Hello everyone and welcome to Voice Like a Lion podcast. I'm your host, steven Pemberton, and today we have somebody who is the cash flow expert, and if you are someone who is a founder small, medium sized business you are probably wondering the same kind of questions that I am, so I'm really excited for you guys to meet my guest today. My guest is Chris Miles. Like I said, he is the cash flow expert, which is insane because I haven't really met many people who are cash flow experts. He's the anti-financial advisor and a leading authority teaching entrepreneurs and professionals how to get their money working for them. Chris, welcome to the show.
Speaker 2:Hey, it's such a pleasure to be here, Steven. I really appreciate you having me on today.
Speaker 1:Absolutely. I'm just thankful for you coming on the show because I think that your story and what you do is really going to help a lot of people. It's most likely going to help me, because when I hear the word, when I hear cashflow, I think back honestly. The first thing that comes to mind is Grant Cardone, because he talks about all the time cashflow, cashflow, cashflow. But for those of us who are maybe not as initiated, what does cashflow mean?
Speaker 2:Cashflow is like profit.
Speaker 2:If you're a business owner, you want more profit. At least I hope you do. If you don't I mean I don't know if you're a nonprofit, maybe that's the case, but even nonprofits have profit. So cashflow is always about that, and that's even true in your personal life is how much more income do I have coming in than my expenses without having to live on rice and beans Because we don't want to be living like Dave Ramsey was telling you to live on rice and beans, because we don't want to be living like Dave Ramsey was telling you, to live as cheap as possible, and you cut out that freaking latte and all the other stuff that your life sucks in, hopes that someday you might have something. And that's definitely not what I'm all about. I'm all about profit. I'm all about having a lot more money coming in than what's going out, especially if you have enough passive income coming in. It's where your work optional where you get to work in your business or your job because you want to, not because you have to.
Speaker 1:That's really good. I think that that I love that you. You talked about Dave Ramsey. I find that really fascinating. I mean I come from a middle-class household.
Speaker 1:So Dave Ramsey was kind of the thing right.
Speaker 1:So that was what my I mean my parents always for the longest time and they still are to a certain degree they were just heavy, heavy savers.
Speaker 1:Like that's how they were going to be a bazillionaire was just by saving every penny they had. And I just find that really fascinating that Dave Ramsey talks about all this stuff, but he's a multimillionaire. I mean, his house that he's selling in Franklin, tennessee, is like $12 million. So I think that there are certain aspects of things that he doesn't talk about, like actually cash flowing and what that means, what that actually looks like, because I don't think that he's cutting out his lattes to be able to afford a 12 million. It's true. I mean, he's got the mugs to prove it. So where did you because I'm sure you didn't just like go to college one day and figure all this stuff out what was the journey like for you to be able to figure out how to actually have cashflow working for you instead of just having to cut out Starbucks and having to go eat off the dollar menu every single day to make it work?
Speaker 2:Man, and when I was growing up I was, I was I would have loved the dollar menu. In fact, that would be eating out for us.
Speaker 2:So I'll tell you I only ate at Wendy's twice in my childhood. I mean, if that gives you any idea of how, how cheap. We were right. Uh, even for five years I even lived in a trailer park. We were right Even for five years. I even lived in a trailer park, you know.
Speaker 2:So I grew up in Oregon, you know, and my parents taught me good values, but when it came to money it was a lot about really just how to not spend it, save anything. You can right that kind of thing. And so you know, when I got into college I vowed I wanted a different life. I want a life of freedom. I want to control my own destiny, my time and all that kind of stuff. Which freedom? I want to control my own destiny, my time and all that kind of stuff.
Speaker 2:Which is why I kind of left the college path to become an entrepreneur, because I realized that if I really wanted to control that time and the amount of money I made and not have somebody tell me you know not only how much money I made, but even I had a job where they told me how much, how many minutes a day I can go to the bathroom, I mean that kind of thing that nine to five slavery. I didn't want that, and so when I was in college, I took a little hiatus. I was supposed to go back. I actually stayed dropped out. But I took a hiatus to get some business experience. I thought if I'm going to get an MBA, I should have real life business experience instead of just book smarts. And so I dropped out. I said, all right, what am I going to do? And the first business that came up that was interesting to me was being a financial advisor, because I figured, worst case, I learned about money for myself. I even get to maybe help my dad who he thought literally work would kill him, because he'd already had strokes by his forties, heart attacks by his fifties. He's like there's no way I'm making the age 70. I'll be lucky. And so I thought, man, if I can just give him a few years of his life back, that would be worth it. So I got into that business and I'll tell you I loved being a business owner. I loved being an entrepreneur where I was a hundred percent commission. Only there was no base salary to save me and I had to really, you know, hustle and struggle. I was working full-time at a job and then doing this as a side hustle, being a financial advisor as a side hustle, and did that for four years.
Speaker 2:And then, after four years, my dad reached out and said Chris, will you become my financial advisor? I thought, oh, I didn't think you'd want me to. I mean, you changed my diapers. I didn't think you actually want to hear about what I had to say about money.
Speaker 2:Well, I sit down with him and I see his financial situation for the very first time ever. Right, first time ever I saw his financial situation. He had paid off all his debt. I mean, he was debt-free, including his house. He had stuffed his 401k full for several years. And then, as I'm looking at it, I said dad, you're 61 years old right now. If you want to retire today, you better hope you die in five years, because that's when you're going to run out of money. Naturally, you can imagine his response is like okay, I don't want that. What else can I do, mr Financial Advisor? And I was like I don't know. You did everything. Right from what I teach in the financial advisor world, which is not much different than Dave Ramsey, which is get debt free, stuff your money in mutual funds and then you're going to be free somehow, Right, and you could be on his radio show streaming to Braveheart music too. And so you know I did that and I told him. I was like I don't know, like if I put you in this stock thing, if the stock market goes down, I don't know my dad, and it was just a few weeks later.
Speaker 2:I was talking to a friend of mine and he actually I trained him to be a financial advisor, but then he left to go do real estate investing. And he's telling me Chris, my life is awesome right now. My dad and I have partnered on some real estate deals and we've doubled his income as a professor at the local university. I said wait a minute, hold on. I met with your dad. There's no way You've just started doing this like four or five months ago. That's too good to be true.
Speaker 2:He says Chris, let me ask you a question how many of your clients are financially free where they don't worry about money? And I said well, even the retired ones worry about running out of money. So they all worry about money. He's like great, so zero, good job, chris. How about this? How many of you guys, as financial advisors, are financially free, not off the commission journey, but actually doing these investments.
Speaker 2:And when I was really honest with myself and there was over 100 people that worked in our office, I said you know what? There's guys that have been working in our office since the late 1970s and they can't retire either. So, right, so I'd say none, there's your problem, chris. And that got me on a journey. Right, I started taking the matrix red pill, so to speak. Right, you know, I'm going on this journey here where I'm learning about alternative investments, things like real estate and and learning about cashflow and passive income the very things you would learn about in rich dad, poor dad, but actually how to apply it, versus just getting a nice philosophy you know, philosophical fluffy book, right.
Speaker 2:And and then what's cool is later that year I quit being a financial advisor. I vowed I'd never go back to teach about money again because I felt like a liar and a deceiver as a financial advisor. But then I kept doing this investing, to the point where later that next year, I was able to retire myself, when I was 28 years old. And that shocked me. I did not think it could be that easy and, as a result, of course, any 28-year-old that's unemployed pretty much, but not broke. People want to know what the heck I'm doing, and that's why, in 2007, I came out of retirement to start teaching people how to break free of that rat race, how to break free of that mold that every financial advisor, every Dave Ramsey, every financial expert that's out there is telling you to scrimp and save and suffer and suck your entire freaking life away until someday you hopefully have something down the road when you're either too old to enjoy it or you may not even live that long to enjoy it. That's the thing I'm trying to break people free from.
Speaker 1:Thank you first and foremost for taking us on that story, because I find myself along the way in so many different areas of it. When you're talking about sitting down with your dad as you're the financial advisor, I think about my parents, because my parents are very much in the same spot, Like the house paid off. The house had been paid off before I was born and so well over 30 something years the house had been paid off, Every car paid off. It's like everything, everything's paid off and their IRA is stuff full. Same thing that you were saying. And I remember I just had this conversation with my mom not too long ago and we just and I just said I told her. I said you don't need to tell me your finances. I said but look at them. And I said you tell me are. Could you guys retire today and actually make it for the next 10 years? And? And she said no, and I said exactly.
Speaker 1:So the thought process of just being able to sit there and put into mutual funds and do these things and you'll be, you'll have a million dollars when you retire I think that those are great concepts and it sounds really good. Let's say you're living a lifestyle, you're making a hundred thousand dollars a year. Then you stop making a hundred thousand dollars a year. You have 10 years, it's like. So you better die quick or you better figure something out. So I think that when you're telling that story, it really resonates with me and, I'm sure, to so many other people listening. But there's one thing that you said that you started talking about, because it doesn't just relate to people working a nine to five, it's also. I've seen people build themselves a very high paying job by creating a business.
Speaker 1:So with even with entrepreneurs, who, someone like me let's say where because this happened, we were doing a million dollars a year and we started. We realized it's like, okay, as we grow the business, I'm going to grow stuff passively. But for someone who is a small business owner and they're starting to increase their business, yes, double down, focus on your business, grow it cool, but at a certain point in time you should have something that is passive. So how would you instruct, how would you help somebody figure out what that passive model would look like for them?
Speaker 2:Yeah, you're so right. I mean, it's always easy with people that are employees, right, because employees kind of get it. They're like listen, if I don't keep working my job, I'm broke. Business owners are a different animal, because business owners here's where the truth is your number one investment is your business, right? There's no doubt the trap that business owners get caught into is that they quote unquote reinvest money into their business.
Speaker 2:Now, I reinvest money too, but when you reinvest a hundred percent of your money into your business all the time and maybe you take a small paycheck home, whatever it is, maybe you have a decent lifestyle, even, right. But when you're always just reinvesting, when you're a number one investment and the only investment is always your business this is what Mike Michalowicz, author of Profit First, says that you're not profitable, right. If you're reinvesting 100% of your money in your business, you're spending all of your money. You have zero profit, right, and even if it grows you to making 10, 20, $100 million a year, who gives a crap if you can't do anything else but that? Right, and that's the thing. That, and especially after 2020. I mean, 2020 was such a weird year, wasn't it? Because all of a sudden, we found out, we learned, I mean, we always kind of knew it. And I'm not a huge fan of the government. I mean I'm okay with minimal government, right.
Speaker 2:But not like the kind of government we have, and then, all of a sudden, we find out in 2020 that they could shut you down because you're quote, unquote non-essential. That, to me, was scary, because that's when I realized wait a minute, even though I was okay because I was virtual. There are a lot of business owners that think that they're okay, but they get shut down for months at a time. They could be toast, and so this is where every single business owner needs other streams of income outside of their business. You need something, money that's coming in from outside, and so when you have that profit, don't just reinvest everything back in your business. Especially when you're a mature business. You don't have to reinvest everything. You realize that the more you reinvest, the rate of return on your money goes down. So reinvest where you get the max ROI in your business so that you do generate more revenue and more profits, ideally.
Speaker 2:But then also take some of your money, your profits, home and invest that in things like real assets. Don't gamble it in Bitcoin and that kind of crap. Don't throw it away in the stock market, because you can't control that either. Right, you got to buy real assets and the only thing that's been proven. Besides business. If you look at the Forbes 500 list right. If you need to look at the richest billionaires in the world, they list right. You need to look at the richest billionaires in the world, they all have businesses in common. That's the number one, easy, proven model for becoming a millionaire, multimillionaire or billionaire. But the second thing is real estate, and that's where, again, I buy real assets. I don't buy things that are just seriously traded on markets and they can go up or down, because Biden has a brain fart and he can't remember what his last words were right.
Speaker 1:Or Trump says something on Twitter and, all of a sudden, tesla tanks.
Speaker 2:Well, come on, elon Musk says something on Twitter and Tesla tanks right? I don't want to have my life determined about somebody else's business screwing up my life. If I'm going to invest money in any business, it's going to be my own, first and foremost, because I can screw that up and I can blame myself. I can screw that up and I can blame myself. I can't blame somebody else because that's not what stewards do of your money. And so I buy real assets and it doesn't have to be just like your rental property in your backyard. Like, for example, I've got assets that vary from. I do have rentals, but I have rentals in the other part of the country. Like, I live in Utah, but I've got rentals in Tennessee, north Carolina, just sold off a couple in Alabama, things like that. I've got rentals in other places of the country where I get better cashflow, but I also have things like raw land that's all over the country and I have somebody else invest it. So I'm the financer, they go, do all the hard work and I get to be a 70% partner in that business. Cool thing is I've invested 400 grand in this business in the last couple of years and it's now generating almost 10,000 a month. Again me hands off. Right, that's freedom to me.
Speaker 2:Having that kind of success Mineral rights, oil and gas I mean you can literally have the land, that's your collateral and you can still get paid royalties off the drilling and things like that. You can invest in franchises passively. You can be in a car wash business and again you're hands off. You're not the operator but you're the financer and get paid off of those profits. I mean there's so many ways to make money outside of the stupid mutual fund world, which is high risk, mediocre returns. I mean the stock market, and the stock market only averages. Even just here, and we've had a really good 30 year run, the real return of the stock market is only 8.3%. He, you know, not 12%. Like you know, guys like Dave Ramsey promise that you get right, which is BS. That's why he hasn't been sued so much, because he's a TV personality. Nobody. He has no accountability to the crap that he teaches, but he'll tell people 12% all day long. The market has never averaged 12%, at least not in the long term. A couple of years, yes, but not long term. But he's been teaching that forever. So if you're only earning 8%, that's before fees. That's before taxes coming out. That's why you end up like our parents and I'll tell you, steven, your parents.
Speaker 2:What they did is miraculous the fact that they were debt-free before you were born. I mean, what percentage of people can even claim that? But you've made a perfect point, right Is that it's not about being debt-free. Debt-free does not equal freedom. It's really about how much income is coming in, and the problem is in mutual funds if you're lucky enough to save a million dollars, like you're. Using that example, just so you know, fidelity, which is like the largest 401k provider in the country.
Speaker 2:Fidelity, came out with their stats of how many people have at least a million dollars in their IRAs or 401ks. It's 810,000 out of 45 million. That's like less than 2%. About one and a half percent of people have at least a million dollars and of that that one and a half percent, 35% when they were surveyed last year, said they think it will quote, take a miracle to be able to retire. Maybe, like your parents, right, they might be that 1.5%. That said, it will be a miracle.
Speaker 2:Why? Because in the traditional financial advising world that I was in at one point, if you had a million dollars, if you didn't want to run out of money, you were told to only pull out 3% a year, not 4%. The 4% rule is not even a rule. It's lame stuff that came from 1974. That's not even true today. We were taking off the gold standard since that point, so 3% is really the new number. Well, 3% of a million dollars is $30,000 a year. You're living below the poverty line as a millionaire. You are a broke millionaire. That, to me, is just criminal. So even if you want $100,000 a year lifestyle, you've got to save up $3.33 million in mutual funds, which is really dang hard to do when the returns suck, which is totally different because, for example, I mentioned the million dollars, you pull out $30,000 a year.
Speaker 2:Well, I had a client in California. That was exactly what his financial advisor told him. He just retired from the military. He's one of the top ranking generals in the military. He retires. He has a million bucks in his retirement account.
Speaker 2:Well, when he tells him 30,000 a year, he's like I live in California. Nobody lives on 30,000 a year. Homeless people live on 30,000 a year. Right, we can't do that, and I can already hear some of those people in different countries or different part of our country. That's single saying oh, I can live on $30,000 a year. You guys are spoiled brats. Okay, shut up, we know. Okay, we get it. That's not the point. It's not about trying to survive, you just try not to die. It's about trying to have a life, right? Well, he didn't want 30,000 a year. Well, when he came to us, we said, well, let's look at other things, other all-term investments like in real estate and even oil and gas and things like that. Well, that same million dollars kicks off about between 100 and 130,000 a year, not 30,000. Then he pays taxes on it. 100 to 100, that's a big difference. It's not that you have to have more money. It's how I get my money to work harder for me. So I have to keep working so hard for it.
Speaker 1:Yes, that's so good. I love all those stories because there's so many different ways I can go from that. But when I think about it, I mean $30,000 a year. Let's be real, I don't care who you are, you barely live in. I don't even know you barely surviving, because in today's economy especially after 2020, everything has shifted.
Speaker 1:I remember 2020 is when I quit my job and I went fully into business, so almost four years ago now. And what had just happened? Because I left in June, so March is really when the world shut down. And I remember I'm sitting there in May, so a couple months later, and I'm looking at my 401k through Fidelity and I'm talking to this guy because I'm in, I'm over a warehouse at this time. I've worked my way up in corporate, done all the stuff that everything right.
Speaker 1:And I'm talking to this guy and I said you know, I'm gonna stop funding my 401k. And he was just. He was appalled. It's like, how could you? It's like you know, the company matches. It's like if you just give it all you got and you stay here for another 30 years, you could have. And I just said, dude, I just lost $23,000. I said everything I've worked for for the last four years just went up in smoke. Actually it was five years at that time. Everything I worked for for the last five years basically just went up in smoke. And you're telling me to keep investing in this thing because it'll be fine. It's going to take me, on average, it's going to take me at least another four years to make my money back.
Speaker 1:I was like I could, I could go take my twenty three thousand I just lost. I could go lose twenty three thousand on my own. It's like I could have done something else with it. But I said the thing you don't understand is I said it's not just that, it's like it's the way that they're investing. I said I could have taken that twenty three grand because if you do enough research, you can see like what your account fees are, how much they're charging you to manage it. You can figure out where they're actually investing it, how aggressive. And most people don't even take the time to go look at how their money is actually being invested. They just think it just sits there and it gets interest. But that's not how it works. And so for me I just thought, ok, if I have 20, I took the rest of my money out when I quit and I was willing to take the capital gains tax and then I just deferred it because I just thought if I take my money now, I have a higher likelihood of making the money that I need to pay my capital gains tax and make the money back that I lost. And that's actually what happened.
Speaker 1:So I mean especially for you as you're going through that story that's what I hear is don't just get entranced with what you hear. There's no way that you can live off of $30,000 a year. There's no way that you can live off of $30,000 a year. There's no way that you just stuff a 401k and just hope that it keeps going up, because all it takes is another COVID and you're losing a big chunk of money. That's what happened.
Speaker 1:And even when you're saying, like the eight point something percent average the word average is most people cannot stomach the down years it's like, yeah, if you kept your money in, you've probably rebounded. It's fine. The same thing with bitcoin. Like I'm very much, I'm not invested in any cryptos, I'm very you and I are on the same page. And but it's like, if you, if you could stomach when crypto went from sixty thousand dollars down to seventeen thousand for bitcoin and then now it's back up. If you could stomach it, then your averages are good, but that's why it's called an average, because most people cannot stomach when you lose almost $50,000 per share, basically. So I just I love what you're talking about.
Speaker 2:Yeah, it's kind of like. You know, I've got, you know, in my shower we got two shower heads. You know, if I turn one up on scalding hot and then the other one on freezing cold, the average is warm, but I can guarantee I'm going to be really miserable. Right, and it's, it's true, like I love what you brought up there, because it's almost become like a religion with the 401k, hasn't it?
Speaker 1:I mean it's.
Speaker 2:It's like it's. It's almost religious to the point. It's like dogma, even though it's rhetoric, but it's still like. People are like how dare you? Because financial advisors and the financial market, which are really like, it's really like financial pharmaceuticals, right, it's like the pharmaceutical industry, Like they pitch to all the doctors this is the way to fix people, right, Buy my product.
Speaker 2:And that's exactly what's happening in the financial world is that they're trying to put everybody in the same mold, saying, no, this is the way to do it. Why? Because financial companies, like you said, always get their fees. They always get paid, whether you make money or not, Guaranteed, and so, for that reason, I think that's one kind of unethical. Anyways, I mean, granted, they're working quote unquote, right, but they're not really working that much. They can't control the stock market. They're literally making fees off of you gambling your money. That's what they're doing.
Speaker 2:And when people say, yeah, but you get the matches, it's easy money, it's free money, it's dumb not to take that. Well, that's fascinating because when I've done the numbers, the math, every time, even if you get a hundred percent match because a lot of times people say, well, I only go up to the a hundred percent match, Then I stop, which is better than just trying to max fund them, which is really what you have to do if you want to have any kind of piddly retirement, right? But even then, like that match, it's fascinating because long term it only adds about 2% or 3% a year return onto your numbers. 2% or 3%, not 100%, right, Because it's not 100% compounding. Trust me, if you put in a calculator 100% return on putting in $20,000 a year for the next 20 years, you wonder why you're not richer than Bezos. Right, Because it's just not real. It's not true. It's not a true compounding 100% return. It only adds about two or 3%. Well, guess what? Fidelity? Do you pick on them again, their target date retirement funds. Right now, about 85% of millennials only pick the target date retirement funds. Well, guess what? Those target date retirement funds?
Speaker 2:I went and looked at their last 10-year performance compared to the market. They did just over 2% worse than the stock market and they have a 0.75% fee, which means you're losing about 3%. So what does that match give you? Maybe 2% or 3%, Guess what? The match just made up for the bad performance.
Speaker 2:You'd be better off just investing on your own in the stock market without the freaking 401k match. And even worse, if you're a business owner, you're paying your own 401k match. It's even dumber because you're like, wait, I didn't get a rate of return. 401k match is even dumber because you're like, wait, I didn't get a rate of return. I just thought I'd pay that money to myself to make that money. So to me, if you're a business owner, having your own 401k is ridiculous.
Speaker 2:I've had so many business owners like actually shut down their 401ks, even for their employees. They said you know what? We give you a 3% match. We're just going to give everybody a 3% raise. You can do whatever you want with the money. And never do you see people say, oh no, oh no, I didn't get my 401k match. No, they don't care, they get a 3% raise. They're like I'm going to do whatever I want with it. Maybe I'll even do my own investing, right, that's the thing. It's such a big crock of crap that you're given. I'm trying to obviously be nice and edited for you here, but it's true. It's just such a big fat lie that the financial institutions have brainwashed you to believe that that is the way. When it's not, it's been proven over and over it doesn't work. Yet when you look at business owners that actually do go and do other investments outside of their business I mean, the business alone is awesome. When you start doing other investments outside of it that's where the multi-deca-millionaires start happening inside the business world.
Speaker 1:And that's what I love about real estate and that's what I love. That, that's what you teach is because I, my dad, does pretty well with options and everything else stock market wise, but I just sit there and I go, okay, that's great for you, but options are very volatile. He'll even admit that it's like, and I even even, as he broke it down to me, I said, dad, what's the difference between doing that and just going to Vegas and in the casinos? I said there's not a big difference. And even and that's why even at 20, I was 20. What was 26? When I had that revelation.
Speaker 1:We were talking about the 401ks. It's. It's really just a crock of crap, like you said, because it's I mean, it's there to make you feel good. But I was sitting there and I added up those numbers. One day I did the numbers on my own 401k when I was sitting in my office, feeling like I was on top of the world. I went wait, this match didn't really match in nothing. It's like this thing hadn't done anything. That's where I just came to that revelation. Just for everyone listening, it's the same thing.
Speaker 1:Really, ask yourself a question. It's like why do I believe that this is the way I should do it. Why do I believe the 401k is the thing? Where did I actually get that? I think that not enough people actually take the time to do the research, and this is something I would love for you to talk about, because there's a stigma, or maybe a dogma around it as well that, well, 401k is easy to invest in Some markets easy to invest in, that's why I invest there.
Speaker 1:But real estate is super hard in Some markets. Easy to invest in, that's why I invest there. But real estate is super hard, especially if I want to do anything. It's like I can barely afford my one house. I'm trying to save and do all this other stuff. How could I ever go get another rental property or buy an apartment building? That's just insane. And a multifamily? There's no way. And why would I buy land? Then I'd have to clear it in case somebody wanted to buy it. And how do I find a developer? Investing in real estate is way too hard. I would love for you to talk about that piece.
Speaker 2:You bet. So I'll answer the first one, the 401k. Where did that all come from? Easy, I mean. It existed in 1970s, just created then for high level executives. Reason being is because the top tax bracket was like 89%, the top income tax bracket, right. So if you could get a deduction and then put you in a lower tax bracket, it totally made sense.
Speaker 2:But then the government picked up on this. They said the government really created this nice little partnership with financial institutions, because the financial institutions have big lobbying groups. They always want favors, right, with the politicians. But the politicians are saying listen, we know social security is broke and we can't keep this up. Like people are living longer and they're they're wanting more money. We need something. And so they said let's create, let's, let's take this 401k that's only meant for really rich executives and let's apply it to the rest of middle America, right, and that's kind of where the 401k was born in the mid eighties, right. I mean, again, it was already existed, but then it became more available for everybody else at the mid eighties.
Speaker 2:And? And it already existed, but then it became more available for everybody else at the mid-80s, and so that's where it's really trying to bail the government out of the responsibility of saying, hey, we kind of screwed up on the Social Security thing. We didn't think it would actually go bankrupt, so we need help. They saw the writing on the wall. That's why they started making some changes.
Speaker 2:And of course then financial companies love it because they get their guaranteed fees all the time, so they're selling that lie. The love it because they get their guaranteed fees all the time, so they're selling that lie. The government wants that lie perpetuated and really for them it's not a lie, it's just a take responsibility of your own life, which is not a bad thing. But when you combine the financial companies, their self-interest of saying wait a minute, we can make a lot more money, a lot more profits by just getting people to you know what, let's teach them this. Let's teach them that compound interest is the eighth one of the world. We'll even say that Einstein said it, even though he never did. We'll say that he did. So people think, oh, that's smart.
Speaker 1:Yeah.
Speaker 2:I should compound it. Yeah, so let's grow it forever so that our cashflow, our own profits, our company grows forever. Oh, and what else? Well, eventually we're going to take that money out. Well, how do we make sure we still stay profitable as a financial company if they pull the money out? Oh, I know, tell them to live on less than the interest because there's inflation. We don't want to run out of money too soon, so just pull out as little as you possibly can. So then we keep growing it while you're alive and then we don't lose any money.
Speaker 2:If you really think about it, it's just business. Granted, I mean we're all about profit. I mean that's the thing we do. But that's really where it came from. Right, it was like two powerhouses self-interest combined together to brainwash the crap out of you. So you think that is the only way to go right. And it's just not. It's just not true. It's actually the proven way to get really mediocre, really a mediocre life, like you're going to be.
Speaker 2:Whatever you put into a 401k per year after inflation is what you'll live on per year. You stuff, you start stuffing away. Even you're maxing out your SEP IRAs. You know cause? Your business owner makes a lot of money. You're packing away 50,000 a year. Guess what? After inflation, you'll probably only have about 50,000 a year. Live on, that's it so. So that's the first answer.
Speaker 2:Now of course, people say, great, well, what's the option, what's the alternative? Because real estate it's hard. I actually got to use my brain. Where 401k get thrown in there, I can set it and forget it All that kind of junk that they teach you to believe so that you make again. They make more money on you. But with real estate, it's true, if you try to be an active real estate investor as a business owner, that's even worse than even when I see people are just W2 employees. Because as a business owner, your time and your energy is everything. Because if you get distracted with any bright, shiny object, you've probably done this in your business at one point or another, where you got distracted on some little project that ended up tanking and it took your focus off the main thing that made your business successful.
Speaker 2:Right Investing is no different. You do not want that kind of effect on your business because I can tell you, no matter what you do in real estate, it won't make up for bad decisions in your business. You want that to be protected and secure. So how do you find something that takes up a minimum amount of your time. It doesn't require you to become like some real estate investing expert.
Speaker 2:It's going with passive investments, like I was mentioning before, when I have rentals in various parts of the country. I don't manage them, I don't even find them. I find what are called turnkey companies turnkey real estate companies to find them for me. They'll have the properties already there and I'll know how much profit I'll make even before I purchase the place. So I know exactly what rent to collect. I know everything about it right ahead of time. And then I don't manage it because there's a property manager that manages that and so, yes, I still get profits. Even after paying a property manager their management fee, I get to take all the rest. That's where it becomes more like mailbox money, so to speak.
Speaker 2:Now can things go wrong? Sure money, so to speak. Now can things go wrong? Sure, I mean, the property manager could be a piece of crap. They could be horrible. So you want to make sure you vet good property managers and find a good one and hold on to them. It could also be that there could be disruptions in that cashflow from time to time.
Speaker 2:I'll tell you though. I mean I remember I've done master classes on my Money Ripples channel before and I did one about passive income and I showed when I bought a rental property out in Memphis, tennessee, and that rental property if you look at the total, I mean I put $32,000 and I compared that. I was like what if I put my money in the stock market back in May of 2017, at the same time or was it 2018, whatever it was, whatever year it is, I put it at the same time I put that money in the stock market, I would have over $65,000 in the stock market from $32,000. It would double. It would have doubled in that period of time. But the crazy thing is I've actually made over a 300% rate of return on my real estate without doing jack squat. That's profit, net profit. That includes appreciation. But even if you take away appreciation, I still kicked the crap out of the stock market. So even then, I still got it and I got better tax benefits because I didn't really have to pay tax on it, because I get the write-off with the depreciation and everything else. So when you factor all that in, like real estate, it was like it kicked the crap out of even the stock market that just roared really in the last five years, right, ever since 2020. So that's the difference.
Speaker 2:And again, like I mentioned, like raw land, I'm not buying and selling the raw land. I have guys that have already been doing that. They have a good track record of doing it. I'm a partner with them, I'm letting them do the work, I pay them all of the cash and we're 70, 30 partners. So, yeah, we got 10,000 a month, but even then 400,000 bucks. I mean I would be thrilled if I have $400,000 paying me 1% a month. That would be 4,000 a month. Right, that's 12% a year. That's pretty dang good. Well, still, even after the 10,000, if I pay them the 3,000, the 30%, I still walk away with 7,000 a month, like I'm making in this case. I'm making well over 20% a year net after all of my business costs upfront, after getting the money in and doing all those things. You know, even on the oil and gas side.
Speaker 2:Now, some of those projects they do great, some of them not as great. One of them, I mean my worst investment right now is return like 8% a year. You know, like that's the kind of stuff I look at so, which is like what the stock market does on a good year, you know, you know on a good average, so so that's the difference, like I don't have to become an expert, but here's, here's what you do need. You do need a network, right. Whether you build it up, like I did over the last 20 years, or you borrow somebody else's network, you do need that kind of connection or network to help you out.
Speaker 1:And I think that's perfect advice. How so? I think that this is a good question, but for some so if someone wants to work with you and they came in and you they were working with you specifically, would you help them be able to establish that kind of network? How would that work?
Speaker 2:Yeah, we actually do help with that. We're not investment advisors by any way, shape or form. We're very clear on that. But we are good strategists and we're connectors, and we're connectors. The big thing we try to find is one can we free up cashflow even before you invest?
Speaker 2:I had one client, and in particular this couple, where they said, hey, we got 5 million stocks, Can we get it in the real estate instead, to diversify a little bit more? Well, even before we did that, we realized if we refinanced their property, we could pay off a few of their loans and even sell off when they're investment properties and because they have a business, we also found ways to save about $30,000 plus a year in taxes. Even before we invested a dime into real estate, they already freed up $75,000 a year just by getting their money to produce better their situation. And then they go and invest it. And so now they're in the multiple six figures with the amount of cash, passive income, they could create.
Speaker 2:And so it's things like that, right. So, again, create and so. So it's things like that, right. So we, again, we. I have a whole list of people that we've vetted and stuff. It doesn't mean it's ever guaranteed, but still for you to have to borrow our network. You'll say hey, we're the people you have in your network that you've invested with Chris. I mean not, I haven't invested with every single one, Cause I.
Speaker 1:I can invest with over 20 operators all at the same time. But you know I if I haven't at least done it, then somebody else has done it. You know that's in about just investing in real estate. And you said, hey, I'll do you one better. I'm going to tell you exactly how we help this person basically free up six figures worth of income that they can then invest. And so now you've just given us both sides. So for people that are really interested, how can they find you?
Speaker 2:Yeah, just go to moneyripplescom. You can also follow our podcast, money Ripples Podcast on YouTube, itunes wherever you follow podcasts and even on moneyripplescom. We've got all kinds of free information on there. We even got things like we have a strategy called Max ROI, infinite Banking that we use. That works great with business owners as well. Helps you be able to get your investment money to pay you twice, essentially.
Speaker 1:Yeah, that's amazing, and so everyone listening. Make sure I'll have everything down in the description. If you want to go find Chris, go to Money Ripples. I always have it all on there so you can just make it easy. Also, I always ask everyone this question and in some kind of variance but what is something that you're overcoming right now, whether in life or in business?
Speaker 2:Man. Right now what I'm overcoming is physical, a little bit of physical. I mean one. I mean I'm about to turn 47, so I'm trying to de-age myself a little bit, but I'm also a pretty avid marathoner. A few days after this recording, I'm running the Boston Marathon, right. So it's my third major out of the six majors worldwide that I'm running and I'll tell you it can take a beating on your body a little bit.
Speaker 2:And, uh, having to slow down to some level, having to like focus on the healing process I mean work with chiropractors and massage therapists and stretch therapists and, you know, everybody else under the sun, Right and even like doing the you know, lymphatic flushes and things like that. I mean doing all these things that I never thought I'd be doing, but I'm grateful at least I have the financial means to do so, because I can't say that most people are that lucky. But that's the big thing that I've had to really struggle and overcome is getting really fast, getting faster as I get older and then having my body fight against me a little bit and having to overcome that it messes your head a little bit it definitely does. And having to overcome that it messes your head a little bit it definitely does.
Speaker 1:Well, when you go run the Boston Marathon, wear a GoPro so I can be there along with you, because the only thing I'm running from is my problem sometimes, or the only thing I'm running to is the fridge. So we're working on that. But I do appreciate you just being honest with where you're at, because I think that so many people can relate to that. They can relate to the story that you've already shared about how you grew up, but also just the physical aspects. I mean, even for me just now, turning going to be 31 here in a few months there's a lot of aches and pains that they were not there just a couple of years ago and now all of a sudden they've just randomly showed up.
Speaker 1:I didn't pay for the upgrade plan, like when I turned 30, I should have the same subscription model that I have in my 20s. I don't think I need that upgrade, but I do appreciate you so much, chris, for joining me on the show today. It was incredible. I know I learned a ton. There was so much gold that was in the show and I'm sure so many people got some great things that they can not only apply to their business. Whether you're in business or you're working a nine to five job, there's so much to learn just from this and from Chris. I highly highly recommend that you go tap in with everything he has going on If you want to be able to find more cashflow, if you want to be able to understand what it actually means to invest, not just put it in the 401k. This seems like the absolute leading authority, in my opinion. From everyone I've talked to, from the books I've read, this is the guy that you should talk to. And for everyone listening.