Foreign. Hey, welcome back to the Podcast! So over the last 30 years, I've cultivated a wonderful list of mentors, friends, teachers that have helped me make really good decisions and make smart decisions when it comes to creating wealth today. I Want to talk to you about the lessons I learned along the way: the the systems, the structure, the mindset, the principles, the things that these people were able to install in me over the last 30 years. and but I say install like I had to be open to it like I hope you are today as you're listening to the show.

Um, people that that I was able to as the old line goes, ride on the shoulders of others, learn from their mistakes and maybe try to minimize and I certainly did, in some cases minimize making those same mistakes myself. So if you are on the path and you have a desire to create wealth and I know when I say well, there's a lot of people who say let's talk about wealthy and health and relationship I'm talking about money I'm talking about net worth I'm talking about cash flow I'm talking about changing the course of your financial destiny forever. maybe impacting your family tree in such a positive way that a hundred years from now, your family's like, what? What did great Grandma do? What did great great Grandpa do like that kind of stuff. So if you dig uh, sort of the Art and Science of investing and the psychology around money, you're gonna love this show.

If that's not your bag, I would just encourage you to turn it off and you know I'll see you on the next show. but I'm gonna assume you're with me. So some of those people that impacted me that that you're going to glean some of these insights from obviously my dad who you know who that is, you probably don't know. My stepmom, um my stepmom moved here from Honolulu at 18.

met a family friend named Billy who owns thousands of doors in Southern California and she taught or he taught. my stepmom basically had to buy money with you know, buy real estate with no money down. and you know back in the days we're talking like the 70s, you know that was a thing back then I think it was Robert Allen Who wrote that book or another who wrote that book? You know how to buy real estate, no money down. She got obsessed with that and then that Obsession became you know, really her only as she would jokingly say my only job was just owning real estate.

She taught me so many lessons, it even continues today as I look at deals to run it past her and get her perspective. um Bill Mitchell My mentor who passed several years ago who started multiple companies and and his strategy was like investing in businesses and people so we can talk a lot about that. Brian Tracy one of my early mentors, uh, you know did a wonderful job just expanding my thinking, getting me to set bigger goals. Um, my tax strategist Manny who's been by my side for like 22 years I constantly am asking him what are your wealthiest clients doing right now and then I Just shut up and listen.

uh, financial planners from you know, people at Merrell or Wells or you know JP Morgan Just you know people that I've worked with over the last, you know, some couple decades that have just again, yes, sometimes they're trying to push a product I get that you might have the same thought I certainly do. but being able to ask those people what are the wealthiest people around you doing when in many cases, when I was asking these questions, I was not in a position that I'm in today, right? and and trust me like, I'm good today I want to be extraordinary in the future, but that's a whole other story. All right. And then of course I got to give a shout out to Steve Azonian uh Joe Hanauer Tony Robbins Gary Vaynerchuk Spencer Raskoff Many of these uh, you know friends of mine that were able to say to me you know you can invest in businesses also whether it's startup companies where you can make a difference, right? and and that's a whole other side of it.

But I just got to give a nod to all of them because at the end of the day like I am a sum total of all the mentors and all the people that I've been able to curate throughout my lifetime that have helped guide me in some of these principles. My buddy Claudia Cole right? his daughter working right here inside the studio Claude who is a master you know, a terrific portfolio of commercial real estate and and just to be able to run deals past him and get his Insight that is really if you wanted to understand my superpower, it is that it is curating people, asking good questions, listening intently, getting advice, and then ultimately pulling the trigger and making decisions. But with all that said, I Started having this conversation with a bunch of my Elite clients in February of this this year and it was kind of a continuation of one of my most popular videos on YouTube that's got 13 or 14 million views which for me is a lot and and that was like what are the wealthiest people do with their money and it was really more of a a system and a structure conversation. So if you're listening to this and you've ever watched that show, please leave a comment.

let me know if you've seen that one. It's probably my most popular on YouTube but again, it was all about systems and structure. This is how you should set up your money to set up your banking right. put yourself tactically in a position to win.

Today is going to be a little bit different, right? Playing on that same theme like what? What's the right mindset? What are some of the tactics? What are some of the things that I've witnessed that the wealthiest people I know do? That's what I want to talk about today now. Originally I wrote it down as as this thing like why you'll never be rich and I know that's probably a polarizing thought and not while you're listening to my podcast or watching this on YouTube But but I was really thinking like the information is everywhere so if the information was enough, if the information was enough, you would literally just I would hand you a CD I would send you a link to a video. You would watch it and you become wealthy. Well, we all know that's it's not enough.

You have to change your mindset. You have to change your standards. You have to change your beliefs. You have to make some fundamental shifts because the reality is there's this old line that if you took all the money, all the wealth around the world and you took it away from the people that had created it or their families had you know given it to them over time that eventually over time it would all fall right back into the same people's hands.

And and the reason why is because those people understand the principles, the mindset, the strategy, the systems and the structure for creating and maintaining wealth. and the vast majority of people around the planet simply don't. So I don't know where you find yourself in the journey I I am still a work in progress I am still asking as many questions learning as much as I can cultivating more people into. you know, into my sort of community of advisors.

And you know? so I'm on that journey and I hope you are too. So so let's talk about it. I started writing down. You know what's the number one? What's the number one thing that I see people that never seem to create the kind of wealth that they desire and that is if you're taking notes and I hope you are.

it is. Most people can't define what it is that they want. Most people are unwilling to Define what it is that they want or they Loosely Define it. And the last time I checked, you very rarely hit a Target that's moving.

You rarely ever achieve a goal that's wishy-washy You've got to get clear like Napoleon Hill I'm sure I've got think you are rich right here on my desk. The number One principle is definite major purpose right now. I'm not saying this is the only purpose in your life. Again, we're talking about money.

We're talking about wealth. But if I challenge you right now to say what does it mean for you to be wealthy, what does that mean to you? And and I always hear things like Freedom Choice and then I'll some people say no stress and I'm like listen to me I I Know people with a lot of money that have stress and I know people that have no money and have stress if you got a choice, I'm going with the money in stress versus no money in stress. But stress is everywhere, right? You're not going to eliminate that. Um, but what is your definition like? how do you define it? What I'll say to people is is basically tactical level: I'll say what is your outcome, what do you want, and by when, what is your outcome, what do you want and buy when Which means hey, I'd like to have this much right and again I'm going to give you some I'm going to give you some parameters because the smartest people will not just say I'd like a net worth of five million dollars.

The smartest people are going to say I want a net worth of five million dollars by this time period, right? So I want to achieve that goal in the next five years, 10 years, 20 years, whatever your ambition is. But the even more I almost said smarter, that'd be funny. the even more intelligent the even more focused people will say I want a net worth of five million dollars and I want it in five years and I want cash flow of a thousand dollars a month. Now there's a big difference between having a net worth of five million dollars and having a net worth of five million dollars with a thousand dollars a month in cash flow.

But the the really the really intelligent people say something more like this: I want a net worth of five million dollars that I want to achieve in the next five years I Want cash flow of a thousand dollars a month that covers all my expenses. Now you can fill in the blank with how much net worth you want in what time frame you want with the cash flow you desire. But the one at the end is. It seems to be the thing that when I break down like the truly wealthy people and it doesn't matter what their net worth is.

Right Some are worth 10 million dollars, some are worth hundreds of millions, some are worth billions. They all say the same thing. The game is that your life is set up where your Investments cover everything in your life, that your Investments your cash flow covers everything in your life. So you're living essentially in an environment where you don't have to work.

Now what if I told you every single one of them Works their face off because they love it because it's a game. But the hook is they don't have to Now you could be listening this right now and you could be in your 70s. You could be in your 50s. You can be in your 20s.

It doesn't make a difference I would challenge you right now if that, if you're unwilling to Define what it is that you want I would not go further in this podcast, right? Because if you can't first start with it, you know I don't know. Shut up. Write down a number. Just say I want to be worth 10 million dollars.

Two million dollars, a million dollars. Whatever it is. And by the way, okay, when you get to the goal, can you adjust the goal? The answer is of course what if I told you that when I was 25 I wrote down I want to be worth a million dollars by the time I'm 30. and it was just one of those like Brian Tracy my dad like Hector you got to set goals.

You got to write them down. You got to put it on your bathroom there. You gotta, you know, get focused on it, get obsessed about it. So I did all that well.

What if I told you I didn't achieve that goal that it actually took me until I was 31 before I achieved that goal when my true net worth my assets after all my debts totaled a million dollars. But the bummer was because I never wrote down I wanted cash flow. Guess what? I did not have I had no cash flow. So yeah, I had a mass because I bought real estate and I'd made other Investments and I saved a bunch of money and I put money inside the market that the the total was a million dollar net worth.

It took me basically six years to get there I'm convinced had I wrote down at that time and a thousand dollars a month in cash flow, it would have changed how I invested. It would have changed my concentration whether it was investing in the stock market that would produce dividends or buying more real estate that was producing more cash flow versus breaking even it all. Like once you decide what you want I'm just convinced that the how you get there the how becomes easier. It becomes more clear to me that if I say I want a net worth of X and I want cash flow of Y that covers all my expenses.

Hey, I can reduce my expenses, increase my cash flow, and get to my goal or I can keep my expenses where they are and really focus on cash flow. But the bottom line is that's where it all begins in my opinion. Now I don't know about you but if you Google right now like where where do people sort of in, let's just call in the Western World They say that 80 of the people end up flat broke. Eighty percent of the people end up Hector basically living off their family, living off, uh, little to no savings and ultimately like the Federal government And I would argue in one of the wealthiest times on the planet right now where someone that could have a full-time job and have three side hustles you know, who could do so Like who could house hack and you know, buy a four bedroom house, rent out three rooms.

There's so many ways you can do it. But I'm getting ahead of myself. but 80 of the people end up flat broke and that to me is just a shame. So is it? Is it The lack of information? Is it too much information? or do they never write down what they were committed to? I'm convinced it's the latter.

They say that 15 of the people become wealthy whatever that means. and you know wealthy is you know such a who knows right? Is it like three million dollars and you paid off your mortgage? I would call that person wealthy, right? Especially if they've got some form of cash flow. And then they say four percent like Point Yeah, four percent become generational wealth right where? Now their issue is how do I now transfer all this to my kids and and try and do it without a lot of tax burden? Um, a mutual friend of mine passed away recently and and she was worth about 200 million dollars. They had to like her.

Her kids are basically dealing with probates like it's this leads to real issues, right? She She had set everything up as far as she can go, but she didn't plan to die as early as she did. God Bless her. Um, that's a very real issue, right? Generational wealth. But again, I'm getting ahead of myself and then ready.

One percent of the people are like transformational wealth. Like transformational like. you know they could go buy a city with me like they've just they've amassed such a fortune. Now as you hear that and you think about, you know the top one percent.

By the way, in the U.S If you're making four hundred thousand dollars a year, you're in the top one percent. Like that's the number. If you're in the top one percent of income earners in America, you're making 400 000 a year now. I Can remind everybody that your income is in direct correlation to the value that you deliver the market.

So if you have a role that is easily replaced, if you have a role that the market Bears What The market? Bears right? If you work at McDonald's you're not going to make four hundred thousand dollars a year, right? Like it just is what it is. So even as you're listening to this, right? That whole top one percent, it's four hundred thousand dollars a year. It's not what you earn, it's what you do with the money. But that's again.

I Keep saying I'm getting ahead of myself. It means I have a lot of stuff I Want to talk about and I'm only at Point number one. So so maybe just stop for a minute. So I got three of my teammates in front of me right now so let's stop and I would ask you to say where are you today What is your net worth today? What is your network today? Do you know? Have you thought about it right? What is your financial? It could just be have got this much money in savings and I've got that much in debt right? and I don't own a home right now? Maybe the person listening that's not you but talking to a couple of my friends here inside the room.

But then the key is to say okay, so wherever I want to be in three years, what do I want it to be in three years after then what? I wanted to be in five years, Then where do I want to be in 10 years and then where do I want to be in 20 years But I wish somebody would have said to me when I was in my 20s that you could decide where you want to be in 20 years I didn't get that until I was about 30 right when finally one of my coaches Teresa said to me, let's create a 20-year vision for your life Let's create a 20-year vision for your finances. Let's create a 20-year vision for the kind of family you want, the relationships you want, the health you want Etc I Mean what a blessing that was to get that advice. but I took action on it. So as you're listing this: I hope you're not just listening I hope you're actually like pausing this and saying all right I'll go with this 20 years from now.

Hey I Want to be worth X But remember, it's not just X it's X with cash flow and it's you know. Covering your expenses, covering all your expenses, all your costs of living. If you sat today and you just decided just that and you wrote it up on your bathroom mirror, the house starts to become pretty automatic. you know? Okay, well, I probably should stop spending money on dumb I should probably sacrifice a little more I should probably house hack if I'm buying my first house I maybe I should buy a duplex a Triplex or a four Plex live in the most inexpensive unit, take that one and rent out the balance and and it's okay to do that in your 20s, 30s, 40s, 50s.

It's okay to sacrifice to get to what you want, so make sense. So that's all. Point Number one: Let's go to point number two: The thing that I I look at when I look at all my mentors. They are all obsessed about reading, studying, learning, and asking good questions of people that have more insight and information than they have.

So the number two reason why I think most people will never get wealthy is they're afraid to ask. They are sometimes intimidated by the woman who's become wildly successful who built a monster business so they're unwilling to say how did you do it. Can you break it down for me before the end of the show? I'm going to give you the 18 questions that my buddy Gina Bifari the CEO of Home Services came up with. It's the 18 questions he asks every new person that he's meeting with.

It's the 18 questions that helps unpack this person's psychology and it's a nice way to get started in a new relationship. But then once you have that established relationship then you can go deeper and say how did you do it, why did you do it Looking back, what were the mistakes you you know would avoid? What were the things, the decisions. What was the hardest part? What was the most fun part? You get all that stuff and what it does is it starts to change your standard. It starts to change your psychology the way you think about it, right you have.

you have more if you will. Data points in your head when you're looking to make a good decision about creating more wealth, making an investment, Buying a piece of property, whatever it may be. So the thing I wrote down is, most people avoid it, right? Some people flirt with it, but the wealthiest people, it's an obsession for them. It's an obsession for them to read and to study.

and to look at market trends. And you know to read books about. You know where the world is going and where it's at Now to not be afraid of things that they don't understand, but to instead say I don't understand it I should lean into it I Remember in the early days of like Bitcoin and all that stuff I was like I don't get it so you already did I started calling people I knew that we're investing in it when it was like you know Bitcoin was like 10 bucks and saying why, what's the future of this, how are we going to use it in the future right? And and you know what? Candidly I did not invest in those early days I did later on I think primarily because I just I didn't want to be socially irrelevant if that makes sense I wanted to be culturally like. it was a part of the Zeitgeist right? You just had to have a taste of it.

But it was such a small percentage of my net worth. So when it you know flailed as it did I was like okay, you know that that stung. It was a lesson learned. But here's my point: Are you obsessed about studying Real estate? Business finance? Investing in the market? Investing in people? Are you obsessed with that? Or do you flirt with it? or do you avoid it now? I Know as you hear this.

it just it blows me away when I when I talk to people that can tell me everything about the Kardashians except for their business. Think into it, what they wear, how they dress, who they're dating, and I'm like, yeah, but what about the way they structured their business, how many employees does, and whatever, and they're like I don't know any of that stuff I'm like so you took the time to get obsessed about these iconic figures in our Marketplace I'm obsessed with pickleball I Know everything about the rackets I know everything about this I know all the players and I'm like that's awesome I Know everything about the NBA That's awesome cool. Why not just put some of that passion that interest into something that can completely transform your life? Think about it. I'm not saying don't I like pickleball I like golf I like the NBA I Don't really care about the Kardashians but you know, like I've watched some Netflix shows now and then with my wife.

She does often complain that she finds me drifting off to things that I'm more interested in. but that's just it is what it is. What are you obsessed with? What could you be obsessed with? Where do you find a gap in your understanding of what the wealthiest people do? and what if you just lean into that? I Remember watching a show with my boys um called The Men Who Made America Someone to be offended because it's just the word men inside there. but it was like JP Morgan It was like all these iconic people back in the late 1800s that you know where there was oil, business, or electricity.

You know they they became so wealthy. and yeah, they. There's no doubt they did some douchebaggy things to get there right. Like the way they worked with their labor force created things like the unions which we have today.

Um, it was horrible. But it was fascinating to look and see how these individuals found a problem and solved it. Found a problem and they solved it and they did whatever it took to get there sometimes like whatever it took was a little crazy. but there's a lesson inside there now I Could take the lesson of humanity that you could do it the right way.

But the fundamental thing that they all did was they found a major problem and they solved it. Look at the Elon musks of the world. He sells his first company and he takes all of the profit from it and starts three new businesses. three very different businesses, a solar business, a rocket business, and of course Tesla And what did he do? He just obsessed about it and through that Obsession he built three of the largest companies and created more net worth.

and you know I don't know where he ranks today, but it's it's tremendous. tremendous what he was able to accomplish. That's the kind of obsession if you just carved out a couple hours every week to just say I'm going to read more I'm going to study more I'm going to lean into people that you know the the rich uncle that you have that you're not really connected to, or a family member who's done something that you're like. How did you do that? Like how did you start that business? What did it take? How did you go from zero to ten investment properties? What did you do to create your first indication? Like just leaning in and being okay, being okay, being stupid, not having the answers.

That's where the real growth begins. When you could say I don't have an opinion about this I don't understand how to do it. How did you raise the capital? How did you find the deals? What do you say yes to? What do you say no to what's your buy box? It's these types of questions and by the way, all the smartest people that I've ever worked with. They all love to share that stuff and they love to tell stories about the mistakes they made and how they got there and man I was in the back of this car and the whole world was falling apart and I was sick as a dog and I had to get up and present.

I'm actually thinking of one of my mentors Bill who like literally said I thought I was going to lose everything got a yes, the market turned, we sold out every you know every house that we were building at that time and it completely transformed his life. But the lessons and the stories. There's just so much for you and I to learn from that again. it changes your perspective.

It changes how you think, it changes your standards. That's what the wealthiest people do. All right, let's go to number three. The reason why most people will never create the wealth they want is they don't identify as someone who is deservant of it.

They don't identify someone who can. So Hector I I'm just convinced. As many people as I've talked to, I just asked the question like so so let's talk about money. What's your story? What's your earliest childhood memories about money and and I heard all the time Never enough cookies in the cookie jar.

Parents always argued over money so I'm like so. So the most consistent thing was there wasn't enough and then I said so tell me about your current situation and it's interesting I was I was really thinking about I mean I've talked to so many people doing events and coaching and you know Instagram and just you know just being a human being as curious as I am I feel like the the vast majority of the stories come down to this: uh I always seem to lose it I always every investment I make every stock. It seems like when I buy stocks all the prices go down and then I'm like but do you then buy when stocks go down because that's called dollar cost averaging all the money's made in the purchase and they're like nope I stopped buying stocks Okay cool. I Bought real estate in 2006 I'm not buying real estate again like it was a disaster.

Like that's just the most consistent thing I Hear from them Now you and I both know the more you say a story, the more it becomes real for you, the more it becomes how you identify yourself. So if you identify as someone that's constantly making bad Investments or has historically always seems to lose their money, spend it on dumb, go to Vegas lose like crazy then go again like think about the just the stupidity of that. sorry if that's you, think about that right? Oh, every time I go to Vegas I seem to lose my ass I'm like don't go to Vegas anymore like why don't you stop doing that because the hope of I might be able to that's actually like Point number four but ready. one is I always seem to lose it.

two is I'm just I'm really risk adverse I just you know I just Tom it's just not my thing I don't like taking risks and my responses we take a risk every day we wake up. every day is a risk getting in a car in Dallas at times Hector feels like a risk you with me like it's NASCAR on the 75 freeway. So so this this risk adverse mentality and I always want to go to the backstory and say so, where'd that come from and inevitably I'll hear stories like well you know my parents were cereal entrepreneurs and they would either they'd either be wealthy or broke, wealthy or broke wealthy or broke so there I they would identify with well if you take a lot of risk. Sure you could be wealthy, but the next day you could be broke.

So if I just don't take any risk I'll just never be broke. but you'll also never be wealthy. So I hear that story a lot. But then the third story I hear is let me ask you a few more questions.

Okay, let's go and and I just I'm just curious for you as you're listening to this I know like there's a lot of mindset here in Psychology here. but I want you to get like I was just super lucky to you know I have a photo of me and Dennis Waitley right if you know that name like that's an old school Earl Nightingale Nightingale Kona Corporation audio cassette uh you know author. It was just incredible. When you spend enough time with all these extraordinary men and women, they just identify somebody that can They identify as somebody that perseveres that plays the long game.

That isn't about quick money right? They identify smart investors. They identify as people that ask a lot of questions. I am just convinced being a dad. the one thing I I hope I did as a father looking at my my two sons is to help them form an identity of someone that can to help them form an identity of someone that can.

Now the great news is it really doesn't matter what your identity is today because what we know is you can change your identity. So I wrote down some some things that maybe this will resonate for you. Maybe one or two of these is all you need. So I'm gonna give you a bunch of things that that I've done because if you asked me when I was you know kicked out of my last high school before I got my GED and had like purple hair and was driving 100 125 CC motorcycle which like a lawnmower on Wheels living in Costa Mesa La Off Center Street by the old original Wahoo's Fish Taco right and I had a bullet hole in my window that when the sun was basically going down right like I would see or should be coming up in the morning.

It made this beautiful rainbow on my wall like the the way the sun hit the bullet hole in my window. So I think you get a sense for this was not a uh, this was probably a D apartment building on a scale from A to F. Um, but living there what I started to understand was you can change your identity and back then it was because my dad gave me a bunch of audio cassette programs and said basically like hey, either listen to these or I'm gonna kill you It was one of those kind of motivating conversations from a parent. But what I got from that was the truth around who you spend your time with.

If you want to change your identity, you got to change sometimes. The people you're spending all of your time with the majority of your time with and at that time as you can imagine you know, being a senior in high school working in a grocery store from Midnight to nine like the people I was hanging out with were people that were like Mia degenerate like they were hanging out partying too much, doing all the wrong stuff. you know, doing all the like. We had a ton of fun.

Don't get me wrong, it was a ton of fun, but it wasn't a path like I Had multiple friends die in my early like like early 20s, late teens right? suicide, murdered, drug overdose and I know all of us like you know we. We know someone that either you directly or you know someone who had that experience. It took some of those moments for me to realize like the path that I was on was not the right path, then the path became I actually did this exercise I actually wrote down one day and it was harsh. um I forget who gave me the assignment.

it may have been one of my buddies at the grocery store. it was one of those like he was old, he was 30. um and he said to me you should write down the people in your life that like believe in you. You should write down the people in your life that are neutral and you should write down the people in your life that you think are on the wrong path like negative and this guy was like you know, jock, super athlete and he was looking at me I'm like 17 I got a mohawk and I'm purple hair and he's like you're such a knucklehead right? But he saw something in me to be able to say if you spend less time with the negative people.

If you figure out why the people in your life that are neutral like they're just they're sort of vanilla, you know what I mean like they don't care if you do well, they don't care if you do bad, they just they kind of just don't care. And then you spend more time with the people that are positive in your life. The people that are doing something. and he didn't describe it as like positive like Pollyanna he meant they have purpose, they are moving forward, they're trying to get somewhere I was like wow and I started like thinking about my buddy Aaron who you know became a fireman and like Aaron worked out every day and he was passionate and he looked good and he took care of himself and he was talking about buying real estate when we were like 19 18 I was like yeah, more time like with people like that and less time with the people that all they want to do is just be Knuckleheads And it's a hard thing when you're in your teens or in your early 20s to start pushing away those people and not it wasn't their fault, they were just on a different path I decided I wanted something else.

So number one thing is you need to start cultivating one to two slightly wealthier than you people in your life. So if I asked you just to stop and say okay, who are some people that are in my life that are just three, four, five steps ahead, you don't want them like 500 steps ahead because it's unrelatable, right? You're like I just bought. You know, my first house and they own 1200 doors, right? It's an unrelatable conversation actor to go straight to there. But to go hey you bought your first house and then you refinance pull some cash out and you bought a second home and made your other one a rental property.

Tell me how you did that. Oh, you now own three rental properties. Tell me how you did that. You start cultivating some of those relationships and now all of a sudden your identity begins to shift because they see you the way you want to be seen.

They're like I can do it. You can do it. And that little s like subtle shift is the beginning of an identity switch. I Wrote down: who are you willing? Who are? Who are you willing to reach out to in the next couple weeks that are a little outside of your comfort zone that are just a couple steps ahead of you to start cultivating that relationship? Can we meet once a month for coffee? Can we? You know what books are you reading? You know? can I share with you the things that I'm learning I'd love to learn more from you and you form that relationship, right? It could be around pickleball I Don't know it could be around something you're passionate about, but your real mission is to extract what it is that they're doing that got them there so you can do it faster.

Second thing I wrote down is you should be joining groups, reading, listening, learning. Um, I was saying like this morning I watched two episodes on the Shark Tank right? So so you know I'm like literally getting ready in the morning and I'm watching Shark Tank and I'm thinking to myself I just love like the number of people I know that watch Shark Tank is bigger than the number of people I Know that know anything about the Kardashians does that make sense And I'm not dogging the Kardashians because they've obviously created a massive Fortune with all kinds of interesting influence. But my point is like I can watch the Shark Tank and go wow That's an interesting idea and it gives me two more I can say oh, why did Mark say yes to this? Why does you know Mr Wonderful always try and structure a deal This Way versus that way and here I'm watching a little YouTube clip for eight or nine minutes of just one you know piece of an episode and I'm absorbing that information. But then I also wrote down: can you join groups Investment clubs? Can you join networking groups that are focusing on this? You know there's in every nook and cranny around the world there is a stock market.

Club There's a real estate investing Club There's a small business group. There's all these groups. and again, I just say like attracts like spend time with more people like that and you're going to shift your identity. The third thing I wrote down is um, this is the third.

Excuse me the fourth major point. fourth major point. But first, are you gonna do the assignment? Write down exactly what you want, right? Get super clear on that. Realize that we all have a story.

You can change your story. You're going to identify two or three people to say I'm gonna go spend more time with them. What are they doing? And by the way, the older ones are better. The ones with a little more gray hair right? or a little less hair.

Or like my stepmom who dyes her hair right. the more experience they have, the better because they've been through. Market Cycles UPS Downs You know, like catastrophe, All that's who I want to learn from? Okay, Major Point Number Four, Write this down. My wealthiest friends don't chase fast money.

They have no interest in it. Fast money makes them nervous, like if it's too easy, if it's too good to be true, you could probably finish that statement. It very rarely is. If anything, fast money creates fast losses, right? The people that I'm spending time with all are focused on the long game.

Is this piece of real estate today going to be worth more as I improve the incremental value of the property? Is it going to be worth more in a year? Sure. Could it be worth more than three to five years? Yes. How about 20 years in 20 years? I'm going to look back and say that apartment building was a steal I Think about my mentor Bill Mitchell He had the Good Fortune to work with. a guy named Donald Brand who's one of the wealthiest people on the planet owns a company called the Irvine Company in Southern California and they've got you know buildings and holdings everywhere.

Billions and billions and billions and billions and billions of dollars of wealth created. He told me the story of how Don got involved and bought a piece of the Irvine excuse me but the Irvine company with a small piece of his own money but leveraged other people's money and then when the market turned right and got really bad in the early 80s he was able to buy all of his Partners out For you know all this is documented. you can Google it several hundred million dollars and then you take a several hundred million dollar asset in the 80s and you compounded out to 2023 and it's made in one of the wealthiest people on the planet, one of the wealthiest people on the planet. The long game, The long game.

So again two you know, two people hatch how old are you 35 and then Jordan 25 23. So I've got 23, 25 and 35 in the room. The long game. The long game.

Now everyone listening knows because you you hear about people like Warren Buffett like yes, I drink you know, whatever this drink is. So I invested in that company and I've owned it for 25 years and the 25-year return on that stock is bananas. I'm sure someone's listening like yeah, but I'm like man I you know I'm kind of into the day trading thing and I like the in and out. So um I read and you should Google this I read that there are 12 days in every 365 day year that make or break the entire stock market.

12 days 12 days No One Ever Knows when they're gonna happen Hector right? But there's 12 days that make or break the entire year in the stock market. So what if you miss one of those days? So when I was going through this, you know content I was looking at this material and I don't want to misquote the numbers, you should Google this It was super interesting, but essentially it said if you miss one of those days, your return goes from here to here and if you if you only are listening to me, I just I dropped it down by an inch. But if you miss a couple of those days like your return goes to next to nothing. so I don't know about you like I I own stock.

It's in companies that I believe in. It's in companies that I can read about and understand and like. Find out what the CEO is committed to, find out, what the managed team's committed to, what's their cash balance situation, what investments are they making? It's not an obsession the way it is for my wife who loves it and that's okay. but it's all about the long game.

It's all about buy and wait right? And now you could say no I figured it out I know when the 12 days are and if you do please DM me because I would love to pick your brand on that I'd love to learn more how you figure that out and I want to know how many hundreds of millions of dollars you are worth because you figure that out. Play with me here. All right. So you ready all my wealthiest friends play the long game.

It's buy and wait. it's buy and wait. it's Buy and Hold it's even even like so I invest in a lot of startup companies and when I really got obsessed around this I remember sitting with Tony Robbins and then shortly thereafter sitting with Gary vaynerchuk and and basically the conversation was like Tony like I'm investing in companies that I believe in and then they become sponsors of my events I was like that's a good idea and now I do the same thing. not every one of the companies that sponsors my event, but many of those companies that I believe in them so much it's like there's a there was this old Gillette Razer commercial.

the the guy that bought the business said Dale I like Gillette razor so much I bought the company like think about that I like the Gillette razor so much after I bought the company that was like the ad and and you know from some of my older timers right, you'll remember that ad that was Tony's model right where Gary's model was I can invest in these companies and I can provide resources in side influence more investors and I was like I like that I can do that too. But understanding investing in startups where the risk reward is pretty like it's pretty significant. Like if you have a hundred companies in your portfolio which I have, you're gonna have seven or eight of them go out of business every single year. you're gonna have one or two dying because they can't raise capital and you're like man, we took this thing pretty far and it's starting to work.

but right now the capital markets suck and it's unless you want to take a massive write down on the value of your business. which means all the investors and the employees and everybody just gets screwed over which happens every single day. Then you know we got to figure it out right? Do we cut expenses? It's it's a it's a very I would say for me fun for some people. stressful business environment as an investment strategy, but when they hit when their true car or slack or others that hit it more than pays for itself and you hope that on the end of it that you invested a dollar and you made a buck.

Fifty Two dollars, Five dollars. But when I say to my wife every one of these deals, it's a 10-year investment Because it takes 10 years to build a good business. 10 years to build a good business as a CEO of a company, as an owner of your team, as an owner of your business, it takes 10 years before you actually really figure out the business. You figure out your product, you figure out your customers, you figure out your systems, you figure out the mechanics.

you forgot the financials. It's the long game. It's the long game. My biggest mistake was the second company I invest in sold in 90 days and I thought oh, I'm hot then I realized no I just got lucky right? thanks Big shout out to Kelly Perdue by the way, Moonshot capitals he's like you should invest in this deal me and your dad both invested in the deal.

Nine days later, they sold I was like I'm a pretty good startup investor then like I think like the next five all died within like a year and a half and I was like oh, I'm a typical startup investor now. with that said, that's a whole other conversation we're talking about. You know, being risky here. it's all about the long game.

Please write that down. It's not about the dollar you make today. It's not about the dollar you invest today. It's what happens to it in the next three years.

Five years, 10 years, 20 years If you just bought a bunch of houses in 2007, 8, 9, 10 What are they worth today If you bought a four Plex or a 20 Plex or a 200 Plex in May of 2020 when the world was falling apart, What happened to the value of that property? We know what happened. It's skyrocketed. So I just I Hope as you're listening to this and I know I'm talking about it a lot. In a lot A lot.

it's just a long game. So I wrote down ready, what's the long game 10 to 20 years That's my mindset for most of us. It's just buy real estate and wait, it's put money in the market and let the market do its thing right. Asset allocation, all that kind of stuff I covered that in my other video I'm not getting any of that stuff today.

I'm just talking about the mindset. then I wrote down for you: spend an hour every single week getting clear on where the Market's going, where are their opportunities? and if I were you, especially if you're a real estate practitioner, I would challenge you to write an offer on a property every week I would challenge you to find the deal in your Marketplace every single week Tom There's no inventory. Shut up. There's always property, right? Maybe the deal is 20 30 minutes outside of town? Maybe the deal is it's a Sfr, but it's sitting on a lot that's zoned for a Triplex or a fourplex or an aplex.

Maybe that's the opportunity. And sure, the cost to acquire it. You're like, oh, they're really trying to get a premium on this. Well, of course they are because they know the moment you buy that thing, you're going to scrape it and you're gonna build one, two three, four five, six, seven units on that and you're gonna sell that for a profit or turn into a multi-family You know situation.

You don't always have to have the cash. What I'm trying to get you understand is be on the hunt for deals. Find Opportunities Whoever finds opportunities can tie it up and flip it to somebody else. You could say I'll take my entire commission from this deal, put it into the deal and you Mr developer you Mrs developer.

You go finish it and I'll just take the listings on the back end and I'll ride my commission into the deal and take a return on that. Now all of a sudden, you're making exponentially more than just the commission. And yeah, sure, it may take 18 months to two years. Who cares? We're playing the long game.

All right. let me go to the next major Point Number Five. Hard to argue that this isn't one of the most important things that I learned from everybody and it is. I Think it's the I don't know if I would say it's got to be one of the top five reasons why most people never make it.

It is number Five. Most are just unwilling to sacrifice. They're unwilling to sacrifice. they're so busy buying dumb the next.

iPhone The next thing that they don't need releasing another car versus just buying the car and just owning it for a while, right? and just saying it is what it is I don't need a new car every three or four years, right? Unwilling to sacrifice? Unwilling to sacrifice. How many stories have you heard of parents and grandparents and great grandparents that sacrifice like crazy to put you in the position that you're in today. The vast majority of people are just unwilling to. They need everything right now.

They have so much Fomo. so much fear of missing out or worse. I started to write down. um they man.

let's go back to sacrifice. Think about all the people that sacrificed to get people into college for the first time to be the first one to go to college to start a business. They had a full-time job and they started a business. They bought their first house like I Think about my my in-laws who bought a house in like Anaheim California for like 14 right in like I don't even 1950 something like that on a VA loan and it was a stretch and then just held it forever.

They made the sacrifice. I Know you could. You could say Tom I've made some sacrifices. Did you make sacrifices when things were really good? or did you make sacrifices when things were tight? I'm talking about the willingness to make sacrifices to not get over your skis, to not just continually rack up credit card debt, or buy things on credit that you know you can't afford in the moment.

I'm talking about some of those sacrifices. Maybe it's like making your own coffee versus always buying Starbucks right? It's those kind of sacrifices that over time you go. well. four dollars a day doesn't matter.

but times four dollars a day or four dollars a day times 365 days and sometimes twice. and I'd rather see that money in a money market account. or you know, trying to buy my first piece of real estate as an example. So here's what I wrote down you ready if you go back to think you are rich I Want to say it was um, it was like number two or number three in the book he said Napoleon Hill said you have to write yourself a letter talking about your definite major purpose I Want to be worth this much money in this time period with this much cash flow covering all of my expenses by this time period.

And then the balance of a letter is about the sacrifices and the work you're willing to do to realize that goal, the sacrifices, and the work you're re. You know you're really willing to do to realize that goal. So it's so funny. like when I was with all my clients in in Vegas I Literally said to them: sacrifice like having 10 meaningful conversations a day is probably a sacrifice to the vast majority of real estate professionals.

I Don't want it to I Don't have any time for it. Shut up. The more meaningful conversations you have. You have 10 meaningful conversations every single day.

Five opportunities of those ten will be an opportunity for you to serve someone else. Hey, Hector you told me you needed this I got a guy for you I got a gal for you I know the hookup. Let me let me connect you. Those five is you just doing good for others And of those two opportunities will be there for you to do business.

So from 10 meaningful conversations a day, I know you'll get two opportunities for business. Now the opportunity could be Hector Wants to buy a house outside of my Marketplace and I'm going to refer to another agent, get a referral fee or it could be Hey Hector Just told me in four years when his kids graduate, that'd be funny at 35 but just playing along. Then in four years when his kids graduate, he wants to downsize from the big house to a smaller house and not tell his children where he moved to, right? So I don't care if it's four years from now or next week, there is always an opportunity. But it's so funny for me that people say I just I'm too busy or I'm not comfortable I don't know what to say, they just give me every excuse in the book and I say I know what it is.

You just are more committed to being broke than you are to being wealthy. Do you hear what? I just said Wealthy people do whatever it takes, they remove the feeling from it and they do the work. They do the work whatever is required to achieve the results to serve our clients, to make a difference, to create an impact to create more. Revenue To invest more.

Maybe that's just the sacrifice you need to make I got a phone If you have kids, say to your kids I would love for you to have everything you want, but I am unwilling to make phone calls every day so that's why you're not going to have it. You just have to figure it out on your own. Say that to your children and watch how they respond. On the flip side, say to your kids Hey listen to me I need to go and have 10 meaningful conversations a day and I want to sell this many homes and I want to save this much money And if I'm able to have this, these conversations every day hold me accountable.

Seven-year-old help me accountable. 12 year old. If I sell this many homes and I save this much money, we're going to talk about saving. There's money after taxes.

This is the dollar amount I want. When we get there at the end of the year, you will be rewarded in the following way: We will go to Orlando and go to Disneyland and we'll have a wonderful family vacation. But if Mom doesn't have 10 meaningful conversations today, it doesn't sell 24 homes and doesn't save after taxes this much money, we can't go. What is your 5 and 12 year old going to do non-stop Did you have a conversation? Mommy Mommy I Just drove by a for sale by owner and I knocked on their door for you on my big wheel like you will create so much structure.

but what are we really doing? We're teaching our kids the value of setting a goal, working towards it, delaying the gratification. it's 12 months from now. You put the vision board up on the wall right? and could this could the same thing be to buy our first investment property to set aside x amount of cash and buy REITs So you're you know you're investing in publicly traded real estate assets that give you dividends as an example. The answer is whatever you decide for it to be.

But what I really want you to get is you got to sacrifice. You got to be willing to sacrifice. So um I literally wrote down. you know, is it eat out less than you currently do? Is it sell the big ass house that you're in and downsize is something more reasonable? Take the cash and go make investments.

Is it cashing out and buying two investment properties and living in a condo? like? what is the sacrifice you need to make? Is it your 1800 a month car payment right? That just as easily like I I have a buddy who is worth so much money? it is ridiculous and he drives a Jaguar and I want to say it's like an 85 or 86 that he must have paid off and he didn't go by like he bought it in 85 or 86 and every time I see him, that's the car he drives like he's like I don't care. gets me from here to here and he'll make fun of me because I've you know I have a couple nice cars but my cash flow pays for my cars. You hear me? my cash flow pays for my cars. That's the key right? important distinction and he still busts my chops on it says fair.

You should sacrifice more if you really want your family to be right. I'm like, okay Joe I got it all right. You know, you know, you know, you know. Okay, let's go.

Number six, Number six and we're almost at the end. The number six reason why people will never kind of create the wealth that they really deserve and I do believe you deserve it is they don't ask for help. They don't ask for help. They don't ask for help or worse or worse.

they ask the wrong people for advice You with me on this. Don't ask people that always lose their money and make shitty Investments about investing. Ask people that are willing to tell you that's stupid, that's a bad idea or let's unpack that together. Send me the contract.

Let's review it. That's your dad. Send me the contract. Let's review it.

Let's figure that like he loves contracts, right? Like it's he obsesses over the smallest little details to make sure that he is protected. The families protected. the deal is protected. Etc If you're unwilling to ask for help, if you're unwilling to ask for help, you're just going to make bad decisions.

I had a coach that uh, used to work for me and nice guy known him for a long time when when I was in the early days of 10 years ago investing in startups he's like I I want to do that and I was like okay, how much cash do you have set aside that you could lose and if you lost it, you wouldn't care. It would sting. but you wouldn't care because that's the only way you want to do it if you're investing in startups. otherwise you should be buying more real estate.

No, No no you know you know it's like he had this like get rich quick mentality he he didn't ask for help I because I love him was saying what's your buy box You got to decide what you're gonna say yes to what's your criteria, what are the questions that you asked before you invest in them and by the way, I should probably share those eight questions. maybe not on this show. Maybe we'll do another show, but there's eight questions I ask every person that that pitches me on their company and so so I'm I'm prodding him because I love him but I can just feel the resistance. he just did not want to listen to me and then he called me hey so I invested in that company and I was like oh yeah the the weed transportation business in Canada I'm like yeah I'm like you know I passed on that he's like no man I think it's gonna really be hot I'm like okay and I'm like did you ask him about this this this and this did you see how how easily disruptible that business is like the supply chain situation? like did you ask anything? he's like no but like I really got hot and I met with a guy and he made a compelling offer and he told me he's going to sell the business right away and I'm I'd literally I wanted to punch myself in the face because I couldn't get across to a friend of mine how bad of a mistake he had made.

Then he told me how much cash he put into it and I almost threw up because it was like half of all the cash he had. which is the exact opposite of what anyone I know who invests in startups would ever do. Nobody I know would risk that much. they could say you don't know Elon Musk and he did it I Get it, This guy is not.

Elon Musk He is not going to go to the library and read every single book you can read on how to build a rocket ship. so he understood the engineering. You know, mechanics of it all. Like this guy wasn't doing that, he was going for the get rich quick.

He didn't ask for help and as you can probably imagine, that business folded within about nine months. So his entire investment and it was a it was a six-figure investment gone. How many stories do we need to hear about? people that were unwilling to set their ego aside and just say, what do you think? Shoot some holes in this I was on the phone this morning with a board member of mine. I'm telling you about a company that I that I'm enamored by.

That would be the way I would describe it I'm enamored by the CEO I think he is. He could be an excellent number two. I'm not convinced he's a number one, but he could be an excellent number two. So I Say to my board member: I'm going to tell you about this deal.

talk me out of it and I told him everything about the deal. He talked me out of it in three minutes I was like yep, you're right. Okay, cool. Next move on now I know way more about the deal I can be super enamored by it I could be super passionate about the opportunity I could even think I could fix that individual but I'm willing to ask someone who's smarter than me who's done more deals than I have.

Hey man, this is what I'm thinking about it I didn't say let me tell you about the deal I said talk me out of it and he did. In three minutes you have to be willing to ask for help. So here's my note. You ready very tactically I Hope you're writing this down.

You guys, You guys ready. You need to build or cultivate your net worth Inner Circle You need to build or cultivate your net worth Inner Circle Right Like this for me is like my unofficial net worth. Mastermind So so I won't say names but some of you will know. So tax strategist gotta have a tax strategist every deal I look at I Call my tax strategist first hey Manny I'm thinking about doing this.

What do you think? What do I need to pay attention to Would you review the contract? Do I need to create a separate LLC for this Can I put this inside this one. How do I make sure that how how help me help me help me help me Ask Ask Ask and Manny I love you if you're listening I love you right then I ask my attorneys I have two I have a like a contracts attorney who's been with me for 26 years and then I have my really expensive scary attorney that you never want to go against you and but he is T cells pieces of the Yankees he's been he was part of the Los Angeles Rams coming to California like he's a big dog right and and depended upon the situation I'll call sometimes both of them and say I'm thinking about doing this how should I structure it? what do you recommend or I call the other one the really expensive one and I say I know you're charging me like 11 million dollars per second. So let's do this really fast right? I Think about this, this this this this. What do I need to know? Well Tom that's how he talks like he just elongates everything so he can charge me like you know, a thousand dollars a second, right? But I say that because you gotta have two, You gotta have two.

You gotta have experts. Now for me, these are deal attorneys. They do m a work right? They know good contracts, They know how to structure things. They make sure that I'm good.

The other investors are good and my new partner who I'm you know buying into that they're good. He wants everybody taken care of. um Real Estate Investors right? Claude Kirk Pua Eric right? Those are my four my dear friend. Claude you called Big shout out to Claude Eric Who is my partner in real estate syndications we've now I think we've acquired nearly 500 units in the last year Eric owns 1200 units.

This is all he does I was seeking him out I wanted a partner like that right? Pua My mom who it like she's just a deal junkie right? Like some people like it's like about milk and cookies. When they were raised she was just real estate like she loves it. So we talk a lot like him. Think about doing this and think about buying this.

What do you think about this? What do you think about that? What are the holes? Kirk Kessel is one of my closest friends on the planet. Big shout out to Kirk I Love you. If you're in my network you've probably seen Kirk and you know me hanging out at events. Kirk is also someone that has done land deals, developed, built high rises, sold them off.

Uh tree farms, shopping centers, apartment buildings, single family res. He's done it all. So to say to him I'm looking at this deal. What do you see? What are the holes He says send me the contract.

Let's look at the numbers like they go deep and they get gritty with me. This is your build and cultivate your net worth Inner Circle Business Inventors uh investors Spencer Raskoff Greg Greg Schwartz Kelly Perdue Joe Hanauer Steve Azonian I have like five people I said I was gonna say names I'm like just dropping all these names so you should follow all these people. um literally I'll just hey I'm looking at this. what do you think like Spencer's fantastic if you know Spencer He was the former CEO of Zillow dot La He's invested in a bunch of companies.

He was really the one that got me to think differently about the questions that I'm asking right? Like he stopped doing small deals. only think about unicorns right? Like stuff like that where I'm like, what do you mean he's like, why invest in a company that sure they can go from zero to 20 million dollars in Revenue You know, why not find companies and go from zero to a billion dollars in Revenue Like focus on large addressable markets, focus on large problems you can solve I'm like oh I Love you