comes over and just hugs me, which is not tip. Certain communities don't do that. And not that I know that much about the Hasidic Jewish community. You don't go up and hug someone you don't know. Typically.

Right.

Runs up and just hugs me and goes like prophet first has changed my life and just starts sharing a story. It was unbelievable. He has nine children. That's a story alone in itself. Nine children and his wife. And they went cross country on their profit distribution and they bought these, these plates, I can't remember what they called them, but these celebratory plates in recognition of their achievements. So the whole family's like profit, Profit. So that was great. Before we get into today's topic in detail, I want to do. I want to thank our corporate partners to make the show a reality. So thank you to Fundbox who was at Profitcon because this is. This is posted after. Yeah, 140 plus people in that room. Nextiva, which is a voiceover, IP phone system receipt, bank was a receipt. Scanning system and write networks, of course. And also hub doc. I wanted to give them a special shout out for Being there. And QX Services too.

Qx, yeah.

So thank you to all those companies that supported ProfitCon and that support the show. We'll share more insights about them in just a little bit. Let's dig into the meat and potatoes though.

Okay.

Do you eat meat and potatoes? Not in India. Not in India.

Trick question.

Her name is Priya Malani. Pri Milani is an entrepreneur and founder of Stash Wealth, a financial planning for the Henry's of the world. And you, listener, you may be a Henry, you don't even know it. What's that stand, for example? A high earner who's not rich yet. That's. That's a person where the cash starts flowing into your hands and it just doesn't seem to stay there. It flows right to the bottom line. Priya's got solution for that. That's what our company addresses. After years of work on Wall Street, Priya left to work with millennials specifically. But the lessons you're about to learn are more than just millennials. It's anyone making a large income or any kind of income and having a tough time holding onto it. In addition to running Stash, Priya serves as a resident financial expert for Refinery29. A couple things you may not know about Priya. You know she's a professional ballet dancer. She was, yeah.

That's awesome.

Someone else was on the show.

Yes.

Yeah, it's a very artsy show.

Was it Bryn?

Brynn?

Brynn, was it?

I think it was Bryn.

I think it was.

Yeah, it was. You're good. She puts a hot sauce in everything. She puts that shit on everything. And she binge watched Saved by the Bell reruns with Scream. All right. Welcome to the show, Priya.

Hey, Priya.

Hey, Priya. Welcome. Hey guys.

So happy to be here.

Who is your favorite character from Saved by the Bell?

Kelly.

Oh, really?

I like that.

What happened to her career?

Wow.

She was on 90210.

Well, if you're. Was she on 9120?

She was, yeah.

She wasn't Kelly, the black haired woman?

No. Oh, she was the like brown haired.

Kapowski.

Yeah, she was the like main female character.

Okay.

Dated Zachary.

Okay. Yeah, I remember her. Yeah, she was on 900, 120, some of those other people, you know, Screech ended up doing a porn. Okay. I swear to God. Did you know that?

Yeah, I did.

Yeah.

What's her name did that show. That was about a stripper.

Oh, yeah, but that was at least a movie. Yeah, no, he did like this Salacious.

Jesse Was it strip teen Jesse or something? Jesse, yeah.

So let's talk about that one other character, Henry. Henry. Tell me Exactly.

Before I even get into it with you, Mike, I gotta set the record straight, if you'll allow me.

Of course.

I'm 100% Indian. Do you know, did you know that? Could you figure that out from my name?

I assumed a little bit. But why? Why is that relevant?

Because you're going to India.

So are you a vegetarian?

No.

So you're not 100% Indian, you're 99%.

That South India is all veg. North India is all meat. They're big meat eaters. And big drinkers.

And big drinkers. I didn't know.

Yeah. So go to North India. I don't know where you're going, but go to the north.

Well, a very close friend of mine's from Chennai and vegetarian. And a non drinker.

Yep.

And so that's. Honestly, I have a biased perceptionist. South India. I have a biased perception of India, so. Shame.

There you go.

So you're a big drinker and a big meat eater. But the question is, what's a Henry? What's a Henry?

So a Henry is a subsect of the millennial generation. It's how we classify our clients. And it stands for high earner, not rich. So 20 somethings and 30 somethings who are kicking ass at their jobs, their life, making good money and want something to show for it.

But isn't the typical trap for a millennial, but this is true for anyone. Once you finally get that money, you're out of college, you're done working at Bennigan's or whatever down the street that even exists anymore. Houlahans. Now you're earning money like you've never have before. It is so compelling to spend that money to get that, that luxury car or whatever. I mean, doesn't the money for folks that start earning money like they never have before, doesn't it go right out the window right away?

Yeah, it totally does. And that's part of why we, we do what we do. But we're a lifestyle oriented firm. Everybody wants to invest in their now and nobody wants to compromise. I don't. Our clients don't. So the trick is figuring out how to spend today without compromising tomorrow as well. Putting a little bit of automation and planning in place, and that really makes a difference.

Okay, so give me some of the secrets to doing that once I have a burst in income. And you know folks listening to the show, many of them are entrepreneurs that have started a business, at a certain point, they're going to start earning or may already have more money than they ever have. What are some of those things you can put in place, those devices to not spend at all?

Well, one of the philosophies that we talk about a lot mirrors profit first and is actually why we like profit first. It's called the reverse budget. And the concept is to save first so that you can blow the rest. I think a lot of us get caught up in not knowing how much we're supposed to save or just save for the sake of saving. And it can be very hard to stay motivated to that. So what we do is try to put purpose around that. Like, what are you saving for? Do you want to go to SoulCycle more? Do you want to go to the Amalfi coast next year? Do you want to buy a Tesla? Like, what are you trying to accomplish? And then save for that? We hate budgeting. Budgeting doesn't work because there's no such thing as a typical month. So once you really know what you're saving for and you automate that, the rest of whatever's left in your checking account is yours to blow guilt free.

Oh, I like that. But you said there's no thing as a typical month. I presume if you're. If you have a job, there's some predictability, but maybe that's not even true.

No, I mean, like, yeah, of course, on the income side, Perhaps especially for W2, it can be harder for entrepreneurs, but, like, maybe you're really good at taking public transportation. And then it's a rainy month and you're like, well, fuck it, I'm gonna take Uber all the time. Or you have like, let's say, call it your dining out budget. And then your friends come in from out of town or you're hosting your parents or whatever it is, and your dining out budget goes out the window. So there's really predictability. And budgets get very, very rigid. So kind of the free form and to speak to profit first. It also allows for flexibility and moving percentages around as your business grows, as your income grows, as your business income grows, as your personal income grows.

And sometimes your transmission falls out of your. Yeah, Christina's car. The Transmission falls out. $4,000.

$4,200.

Painful.

The way you guys talk about the vault is the way we talk about the emergency fund.

All right, so that's what I want to learn about. First, tell me, how's the. How does the emergency fund work?

So at Stash. Unlike typical, like stuffy Wall street gurus, we advise our clients to have no more than three months worth of their fixed expenses set aside in their emergency fund. So like, let's say your average and fixed expenses. Just to clarify, fixed expenses are the things that you couldn't turn off very easily if you lost your job or if shit hit the fan. So like you guys still got to pay rent, you still got to pay your utility bills, maybe a car payment. Figuring out what that number is, multiplying it by three, that's your emergency fund. Anything above that is money to blow to put into more fun goals to upgrade your lifestyle. And you guys have that same philosophy with the vaults. And anything above a certain amount in the vault kind of gets reinvested in the business or is it just more additional profit to spend and enjoy life?

Okay, so with that emergency fund, I put away three months, but clearly if I'm just starting the system today, I can't put three months away today. How do I start distributing money? Is there a sequence where I prioritize money for emergency funds and then to a different account or how does that work?

Yeah, absolutely. Emergency fund is the absolute first place you have to start because you have to have a strong financial foundation that you can build off of. When I was working at the big banks, I guess I can call it out. When I was at Merrill lynch, one of the mistakes that those high net worth, ultra high net worth clients that I used to work with made was not having that emergency fund. So chipping away at it, even a couple hundred dollars at a time to get that fully funded is the absolute first step you have to take. And it's hard as an entrepreneur, I think, to be disciplined, but knowing what the loss potential is kind of can keep you motivated to say like, okay, I know I have to build my vault first before I can do anything else.

And. Okay, so what are the other accounts you have? The emergency fund was one you recommended. I know you said some other already, but is there some foundational accounts you suggest?

Yeah, so for most of our clients, we have them keep their short term savings in an online bank, which pays you a higher rate of interest. So any of you that are still out there using a brick and mortar bank or savings account, you'd really want to switch that to an online bank account and you'd want to have a different savings account for every short term goal. So the most common two that our clients have are travel account, because travel is sort of a non negotiable for our clients. All millennials, like, experiences and want to be traveling. And the second account is holiday gifts, because, let's be honest, what happens, the holidays roll around, we put that stuff on our card. January comes, and we're like, oh, shit, gotta pay for this.

So I bought Mike that big, expensive gift again. Yeah, I gotcha.

Okay, so those are two really common ones. And then sometimes if clients have a pet, that's a really important one to have as well. We had three clients last year. This is not. This is really sad. We had three clients last year whose dogs got cancer.

Yeah.

So expensive for a dog.

Oh, my God. Yeah. Any kind of healthcare for a dog. Any kind of animal or pet. So you're saying if you have a pet, you know, and of course, a pet relation to a human relationship is almost like a child to parent. Set up an account for that pet for these unforeseen circumstances.

Exactly, yeah. Before you can start investing and start making your money work harder for you, these are the absolute first steps you have to take to build that solid foundation.

Now, I presume some people listening maybe don't have a pet, and they're like, you know, I don't need that. I assume there's some foundational accounts you have, but for each person, they have their own unique interests or needs that they should set up accounts specifically for those needs and interests, right?

Oh, absolutely, yeah. Those are just two of the most common ones, the holiday gifts and travel. But absolutely, this is done on an individual basis.

And where do you set these accounts up? You said an online bank does some elsewhere. How's that work?

Yeah, no, we want people using online banks. I mean, the whole difference between an online bank and a brick and mortar bank is that the online banks don't have the same overhead. Right. They don't have real estate. They don't have. So they're able to pay you a higher rate of interest on your savings account. So it's a simple hack. It's like the same type of account. It's still a savings account. You're just using an online bank instead of a brick and mortar bank. And so you get your money's working harder for you. One simple switch.

Gotcha. Gotcha. Now, you know, you're working with people that are making a lot of money, but not keeping it in their hands. Once they start doing this process, it sounds like they start accumulating some wealth. If that's true, does their behavior change in that they. They become more frugal? How does it affect them?

No, I mean, that's. That's a really good question. But actually, the mindset shift is just so much more exciting than that. Once you really set up that automation around your financial life and you can feel like you can spend the money that you work so hard for without feeling guilty about it, that's an amazingly empowering feeling to know. Like, if the money's there, yeah, you can buy the Louboutins, you can go to SoulCycle, you can take a trip, you can do all these things. I mean, and knowing you're not jeopardizing any of the things that you prioritize, it's extremely freeing.

So let it be known. I had no idea what Louboutins were. I thought it was Louis Vuitton.

Yeah, yeah.

I had no idea until last quarter. I had my profit distribution and I said, we have. It was like $500 or something, $600. I told my wife, I said, look, profit distribution from. From book sales, right? $600. And she looks at it, she goes, oh, let's get Louboutins. What was that? What's that? It's a shoe with a little red on the bottom or something. Absolutely.

I don't want to stereotype, but most millennials are prioritizing experiences more than stuff. But the bo. You can spend your money on whatever you want and not feel guilty about it, right?

Yeah, there is that confidence. Right. Because on the flip side, what do you experience with people when they don't have money, when they spend it? What's the emotion around that?

Yeah, I mean, that's a very fear driven emotion. And I think one of the best compliments we ever got was I was so afraid you were going to tell us what we couldn't do. Instead, you showed us how much more we can do.

That's fascinating.

We often joke at Stash that we don't like taking on clients in their 40s because we don't like delivering bad news. It's just our cheeky way.

Hold on, you're talking to a 40 plus year old. So what do you mean delivering bad news?

No, I mean, honestly, it's just a silly little way of telling people in their 20s and 30s and 40s that the sooner you get started, the less you have to compromise, the more fun it is. The less money you have to put towards these things in the future, like down payment on a home and retirement and all that kind of stuff that, you know, you want to do in the future. That real stuff that makes you an adult. Yeah.

What's the runways, I mean, for millennials, specifically, you both are millennials. Christina and Kelsey, half the crew. Actually, almost everyone except for me and Ron with the grandparents are millennials. What's the Runway to achieving big things? Kelsey here wants to buy and build a house. You know, you want to do the same and get a car instead of a transmission. What's the Runway to making this a reality? Living that lifestyle of comfort.

We say one of our other cheesy lines at Stash is a goal without a plan is just a wish. So, like, taking the time and to sit down and say, like, okay, I do want to buy a house. Like, what would a house that I would actually live in cost? Because there's a difference between what you think you like, oh, maybe I'll spend 400,000 or 500,000 on a house. And then you go, look at that. And maybe if you're living on the coast, you're like, well, crap, I would never even. I couldn't live in that. It's. It's just whatever the case is. So, like, you have to, like, feasibly do some research. We call it Zillow porn. Spend some time on Zillow porn. Trulia porn and, oh, my God, I.

Knew you were a porn addict.

I'm a realtor dot com.

Are you the same thing?

So. So Kelsey and Christina have very clear dreams of what they want. You have to. I love that. That a goal without a plan is just a wish. So you have to have a plan. But what if you're on consistent income, like Kelsey and Christina make income? A salary, you know, they can't spike it by 50,000 this year, you know, or maybe they can. Like, what do you do if you are on a W2?

Give us the deets.

Actually, on the W2, it's even easier. I think planning, financial planning for our entrepreneurial clients is so much harder to have that to. It's so much harder to create a financial plan with unpredictable income when you're not W2. It's so much easier because we can very feasibly say, like, here's today, what your situation looks like. We'll recalibrate it a year from now. But based on the numbers today, here's what should be going here, here, here, and here to accomplish all the things that you want.

Is there any excuse not to be making your dreams come true if you have that predictability?

Not that I can see.

What if you make. What if you're working a. And I'm not picking on McDonald's, but what if you make a McDonald's wage? Can you still make your dreams a reality.

Yeah, it's actually funny that you asked that. So in a piece I was doing for Refinery 29, they were challenging me on this concept because one of the things that we do at Stash is we show every one of our clients when they're gonna be a millionaire. We show it to them in their first meeting. So one of the questions that one of the editors at Refinery had for me was like, well, what's the lowest possible income that could achieve that? So we went as low as a $30,000. And even someone in their 20s making $30,000, making $30,000 for the rest of their life will have a million dollars, will be a millionaire. So there isn't any excuse.

There is no excuse. And can they, though, achieve their dreams still in a reasonable timeframe? Like, listen, If I make 30,000 a year and it never changes and I'm 25, does that mean, though, I'm buying my first house when I'm 80? I mean, can I achieve some goals for myself within a quote unquote, reasonable timeframe?

Yeah, I mean, listen, we say it's financial planning, not financial magic. Like, I wish we could just create cash out of thin air. But do. If you take a planned approach and you actually sit down and think about it, you'll do more than if you don't.

Yeah, right.

Yeah, absolutely.

Yeah, that's totally true. So what about the mindset? And I just want to stages. I just did a TEDx speech. And I'm not trying to plug my TEDx speech. Oh, this? Yes, I did, but I did a TEDx speech. And the speaker after me, Darrell Rochelle, who were trying to get on the podcast, right. Awesome young guy, 17 years old, grew up in a impoverished neighborhood. And he's telling me about the impoverished mindset. Right. Just quick side story before I go on stage, he goes, mike, you pour the gasoline. I'm gonna light it on fire. When I'm like, nice, Terrell Rochelle. But then he says, it's a shame when I went to school that the impoverished mindset works like this. I go to school and the teacher looks at all the students in the classroom and says, nine out of ten of you will never be able to have a job that makes more than $12 an hour. The unfortunate reality, she said, is this and that. And she starts talking about all the negative things. And he said through his mind, like, we're being programmed to be impoverished. Do you find, Priya, that people go into or experience these kind of mindsets, these preset mindsets that are coming to help for help from you.

Yeah, yeah, definitely. I mean, we are breaking a lot of stereotypes, a lot of bad money habits. We're busting a lot of money myths around credit. I feel like credit cards, there's so many bad myths around it. So, yeah, there are some perpetuated narratives that we definitely have to unwind, and we do that through education because you don't know what you don't know, and as soon as you know it, then you see the light. So there is a lot of that. But. But it's all within the context of, like I said, our clients are high earning millennials, Henry's, as we call them. So we may not see some of those narratives that you're talking about. We certainly see some that belong to those who are, you know, on the fast track.

Yeah. But there's definitely these pre established mindsets in, in all environments. And you, you mentioned credit cards specifically. That are these kind of perceptions around credit cards. And that's been a real challenge.

Credit cards.

Oh, God bless millennials. Do you guys hate credit cards?

I mean, I like rewards. I like kind of making my money work for me.

Okay.

But you have to be super diligent.

Yeah. So what about that, that, that, those rewards and stuff like that tell us all about credit cards. Priya.

Oh, my gosh. So this will blow your mind, but we get, coming out of our process that we get our clients to never, ever use a debit card ever again.

Oh, that definitely blows up a debit. Do you encourage them to use credit cards or is it just all cash or what?

Yep. So I'll go so far as to say that we, we want you to start thinking of your credit card not as free money, because that's the narrative sort of perpetuated out there. We think of credit card as free money. We advise you not to think of a credit card as free money, but rather to use a smarter way to use the money you already have. Because three things. By using your credit card, you're building your credit score, which is going to come in handy as you make bigger purchases in life. You're earning rewards, points, or cash back, and the money is sitting in your account all month, earning interest until you pay the bill. So as long as you use your credit card as if it is a debit card that debits once a month when you pay the bill in full, that's the smartest, most efficient way to use your cash.

All right, So I want to challenge you on this, or at least these are challenges that I think the industry faces. So I wanted to hear what your thoughts are. With a credit card, they, I assume, are hedging their bet that you won't pay off that loan. Yeah. Yeah. And so the war, the rewards are a behavioral mechanism to make you spend money because it feels good. Oh, I earned 10,000 points. And what do you do with rewards? Not much. Maybe get some cash back. But how do you get past those behavioral tricks they're using to keep you locked in and paying those interest rates?

So, fun fact, there is a word that you can Google. This is a real thing in the credit card industry, if you are someone who pays your credit card bill off in full at the end of the month, like, you get your statement, you pay it off in full because you haven't spent more than you can afford. You're living a life you can afford. They call you in the credit card industry, you're known as a deadbeat.

Are you kidding me?

No, that's like a real word. I came across it a couple years ago, and I was blown away. I couldn't believe that that was a real thing.

So, yeah, they are.

They're hedging. They're hoping that you don't. They're hoping that you don't. So, I mean, we come up with the number for our clients. Like, this is how much, like, you can't afford to put $2800 on your credit card this month, or you can't afford to put $3,500 on your credit card this month. And that's. That's. That helps to kind of have a number in mind. But of course, yeah, some of us, we go out, we're at happy hour, round after round after round. We're not really. It is what it is. So, you know, there's a company we use. I don't know if I can give a shout out, but there's a company.

Yeah, sure, you can shout it out.

Yeah. It's called debitize. And it's a free tool. It's a free online tool. Basically, you hook up your checking account, you hook up your credit card, and every single time you swipe your credit card, debitize pulls the money out of your checking account and they pay your bill off for you in full at.

The end of that time.

Yeah.

Brilliant. It's so brilliant.

And our, like, four years ago, I.

Think it's time to debitize. So that's. Now, that's fascinating. That's a workaround that works.

Yeah.

So you all about the hacks yeah, that's a good hack. I was wondering, could I also. And maybe this works against me. Could I reduce my credit line? Say. Say I can only afford to pay $800 a month on my credit card.

Don't reduce your credit limit.

Okay, teach me. Teach me a wise one.

Oh, my God. I'm gonna sound like the biggest nerd right now, but. Okay, I'm gonna talk to you about credit scores for a quick sec. So the second largest component of your credit score is something called your credit utilization ratio. Okay. It sounds fancy. All it means is the amount of credit you're using at a time relative to how much is available to you. So let's say you have a credit card and you have $10,000 available credit, and you're charging up $2,000 at a time, and then paying your balance off in full, you're using 20% of your available credit. The lower that number, that percentage is, the faster and quicker you will bump your credit score. So, in fact, what you want to do and what we have our clients do is every six to eight months, if you're really good about, like, charging and paying off your credit card in full, we advise you to call your credit card company and actually, actually increase your limit because that lowers your credit utilization ratio, which bumps your credit score.

Interesting. And the credit score is absolutely key. I know. Christine, if I could share a little bit of your story, you know, you're considering do I buy a car? Do I replace the transmission? And the credit score comes into play here, like, if you're looking to buy a car. Hugely. Right, totally. And so you can use this technique of increasing your actually having a higher credit line as compared to how much debts on there, and then that gives you a better leverage to. Amazing. Okay.

Yeah, exactly. When you go for financing, the interest rate is the key variable. And the better your credit score, the lower your interest rate, which could save you, I mean, in the case of a car, thousands of dollars. In the case of a home, tens to hundreds of thousands of dollars over the course of your mortgage.

Yeah, that's true, too. Okay. All right. All right. I've been so anti. Credit card. Maybe got me a little bit here. Maybe you got me. So one last thing before we get going. What should people do to get started with your system? I mean, it sounds like if I go all in on this, it's a lot. I mean, it's a lot of information to digest. How do I get started in this process?

In the process of creating your own financial game.

Yeah. What's the first step I should take set of that emergency account first or maybe the first thing you do is call debitize. What have you found is the to be the best first step?

Ooh. Every. Everyone's very different. Some clients come to us with student loans that the average Henry that comes to us with about 80k, 80,000 in student debt. So there's student debt. The average American has around 30,000 in student loans, but the average Henry has about 80,000. It's very overwhelming. So it's balancing that with building your emergency fund, with optimizing your credit cards, finding all the ways that you can be smarter with your money, cutting off subscriptions that you're not using. Whether it's cable or magazines or whatever it is, the list goes on and on. It's part of our process and going through and figuring out how to be smarter with your money across the board. But there are many ways in which you can take first steps. It all depends on your situation and what you're dealing with, what you're facing.

So Priya, I want everyone listening to the show that's under 40 giving you a call at Stash Wealth. Can you tell us more about how to get hold of you and what Stash wealth is all about?

Yeah. Stashwealth.com, we're home of the Henrys. And the first step in working with us is something called the Stash Plan. It's a five to six week experience that we take our Henrys through and we overhaul their entire financial life, which is much less scary than it sounds. We figure out everything, they figure out everything they need to be doing to be smarter with their money. And we build a game plan to put them on track for their goals. Figuring out what they've done so far, what lifestyle they're living and what lifestyle they want to live and how to reverse engineer a game plan so that they can have everything they want and more.

Awesome.

Yeah. That is awesome.

I love that. Yeah. Thank you so much for joining us today. What a great episode. All right, so you heard it. You heard it there first. My dear listening friends. Check out Stash wealth right now. They can help you move forward. And listen, if you're in my age group or older, at least browse the website and get some good tips, you.

Know what I'm saying?

Like hang out with the Henry's but don't be pervy. I was walking to college campus because I had a lecture there. I felt disgusting because it's all people. 18 years old.

Yeah.

And there's one person here who's not a professor kind of lost looking around, and then I just feel creepy.

Fat daddy Fatback.

Yes. Fat daddy. Fat. Yes, Ruby. Fat daddy Fatback. All right, Christina, just give me a punch real quick, would you?

Thank you.

All right, so here's what we're gonna do. We're gonna recap what we learned today. We got listener mail, and I got a new sound effect for that too. It's very funny. It's pretty stupid, maybe. I don't know. And. And then we're going to have a special surge book giveaway. But first, I want to thank our corporate partners. So, Kelsey, you're going to do the search book giveaway, so get ready to announce that.

Okay.

All right. I'll thank our corporate partners, and then you're gonna do the listener mail call.

Got it?

Okay. And then we'll do our one takeaway after that.

Okay.

So I want to thank Fundbox. Fundbox is a cash flow accelerator. So if you have invoices due to you, but you don't have money and you need it now, Fundbox releases those invoices to you in their entirety. When you get paid back by your client, you just return the funds to Fundbox. It's that simple. They have a service fee, but I think if you pay it back within the first, like, 25 days, I think they waive all fees minus, like, a $25 service fee. It's, like, really a great deal if you have an immediate short term cash flow issue. Check out Fundbox Nextiva. That's our voice over IP phone system. You know, at PrivateCon, they gave away a phone system.

Yeah, they did.

I tried to win. I tried to kind of stash the.

Bowl because you need another one.

I want it for my home. Wouldn't that be funny to have a professional voicemail system for your house?

Yeah.

You've called the McAllowicz House. Push one if you want. Mike, push two for this message to play again. Receipt bank. That's our as an efficiency tool, but really, it's a receipt scanner that ties into QuickBooks and Xero and all these different things. And I'll tell you when you got to produce reports for your clients. If you ever get audited, everything's taken care of. And then last but certainly not least is write networks. Finally, you can put those applications you love, those desktop applications you love on the web, Just give them a call. Eight, four. Four. That's our number. What the heck was the number? I was reading our number. Where's their.

I lost it 888-469-5905 for networks.

Yeah, good. And say Mike sent you to the wrong number. Okay, Chris, who's up first? Okay. Is the Kelsey at first in the.

Sequence there is a surge book giveaway time?

Yeah, I think so.

I think it is.

Well, everyone, because we love you so much, we are offering you a free surge book. It's Mike's fourth book. All you have to do is pay for the shipping and handling. And if you'd be so kind, leave us an Amazon review.

That's the big ask.

Yeah, we'd really love to quit pro quo, you know, so if you're interested, just email me, it's Kelsey K E L s e y ikemicalitz.com and I will get you set up.

Yeah, and you can just Google, if you type in Mike, hit the space bar in a mic M I C. You'll see the spelling McCallow as it pops down. So it's eight bucks. That covers our shipping, handling, all the materials here. It's effectively our cost. Yeah, we also have to get the books printed. That's part of why I kind of talked that into the handling because I gotta print the damn books. But on Amazon, what do they cost? 2720?

Yeah, it's 20. I just looked it up and I forgot. I feel like it's 21 something or 20 20.

They discounted at 21. So 8 bucks, shipping, handling and you get a pristine copy of the book. We gotta email Kelsey and if you want me to sign it too, because literally we ship it out here out of the office. Just type in, you know, could you have Mike sign it?

Cute.

Yeah, just put Mike sign something, please. And I only sign it with this name, Daddy Fetback. Did you go to the website by.

Anyway, I did. Yes.

I was, I was.

It's disgusting.

It's so inappropriate. I was. Where was. I don't know.

Talk about Jesse and her.

I was at a speaking event and at the end of the event, some guy comes up, he's like, dude, fat daddy, fat back. He whispered, yeah, I love, I love that. I'm like, dude, you're my peeps. All right, so there's a surge book giveaway. By the way, we're only doing this one episode. If. If it catches on, maybe we'll do it again. So this is like your one chance. If you don't do it, it's not like next episode. Oh, now you can do it. Yeah, you got to do it this week.

And a big shout out to Funky Colin, who Recommended for you to give a giveaway like that. His real name is Colin Betts, but we call him Funky Colin.

Funky. Yeah, yeah. Everybody has a rapper name here. So Fat Daddy Fact gives you shout out, funky boy. All right. Listener mail.

Yeah.

Oh, wait, wait. I play the sound effect. This is our new sound effect. When we have listener mail come in. You've got mail pattern baldness.

That's actually hilarious.

Is it good?

At first I was like, good one, mine.

Gotcha. Gotcha. All right.

Goodness. Okay, so this comes from Danielle. She says, hi, Mike. I'm about halfway through your book, but I have a question. I've been moving deposits directly into our income account and then dispersing them every two weeks. It's great having enough to pay our taxes and ourselves, as well as watching our profit grow slowly. But it's there. We're still in the growing phases of this new way of operating, so our operating expenses are still higher than they should be. We're feeling the growing pains when we still have to wait two weeks for each distribution. Would you ever suggest distributing to the profit? Slash owner's pay, slash taxes, slash operating expenses? Yep. Weekly or with each deposit, at least while we're getting used to the new setup. Or is this a good stretch?

Great. So, Daniel, great question. It actually one I get pretty frequently. So in the book, I suggest that you do your allocations twice a month or every two weeks, bi weekly. I found out in Australia that's fortnightly. But here's how it works, is the goal is for the money to pile up in your income account to a certain point that when we allocate it out, we know what the amount was in the income account. So the next time it accumulates over the next two weeks, we know what account amount to expect in the income account, and we start achieving these, what I call wave patterns. So there's some predictability. And when it's outside of a normal wave pattern, that amount that accumulated in the income account, that you can then have a red flag moment and kind of investigate what happened. Why is this less or hopefully more than expected. But here's the deal. You can do this weekly also. And guess what? We do it weekly here. We have a weekly meeting with Christina. Then our bookkeeper gets on every Thursday, and we go through our allocations. You don't have to do bi weekly. You can do weekly. The goal or the requirement, though, is stay consistently at that for an extended period of time because then you'll know what the income account is expected to be at every Week. And what's outside of what you expect, that's a red flag moment. The only thing, Daniel, I suggest you don't do is do not do this daily because there's such inconsistencies on a daily basis that you're not going to know what the normal income is. And therefore it's going to be a distraction. You're not going to know when you have what I call that red flag moment. So the most frequently would be weekly. Alternatively do bi weekly. That's what most people do. The slowest frequency I would do is monthly. Hope that helps and wishing you big success. That was the mail moment. You got mail pattern baldness. The second time, it's not as funny. It's not funny. The first time was good, though.

Yeah, yeah, yeah.

Okay. I'll never use that one again. All right, let's do our takeaways, my friends. So here it is. What did you learn?

So what'd you learn today?

Who wants to go first?

I learned debitize.

Yes.

Damn.

Yeah. I think that's bomb drop. Pretty remarkable.

Yeah.

What a great idea. What a great concept. And I like that there is a. An effective way to use credit cards to our advantage rather than reverse. But it is really hard to be really diligent with credit cards.

It really is.

It is so hard.

So I like that because that's kind of like a fail proof, you know?

That's fail proof. That's. Yeah. That may be the hack of the century.

Yeah.

Because credit card companies are designed to make us delay pay. They want us not to feel the pain of that expenditure. So we start incurring interest.

Yeah.

So good. What'd you learn? Or did she take?

Oh, no, no. I mean, this is just a touchy subject for me on a personal level because, like everything that she said are things that I want to be doing. I'm just in such a bad financial place right now that I'm trying to crawl out of it. So, like the. I love setting up the emergency fund and those short term savings for travel and all that stuff. And if you look at my bank account, I literally have like five different accounts for those things. I just still find myself having to drag money out of them because I can't afford to disperse it yet. So I love the system. I'm just personally trying to figure out how to get over the hurdle of actually being able to implement it.

Yeah, well, I think. I think you gotta make a call to Priya.

Yeah, actually, I would love to do that.

Why don't you give Priya a call and then we can talk about the experience.

We're gonna chat.

Yeah, yeah. Because Christina is financially, I think, qualifies, you know what I'm saying? Like, she's earning more and more, and I'm not going to go into the details there, but you're not working at McDonald's salary. And she says you can do it, so anyone can do it. But I bet you some hard decisions that are going to be forced. And that's the challenge. We delay some of the hard decisions. So thank you for your candor, as always, Christina and Priya, you got a new client for me. It's the emergency account build that first the three months I've now experienced. I had to pull into an emergency account once, and thank God I had that account. I would have been and knocked off my financial game in a big way. And I just thought it was interesting. She says millennials like travel, and I think that's true.

That is true.

Right?

Yeah. And I use my credit card rewards to travel.

Okay.

So I use them for airplane tickets.

Now with debit ties, you don't need to worry about incurring interest. I just think it's a fascinating thing. And what excites me about that is we need a world that gets out and sees the world.

Yeah.

We're to. The older generation is too. Like just us folk. Us number one. Us number one. Like, we see ourselves as this independent, I don't know, island or something.

Yeah. We definitely live in a globalized world in every aspect.

Yeah.

So there's, you know, the. The resistance against it is hard for myself and I'm assuming a lot of my peers to understand.

I'm really pumped for. As the millennials kind of become the new leadership generation of the good things that are coming now. The other thing I learned, too, is a goal without a plan is just a wish.

Yeah.

She said it's a cheesy saying, but I loved it. Yeah, I loved it. Okay. That's what we learned. The question, of course, listeners, what did you learn? You can post on our blog. You can post on our.

Well, anywhere you listen.

You can tell them where. You can tell them where to do it.

Itunes, Stitcher, Tune in radio, any podcast you use. And of course, Profit first podcast dot com. And then you have to go to profitfirstprofessionals dot com.

Christine. I didn't. Didn't see that. I really wasn't prepared for this moment. So we got a website called profit first professionals.com. actually, the site went down for an hour. You yesterday because we were upgrading to more powerful servers, faster servers. So we went down from like 9 to 10 o' clock. And now we're on even better servers so we can better serve you. That's right. Here's what I want you to do. Go to profitfirstprofessionals.com why? Because we have profit first professionals, experts throughout the world who are there to serve you, who are there to drive profitability in your business. These questions we digged into with Priya, they have the answers for the business side. Priya has it for your personal side. And let me tell you, it's a perfect match. But you gotta take that first step. So go to profitfirstprofessionals.com. step one, step two. You like that? Step two, fill out. Kelsey loves that. Step two, fill out the form. Step three, click on send. And when we get the form from you, we'll get you in touch with a Prof. First professional and, you know, drive profitability in your business like never before, you know? You know? Yeah, I think that's pretty much it for today, right?

I think so.

All right, kiddos, let's get out of here.