The Affluent Entrepreneur Show

Wealth Habits That Make a Difference

February 06, 2023 Mel H Abraham, CPA, CVA, ASA Season 2 Episode 122
The Affluent Entrepreneur Show
Wealth Habits That Make a Difference
Show Notes Transcript Chapter Markers

How do your daily behaviors, choices, and habits impact your financial future? More importantly, what are the essential habits to cultivate if you want to create wealth?

I’m going to answer these key questions in today’s episode and go even further. I’ve always found that building wealth is like building anything else in life - if you adopt strong habits, those habits become the norm. They become second nature. 

Understanding and learning the key wealth habits of successful entrepreneurs is a good starting point. These habits will help you build a solid foundation for your wealth, enabling you to create a lifestyle that is both meaningful and financially secure.

It's time to take control of your financial destiny, and this episode is the perfect place to start!


  • The seven wealth habits that will help you build your financial future
  • The four wealth drivers matrix and how each of them impacts your overall wealth
  • When is the right time to invest

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Mel Abraham  0:00 
Oh my god, this one's a good one. This one's a special one. I recently did a live training session a live keynote, all around the wealth habits, the things that will drive your wealth, I will talk about the wealth flatline. How you have to get past the wealth flatline. And then the four wealth drivers matrix, as well as a wealth priority path pathway. So in this episode, we're going to talk about wealth habits. Remember, creating wealth is about your behaviors, your choices and your habits. And this one is a good one, enjoy this episode. This is the affluent Entrepreneur Show for entrepreneurs that one operate at a high level and achieve financial liberation. I'm your host, Mel Abraham, and I'll be sharing with you what it takes to create success beyond wealth. So you can have a richer, more fulfilling lifestyle. In this show, you'll learn how business and money intersect. So you can scale your business, scale your money, and scale your life, while creating a deeper impact and living with complete freedom. Because that's what it really means to be an affluent entrepreneur.

Mel Abraham  1:07 
So good to be here. This is such a good topic, and especially given what we're going through in the economy right now. And I think that this is important for us to have this conversation to to be real about it. I I kind of changed my my presentation based on some things that were going on. But I think that the reality is that although we're talking about wealth, habits and and Jenna hit on this perfectly, I want you to just understand, so if I'm going to jump to my iPad, I have some frameworks and tools, some things that I want to get to you, we'll walk through a recipe that I think that will keep you safe during these times as we go through that. But the first thing is this. It's not about the money. It truly isn't about the money, we get all caught up in trying to figure out the money. But this was August 2 of last year. And that is my very first granddaughter, Emily being born I am and I'm saying I am expecting a second granddaughter but but they are expecting a second granddaughter in January. And and here's the thing, on that day, my my daughter in law, my son are in a hospital get in and giving birth the same day, my mother at seven years old had been on dialysis for three years at that time was in another hospital across the valley. And and we didn't know whether she was going to make it she had been struggling for a bit. But here I was standing in the middle of the valley with with people that I loved on both sides. And at the inflection point of the circle of life. On one side, there was the possibility and the promise of life. On the other side, there was the possibility and the ending of life or the transition, if you will. And and it was in that moment that I started to look at things and so once again, all the money in the world, like Jenna said, Didn't matter. What mattered more than anything else was was I able to enrich their lives? Is my mom's life better because of me, because of the things I did because of the things I was able to do because I had the wealth to do the things to do is Emily's life going to be different because of the way I live the way I raised her dad. And in start to look at at this because that's the moment where we start to realize that money isn't the objective. Moments are let me say that again. Money isn't the objective moments are, you know, good news is that mom is fine. She is healthy. She is honoree as all get out still, but but the reality is, is that I want us to look through this conversation of wealth through the eyes of owning the moments in our life. If you look at your life today, and you say, how much of the moments do I own? How much of the moments do I control? How much of the moments can I dictate? Because it's truly the moment that we're really trying to do this for now a lot of people will say, Well, you know, I don't know a million dollars, I want a million dollars, let's just get some real facts about millionaires as we go into this. And then I want to, I want to talk about what is really going on in the market right now. So we set some things and then I want to take you through some habits to do that. And so so as we look at the truth behind millionaires, because I think this will set a perspective for you, hopefully, to understand this. And because we think it's this far off thing, this, this thing that maybe we can't achieve because of whatever age or stage we're at. And I'm here to tell you that it doesn't matter whether you're 20 you're 40 you're 50 you're 60 it's still achievable. So here's why The thing, majority, almost 80% of millionaires in the US did not receive an inheritance. They didn't get a gifted, they didn't inherit it, they didn't win the lottery, they earned it. Okay. And this is from a study of 10,000 millionaires, eight out of 10 millionaires come from families that were below middle income level. Eight out of 10. Over 80% are first generation millionaires, they're they created it on their own. Then, when you look at how much they made to create the millions, and Jenna mentioned this about investing in the 401k, and all of that stuff, 31% average only $100,000 a year over the course of their career. So we're not talking about a lot of money. It's what we do with it, that starts to to transition it. And so then we look at the education. Are they all Ivy League schools? Are they Yale, and Harvard and, and Princeton, and all of that? Nope. Most of the degrees are, are from public state schools. And I just wanted to put that out there. So we can maybe dispel the myths around being millions, building millions, and knowing that it can happen, and that it's a matter of choice. It's a matter of habits and the things that we do, here's, here's my belief, the reality is, is that financial freedom, it's your birthright, you just need to understand how to claim it. We don't talk about it, we're not supposed to talk about it. It's impolite to talk about money, but we're doing a whole month in growth day, on money on wealth on building a life that is full of richness, and meaning. And that's what this is all about. So, as we go into this, I want to talk about the elephant in the room. Okay. And that is this. The elephant in the room? Is all of the stuff that's going on around you. You might have seen some of these headlines. This was from yesterday. Stock market, worst worst day, and since 2020, as it was a meltdown. Okay, 1300 points down. The fact of the matter is that it's the, the depending on which market you look at, it's the fifth or seventh biggest loss in history. And it's freaking people out and the media is freaking people out. And the reality is that that all that Zeitgeist is doing nothing but spinning fear. And we got to stop. The question is, if that were an ocean, would you jump in and swim in it? Because it's not the reality. The media and the people that put out these headlines, and this is not a political statement, this is just the truth. They're not there to inform you. They're there to get ratings. They're where to get eyeballs. They're there to to get viewers, they're there to get advertisers. And the way they do that is to polarize or spin the fear. But that doesn't serve us. So I want to give you some truth. I want to give you some some perspective, so you understand what's really going on the market. So a bear market is when the market drops 20% from its high, they call that a bear market. That means it's going down. Well, yesterday, we dropped 5%, just in one day, just in one day, do I think we're over? No, I don't think we're over. But does that mean anything? Let's look at some statistics, just so you understand that. And then we can dive in real quickly. Here's the thing. These are bull markets are markets going up bear markets are when the markets going down. Okay, the blue here, the blue here is when the markets are going up. If you notice the difference between the yellow and the blue. This is the history. People are trying to say well wait a second. Now granted, it doesn't feel good when we're in there. But look at this. The average bear market loses 31% 31% and last 11 months, 11 months. The average bull market makes 155% and lasts over four years. Let's look at recessions for a moment. Okay? Look at the recessions. Look at the recessions. These are these are when we have booms in the economy and these little red things are the recession. So I'm not saying they don't hurt. I just want to give you the proper perspective. Okay, the average recession is 11 months long. We've been on an 11 year bear run. And my point is, my point is is that that we can do in what they're trying to tell us or we can get the reality behind what it is and choose it because here's my belief. This recession doesn't need to be your recession. This economy doesn't need to be your economy. This bear market doesn't need to be here. You're Our market, you get to be that in your own world to choose it your way. So I'm going to ask you to do one thing. And that is to choose whether you want to be a thermometer or a thermostat. That's your choice. That's your choice. Here's why I say that. What does the thermometer do? The thermometer measures the environment that you're sitting in and tells you what it is. But the thermostat sets the environment that you're creating. And when we choose to be the thermostat, we don't run for the hills. We don't run in fear. We don't freak out. We don't allow the media to get us into a situation. Yeah, thermostat, baby all the way. Here's what happens. I am not devoid of this. I ran in fear. I got caught in it. Okay, not recently, decades ago.

Mel Abraham  11:00 
And, and here's the beautiful thing. When you start to look at, you know, I just turned just had my birthday a week or so ago turned 61. A week or so ago. My wife doesn't think that I'm a day over 12 way I act. But here's the beautiful thing. I've been through seven recessions, eight bear markets, 40 plus rate Bust, the Black Monday, Black Wednesday, 911 energy crisis, SNL crisis, financial crisis, the global pandemic, the 2020 crash and whatever we're going through today. What does that mean? I'm still here. I'm still here. But you know what, back a few decades ago, I got scared. I listened to the fear mongers, I listened to the media. And I put everything in cash, I curled up in the fetal position, I crawled up and I didn't do anything. And I chose to sit on the sidelines. And so I went back and I said, What would have happened? If I understood just the graphs I showed you and stayed in the game, and kept investing during that whole time that I sat on the sidelines up to today? How much more would I have? This might be shocker for you. $3,918,723, based on what I was investing in the market returns, if I just stayed the course. But my fear cost me $4 million. My hopes is that that lesson doesn't need to cost you $4 million, that you get a chance to take it on the way you want to take it on. So that leads me to the very first habit and Jenna hit on this. And the very last thing she said, Because I will hear people that say, Oh, I have a I have an advisor for that. I get it, you might have an advisor for that. But your advisors, and your advising team will never love your vision and your life more than you. And so the thing that you need to take on is the the ability to say I will be the captain of that ship. What Jenna did when she put them all on the phone. What Jenna did when she put them on the phone, she said, I'm the captain. But I need you all on deck. I need you all look in the same way. And I need you all moving forward. And so never do we allow our advisors to take control of our financial future. They are simply there to help us as navigators as as deckhands to help us make that happen. We have to Captain our ship. That means that we need to do the education, we need to understand it, they'll get the details, they'll get all the complex stuff, they'll get all of that. But you will make the educated decisions when you start to captain the ship, you now have control you are in the game, because making money and keeping money is a skill and all skills are learnable. And so we don't I made this mistake, I parked things with advisers that I lost, because they didn't have my best interests at heart. They had conflicts of interest, they had biases, they weren't communicating all kinds of things. So so the first habit is to choose to be the captain of your ship. Wealthy people will always captain the ship. They will have a bunch of advisors around and I've got a wealth team that we talked to in fact, I'm flying out to see them all in a few weeks. And we're having a meeting like a board meeting. We will captain the ship that leads me to Habit number two, okay, habit number two is know your why before how and how much. This is important. Too often we say I want to have a million bucks, 2 million bucks, 5 million bucks, but we need to understand some money is a result not a purpose. Without the purpose Behind the money if we don't give the money a higher purpose, we don't move towards that higher purpose. And so, so if it's simply the statistic in the bank account, that becomes a problem, there was a millionaire study done by Harvard 4000 millionaires. And they were trying to figure it was a happiness study. It wasn't a money study was a happiness study saying saying, what are the things that made them so happy during the during their journey of becoming a millionaire? None of them said it was making the money. All of them though, ranked high on how they made the money. What is the purpose behind what is your why behind the money? Because that's important. There's a dear friend of mine. Some of you may know, and this is her Alison J. Prince, she is amazing. She teaches people about e commerce, she does a great job she, she's successful. She's got a great family and all other things. She called me up one time, and she says, probably one of the only people I can have this conversation with and I said, What's that? And she says, I hit all my numbers. I said, Well, that's great. And because I know, I know, I said what? I said, Why do I think that you're not excited? Because well, I'm just confused. What what do I do next? What do I do now? Do I just increase the numbers? Do I just do something more? What do I do? And I said, Well, let's get back to your Why? Why do you want to do this. And for her it was to give women the possibility of independence again, for her it was to allow women in third world countries to see that they could be independent. And so we restructured her business in a way that every time she makes a sale. She gives a microloan to a woman in a third world country. And the beautiful thing is she does it in the name of our client of our customer. She doesn't do it in her name. So she says she had a launch just a little while back. And she sends me this text and it says, Hey, just wanted to let you know challenge closed last week. Oh my gosh, we killed it. 1049 people average value of $1,155. You know what that means? 104,900 goes to charity. That equals 50 245 micro loans given out to new families. My heart is so happy. I know today that that number of 5000 is over 8000. But what's driving her? Is meaning what's driving her is why and purpose. Okay. leads me to to Habit number three. Habit number three is know your finish line. What is your finish line? Okay. Too often, and this was me know, too often we do not know what our finish line. Where are we trying to get to remember, Jenna made a comment about experiencing life. So one of the things that we do with the affluence blueprint and everything one of the first things is to define what our life looks like what we call the affluence vision, how do we want to experience life, and then we figure out the price tag on it. Because here's the challenge for most we get in this game of achieving, acquiring and accomplishing. And we keep running. And we keep running, and we keep running. And we never know when we pass the finish line. And in the process, we had burnout, we had breakdown, we had crisis, we had all those things, what we didn't have to hit if we just took the time to figure out what it was that we're trying to achieve. Where are we getting to to make that happen? When I I was I was I was in a relationship a while back. Not not with my wife. It was a bad conversation that I had with with with this gal. And I was angry. I was distracted. I was distressed. And I literally said I'm just gonna go work it out. According to Jim, I'm gonna work this out. I know guys, you probably understand this. So I jumped on the bike, and I'm writing down back then I wasn't living to the beach. I was living in the hills. And so I was riding down the hill on a mountain bike on the street, going to the gym, and I was going as fast as I possibly can because I was trying to go up coast up and uphill. And when I got to the crest of the bottom of the hill, my shoelace got caught it clipped the brake and flipped the bike. So my bike ride turned into a flight which was fine until landing. So the landing I stuck on my head. I ended up with a great for concussion completely unconscious. I was stuttering I had no feeling on the right side. And a dear friend of mine two days after I got out of the hospital comes to me and says I'm taking you to lunch. He had been retired since age 37. Now I'm in a neck brace I'm stuttering takes me to lunch and he sits across the table at the sandwich shop and looks at me says how much is enough? I go dude, I just I got a great for concussion. I'm going a neck brace and you're asking me lice philosophical questions. Why are we doing And he says, Know how much is enough. Because here's the deal, you are angry, you are distracted, you are distressed, how many of you are running in your life right now with uncertainty, he says, the reality is, is you'll heal from this. But because you don't know where your finish line is, you don't know how much is enough, you're gonna get back on the bike, angry, distressed and distracted, you're going to do it again until you hit crash and burn.

Mel Abraham 20:22  
And that was the day that I sat back, I went home, and I started to rethink and said, What do I want life to look like? How do I want to experience life. And when you do that, now we can put numbers to it to make it happen, I've got a tool that I will get to you, we'll make sure that we hook it up, that will allow you to actually calculate the number down the road. Okay, so I'll make sure that we get that link hooked up for you, we can literally put some numbers in, it'll tell you, here's the number, you need to have the money that you that you want to make that happen, I want to make sure that you have some things to tactically go do. That leads me to Habit number four. Habit number four is to track your money machine growth, this is what people will call your net worth, okay? This is all the assets, you own less all the money you owe. With an adjustment, here's what I mean by this. All I want to count is see what we need to do in order to have are in order for us to have freedom of our time and our moments, we need to have something that is going to produce cash income for us, without us having to run on the treadmill. It can't be tied to our efforts. And so when Jenna was talking about real estate, and stocks and and investments, that's what we're talking about creating a money machine, a portfolio, if you will, that's going to generate the cash to allow you to live. So you don't have to keep running. It's not tied to that. And so, in order to do that, we need to track it. That means that we need to tabulate all the assets we have. Now, here's how I want you to define assets. They are those things that can produce cash for you in the future. So they aren't ladies. They're not the shoes and they're not the wardrobe. Guys, it ain't the technology. And it ain't the cars unless they're collectibles. It is assets like real estate that can produce cash flow, like investments in index funds that can produce cash flow, it is those things that you can live off of down the road, including, look, my house here is one of the it's a beautiful house right on the beach. It is the worst investment I've ever made from a investment standpoint. Only from that perspective, because it doesn't produce cashflow, cost me cashflow. If I sold it or I rented it great. It's now an asset. But I don't look at the house as an asset. Because it's not there to support my lifestyle, that vision of the lifestyle that I want. It's there to give me pleasure, it's there to allow us to have the kind of life experience that my wife and I want to have. But it isn't there to produce cashflow. So your money machine we need to track is all the assets that you can live off of in the future to be able to live. And if we don't track that we note won't grow that. And so this is why once a quarter, I will sit down and look at my net worth. I actually do it monthly, but my clients will do it once a quarter, or at least every six months. Where are we? Are we on track? Where do we need to go? What changes do we need to make all of those things that happen? With that in order to facilitate that there's something that you need to do and that is this track where your money flows. This is Habit number five, track where your money flows. Okay? This is a different take on wants and needs. But really understanding where your money goes. People think that building wealth is complicated. I'm gonna walk you through the something that I call the four wealth drivers matrix. There are only four things you need to figure out to drive your wealth, okay? And when you understand the ones you can control, then you can focus on those. And that's it. So here's how this plays out. The four wealth drivers matrix looks like this. The first part of this is this. There's four things you need to master I'm hesitating, because there's only three things you can master because one, you have no control over. Okay? So let's call it three things you can master. The first is your income. How much do you make, whether you're going to scale your income, you're going to get a side hustle, you're going to create income, we need to focus on income generation, which entrepreneurs are really good at. The second is the savings rate. And actuality, the savings rate is the most important thing. This is how much you say, how much do you put away. So if I make $100, and I'm saving 20%, we're going to put $20 away every single day or every single week or every single month, it is consistent. These two are the most important things. And when we control those, we can control our financial destiny. The third piece is is your investment returns, what are we investing in? This is about what assets we're buying real estate, apartment buildings, oil and gas ETFs index funds, your investment returns. And the third piece of this, or the fourth piece of this which you have no control over is time. Time. Because so many people will ask me, Is it a good time to get in the market is a good time to invest? The best time to invest was a week ago, the next best time is today. Today, we need to start today because that is a behavior that you need to start building on. And it doesn't matter whether it's $5 Doesn't matter whether it's $50, or $100, it matters that you're exercising the muscle, just like Jenna said about the contribution if you don't give away $10, when you have 100, you won't give away 1000. When you have 10,000 or 10,000, when you have 100,000 Just the same if you will not invest $10, when you have $100, you will not invest $100. When you have $1,000, it is a behavior, it is a habit. The reason those millionaires made millions off of $100,000 was because they manage these four things, and they created a habit to make it consistent. We just need to do this. And the way you do this is Habit number six. And as this to make investing a priority. Here's how most people, here's how most people live their life, okay? They make money. They spend money, especially with the comparison that we see now. And then they invest what's left, they invest what's left. This is investing the scraps. What a wealthy do. So wealthy will reverse this, they'll make money. But instead of spending it first they invest it first. And they build a lifestyle on this. And if they don't like this lifestyle, they come back here and say how do I fix that they go back to the four wealth drives and say how do I change my income, so I or my savings rate so I can have a better life. And the reason this is important is because there's something called the wealth flatline. If you look at the way wealth is built, it takes time I get it, you might talk to crypto millionaires, billionaires, that that made it in a day. And there's a whole lot more that lost it in a day. But to true sustainable wealth will take time because you need to eat up what I call the wealth flatline. Your trajectory for building wealth looks like this. It starts off flat. And there's this thing called the wealth flatline. That until we get in the game, this is why now is the most important time to do this. Until we get in the game and stay in the game consistently. We can't eat up the wealth flatline. Because the wealth the our wealth is beyond the flatline. This part is the acceleration. So we have to eat up time and investing to make that happen. This is why when you invest $500 a month, over 20 years, it'll turn into over a million dollars. But if you did it for another 10 years, it'll turn it into over three times that because they're in the acceleration zone we got to get the sooner we get in the game and eat up the wealth flatline.

Mel Abraham  29:52 
The faster we can have the money work harder for us than we did for it. And that leads me to the last habit and I want to walk you through this framework of have the recipe of what to do to keep you safe and get you on the right road, there's a reason that what I'm doing is not telling you to go invest into something. Because what investments you make are only as good as the foundation. And the framing that you're making investments from, think about building the house, the finish work on the house is the sexy, beautiful stuff. It's the stuff everyone likes, likes to look at. That's the investments in your portfolio. But the finish work on the house isn't gonna stay for long if the framing and the foundation isn't right. And so it's important that we look at the framing and foundation of your money, mindset and tactics to make it happen. So so what I want you to do is I want you to follow a system, if you don't have a system, I want you to follow this system, we have used it over and over again. And it's it is how I want you to allocate your cash, it's what we call the wealth priority ladder. Right from the get go, the very first thing I want you to focus in on is how do I get $1,500 or one month's expenses $1,500 Or one month's expenses in an account. This is to protect you for the two tires that go out for Jenna. Okay, I want 15 or and you might sit back. Where do I get? Where do I get $15 from? Let me tell you don't let that out. Here's the key, don't tell my wife. If I just looked around my house, all the technology I have, if I open those closet doors that I'm not using, I could easily come up with 1500 bucks. The point is, is this in a time where 58% have less than $1,000 saved. We need to change that, especially when we're going into uncertain times, especially when we're we're at 6% mortgage rates now, and we're starting to see market issues, we need the liquidity to make that happen. Now, this isn't an emergency fund. This is simply so you don't have to go to the wild borrow and put yourself in a deeper hole. So $1,500 Or one month's expenses, whether you have to sell something, start getting rid of subscriptions. That's the first stage until you have that you shouldn't even be worrying about investments. Okay. Hopefully this is making sense. That then leads us so that's phase one. That leads us to the second phase. And then the second phase is a two prong phase. Once we know that we have this comfort fund in place. Now I want you to focus on getting rid of consumer debt, the destructive debt that is in your life, this is for consumables, this is the and I don't believe all debt is bad. So just so we're clear, I know that there's people out there who say all debt is bad. No, I think that there is debt that is productive debt, it is that productive debt is debt that is actually going to increase your net worth your money machine or increase your cash flows. So if I go into debt to buy a machine to increase efficiency to produce more and a higher profitability, that's good debt. Okay. If I go into debt, to buy a big screen TV, or something like that, better consumables, for lifestyle and all that stuff, that's not good debt we need to get out of it. If you are in debt, and you want to get out of debt, I will make sure that we hook you up with a worksheet. It's an XML template that you can put all your debt in and figure out how to get out of it either using snowball method or an Avalanche Method. I don't have time to go into here, but I want you to have the tools. It's totally free. It'll give you it'll walk you through exactly how to do it. But I want you to start to get out of debt. Because we're at a time where interest rates are gonna go up, if you're carrying balances, it's just going to get more expensive. Now there's a second piece of this phase. And that is at the same time, I want you to build a peace of mind fund. This is what some people call the emergency fund. I happen to like the term peace of mind fun because I want it to give me peace of mind. Now some people will say get out of debt first, then worry about that later. I think it's a mistake. Your Debt Management muscle is a muscle group. Your wealth creation muscle is a muscle group. They are not the same muscle groups. They are different habits. They are different behaviors, and they have different mentalities. And if we don't start exercising them at the same time to build them together, maybe it takes you three, four or five years out of debt. You've not eaten up the wealth flatline zone. By doing it, you waited and you didn't exercise the muscle. If you're only exercising one muscle group. It's like the guy that goes in the gym and only works his upper body. He looks good from the top up. But in shorts, you He's kind of odd looking, I want you to build both. So here's what I would do if you have $500. If you have $500, that you can allocate towards debt and building this peace of mind emergency fund, split it. And you can split it 5050 6040, you know, 250 to the freedom fund 250 to to pay down your debt, yeah, we'll take you longer to pay down debt, but you're exercising both muscles, you're creating both habits at the same time, okay, and you start to eat up the wealth flatline. Okay, so, so this is phase two of it, and I would do these together. If you don't have debt, then you're you're going to put it all towards towards us. Now I say 918 months, I have said that well, before the pandemic, I think three to six months isn't enough, at nine to 18 months. So call it 12 is going to take a while but you're going to build it over time. That leads you to phase two, phase three. Phase three is where you start to invest and build. Because until we have that security, that safety, in a place where we can navigate when things are challenging, we shouldn't be investing because now we're risking our future because we are living on the edge or we're living on debt. Okay? This is to keep you safe during uncertain times, and even uncertain times. And you'll see that what I'm saying is 20 to 25% of your income should be invested. Now, what we invest in is a different issue. But at the very beginning, we don't get complicated. At the very beginning, you can go into a broad based index fund a low cost ETF or index fund, something that is a broad market fund, you can go into a target date fund, I talk about these on my podcast and walk you through it, where you can sit back and say I don't need the money for 20 years and you get a fund that adjusts for you. The investing isn't the issue, the first piece is that we need to start putting it away 20 to 25% of your income should be going automatically into a fund or into an account that you can then invest directly. If you don't have it to invest, there's no reason to worry about the investments get this in place. So then we can worry about what investments are making sense. And so this is the freedom the freedom fund that we're talking about. That leads me to them this, a lot of people are asking, should I pay my mortgages off? Listen, if you've got two and a half percent mortgages, you're not paying them off right now, not when they're 6% mortgages right now, make sure that, but when once you know that you're fully funding your investments at 20 to 25%. Now we can look at accelerating our pay down our debt on our mortgage, okay, or what you do, or what I do with a lot of my clients is say, instead of paying the debt down, I want the capacity to pay the debt down. So for instance, I'm overpaying. I'm not overpaying my mortgage, but I'm putting extra money away every month that I can use for their mortgage. So five years down the road, because it's a low interest mortgage, I had the capacity to pay the loan off, I just may not be paying it off right now. Because opportunities might come up, things might come up. So I want to make sure that I take care of so in this phase is when you start to look at building your investments, paying down your properties. And then you go to this other phase. And now this is going to rub some people the wrong way. Because of what I'm going to say this is college, notice that I'm not I don't have college down here I have it up here. At this point, once you have all this working now you can start looking at how do you fund college for your kids. Not until that you do not have an obligation to pay for college for your kids. I hear you I paid for college for my son. But here's what I'm saying. The one thing that is certain your retirement, your financial future, it's common for you. It's common for you.

Mel Abraham  39:12 
Whether your kid is going to go to college, what college they're gonna go to whether they're going to finish college is an unknown, it's an uncertainty. So I want you to fund your certainties first. And then we'll fund the uncertainty, then we can talk about it but but once you know that you're fully Funding Your Future so you don't end up on your in your kids basement saying because I can't take care of myself because I paid for your college. Then we can fund the college. And in the process just like Jenna was saying, you get your kids involved in the responsibility for qualifying for college, not student loans. But for grants for scholarships where they understand if they want to make something or do something they need to earn something. We don't transfer assets to kids without transferring skill set That's the only time that we start to fund college. And that leads me to the last piece of this because now we have everything taken care of emergency fund debt gone, mortgages, getting paid down investments going, we're building it, we've got the college fund, funded. And the last step of this is this Eflin stage. This is living, the experience and the rich life, giving generously, leaving legacy wealth, creating generational wealth to make it happen. This is the process that I use. This is the same process that my son Jeremy 32, is using. And our clients use, it takes discipline, but in a time of uncertainty in a time that we're going through, this will keep you safe. This will build a foundation, I'm not saying it's going to be easy, because you might have to change some habits. I'm not saying that it's going to be easy, because you might have to earn some more income or cut some expenses. But I am saying it will be worth it. And when you work, the process that has worked for decades, and yours, there's a reason that in a book from the night, early 1900s, The Richest Man in Babylon still makes sense today, because they are time tested universal truths that still work. So I hope that with this, you start to look at this in a different way that you take control and be the captain of your ship, that you know that there's only four things I got a master on the wealth drivers that you understand that I'm gonna eat up that flatline and we'll make investing a priority because your financial freedom is your birthright. We just got to walk you through to claim it. And I look forward to helping you out if there's anything I can do to serve you and help you make this a reality. Let's do together and in growth day. You're in a great community of people with common common goals, common visions, common values, doing the same thing on the journey with you. Thank you. God bless you. Thank you for listening to the Affluent Entrepreneurship with me your host Mel Abraham, if you want to achieve financial liberation to create an affluent lifestyle, join me in the Affluent Entrepreneur Facebook group now by going to and I'll see you there.

Money isn't the objective
Habit #1: Be the captain
Habit #2: Know your why before how and how much
Habit #3: Know your finish line
Habit #4: Track your money machine growth
Habit #5: Track where your money flows
The four wealth drivers matrix
When is the best time to invest?
Habit #6: Make investing a priority
The wealth flatline
Habit #7: Follow a system
Wealth priority ladder