MONEY MANAGEMENT 101

So how many of you

How many of you were raised
perhaps like me where in your
family?
So how many of you
How many of you were raised
perhaps like me where in your
family?
Maybe there was some split
How many of you were raised
perhaps like me where in your
family?
Maybe there was some split
mentalities around money
How many of you know what I'm
talking about?
You know like maybe mom had a
certain way of thinking and dad had a
certain way of thinking
So how many of you guys know who
my dad is?
My mom and dad got married when
 they were like 22 years old, my dad
flunked out of college
Right as a speech and communication
major which is pretty awesome
considering
he's like one of the greatest
motivational and real estate training
speakers ever right and
His mindset because his mentor this
is what his mentor said to him you
want to make a lot of money go buy a
rolls-royce
Go get a big fancy watch and go get a
really expensive car and a real
expensive house
And you will be motivated like crazy
And you will go do whatever it takes
to be successful and guess what my
dad did
He went up a big fancy car big watch.
You know rolls-royce the whole nine
yards and every day
He was like this. Holy shit. I gotta
make money
 My mom on the other hand
Grew up in an environment with a
few more kids my grandfather. My
mom's mom passed away when she
was very young and she
Immediately had to go to work at like
14 years old by the time. She was 16
She was working at Disneyland as a
Mouseketeer
You know Orange County,
California, and she's doing great
But all of her money went back into
the family
So she would work only to basically
have no for herself benefit from it so
in her mind
Every cookie in the cookie jar
mattered you should be very
mindful with every single dollar
Imagine growing up in that house
This one is like it's not how much
money
You just need to make sure there's at
least one cookie in the cookie jar
 we could divide it up six ways and
my dad's like we should start a cookie
factory and
finance the entire thing
Well, no surprise that relationship did
not last long right my dad actually
ended up marrying somebody who
was ridiculously financially savvy
And I think she's somewhere inside
the room who are you inside the
realm?
My my other mom somewhere inside
her maybe you're running around the
room
The bottom line was this I grew up
with a completely messed up
psychology when it came to money
And it wasn't until in my mid-20s
when I met one of my mentors who
he showed me something which I'm
gonna
Show you, the bottom line is this
guy's money is a tool nothing more
nothing less say that out loud
 Money is a tool nothing more
nothing less, listen if you're a jerk
money makes you more of a jerk if
You are mother Teresa money makes
you more mother Teresa
It is just a tool, but this is what I
know how many of you know
someone that
doesn't have enough money, I
Don't know about you guys. I don't
want to be that person and
Not that I feel bad for them or less
them all I think to myself is
That person was never taught what
I'm about to teach you
They never
understood that your money is a tool
and just like an app on a phone if you
don't use it and play the game
right and follow the steps. You don't
get the results. It's not how much
money you earn
It is what you do with the money that
matters, you guys with me on this
 So I want you to write in your notes
the following
There's been a lot of research on this
and you've probably seen something
like this before
Especially if you've ever met with a
financial planner, or you know you've
watched CNN financial. They all say
the same thing write down
5, 15 and 80.
5, 15 and 80.
5 percent 15 percent and 80 percent
Five percent 15 percent and 80
percent and as all the studies show it
Says five percent of the planet are
basically
generational wealth
They have created generational
wealth
It's not the top one percent guys
somebody who is worth five million
dollars
Who has paid off their home and
when they pass on they
 Transfer all that wealth over. That's
generational wealth you with me on
this
Some of them are worth millions
some of them ten some of them are
hundreds some of them are now
billions
But that's the 5% the 15% write this
in your notes. You ready. They are
the middle class
They got a house
They got a little savings. They go on
a few vacations, and they're
comfortable and there's nothing
wrong with that 15%
But where do you think the 80% sets?
Darcy the 80% 80% 80% look around
the room
potentially 80 percent of this room
I don't think so, but potentially with
the numbers 80 percent of this room
when they are older either A
have to work to make money or
B are dependent upon the government
 or their family to subsidize their
lifestyle
80% 80%
80% some of your think to yourself
my kids better be successful
5%
generational wealth and it starts at
five million dollars and above fifteen
percent comfortable my in-laws are
93 and 90 years old they have a
million dollar net worth there in that
15 percent, house is paid for that they
bought for
$11 300 years ago
right in Anaheim, California on
Bruce Street
Paid that sucker off
Every time I talked to my father law
you see my Ford stock
Right he's not he started buying Ford
stock like in 1948
You with me like I had a dollar that I
had two shares then three shares, but
over time guess what he's in that 15%
 How many of you know someone
right now though?
That based upon their money
behaviors, and their money
psychology
They're clearly going to end up in the
80%
Don't point out him if they're in this
room and don't like you know make
them wrong, but I'd like you to
consider
Maybe they just never heard what I'm
about to share with you
So I'm gonna show you guys a
business strategy for your money you
guys have for that a business strategy
I'm not gonna tell you what to invest
in that's not my role
I'm going to show you ideas of what
the very best people do, I'm gonna
put it up on the big screen
Which means the team's gonna keep
it here the whole time?
And you're gonna take detailed
 copious notes, so here's the first
thing. I want to show you
This is what 80% of real estate
professionals do
80% of real estate professionals
They get a commission check and
that check goes into their personal
account
their personal account
80% they get a check and it goes into
their personal account they go home
And maybe they say here honey, or
here on by myself, and I put it in my
account
But this personal account is not an
LLC an S. Corp a limited light
You know limited partnership. It's not
a corporation. It's a personal thing
now. I'm not gonna
Ask you to raise your hands if that's
you
But I am gonna say this to you I
would like to thank you for paying
lots in taxes
 Thank you very much. I really
appreciate you overpaying what you
should be paying keep up the good
work
So what's rule number one?
Should I have a corporation yes, or
yes?
Yes, or yes?
so check this out guys if you
answered this, don't feel bad I will
teach this stuff at conferences
And I'm blown away by ten people in
the room 10,000 people in the room
the number of people that go
Yeah, I thought about doing that but
like I don't know like which one do I
pick I'm no expert
Here's what you do you call your
Accountant and say I think I need to
get incorporated, which you
recommend based on where I live
What country what state etc?
But rule number one is no one leaves
this conference in 30 days if you are
 not incorporated
And you don't own your business and
now your checks come to blankety-
blank LLC not you personally
Cuz now you get all the tax
advantages yes or no guys
But I got to tell you, this is what the
80% does and this is clearly bad. Let
me show you
What the 15% do.
I Want you to draw this out I
Want you to imagine a world, where
and by the way? Did you guys notice
the subtle little difference?
This one says check this one says
checks
Because people that get checks
Understand the following, I get the
check it goes directly into my
business account
Right I get it wired in from escrow. I
don't get physical checks anymore the
money
Just gets transferred over, you with
 me
Oh my a escrow company my title
coming up won't do it great get the
physical check
But it goes into a business account,
which means now as you can see I'm
gonna have four different
Accounts at my bank
Four different accounts at my bank.
I'm get out my business account
I'm gonna have my tax account to me
three accounts
Tax account business account and my
home account my personal account
Here's the reality my friends if I if I
can encourage and inspire
You know every single one of you to
just do that and then
Follow the rule you ready write this
in your notes
above the tax account
I want you to write down let's let's do
an imaginary check and I want you to
show you how much money goes
 where
so at the top, let's say, that's a
$10,000 check, just for easy numbers
$10,000 check so all of a sudden
$10,000 hits my business account and
the first thing that happens is
instantaneously
3,300 of the 10,000 goes directly into
my tax account
3300 automatically into my tax
account because some of you think
when you get a check for 10 grand
that you actually have 10 grand
How many of you are in the state of
California or New York or in the
country of Canada
You get a check for 10 grand, and
you're lucky if you get 4,500
That's the real deal now you're an
entrepreneur you own your own
business you're gonna start taking
better write-offs
You're gonna pay more attention to
your accountant
 You're probably gonna have your
uncle Larry who's done your taxes
forever stop and actually hire a CPA
who's gonna pay attention?
But 3,300 bucks automatically goes
there then
3,300 or less
goes into your business account and
This is where I run my business a
check comes in I've got marketing a
check comes in
I've got expenses a check comes in
I've got my MLS dues
Everything that I need to run my
business every check 3,300 3,300,
and then what goes over here
3,400 bucks to my home
Now it sounds like you might need a
home budget. What do you guys
think?
Because many times what do we do
we get a check and we just start
spending the money?
By the way if you look at this the
very first one. This is the the cardinal
sin
this is what poor people do they get a
check and
They just start spending
Who knows someone like that say I?
matter of fact the bigger the check the
more they start spending and they
never think about
Debt reduction because they'll do that
later
Because I've worked so hard and this
was such a challenging transaction
And that's why I'm going to
overindulge and over and spend on
myself, and we know the financial
rollercoaster. You're actually putting
yourself through
this my friends is
What the people do that take care of
their money they know Uncle Sam or
Revenue, Canada or Mexico?
They're taking their money. No
matter what so when I commit that
Check comes in I don't say to myself
I get it all it automatically goes there
I leave a piece here, and the balance
goes here makes sense so tell your
buddy. Are you gonna do this yes or
no?
Yes or no
Now here's what I know look up here
guys
The number of clients that have done
this and then I see them a year later
And they go I have $15,000 and my
savings kind of never had that but
more importantly I paid all my taxes
Like I'm on time
and I have money inside my business
account and it's the end of the year
and my accountant said I need to take
a
Dividend so I'm getting a big chunk
of change at the end of the year. This
is awesome
Now I don't know about you guys,
but I like is anybody like nice things
 You know family trips vacations
memories, holidays, you know maybe
a new outfit
The challenge is if you keep that
psychology without requiring or
putting in the discipline
You know what you end up with a
bunch of nice things and a shit ton of
debt
So do me a favor tell your buddy. Do
you know someone personally that
has too much debt?
Anybody's anybody inside this room
Now listen there's smart Debt. There's
bad, debt, and I'm not gonna go too in
depth with you on this
But you know the difference you
know credit card, debt at nineteen
percent is dumb
Debt buying a house and getting a
mortgage with three-and-a-half
percent is really good debt
So we all know the difference, and I
just want you to be mindful
 I want you to take care of your
money, but now did you guys get a
photo of this?
Did you capture it are you sure?
Are you promising to do this?
Okay, do you want to know what the
wealthy agents do?
This is what the wealthy agents. Do
it's a little more complex
It's a little more complex
I would get it up on the big screen
over there guys and take a photo of it,
but more importantly
I want you to draw the whole thing
out in your notes
Draw the whole thing out on your
notes, this is what the wealthy do
This is the stuff that no one taught me
so all until Bill Mitchell
Pulled me aside and said what do you
do with your money?
and I'm like I don't know I just get the
check and I throw it inside my
account and I spend it like crazy and
I never have any cash, and I'm always
in trouble
Draw this out
So play a game with me you get a
$10,000 check
The $10,000 check goes to what
account?
to what account and
33% of it goes automatically where
To my tax account because I don't
really have 10,000. I really have like
you know
6,000 and change that's the real deal
so 3300 automatically here
then I take another
3300 over here or less because I don't
know your business expenses
But by the way guys here Marketing
costs should be no more than 10% of
your expected gross revenue
Your marketing cost should be no
more than 10% of your expected
gross revenue
So a percentage that 3300 is gonna go
 for your direct mail and your
Marketing and your email and your
Zillow leads and your Facebook ads
and the prints and the brochures and
everything else
But no more than 10%
No more than 10% got it?
Because you're incorporated now
your car and a piece of your house
and all kinds of other things get
written off
into or from this account so we like
that but you might also have inside
there ready guys a
Virtual assistant an assistant well,
where is that person gonna be paid
from you got a check for 10 grand
You didn't actually get 10 grand you
got
6730 3300 goes inside here now I can
pay my assistant it starts to work like
clockwork you with me, but you can
see
This is where it gets interesting
 Some people call this other account
your investment account. I like to
think of it as my financial hub
It's where the money comes in and
then it gets divided again
Now I'm not a financial planner nor
do. I you know even would even
attempt to be, but I'm giving you just
an example
Of what that extra thirty four hundred
dollars could go towards
So maybe you need because you do
two deals a month you're like I need
Four grand a month to come into the
home expenses
So I'm gonna take you know two
grand of my thirty three hundred or
the thirty four hundred. Where does
the rest go?
Do you have a retirement account?
Do you put money in the stock
market or in bonds or whatever you
believe in 401 K
Do you have an account where you
 just put cash?
to buy real estate
Why not on every check take five
percent of every check put into an
account called cash for real estate
And you just watch that sucker grow
like crazy over time
I'n two years, and also you're like I
got 185 thousand bucks in cash
sitting inside that account
I should go buy a duplex. I should go
buy a four-plex. I now have the
money to go do these deals
retirement account real estate cash
account
I use this because I did it you know
with my kids a 529 B account which
is a college fund
Cash account since we did real estate
cash. What do we call this the fun
account?
The fun account you know the I'm
gonna go spend this money on stupid
stuff and
 Throw it away later and not care or
I'm gonna take this money, and I'm
gonna use it for vacations and
holidays
What action are you going to take in
the next 30 days around this
conversation? There's no more
information. That's it?
Tell your buddy What actions are you
gonna take in the next 30 days do it
right now?
Okay thanks so much for watching
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