Get Lean, Get Liquid, Get Out: Chris Miles on Financial Strategies to Acquire Financial Freedom.mp3

Welcome to Inside the Speakeasy Mastermind Podcast, the private room where today's sharpest founders, innovators, and renegade thinkers come to trade the ideas that move industries. This show is brought to you by HighLevel, the AI-driven business operating system trusted by over 2 million businesses to help automate, scale, and create real leverage. HighLevel isn't just a tool, it's the engine behind some of the most agile and high-performing teams on the planet. If you're ready to streamline everything, amplify your reach, and actually build a business that works for you, you're in the right place. Visit www.gohighlevel.com/speakeasy-mastermind-promo to get an exclusive 30-day trial for being a listener of the Inside the Speakeasy podcast. Enjoy the show. Get lean, get liquid, get out. 3 incredible strategies that you're going to learn in today's episode. Of Inside the Speakeasy Podcast, where Chris Miles breaks it down and shows us how to make some incredible passive money. Talk to us about some common mistakes that damn, I'm making, we're all probably making, and let's get out there and make some more money and do the right things. Welcome, Chris Miles.

Hey Eric, it's good to be here, man.

I said Salt Lake City, but I know you're in the Salt Lake chapter. Are you near the city there?

I'm about an hour south of there, so yeah, it's close enough.

Nice. Nice. Well, welcome. We're going to get into all things money. Chris is known as the cash flow expert, also the anti-financial advisor. I love that, the anti-financial advisor. I can't wait to drill deep into what the hell that means. And you're going to teach them strategies where you're going to get our money, pay us twice. So I like that. So I am all about, I am working my ass off. I am working too hard. I need to get my money hustling way more than I'm hustling. I'm so excited to talk to you and figure out what the hell I'm doing wrong. Not to mention probably a lot of us listening on the show. And this is great. This is such a good topic because we talk about scaling business and this is the other side because what the hell are we doing this for? Obviously it's for family. It's for wealth, for building the ability for us to not have to worry about that money coming in. And we need people like you in our lives. So thank you for coming on the show.

Hey, it's been an honor, man.

Well, let's dig into this a little bit. I mean, you know, quick background. I mean, I know you have an incredible podcast. You got about 1,000 episodes right now. On the Money Ripples podcast. You're out there in the world of talking money, finance. You know, gimme a quick background on how you got there.

Yeah, so not the way that most people would think. It wasn't like I started out just, you know, having lots of money, making lots of money, and voilà, it's magic wand and I'm there, right? It was actually from doing the opposite, from screwing up a lot of times and not necessarily having like, you know, the best example. Because for example, I mean, I started out when I became a business owner, I actually wanted to become a business owner because I wanted to have that freedom, right? My control, my own destiny, my time and everything else. And I was trying to look for something to do. I was actually gonna become a business consultant, but I changed direction cuz I thought, let's have a business experience first before I become a business consultant. Cuz I don't wanna be some 20-something-year-old kid with an MBA saying, here, you should listen to what I do, even though I have no clue what I'm doing, right?

I mean, one of those business coaches who says they're a business coach, yet they never run a business.

That's right. It's like the best life coaches in the world, right? It's like the ones that never experienced life. So I didn't wanna be that guy. So I actually looked for a business and the first one came up as being a financial advisor, the traditional salesman in a suit, you know, that kind of thing. And so I started doing that, was on 100% commission only. Eventually quit my 9 to 5 job and started doing that, you know, living the dream, so to speak. Although it was kind of a nightmare because I didn't know how to run a business. I wasn't doing great at it. I was barely making ends meet, but I started to slowly get that business going. And then about 4 years in, I sat down with my dad now. Understand my dad is like the model poster child of the cheapest son of a gun you've ever met, right? I mean, Depression-era mentality. The guy, you know, would buy everything on sale. He has Mrs. Buttersworth still on his shelf that's 25 years old because it was on sale and he refuses to throw it away. Like a level 3 hoarder, you know? And so this guy, like, I mean, he taught me to just scrimp and save, be cheap and everything. Well, he said, Chris, when are you going to advise me? So I sit down with him, I go fly back home to Oregon where I grew up, and I'm sitting down with him. And as we're talking, I look at his numbers and everything. I was like, okay, dad, you're 100% debt-free. You paid off your house in 18 years. Good job. You've been stuffing money in your 401k like every good boy should. Here's the deal, dad, you're 61 years old. If you want to retire today, you're going to need to die in about 5 or 6 years because that's when you'll run out of money. It's like, well, okay, Mr. Sunshine, that's not what I wanted to hear. What do I do? I said, I don't know. Work longer, save more, just keep going. Maybe you'll retire in your 70s. And that's exactly what he did. Now, the next month, I'm totally just bugged by this, right? Because remember, I was following in his footsteps too. I was living cheap. I was the guy to turn off the AC in the summer, turn off the heat in the winter, save a few bucks so I could throw it all in mutual funds and hopefully I'll have, you know, a couple million dollars, you know, a few decades or so. And I realized like, wait, what if this doesn't work? And at that same time, it's like when the student's ready, the teacher appears. One of my friends I trained to be a financial advisor had quit to go do real estate investing. And we're talking and he said, well, Chris, how many of your clients are financially free where they don't worry about money? I said, oh, you had to throw that last part in. They all worry about money. Even the retired ones watch CNN and then they freak out. They're going to lose all their money. Right. And it doesn't matter if you've been in the stock market or not. They just freak out because the world's going to end. It's like, okay, good. So nobody, nobody's financially free. Good job, Chris. Well, how about this? How many of you guys as financial advisors are financially free? Not off the commissions you're earning, but actually doing these same investments you're recommending. And this is end of 2005. And I'm thinking, I'm like, you know, there's guys working here since the mid-1970s. They can't retire either. So I don't know, none? There's your problem.

Ouch.

So of course I started going on that journey, right? I started trying to find out what my friend knew, learning in the real estate game. I actually eventually quit. I just realized I couldn't teach something that I didn't believe in because I'm the worst poker player. Just heads up Speakeasy Mastermind, I'm not going to do gambling with you or ever do Vegas again. I won't do it because I will lose all my money to you. So that's the thing. I just can't BS it. And so I just quit. I said, I'll never teach about money again. I'll just be a mortgage broker. I will do a little bit of stock trading on the side and I'll teach ballroom dancing. Because, you know, one thing that some people know, some people don't, is that I used to be one of the nation's top amateur ballroom dancers. What? So I actually was teaching at Utah Valley University, which of course is where Charlie Kirk was assassinated, unfortunately. But but yeah, I was like the world championship ballroom team there at one point, just 5 years prior to this.

Oh my. We're going to have to get into that a little bit later if we get some time. I love that. Okay, keep going. You got me open.

Yeah. So, so that's kind of the path I was on. I didn't want to teach about money, but of course I wanted to know how to be free. And I saw these guys in their 20s and 30s in real estate doing it. And so I started to realize it wasn't just about, you know, flipping properties, although I flipped my own starter home and pulled all the equity out, but then I rented it back from the owner that I sold it to, the investor. And then subleased it and tried to make cash flow off that. And I was doing all kinds of things because I realized I could lend my money out to investors and make money off of that. And so I didn't even have to be the hands-on investor like Kiyosaki talks about in Rich Dad Poor Dad. I could literally turn my money over to those guys and get paid money. And so between that, some other income streams later that next year in 2006, I had enough passive income coming in. I was able to be work optional as we call it, right? Where you have enough passive income that you could quit, you can, work because you want to, not because you have to. And it's at that point I really started to ask myself, well, what am I going to do when I grow up? You know, I'm 28, almost 29 years old. Not too many people, my friends of mine, are able to just hang out in the middle of the day because, you know, they have jobs, right?

Well, timeout though. You kind of sped through something important there. I mean, you just sort of like, oh, you did this, that, and the other thing, and all of a sudden you now have enough money to live off of passive income at 28. So can you, can we dig into that a little bit? Or are we going to get back to like, what are you doing to be able to make that kind of money? That young?

Yeah. So like I said, like I realized that it was about, not about really just saving up a ton of money, but getting it to work by producing income. Because most people teach in the financial advisor world, you got to accumulate it, right? Store it all up like a squirrel saving for that winter of retirement. And hopefully the winter doesn't last too long where the squirrel dies of starvation.

I remember, I mean, just, you know, for those, you love them or don't love them, but I remember going to a Grant Cardone event. He talked a lot about that, about just, you know, you gotta Currency's current. You got to keep it moving. You know, he'd say, you know, you can't having it saved is not, it's exactly what you're saying. He just echoed that.

Get it working for you. Yeah, I refer to it as a steward mentality, right? Because there's spender mentality, which we all know, many business owners, by the way, about 75% of business owners fall under spender mindset, which is why they become business owners because they have higher control of their income because that's what they hyperfocus on. They forget about the spending, but they get unlimited income and that's why they become an entrepreneur. But on the flip side, also in scarcity are savers like my dad, right? You can never save enough. You can't pay off debt fast enough. It's just never enough. And scarcity never leads to financial freedom. It's about how to be a wise steward, which is what you're referring to, which is what's the best use of my money? How can I get this money to work as hard as possible for me so that I can not just create comfort, right? Not just become work optional, but essentially. Bless more lives, right? And that's kind of what the Money Ripples, you know, brand is about, right? That ripple effect you can create in others' lives. You know, that's what a steward does. Steward's always trying to make it better, which also, by the way, a lot of business owners understand better than the 9-to-5 W-2 employees. Because even if they're spenders, it doesn't take much to switch over because money is meant to be used. It's just meant to be used wisely in a way that actually increases your means so that you can increase your impact in the world versus just blowing it, having great lifestyle, looks great on social media, but you always feel trapped. You're always in the hustle. You never escape the hustle.

Right, right. I mean, yeah. So I mean, Keith, spend it. So what I'm learning so far, and obviously we're going to dig deeper, is have money being fluid and rippling, you know, working, but wisely. You spending money and buying things isn't necessarily the smartest thing. So how do you get your money to work for you to create more income, which we'll get into? Okay. So now we'll go back to your story. Thank you for taking me on that to clarify.

So, so at that time, by the way, I only need $3,500 a month. To live on. So I did a few different things and it really almost became accidental the first time. And I say the first time, because as you mentioned, I had retired twice by the time I was 39. There's a reason, because I screwed up the first time, but I'll tell you what I did the first time and then I'll mention what happened the second time too. So the first time, you know, like I said, I turned my starter home, I turned it into a rental. And then of course from there, I also realized I could lend my money to real estate investors. And there's, and at that time in 2006, because of appreciation, everything, people were really, really kind of frothy. So like people were paying me like 2% a month to borrow your money. So if I had lent somebody $100,000, they'd pay me $2,000 a month.

So the money you were making on the house, you had the rental income, there was enough overage to be able to have you take some of that money and lend it out.

Yeah, between 3 different things. So that was one. Two was I was lending my money. All right. So I did strip the equity out of my property and stuff because I had, you know, built up a lot of equity in that property and then I was able to lend that money out. I could lend it out at like 2% a month.

Yeah.

So, you know, like I said, if you have $100,000, that's paying you $2,000 a month without touching your principal. And that's just lending to guys that are like doing fix and flips and things like that with properties. So you're letting them do the work, you just— or the bank.

Right.

But also on top of that, it was kind of accidental where I had a friend of mine that asked me, he says, well, Chris, I know you're doing mortgages. Do you like doing mortgages? I said, honestly, I love getting people the results and I love teaching them about the strategies with a mortgage and what you can do with it, especially where you can strip out equity and invest it. But I absolutely hate paperwork. And I was used to being like the rugged do-it-yourselfer, right? Like if as a financial advisor, I was like the one-stop shop. I had like life insurance, health insurance, you know, I would do your mutual funds, annuities, you know, I did your mortgages, I did everything. And he's like, why do that? This is an abundant world, not a scarcity world where it's a zero-sum game. He's like, why don't you find somebody who actually likes doing paperwork? I said, does that person even exist? You're like, who would be nerdy and dumb enough to do that? And he's like, trust me, there are nerds out there that love paperwork.

Oh yeah.

So I went to the broker and asked, I said, hey, who would do that? And he said, oh, talk to Clark. Because anybody named Clark would be nerdy enough to do paperwork.

Clark does sound like that. Yeah, exactly. Okay.

Yeah. So I found, you know, I went to Clark and I say, hey Clark, if I send you people that I've been teaching about how to take equity from their homes, you know, cash-out refinances and then invest that money. Could you help set them up with a mortgage? Would you basically do all the work? He said, yeah. I'm like, would you do it for 50%? You bet. And so the great thing is I'd spend half hour to an hour teaching people like, here's what you can actually do with your home equity to even pay off your mortgage faster or invest or whatever. And so he's like, so I would say, great. You know, they're like, how do we get that mortgage? Talk to Clark. And I referred to Clark a month or two later, I get a check in the mail, you know, from Clark for like $1,000 or $2,000 a month, you know, and and it was just friends and family. I wasn't like doing this big affiliate type thing, even though I didn't even know what an affiliate was back then. It was literally just, I was sending referrals. I even sent referrals to a jeweler, a wholesale jeweler in Salt Lake City because they would pay a 5% kickback. And I knew that anybody who went to them would pay a third of the price for their engagement rings. And being in my twenties, everyone was getting married and engaged. So occasionally I'd send referrals there. And so I'm getting paid like an affiliate. I'm getting paid from rent, my rental, and I'm getting paid from lending my money out. And the next thing I know, I have like $4,000 or $5,000 a month coming in. I only needed $3,500 a month to live on.

Great.

And, and it was crazy because I was hustling so hard to try to make that much money or more as a financial advisor and whatnot, working easily full-time to overtime hours. And now I'm literally working like a 3 or 4 hour work week. Even before Tim wrote the book, Tim Ferriss did, right? You know, I was living like that 3 or 4 hour work week doing those things. And that's what blew my mind. I didn't think it was even possible.

Love it. Okay, so now we fast forward. So thanks for clarifying. So now you fast forward your 20s, late 20s there. You said you lost it and then you did it again, and then we'll get into the lessons here.

So yeah, so 2007, I came outta retirement. I was gonna save the world. I was gonna teach with a guy named Garrett Gunderson. Some of you guys might have heard of him before. We partnered up to create a company called Freedom Fast Track, which eventually became Wealth Factory. And we started that in 2007. We're all gung-ho. We're gonna do it. And of course the recession hits. At the same time that recession's affecting our business because all of our clients were actually real estate investors. So they're all getting wiped out. They didn't have money to pay us. At the same time, my own real estate's having issues. And of course I raised my quality of life up too at that time because I was making so much money. It's like air. You never count the number of breaths you take until it's gone.

Yeah.

And that's what was happening. So next thing I know, I'm in the hole $15,000, $16,000 a month. I literally went from like, asset millionaire to welfare, like literally on food stamps and trying to figure out how to make ends meet. I found out later, 'cause you know, the guys at this company were overcharging us for rent, but that's another story. But you know, things like that were just going on. Like I was just like trying to figure out how to make it work. And during that time I stopped teaching people how to get outta the rat race and I pivoted. 'Cause remember, I can't teach something I'm not doing. People always talk about imposter syndrome and I don't really ever feel that too much because if I don't do it, I don't teach it. And I guess that's how I avoid imposter syndrome is that I only teach what I know, what I'm doing.

Comfortable, natural. Yeah, you could. Yeah, exactly.

Yeah. So I started teaching people instead of how to find money, cuz in the recession people were like, Chris, I would love to know what the things you've learned, but I just don't have the money to pay you. Now in the back of my mind, I wouldn't say it verbally, but in the back of my mind I'd be like, man, I wish I was in their financial situation. It's way better than mine is right now. Now I wouldn't say that out loud because that's business suicide, right? but it was really at a point where I was like, man, like I wish I was in their situation. So I would tell them, I said, listen, if I can help you find the money to pay me, will you pay me? They said, of course. I was like, great, let's do it. And so I would show them creative ways to improve their cash flow, whether it's ways to track their money better, creative ways to pay off debt, the whole cash flow index, which is now thrown out there with like the income snowball and income or the debt snowball and debt avalanche and all that kind of stuff. That's now one of the strategies out there that I literally I actually created while I was playing Cashflow 202 on my computer, 'cause I was so desperate. I was up late every night trying to figure out how to take care of my family. 'Cause I had a bunch of young kids. My wife's talking about moving in our sister's basement. I have collector calls coming every day, you know, like I was literally like being crushed under the pressure. Wow. And so I started teaching them creative strategies of what I was doing in my own situation to stretch those dollars out and make it work, save money on taxes, right? Things like that. And finally, After going through all that, and we can go back to all that, you know, emotional turmoil, how to control your mind during those times. But finally it was like the fourth quarter of 2009. I had that system I had started to develop over the course of about a year, year and a half. And then Garrett finally got these great relationships through like Joe Polish in like the dental and chiropractic space. And then all of a sudden, like they married the two together, like with the new system we were creating, cuz the old system that he had created was just trash. So, but mine was actually like implementation versus just philosophy. Meld those two together and the next thing you know, like one of the chiropractic coaches finds out he's freeing up $50,000 a year in tax savings from our, one of our CPAs and just left and right. I mean, people on average were freeing up about $34,000, $35,000 a year. Wow. Knowing money invested, not even investing money, just finding ways to smarter ways to do it.

Yeah.

Yeah. Better ways to be a better steward of your money to stop those money leaks and things like that. And it just, our business went from almost bankrupt in 2009 to making over $5 million the next year in 2010. you know, and had like over 250 clients come in that next year. So it was, that's what started to help me climb out, right? Start to pay back some of the debts I was digging under. I got myself down to almost nothing. By the way, I foreclosed on my dream home that I had for 3 years in April 2009, just months before things turned around. It was almost like I had to lose everything to figure out that I had everything in the first place.

Wow.

I just had to lose it, you know? So that's where things started to really turn around. Now, 2012, we parted ways. I was like, hit the reset button, had to start over. 2015, I had a divorce, you know, which didn't help either. So, I mean, this wasn't like it was a straight up shot from there, but still that putting that focus again on how do I get myself back to that work optional place was the focus to where eventually by the December of 2016, I finally said, hey, I've got $10,000 a month coming in of passive income. I'm there now. I'm there again.

Wow. Okay. So that's an incredible story. As we have time, I'd love to hear how you got through some of these, these difficult times because we've all been there. Let's jump into some of these strategies too, because you hit a lot of these topics. I think all of us listening are like, okay, what are some of these? A, whether it's money saving strategies or how to get money to work for you. I mean, the big, so far the big takeaway, which I've heard a little bit, but I like that you talked about is, you know, getting money to flow. So let's talk about some key strategies. You know, what do you often find with this entrepreneur? Some tips you can give, you know, you can start dropping here.

Yeah, for sure. Yeah. So a lot of these strategies, I mean, come from, in my book, the concepts I call it get lean, get liquid, and get out. So I have the new book that just got released on Amazon called The Work Optional Blueprint. Super excited for that coming out because that's my first book ever. Shout out to you guys at Speakeasy Mastermind Mastermind because between the publisher I was working with and Andrea Rindle, you know, having her help with the book, I mean, I would never have gotten it out, you know, never.

Go Andrea, our Calgary leader. So, uh, let's, uh, make sure we drop that link in the notes. Okay, keep going.

For sure. So yeah, so get lean, get liquid, get out. That's like the 3 phases you want to to do with your money that's different than what every financial person talks about. So Get Lean is— I mean, this one might not sound much different, but it is. I mentioned this, it's like, how do we make sure we're wise steward of our money? Like, it's not about living on rice and beans, cutting out that latte like Ramsey or David Bach talks about, right? Which is like minimizing your way to wealth, which is BS, right? Like, that's not how we live, you know, especially in a world where we want to be bigger stewards of what we have. And so no, it's all about How do we be wise, right? If we're going to spend money on something, make sure it's something that's worthwhile spending on. This applies both in your business and it applies at home. And so really start tracking your money. Track your money. Like if you're in business, and I know we got plenty of people that are saying, yes, you need to do this, especially if they're in the finance space, is make sure you're tracking your money. I would do it weekly. That's what I do. Like I track my money weekly, make sure I know what's going on with that. Are there any leaks in the business? Are there any subscriptions I'm paying for that I shouldn't be paying for? right? Like, you know, all those things that you get when you get all these little, you know, different programs and stuff for helping you do marketing and whatnot. It's like, wait, I don't remember what that thing does anymore. Is it even useful? Right? Or is it extra? We changed our CRM up. You know, we freed up money in that in our business recently because we were using a CRM platform. We were using Kajabi and we're using this and that, right? Like, totally.

I'll echo that too. Cause we did a recent flush out in our own systems. And every time you have that subscription exercise, it's amazing because you got And, and I'll just, you know, again, I'll double down on this one. I mean, what typically happens in businesses is you get an employee who's like, hey, I just need to add this tool for so-and-so. Sure, it gets approved. And then that's 2 years ago. That employee is no longer here. Nobody else is even paying attention to that. And that just happens. And there's literally thousands of dollars a month in subscriptions that are typically in pieces of business. Love that tip. And I think if you double on that one, you said also get lean. That's business. What about on the personal side? What do you often find with your clients that where it's easy to say, yeah, of course, I'm kind of watching what I spend money on and yeah, I'm going to buy my latte. What's a common thing that we're probably not spending that we're spending on that we maybe need to think about not spending on?

Lately, I've seen a lot of eating out is a big one. And it's not bad to eat out, but sometimes it gets ridiculous. I had one lady who she was in IT and her and her husband were making, you know, quarter million a year, but they're like, we're broke. We don't know why. And when I looked it up, And by the way, this is 2010. This is pre all the extra inflation we've seen last year, right? And I look it up and she's spending $5,600 a month. That would be like now eating out of about $10,000 a month. Right. I mean, just ridiculous amounts. I'm like, what are you doing eating lobster for breakfast? She's like, that's not too far off the truth.

Wow.

So I told her, I was like, what if we just reeled it back? That's what, you know, at that time it was like $1,000 a month. So even imagine your case, like what if you reeled back, you know, spending, you know, eating out $2,000 a month? right? For her, it was drastic. It made a massive change because going from $5,600 to $1,000 frees up $4,600 a month. That's over $50,000 a year. She also found out that they were wasting money, like even food shopping, because she was having her daughter's boyfriend, live-in boyfriend who wanted to be a master chef, you know, buying all kinds of crap and he sucked at it apparently. So she was like, okay, we're reeling that in. Then we freed up some money, like with health insurance. They're overpaying on health insurance premiums, which I see a lot of entrepreneurs do too. Mm-hmm. Um, taxes. Had her meet with the accountant, found out there's ways to do little strategies with taxes, whether it's like, you know, for example, if you're an entrepreneur, many people don't realize that you can actually pay for the use of your house. They call it the Augusta rule, right? Now it's become more knowledgeable now, but man, like when I was even applying it back in 2011, nobody knew about it. You know, I mean, so using that to where you can literally pay for the use of your house for one day at a time, not to exceed 14 days a year. And that's tax-free income to you, right? Paying your kids, which now you can pay your kids like $14,000 a year tax-free. you know, and that's up until they're, you know, till they're 18, things like that. So just little strategies of that nature. And when all was said and done, she freed up like something like over $70,000, $80,000 a year. Wow. You know, just doing that stuff. And that's all for her was pretty much personal, you know, in that sense. Wow.

That's great. Okay, so thanks for sharing this. Okay, so it was get— those are some get lean. Now what about get liquid?

Get liquid means get your money in your control, right? What's so bad is that most financial advice tells you to lock your money up in prison. They say to pay off that house, trap it in the home equity. But what I learned in 2008, one of the things that made it so stressful on me is that when I wanted to get my money out of the house, when I realized money was getting tight, the bank said no, right? Because starting about mid-2007, they're like, we don't really like business owners anymore, so we're not going to give it to you. And that's what helped cause a lot of the property values to tank during that time. So you can't ever rely on even if you have a home equity line of credit. I had somebody tell me like, oh, I've got an emergency fund. It's a Home equity line of credit. I'm good. I said, do you know that back in 2007, 2008, I had many, many clients, even myself, who had lines of credit that they took away and then sent you a letter a week later saying they took your line of credit away? No warning. They just cut it back overnight. They can do that to you at any time. That is not an emergency fund. You know, so if you have credit cards or lines of credit in your banks and things like that, I have them too, but those are not emergency funds. You got to have liquid cash on hand. So don't lock it up in home equity or in places like that where you can't get to it. Don't lock up in 401(k)s and IRAs where they slap you with penalties to touch your own dang money, right? That's stupid. It's like, no, get that money in your possession and you don't have to keep it in the bank. You know, like for example, I keep most of my money inside of a life insurance policy, like a whole life insurance policy that pays me 6% a year tax-free. But I designed it in a way where it's low cost, so it actually grows versus just costing me a lot of money. Like most people set up with crappy insurance agents, you know, not to say anybody in this group has, you know, if they're an insurance agent, not you, of course, but right.

I've had multiple debates about, you said that the home equity or just how you don't have your money. So rent versus buy, like most people think the dream is to own a home. I've heard the counter of that's great, but as soon as you buy a home, your money's trapped in the home and you think even though your money might be growing, you typically never take that money out because you just go buy a bigger home with it. And so it's sort of like that money's never working for you as much as you think it is other than maybe at some point in retirement and you're slowly paying it down. So is that what you mean or what's your take on that? That kind of, I know you can always, hey, if your house grows 20, 30%, you can do equity line and take it out, but now you're back to what you talked about. What's your take on that?

Yeah. You know, like that's the thing about, there's a difference between principles and strategies, right? So the principle is have money liquid, which is also a strategy too, in a sense, but really having liquidity, having access to cash. Is a principle, right? It's that safety that you need. Whether or not you buy a house is a strategy and it can change depending on the conditions. I'll make a prediction here, and I'm a huge fan of real estate and I still invest in lots of aspects of real estate, but I predict that you're not going to see your house appreciate much for the next 5 years, right? Maybe in the next 10 years, but not so much in the next 5, right? And so if someone's saying like, I'm literally banking on the value of my house going up, that appreciation, Don't count on it because if that's the only thing that's going to save you, don't buy a house. Right?

Right.

So you're right. I mean, right now we're in a market where rents are actually a better deal than mortgages because rents have actually come down in the last year or two. So there's a good argument that way. Not to mention, I mean, I bought a house here, you know, 4 years ago, you know, right at the height of 2021 where you're like, you know, trying to outbid everybody. And this house, like after we moved in a year or so later, The house, the basement floods, not from plumbing, but from outside water, which is not covered by home insurance. I've even had to come out of pocket $100,000. If I were renting this place, I would not have to pay a dime. So that's the kind of stuff they have to understand, that when you buy a house, when it's for your own personal use, it's not an asset, it's a liability. It's really an expense, just like renting is. Now granted, I agree, you can put a small down payment, make a lot of money on it. And I think overall homeownership will make you wealthier over time. In the short term, don't count on it. And that's where I think renting can be just fine, even if you're a multimillionaire. I've debated the same thing myself.

You know, would you argue then that it's the time to buy a house potentially strategically is when you have other cash that you can use that could be liquid versus putting all your money into a house that you're not probably going to gain for a long time because you said it's not— wait until you have enough liquid not to say, all right, I have enough money finally. To go buy that house, but I have nothing left after that, you probably would argue against that.

And that's where the get out comes in, right? Because you get, get lean, then you get liquid, and then you get that money out working for you. So yeah, you could buy a house, but it might not be the time to do it. You might say, you know what, I'm going to rent for a few years. Maybe I'm just going to try to stay as stable as I can. But how can I use that money? Could I use it in my business to grow it? Now, I will give a warning on this. Like, when you're starting up a business, It makes perfect sense that your business is your number one investment and should be your number one investment even after you've started it. However, this is where I see the trap. The entrepreneur trap is this. So many business owners will constantly keep saying they reinvest in their business. And I'm using air quotes on purpose because they say reinvest. But if you use the words of Mike Michalowicz, who's the author of Profit First, which is a must-read for every business owner, just like, you know, just like, you know, you got books like Rich Dad Poor Dad, you got books like The E-Myth, Right? Every entrepreneur needs to read Profit First. 'Cause what Mike Michalis would say is, no, if you're always reinvesting your business, you are not profitable. You're literally spending all your money back in your business.

Right.

And long-term, that's a chronic problem, right? Because one, your spouse is gonna hate you for it because they're gonna say, why you, your business apparently making a lot of money, but we don't see all that money come home. Right. But the other problem is this, is that you need profit. I mean, profit is a lifeblood of that business. You don't have that liquidity that obviously comes from you having profit and storing that cash. That's why I'm not always a big fan of just paying down your debt super duper fast. Um, even though I did, I still had to do it in healthy levels because every time I would just use all my money to pay off debt, if I didn't have liquidity, something came up or there was a dry month or something like that, I'm hustling and scrambling, major scarcity, which drives away business and makes it— you have to work 5 times harder to get the same business you would've had. Had you relaxed, stayed in abundance. And so getting it out could be in your business, but that's not the permanent solution. That's why I create multiple streams of passive income and I call it passive because it's literally passive, not active in my business, right?

Mm-hmm.

But actually creating outside streams of income. Like when I do things with real estate now, right now I might not be buying rentals.

That's a good point. Back to Profit First, which I know you talked about building in as your strategy, if I recollect, it's profit first is the most important thing. You got to pull money out to you as part of your strategy. If you're trying to like, you know, whatever it is, you're not making money. Like if that's not happening, then you're not doing well as a business right now. You need to be paying yourself first as profit. That money goes into some other account, some other place outside of reinvesting your business so that you could do what you're talking about, which is take that money into other things, get liquidity with that money, build up whatever you need to be building up to start gaining from the work you're doing in the business. Is that accurate?

Bingo. That's exactly it. Yeah.

The savings account, the other account that doesn't, your business doesn't see or sniff at, because it's easy to put that money back in your business, but pay yourself, put it over there. So now you're building up the quick liquidity in your, call it other account, savings account. So strategies with that now to get passive income would be what?

Yeah. For example, I mentioned lending, you know, I can lend my money right now in a good environment, you know, 10, 12% a year. That means if I have, you know, $100,000, I could be paid roughly about $800 to $1,000 a month on that. You know, so I'm now taking that money and helping to create other streams to then replace what I'm spending at home. Remember, I'm being a wise steward. I'm getting lean again, not being cheap, but just being lean right at home and also in your business. And then start to build those streams of income. So lending is another one. I'll even invest in things like oil and gas. You know, oil and gas is great. It has some tax advantages, which as business owners we always love. We get most from our business. It's nice to have some additional ones. It could be rentals, although I do turnkey rentals where I'm not the one managing the property, somebody else manages it for me. And the great thing is that like I live in the western half of the United States, rentals here, horrible idea, bad idea. Even people are trying to do Airbnb or having a hard time out here sometimes.

Really? Okay.

But out east, you know, southeast, for example, you know, you can go to a place like Tennessee or North Carolina and you can get decent rentals. It could be Oklahoma or something like that. You know, there could be rentals there. They have a property manager there on site. So you're not being distracted from your business trying to deal with all the headaches that might occur. Right.

So those are things you say when you say rentals, that means just buying a property that you rent out, you know, buying a property that's not that expensive or, you know, we don't need to spend, you know, us West Coasters are spending, you know, $1.5, $2, $3 million to get anything. You know, you're saying you could put that into way less, couple hundred grand down into something on the East Coast.

Yeah. Like for example, I had a, I had one guy who actually was in California, San Diego, out in your neighborhood. He's a chiropractor out there. And he had, he had about $800,000 of equity in a rental property that he was only cash flowing $200 a month. But he was just so laser-focused on that scarcity saver mentality. He said, no, no, I'm going to pay this off in 6 years and then it'll be $2,400 a month. I said, even then you realize that's a crappy return on your money. That's a 3% return. You put it in a CD. And make more money. So I told him, I was like, what if we did a tax-free exchange of that money out in the Southeast? And so he ended up picking out in a near, you know, out in Louisiana, he bought 6 rental properties with that one that he sold off in California. 6 of those rentals that then were cash flowing $6,000 a month. He then was taking that money and he did what I call an income avalanche where you reinvest that income to build it and create more, right? You compound the income instead of compounding interest, right? Sustained that income and reinvesting it, reached out to me last year. He says, Chris, I've now got to like 8 or 9 properties and I'm making $8,000 a month, over $100,000 a year versus $200 a month that he was making on that property before. Yeah. So, but like I said, like, not, I mean, right now in the current market, we may not push doing that kind of thing as much because that train is kind of not left the station, but it's kind of left the station. It hasn't returned back yet. To make that work.

Yep.

So we always look for different strategies that do work. Like I have a business partnership right now where these guys buy and sell raw land. I'm the financer. I use my cash. They do all the work. I'm a 70% partner in that business. They're 30. But right now that half million is kicking off over $12,500 a month. Mm-hmm. And it's got over, now that half million's turned into well over a million dollars of just land alone that's kicking off cash flow from them. Taking that property, flipping it, selling it to somebody, but they're selling it to them on a mortgage. So we're like the bank getting paid monthly interest payments every month.

Right, right.

Things like that. I mean, just, I mean, we can go on and on about it, but ultimately it's, I find that I like to buy real assets that provide real income and that's what I focus on so that I know that this is my secret in business too, is my business has grown the best when I don't need the money. Right. There is something to be said when somebody's like hungry and they're trying to get after it and they're hustling. And that's awesome. But it's a whole nother level of abundance when you know that you're there because you're there to serve. You're not there just to make money off somebody. You're there to show up and serve. And people respond to that. People say yes to you more often. Your conversion ratios go up because you're not desperate. You don't have what I call business breath, right? Where you reek of that desperation. Like when people are throwing business cards at you at Chamber of Commerce events, right? It's not like that. It's literally like you're there. You're like, I'm here to serve. If I can serve you here in my business, great. If not, I can point you in another direction, right? It's just non-attachment because you know that your family's taken care of regardless of what happens in your business.

Right. Love it. So that's, so that those are all 3. So I love it. So lean, liquid, and get out. You have the liquid. So when you have the liquid money, you want it to start moving and working for you. You said the assets are a great way to something that's tangible, that's producing money. And then you cycle continues, right? Because then you get more liquidity and you reinvest that into other stuff to get more passive. Bingo. Love it. So you mentioned today, I mean, gosh, you know, I'm listening to this and thinking of in my world and others. Okay. So you said in today's world, you know, here we are in, uh, if this gets dated, Q4 of 2025, you like land. What else are you seeing out there that you think is good? If somebody's saying, well, I need to, I have some liquidity here. What do I do with it?

Yeah. Lending has been big. I'm lending my money.

So where do you go to lend and how do you find people to trust? Like, what are the things you've learned? And maybe you could share, like, cause I'm sure not every time you lent money out or something, you never got screwed once. So like, Yeah. What are the things you're looking for when you do lending or investing in other projects?

Yeah. I mean, one, you could find it yourself or two, you borrow somebody else's network, right? For me personally, I mean, I did it through the life hard knocks. I did it the long way, which was build my own network. I've realized that birds of a feather flock together. So first and foremost, like if I'm living a life of integrity, which is a big, you know, I know everybody says that's their value and stuff, but yeah, yeah. But literally like honesty and integrity is like an absolute non-negotiable. And I notice when I live that best in my life, I tend to attract people just like that. That's how we got connected, right? Because like-minded people that I know and trust are also know and trust you. And then we got connected together, right? And so it's that way. That's first and foremost that helps weed out a lot of the charlatans, the, the great marketers that are all talk, but no, you know, as they say in Texas, all hat, no cattle, right? But I would also say this too, is like when I look at people, when they come to me, cuz they want my clients, cuz I have clients that we work with one-on-one to help them become work optional. They're saying, hey, if they've got money, I've got deals. The first thing I start wondering is, okay, well, how long you been doing this? How long you been in this game? You know, like, and tell me your worst deal. I want to know all the scars you've gotten over time. Not from a bad way that I won't trust them, but I want to know what they've learned. I want to know if they've been through a full market cycle. Have they been around for at least 15 years? Or are they like with one of my friends, bless his heart, he's a great guy. He was in the real estate game, but then when things weren't so great in the real estate game for him anymore after 2022, he pivoted into oil and gas. Well, I love oil and gas, but when he's like saying, hey, maybe we should do something together. Well, cool. Why don't you talk to me about the year 2035 and let's just see if this is something you've stuck with.

Right. Yeah. Yeah.

Because, because I don't trust anybody who's just been there for a few years. They've been dabbling in it. I don't want my money to be their guinea pig.

Right.

And so that's what I look for. I look for that experience because I bet not just on the horse, the deal itself, I bet on the jockey. Who is that person I'm investing with? That's more important to me than even the deal they're doing.

I mean, you're ultimately saying Fundamentals 101 from any venture capitalist you talk to is going to put money into a business. What's the top 3 things you look for? And they say management, management, and management. Yeah. So that's really what matters. And within that is exactly what the first 3 things you mentioned. Management, what's their experience? Are they honest? Have they been honest with you about the deal that they fucked up on? Pardon my French. And how they got through it and what they did to take care of their people. Like, you know, going down that rabbit hole, because that'll help you with the integrity question.

Yeah, that's a great point. I mean, there are third-party verification companies that do audits, third-party audits. That's another great one to see, like, hey, have you had an auditing report done recently? Because I mean, most people don't do that. But I think now especially there is more stress in the real estate game. It has been for the last 3 years. You got to be careful, you know, and it could be strategy-wise, like I say, like, for example, self-storage. That's another thing that we look at. But lately self-storage hasn't really been awesome. So finding opportunity is really hard. So when somebody says, oh, I got a great deal, do you really? It's like 2022, 2023, and there's like, oh, we got this apartment building, it's going to— we're going to do value add, you know, we're going to do stuff to it so it increases in value. I'm like, yeah, I've heard that. Like now, like amongst us investors, the term value add is a joke because we're like, no, no, if it's not cash flowing from day one, your little value add isn't probably going to work. You know, it just means we're going to lose our money, you know? So those kinds of things happen, right? So a lot of that is from experience of losing money, you know, in the past and, or watching others lose money too. But it's also, it's literally just from, you know, understanding the deal and the person that's doing the deal. Yeah.

Yeah. I tend to agree with you. I mean, I have done some angel investing and some other types of investing. And I think where I've won and lost is through my own hard knocks is exactly what you said. I think when all the end of the day, it goes back to, I know my lane and what I'm good at. And there's other people in other areas where I'm 10, 15 years behind that I just didn't go down that path. So who do I know that I trust that's been in this business for 10, 15 years that I could give them my mind? And I don't care, like I'll peel off a percentage to them for handling stuff and saying, look, yeah, you absolutely should earn. So you've done all the work for 15 years. Let's make some money together. And certainly you found it great. You know, you're taking care of it. I'm happy to pay you for that. So that's kind of where I've had some successes on when I do some liquidity. Playing around. But yeah, I love what you're saying there. As we wind up here, what on the finance side, what is there anything I didn't ask that I should have asked?

You know, I'll say this to go along with when you were asking what should people be looking at right now. I think right now getting liquid, you know, that second stage I talked about is more essential than ever. I think we're gearing up for something big and ugly too. I know even AI I think is awesome, right? I don't doubt that one bit. But I know that also we've had a massive— yeah, as they say, it's a party, right? The bigger the party, the bigger the hangover. And we've had the everything bubble take off, especially after 2020. Nothing's gone wrong, nothing's gone down, it seems like, other than some real estate stuff that did, like in apartment space and whatnot. But for the most part, everybody's made money by doing nothing. That should concern you, right? Because that easy money The easier it is, the bigger the pop of that bubble. And I think there's a big bubble popping here and you may not see it in 2025 yet. Although we're already seeing cracks, we're already seeing people stop hiring. We're seeing layoffs happen. Although the government likes to report numbers, they all as well in Camelot. Yeah, we all know that's a bunch of BS because they're trying to spin it so that they don't look bad from a political and an economic perspective. You know, so there's a lot of this crap going on that we, we know we feel it. We sense it. A lot of us do. But we don't know when it's going to happen. And I think, you know, starting in 2026, if you don't have cash, you're going to be sorry. But those that do have cash, those that have cash on hand, you know, even if it means not just a couple months reserves for your business, which you should have, by the way, like at least a good couple months of operating expenses in your business, you should have even more because you might have the best opportunity for gobbling up a lot of opportunity. It could be gobbling up market share, could be gobbling up your competitors, you could be gobbling up like other value-add, you know, This is the good of value add. And if I use that right, value adds out of your business. I mean, I really think this is the time to have cash because there will be a point very soon in the near future people won't have cash. Stocks are going to crash. We'll see Bitcoin fluctuate as well, good or bad. I mean, we'll see a lot of people be cash-strapped and try to pull out of those markets, even Bitcoin, which is why you won't see Bitcoin go down because it's not like it's valuable because people need to get cash. They need to use it. And that's the opportunity because when you start seeing everybody raiding their piggy banks, breaking and just trying to survive. If you've got the cash ready to go now, you're going to make the rules, right? The person has the gold makes the rule.

I love it. I agree with you too. I mean, I think outside the COVID dip, which came right back not too long later. I mean, correct me if I'm wrong, but we've had the longest consecutive runs of real estate, stock market, everything all at once. And that is a bad sign. I mean, it's good, but that is, I agree with you. I think it's going to hit. What percentage of your, and I don't know if you have money or what your data set or your pie. What percentage of money that you might have in these sort of stock markets do you have in cash versus mutual funds and equities and all that?

Right now I have zero in the stock market, zero in equities, anything like that. Now liquid cash, like I said, I have a lot of it stored up in my life insurance because it's guaranteed I'm not going to lose it there and it makes money in the bank and it's tax-free. So I'm keeping the lion's share of my money there, some in banks or online savings accounts. But I mean, I've got— I'd probably say of my entire portfolio, roughly about That's the same as Buffett, actually, roughly about 25 to 30% in cash. Buffett has 30% of his money in cash right now, $347 billion, the most he's ever had in cash. He's in cash right now. So I'm modeling the same thing, even though people think that's stupid. I don't care because when the majority— Mark Twain says, is when you find yourself on the side of the majority, it's time to pause and reflect. And right now, like the majority is like, no, get all your cash out. You're going to lose inflation. Get all the money out. Those are the people that will be sorry.

Yep. Yep. No, I love that. Appreciate that. And then, um, ballroom dancing. Ballroom dancer at 25. Like, just close the loop on that, or whatever you were— a champion ballroom dancer, right?

Yeah, that was a very unintentional thing, just like a lot of things in my life, I guess. You know, it's like you get directed into it. Freshman year of college, I had registered for a math class, but I took 2 semesters of calculus in high school. I thought it was enough because it was concurrent enrollment with that, but then the college said you're like 0.6 credits short of getting your math requirements done. So I took like a crappy algebra class. Well, I show up there that week when school's gonna start, they say, oh, you don't need it after all. Now without that class, I wasn't full-time. So I was trying to find a 1-credit class, like some kind of gym class or something like that. And I heard this girl talking to this guy saying, you know, hey, there's lots of girls in this class. I didn't know what class we're talking about, but I knew that was the class for me. I went and I registered for it. And I sucked. I was horrible. Girls would even bypass me sometimes to not dance with me in that class. But I had fun, kept doing it, took a second semester, even took a ballroom class as well. And the next thing I know, my confidence started to increase and I actually won like third place in the competition. And after that, my confidence level started going up. I started, kept doing it, practicing, got better, got on the team there. That was in Idaho. And then I transferred to one of the two best schools with ballroom dancing. There's, and they're both within 5 miles of each other. One's BYU and the other's Utah Valley University. Both had world championship teams that alternate going to the world championships and they would always win. So I went to the one I thought was least stuck up. So I went to Utah Valley, did that and, you know, got on their ballroom dance team there, did that a few years, competed at amateur level and tried to avoid the professional level 'cause I didn't want to get paid. So I get paid under the table from the instructors at the universities. So I'd get paid in cash and stuff and you know, did that for a while. And until my, who was my dance partner, my now ex-wife, gave me an ultimatum, says, you either pick me or ballroom dancing, because I'm not doing more. We keep having kids. Picked her and then started doing marathon running instead. And now I'm running the world majors and stuff.

I love it. I love the competition in all areas of your life. And I was going to ask if you ended up getting the girl, if somebody finally would dance with you. And it sounds like, you know, you did at some point. So congrats on that. As we wrap, what are you enjoying about Speakeasy Mastermind Mastermind so far? What's your favorite thing?

You know, definitely that it's like the who's who. I've been a part of a lot of different networking groups, mastermind groups. And the one thing that impressed me the most, I mean, first was our chapter president, Kat Merritt. I mean, if you don't know her, you got to get to know Kat. Genius, freaking brilliant. I actually met her when I worked with Gary Gunnarsson. She ran our sales floor and I've had a relationship with her ever since and she's amazing. But then I saw the high, the high caliber that was in the room. I'm like, these are people that make me feel a little self-conscious, right? Like, you know, I've been in networking groups. I'm like, okay. I might have the cheapest car, but I have the most money, you know? But now I'm like, I'm in these groups thinking, dang, there's a lot of people I can learn from, just brilliant people and people with a servant heart. Like, like Curt Mauli, I'll give him a shout out too. I mean, never met the guy. My CMO knew who he was, you know, and she like, you know, like glorified him and stuff. But then you meet him, you're like, you're just a normal guy. And guys like David Gonzalez, you know, met him. I haven't joined his think tank and stuff too. And I mean, there's just so many brilliant minds in that room that it's really the kind of networking group that is a true mastermind, not just a conference that they, you know, masquerade as being a mastermind. Right.

Right. Well said. I appreciate the words and thank you so much. And thanks for coming in today and dropping some, you know, talking about masterminding and brilliance. I mean, obviously brilliance in your world and thanks for sharing. Anybody listening, obviously I'm sure you have some amazing takeaways as well. And please get a chance to meet Chris and talk to him. And I'm sure he'd be happy to, guide you through and give you some pointers as well. And thanks for coming in today, Chris.

It's been an honor. Thank you so much, Eric.

And that's a wrap from the Speakeasy Podcast. If something sparked for you, don't keep it to yourself. Share it, review it, and pass it to the one person who needs to hear this right now. Want in on the Real Mastermind? Tap the link in the show notes to apply. Until next time, keep scaling, stay sharp, and don't be the smartest one in the room.