Anthony Robbins - Get the edge Day 6 (Financial freedom)

Summary

Podcast Summary: Anthony Robbins – Get the Edge, Day 6 (Financial Freedom)
Host: roadparc | Guest: Tony Robbins
Date: January 19, 2017

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Overview

Day 6 of Tony Robbins’ “Get the Edge” series centers on financial freedom—what it takes to achieve it, the mindset required, actionable wealth-building strategies, and overcoming common pitfalls. Robbins draws from his personal experience rising from poverty to sustained abundance, emphasizing practical advice, psychological barriers, and proven vehicles for wealth accumulation.

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Key Discussion Points & Insights

1. Why Financial Freedom Comes Last

• Robbins stresses that financial strategies matter only after personal, emotional, and relational needs are addressed.

  "If you don't take time for yourself, the money doesn't matter... If you're not thrilled in your relationship, money is worthless..." (00:46)

• True financial abundance starts internally, with a shift from scarcity to gratitude and contribution.

2. Robbins’ Personal Journey from Scarcity to Abundance

• Tony shares his humble beginnings and emotional struggles relating to money, recounting feelings of shame, deprivation, and desperation, including moments of stealing food for survival.

  “I know exactly what it feels like to walk into a restaurant ... and look at the menu and see how much something cost before I ordered it.” (06:33)
  “I shopped every day for our meals and came home and made them... I shopped every day for my family.” (09:19)

• The transformation started when it became a must—particularly when faced with new responsibilities (having a child).

  "I grew up with so much pain... I always swore I would not have a child until I was set financially." (07:19)

• Robbins emphasizes that taking ownership, facing uncomfortable truths, and raising personal standards are critical to change.

  "I wrote down everything in my life I would no longer settle for ever again... I was totally committed to." (13:24)
  “When it’s a must, you’ll find a million ways to do it.” (14:17)

3. The Secret: Value Creation

• Sustained wealth equals value provided.

  “The only way to become wealthy is to add more value to other people’s lives than anybody else is adding... Your income is in direct proportion to your contribution, period.” (16:28)

• Robbins tackles societal backlash (the “Tall Poppy Syndrome”) and personal sabotage that can follow initial financial success.

4. Psychology & Beliefs: Obstacles and Breakthroughs

• Scarcity thinking, comparing yourself to others, and making wealth a "should" instead of a "must" stifle abundance.
• True change happens when standards are raised due to urgent motivation.

5. The Power of Compounding

• Robbins describes the incredible power of compounding returns, illustrating it through vivid, memorable stories and metaphors (like betting on holes in golf).

  “If you just put away $5 a day... at a 15% annual return... for 30 years, that’s worth $1,051,000.” (27:48)

• Key lesson: Start immediately, regardless of amount; delay erodes compounding’s magic.

6. Practical Strategies for Building Wealth

• Pay Yourself First: Automate savings/investment, ideally 10% of income, before you see it.

  “If you’re not willing to take a dime out of a dollar, you’re not going to take $100,000 out of a million.” (29:56)

• Where to Invest:
  • Invest in assets (stocks, funds, etc.) that grow over time and allow flexible exits.
  • Understand the investment or don't invest; don’t rely solely on “experts.”

  “No one’s going to care about your money as much as you do. Nobody.” (60:37)

7. Asset Allocation (“The Three Buckets”) [43:54–53:59]

• Security Bucket: Safe, low-risk assets (bonds, insurance value, home).
• Growth Bucket: Riskier assets with greater return potential (stocks, real estate).
• Dream Bucket: Profits directed toward personal dreams/luxuries, only after security and growth buckets are full.
• Maintain discipline—choose your allocation before emotions or hype strike.

8. Twelve Reasons People Fail to Become Wealthy [54:00–68:54]

1. Never define what wealth means for them
2. Keep moving the target
3. Define wealth in impossible terms
4. Goals seem unattainable, so they delay
5. Never make it a ‘must’
6. Lack a realistic, actionable plan
7. Don’t follow through
8. Rely on “experts” for responsibility
9. Give up after setbacks
10. Don’t treat personal finances like a business
11. Let others’ pessimism/optimism steer them
12. Don’t get quality coaching

• For each, Robbins prescribes the opposite as the road to wealth and freedom.

9. The Fundamentals to Getting Started [68:54–74:13]

• “Spend less than you earn and invest the difference—and reinvest that difference for compounded interest until you have an amount of money that sets you free for life.” (70:57)
• Four Essentials:
  1. Time (“Start now!”)
  2. Compounding
  3. Intelligent choices (asset allocation)
  4. Money (start with what you have)
• The ultimate wealth is living with gratitude, not just money.

  “Gratitude is the key that unlocks the door to wealth.” (72:10)

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Notable Quotes & Memorable Moments

• “When it’s a must, you’ll find a million ways to do it.”
  – Tony Robbins (14:17)
• “Your income is in direct proportion to your contribution. Period.”
  – Tony Robbins (16:38)
• “If you’re not willing to take a dime out of a dollar, you’re not going to take $100,000 out of a million.”
  – Tony Robbins (29:56)
• “Asset allocation is everything.”
  – Tony Robbins (53:59)
• “The secret to wealth... is gratitude.”
  – Tony Robbins quoting Sir John Templeton (72:10)

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Timestamps for Key Segments

• Robbins’ personal poverty-to-abundance journey: [05:43–15:57]
• Breakthrough: Making money a ‘must’: [13:21–14:34]
• Value creation & income: [16:28–17:04]
• Compounding & golf game metaphor: [25:00–28:25]
• 10% Rule & pay yourself first: [28:30–35:18]
• Asset allocation (Three Bucket theory): [43:54–53:59]
• 12 reasons people fail to become wealthy: [54:00–68:54]
• Essentials & the role of gratitude: [68:54–74:13]

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Summary Table: The Three Buckets (Asset Allocation)

| Bucket | Purpose | Examples | Risk/Return | |-----------------|--------------------|----------------------------------|--------------| | Security | Protection | Bonds, home equity, insurance | Low/Low | | Growth | Aggressive growth | Stocks, real estate, mutual funds| High/High | | Dream | Enjoyment | Luxuries, dream purchases | Not investment-focused |

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Closing Action Steps

• Define what financial security and wealth mean for you (be specific).
• Decide and automate: Deduct at least 10% from all earnings automatically.
• Decide your asset allocation before making any investments.
• Continually expand gratitude—it's the true wealth.

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Next episode (Day 7) will focus on life purpose and using all resources for greater fulfillment.

Transcript

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[Tony Robbins]

Well, hello, welcome to day six, all about financial abundance. How do we experience the kind of freedom in financial terms that we really deserve? Now, you and I, by this point know that the reason I waited till the 6th session for this is because if you don't take time for yourself, the money doesn't matter. You can have all the money. You're running around trying to make more and you're not going to be fulfilled. If you don't have a system for changing what doesn't work in your life, money's not going to solve it. Which is why we went through the results workshop. And if you're in a position where you're not thrilled in your relationship, money is worthless. And if you're in a place where you don't have the physical vitality, health and energy, then we go back to the richest man in the graveyard metaphor. So that's why this comes last in our series. And the only thing that comes beyond this is really knowing the purpose of your life, how to use all these resources to meet your life's purpose. So this session is about financial abundance. And I can talk to you about this because I have the unique privilege of having achieved it. You know, there's nothing worse than talking to someone who talks a good game but hasn't lived it. You know, each of these sessions, I transform my body, I transform myself emotionally, but my. But more importantly, I've not only done it with myself, I've been able to do it with other people, too. Millions of people around the world. So this is a subject I know. One of the things I had difficulty with early in my life when I started making money is I go to people to figure out how to invest my money. And they knew less than I did. They knew how to sell me on a concept, but they weren't wealthy. I talked to a stockbroker and he didn't know anything. He just knew what he was being told to sell. So gradually I began to say why am I talking to a guy that makes one third what I earn to do, telling me what to do with my money? So I can just tell you that I started at ground zero. I did not have the silver spoon, anything close to it in my mouth. I started out with nothing, and now I'm in a position economically where I can do virtually anything I want in my life. So I was recently doing a seminar, and when I was doing the seminar, I was trying to get through to people because a lot of people look at me and I have a public company now, dream life. And the day that the company went public, the value of my stock, I had 23 million shares shot through the roof. And my net worth was $400 million just from my stock hold. So it was a pretty good day. That was above everything else that I'd built over the last 23 years of my life. So it was pretty amazing. But I also realized, hey, it's just paper. I mean, they could go down to zero. Who knows? In the stock market, what I got was abundance. A long time ago, I got it when I changed my psychology. I got it when I worked hard enough to create enough income that I never have to work as long as I lived if I had no public company. So I'm not tied to something, I don't have to live and die, but the stock price is going up or is going down. It's just a neat bonus. But the reason I tell you this also is when people see that, they look at it and go, oh, that's so far from my realm of possibility. Most people do anyway. But the truth is there's people 100 times bigger than what I'm doing. And I don't see it that way. I see if that's what I really wanted, I could achieve it. Maybe I'm deluding myself, but I don't believe so. And if you have certainty and you have the right plan, you can achieve anything. And it's not the number anyway. It's about, what does it take for you to feel abundant? What does it take for you to kill the scarcity, to rid it from your life and experience the kind of gratitude that sets you free? And so I thought I just put you right in that seminar and you can hear me telling them about it. But I want you to know this is an area of your life you deserve to master. Because when you master it, when you're coming from a place of abundance instead of fear, instead of scarcity, you don't worry so much about yourself. Your focus is really on how to contribute. And in my lifetime, I've had an opportunity to contribute quite a bit. In fact, I started my foundation decades ago, and it really began with me feeding two people on my own with the little money that I had. And to give you an idea how much it's grown, we're now in over 2,000 school systems. We're in 750 prisons. We're in more than 100,000 health and human services programs. And this last year, between Thanksgiving and Christmas, we fed more than a million people in 19 countries, over 500 cities. So all this comes from having so much abundance in your own life. You're no longer worried about yourself. You really, truly want to give. But I'll tell you this. The best way to get beyond scarcity is start beyond it. If you can get yourself to feel that abundant now by doing things as if you were already financially independent, everything changes. So let's start out here by me inviting you to join me right now in a live seminar. Will you hear me talking about this story of how things changed for me? And instead of saying, oh, yeah, isn't that wonderful? Hopefully you can start to say, okay, what do I really want? And how can I create the kind of abundance I want at whatever level that is for me? It's not about stock. It's not about money. It's not even about how many people you can help or feed. It's about what's the standard that you really want for your life. And what I'm trying to get across to you, I guess, is I'm just a guy, but I've had the privilege of doing very well in this area of my life because I finally decided it was ridiculous for me not to be abundant financially when I was being abundant emotionally and spiritually and physically. So I want you to listen in. Let's get started. I was talking to my staff earlier

today, and I was telling myself I really need to get across to people that this is real, that this really works. I said, part of that is I take for granted. I don't want to waste somebody's time telling them what I've gone through. But I thought maybe I should give you some sense of it, because the story of what I've gone through a little bit will reflect some of your stories, but also will show you the change in psychology, because I'm in a position where I don't have to worry about this anymore. But I only changed that. Not because the mechanics weren't available to me. They're available to anybody. But they became not only available, but used when it was a must, when I changed my model of the world, when I made it. Okay, So I grew up in a position where I know exactly what it feels like to walk into a restaurant. And like Denny's, if you can call that a restaurant. Right? That was my idea of a restaurant. And go in there and freak out

and look at the menu and see

how much something cost before I ordered it, you know, and worry. And if you took a girl out praying she wouldn't order something expensive, and then feeling rotten for not wanting to

have what you wanted her to have,

which is anything she wanted. Now, I can remember going, you know, even after I made some money, like when I bought the castle, that was like this big metaphor for me of breaking through, that I was gonna. I was gonna buy this because I always was so spiritually driven and emotionally driven, but I never really did well financially. So for me buying this castle, I thought, this is where I want my children to grow up someday. This is like me driving the stakes in the ground. I'm gonna show myself that I can take the invisible and make it visible. So it became my, like, Last Stand kind of thing. I'm gonna find a way. And I found a way. I'll tell you what. Part of what made it a must

and part of what changed me from making $38,000 a year to making a

million dollars a year within one year was having a son that I wasn't planning coming into this world. See, I grew up with so much pain. I linked so much pain to finances and not having it. I always swore I would not have a child until I was set financially. Because I didn't want them to go through that. I didn't want them to go through. Hearing father after father leave and your mother say things to them that you wouldn't want to ever have said to you. And a sense of worthlessness and a sense of frustration and fear and humiliation. I didn't want a son or daughter to be born to me and to go to school and have pants that are way too high because they grew too fast. And your family couldn't afford to buy pants and have kids say things that are just silly but feel so cruel. When you're a little kid, high water becomes your nickname, and you're embarrassed and humiliated and devastated, and you feel it's so unfair. You see, other kids can go and do all these things, and you can't. They make fun of you for it, and you didn't do anything. And then you don't want to be mad at your family, it's not your family's fault. Or being in a position where you got to go to the thrift store to buy a suit so you can take a girl to a dance and the suit is about 30 years old, out of style. Not having enough money to take the person to dinner. So you make excuses not to take the girl to dinner. Getting older and being on your own and trying to figure out how to eat because you had no money at all. And going into a grocery store and eating food in the grocery store as I walked around stealing it. Basically. Not basically, that's what it was. It was stealing. I just didn't take it out of the store. I took out of the store inside me

somehow.

I rationalized that wasn't stealing. I left the package in the store. And I kid about it now. I mean, I used to just cry. Values conflict, sir. How do you think I felt? Honestly, Being one of my highest values. And I'm stealing to survive. I'm eating somebody's food in the store. Walking around.

Also freaked out.

I'm going to get caught. I remember more than once when somebody come by and I knew people in the store. Because I grew up, I used to go in these stores. I used to shop every day for my family. My mom never went to the grocery store. I shopped every day for our meals and came home and made them. A lot of people I knew, I got something in my mouth. Hi, Tony. Freaking inside. Just freaking inside. Not having any money for a car. Working as a janitor. Taking buses for two hours to get there so I could work for two or three hours in the middle of the night, jump back on the buses, go home and go to high school. Living in somebody's laundry room. Finally getting a car and having that car be an old Volkswagen 1960 Volkswagen with no reverse. So I had to park on a hill. I always parked on a hill so I could get back out. Remember being in a position where I was really in love with a lady and watching another man come pick her up in a limousine and knowing she wanted the finer things in life. I couldn't provide them. And I felt it was so unfair because I really loved her. I felt like she loved me. But she also wanted significant life certainty. Looking around at my life and just feeling hopeless and worthless. Living with a woman who I liked a lot but did not love. Really wanted it out of the relationship with, but stayed in it because you paid half the rent. Rent. Convincing myself I should stay with her for security for $400 a month split between us. Giving up my dignity for $200. It's true. Thinking about what I dreamed I would do with my life and knowing it would never happen because I didn't have the resources. I thought being in the position where I saw other people having the kind of life that I really wanted and just thinking life was unfair and feeling hurt and sad, having one of those things after another after another after another. Finally getting so determined. Finally deciding that it was nobody else's fault, it was mine. Finally deciding this would change absolutely now, no matter what. Finally looking at an empty chair, knowing I could not pay my rent, knowing I couldn't answer my phone because I owed everybody money in town, every kind of bill collector, knowing my electricity is about to be turned off. And hearing this song by Neil Nyman saying, I am, I said, and no one heard, not even the chair. And looking at an empty chair and thinking, that is so true. I wasn't even supporting myself. Much less changing the world, much less doing I was put here for. I was so busy trying to survive that I wasn't doing anything to make the world better. And I got hungry. Not for food, for meaning. I got hungry enough that I stopped blaming everybody else. And I decided this was going to change. It would change right now, no matter what. And I went for a run on the beach. And I gained 38 pounds because I didn't want to make it that it was that bad. It wasn't that bad. I was still young. It wasn't my fault. It's my mother's fault. She threw me out. That's everybody else's fault. So I hated the way I felt. I hated the woman I was with. I hated my life. So the fastest way to change the way you feel is eat. Because I didn't want to do drugs because I linked pain to that. So I gained my 38 pounds. But on that day, I'll tell you what, man.

I decided I am.

I am much more than what I'm demonstrating mentally and emotionally and spiritually and physically and financially. One day I changed my life. And I went on this run, 38 pounds, bouncing back and forth, full tilt, man, with every ounce of myself. Song in my ears from a group called Heart called Barracuda. And I pushed myself as hard as I'd ever pushed myself in my entire life.

Total intensity. And I came back and wrote down

everything in my life I would no longer settle for ever again. Settling for less than I believe in.

Settling for a life of survival.

Being in a relationship that I don't

love, being fat, being broke, hiding from

people, lying, that is not who I am. And I wrote down everything in my life I was totally committed to.

So I wasn't just going to solve a problem that was sickening enough.

I was going to create the life. And I knew it was here, the somewhere inside yourself, knowing you deserve more, so do your children, so the people around you life deserves to see more of you show up. And not lying to yourself and saying it's okay, not saying it's a terrible feeling or it sucks, saying what it really is, it's disgusting, it's vulgar, it's humiliating, it's horrible. Because it's.

With that, when you get that kind of truth with yourself, you'll find the drive to change anything, because then it'll

be a total must. When it's a must, you'll find a million ways to do it. And when you find a million ways and you start doing a few, pretty soon you're proud of yourself and you got momentum. And I did. I remember thinking, my God, if I could ever make $2,000 in a month. And then I did it, and it was like, God, if you could make

five, $5,000 in a month, I mean,

$60,000 in a year, then it was like, wow, 10,000. And then I made $10,000 in a day. And I was 19 years old. I was like, yes, I'm going to have pants long enough. No worries. I'm going to drive a decent car. I'm going to have a life that I want, I can give to my church. I can do this, I can do that.

Then I went back to see my

friends, all these people I loved.

I was so excited.

I wanted to share with them.

I said, let's do things. Let's fly to Egypt and let's race

camels between the pyramids.

They said, what's the matter with you? You're just into money.

I said, no, I'm just not into poverty anymore. I said, I've worked really hard. I've added massive value. I've done this and this and this. I've helped people's lives this way, that way, and I actually got paid for it. I actually do what I love. And because I do what I love so well, I can actually go out and do these other things, too. I have a great life. But what I got was, I thought if I had money. Growing up, I saw that not having money meant pain, no love, arguments with my parents, all this loss, all the separation, not being One of the cool kids not even having a bicycle till an uncle goes and finds an old

one and shines it up and paints

it for me and makes it and gives me my first bicycle. And he didn't have a whole lot of money, but he had unbelievable heart. So when you link that man, not having is why everybody hates each other. They leave each other and they don't love each other. Then you start saying, yeah, I'd like to have some. And so then you do. And then people reject you. Now your brain is really scrambled.

You do good things, you make a

difference in the world. You cannot earn without adding value. Let me tell you something.

The only way to become wealthy is

to add more value to other people's

lives than anybody else is adding. It is the only way.

If you don't add value, you will

not sustain the wealth, you will not maintain it. Your income is in direct proportion to your contribution, period.

And you're going to make yourself wrong for that. I guess you want to limit your contribution, but we forget that because boy, love is one of those deep human emotional needs, isn't it? So now having my ankle pain. So I got rid of it. I started not showing up for key meetings, started treating people harshly, started sabotaging every way possible because my brain went,

you better get rid of this money

because no one's gonna love you. So I did. And my Aussie friends have a term for it in their country. What's it called, guys? That's right, the Tall Poppy syndrome. You get a little too significant, we'll cut you down the size real quick to all people's fears because other people not want to be honest themselves and

say, I could be more.

And one of those areas is the way I contribute. And one of those areas is economic. But I don't want to look at

that because it'll make me feel inferior.

So I'll just do what feels good. I'll go drug myself, drink myself, watch myself, live myself, anything else. It's not everybody's focus, doesn't need to be. But most people are not even close to where they really want to be. They mitigate their real wants. They lower their standard in order to feel comfortable where they are. They don't look at what they really want for their lives and they come

up with every excuse and reason to

make it feel justified and holier than them. So I sabotaged it all and found myself in a 400 square foot bachelor apartment and broke all over again. And I learned I love people. If you help people, they still like it, but don't make any money at it. So I didn't for years. Broke terrible. Until finally a few things happened that just got me inside and I realized I was playing a game.

I was doing this to get people's love.

I was lowering my standards for how I wanted to live life and what I want to contribute to life to try and get people around me to improve. And there was a time when I got mad as hell and I said, next level. And I kicked it in gear. And then what really pushed me over the edge though, was making it a must. With the leverage of my son, I got myself up to 38,000 a year. And guess what? I'd had all this pain.

I was doing okay. It wasn't great.

So what happened when it was really intense pain? I had this drive. As soon as I got near 40,000 a year. Gosh, I was only 23. So bottom line is I went out there and did it. My son comes along, wham, million dollars.

Then guess what?

I stayed at a million dollars for the next five years, by the way. I found a way to spend a million dollars. I went from 38,000 a year living in a 400 square foot bachelor apartment. And I made a huge move, man. I grabbed hold of my psychology and

I went for it.

I had a choice to move from Venice to Marina Del Rey. It's across one street if you've ever lived there, but it's a totally different identity. Anybody know what I'm talking about here? Two psychologies and divide it by one street.

And there's a big difference in what

you pay to be an achiever, isn't there? You gotta pay for significance. And I was living in Marina Del Rey and I'm building a business. Yep, yep, Robbins Research Institute. I sat there in this little room and said, I gotta create a name for this company. I gotta make a company that sounds really big, right?

So an institute that sounds big.

And what am I gonna do? I'm research everything that works. Robbins Research Institute. So I had a little room, right? It wasn't big enough to have an office and have a bed. So I thought, which one will get me further? So I took the office, I had this desk and I had Robbins Research Institute. It was an answer phone, right? And I had one stereo to help change my state because I was kind of depressed at times because I didn't really feel like I was quite pulling it off 100%. And I had an eight track player, remember?

He go, where'd you sleep?

I hung from one End of the room, in the corner to the other, a hammock. And what I put in was a futon, so it was solid. And that was my bed, so I could go under it and do my work and build my company.

That's how I started.

I moved from there to the castle. I moved from $625 a month to $16,000 a month. One month I went down. I was building my business, and I got some partners, and I lived in San Diego. I said, I can't build this by myself. I need your help. I said, I'm the best communicator you're ever gonna find. I'm humble about it. I said, I am. I will. I will, in my lifetime, touch more people than any human being you're gonna meet in terms of actually helping them to change the quality of life. It is my destiny, and I will do it. And there'll be plenty of money. But I'm happy to split it with you.

I need people to do the resources.

I'm on a mission. I need somebody to handle the finances. I need somebody who's happy to do that. That's what they do. They said the done deal.

We went to your program. You're unbelievable.

My momentum was growing in the culture.

So then I made a million dollars a year, but I never saw it.

The person had a great lifestyle was my mage.

Oh, Mr. Robbins, I love your Jacuzzi.

Mmm.

This is great.

Love your workout room. I was never there.

It wasn't like I was out spending millions of dollars.

I was gone. But it cost a million dollars just to have that. And I stayed there for five years. And after five years, I thought, I'm working harder than I ever have. I'm helping more people I've ever helped. I'm better than I've ever been. Everybody else is making more money at my company. I'm not earning a dime more.

Why?

Answer. Earning more than a million dollars a year. What's the matter with you? What are you, greedy? Aren't you spiritual? Why would you have to have more

than a million dollars a year?

Then my brain went, is it possible to earn more than that? Is it possible to add more value? This is a spiritual game about create whatever you want. And you went from 38,000 to a million a year. You should at least go from 1 to 3. I thought about, how did I do it? And that was a secret. I figured out what got me to make it a must. And what it was, was nothing more than something else I cared more about than myself. So I was my son. So what's that for me now? And I said, I'd like to be responsible for feeding every homeless person who needs a meal in all of north county of San Diego. There's a man named Brother Beno, an amazing, amazing man there. And I went and met him and I thought, I want to be able to pay for a quarter of that so that when I eat every night, I know that every soul in this county, of this city can eat because of my good works. I set that goal and I figured out what to take, and I figured I have to earn $3 million to be able to afford to do that and still have more for my family. And I made $3 million the next year. But I stayed that way for about four and a half, five years. Then a few years ago, I started thinking about what I really wanted, my destiny, about what I want to contribute to the world and to society. And I figured out a really crystal clear vision that I have now. I know exactly what I'll do over the next 16 years of my life. After that, things will change, but I know precisely where I'm going to do and where I'm going to go. I know what it takes. So now I make between 7 and $10 million a year personally, of which, by the way, 10% of it comes from seminars. This whole company, all that I do here, and yet this is 80% of my time. Not a brilliant decision financially, but an unbelievably rewarding decision emotionally. Thank you guys are awesome. Thank you.

Thank you very much.

Thank you.

Thank you very much. Okay, so you heard a little of my story, and hopefully it gets you to relate. I mean, I really did start out just as a janitor. I really started out with zero. And just as I became abundant in other areas, I became abundant in this area because the. The secret is psychology. Now, one of the psychological barriers to becoming wealthy is the belief, the limiting belief, that, gosh, I have nothing to start with, I have no vehicle, I don't have my own business. I can never achieve this. Well, let me tell you that that comes from not understanding one simple principle that I know you've heard about. But, you know, there are a lot of things in life we know intellectually or we've heard about, but we don't own it emotionally, so it doesn't benefit us. And one of those is the power of compounding. Now, when Einstein talked about all the principles in the universe that were astounding, one of them he described was compounding. That if a man really understood this. His fascination would be beyond almost anything else he could imagine. Because here's a chance for you to start out with almost nothing. And you can be a full time person employed by someone else and still be wealthy. You don't have to be Bill Gates. You can invest in Bill Gates, but you can do it with tiny amounts of money that allow you to take his talent and ride piggyback on Bill Gates. Or in Steve Case of AOL Time Warner or Wayne Huizenga at Blockbuster, you don't even have to have unique ideas. You have to become an investor. Because if you invest in those people who have the genius to build companies as an example, your wealth can grow beyond your wildest imagination. Even if you're not a great investor, you can do it if you understand compounding. Here's what it is. When you invest money and then you don't spend it. Money that is continuously reinvested compounds on top of itself. And in the beginning, it grows very slowly and eventually has explosive growth beyond anything you could earn, even if you're a top athlete or business person. Let me give you an example by giving a metaphor. I just took up the game of golf. I swore I would never do this. It's too slow. It's an old man's game. And I knew I'd get addicted to it as the truth. And it's so challenging. It's such a mental game. But if you and I went out to play golf and most people bet on holes, and I walk up to you and I say, you know, why don't we bet just 10 cents a hole just to make it fun, you probably go, you know, even if I'm a good player, not good player, you probably say, okay. And I say, you know what? As we get close to hitting the first ball, I say, why don't we double it each hole? You know, just 10 cents. The first hole, 20 cent. The second hole, 40 cents, you know, third hole you say, okay, that'll make it more interesting. You just made a big bet and you better be good at golf. Let me tell you why. Let's walk to it for a second. The verse holds for the dimension. Second hole is worth 20 cents. Third hole's worth 40 cents. Fourth hole's worth 80 cents. Fifth hole's $1.60. Sixth hole is $3.20. Now, if you play golf, you know, there's only 18 holes. So we're six holes into it. We're a third the way into it, it's only three bucks. So what's the most it could cost is probably $12, right? Well, let's continue. If the sixth hole is $3.20 and we double it, then the seventh hole is $6.40. Now the eighth hole is $12.80. The ninth hole is $25.60. Now there are 18 holes. We're halfway there. Are we a little higher than you pictured in your mind when we started? Yeah, but you're going, oh, what's the worst? 100 bucks, 50 bucks? 75 bucks? Oh, no. The 10th hole is 51 20. The 11th hole is $102.40. The 12th hole is 204. What? 80. Come on. You can follow this in your head. The 13th hole is $409.60. The 14th hole is $819.20. The 15th hole is $1600, $1638.40, to be exact. You know what it is on the 18th hole? $13,107.20. We go from 1,000 to 13,000 in three holes. Now, if I could show you this on a graph, if I was with you visually, I could show you investing on a graph. It's 10 cents, 20 cents. If you went across horizontally, it looks like the grass is growing. It's so slow. But when you get to about the 15th hole, it starts to explode off the charts, where instead of seeing grass, you see mountains showing up on the graph. And what happens is it grows geometrically. So what happens for most people is they start investing and they say, oh, it's such a small amount. I'm only getting 10 or 12% or even 20%, but it means nothing. You know, I'm not making enough money. I'm only starting out with, you know, $100 a month. Let me give you a reality check. If you just put away $5 a day, $5 you're spending on other stuff, that's $150 a month. And you invested that at a 15% annual return, and you didn't take out your profit. In other words, when you made a return, you reinvested it. And you do that for 30 years. You say 30 years is a long time. Well, of course it is, but you're talking about 150 bucks a month. You're never going to notice it. 150 bucks 20 years from now is nothing. Right. Think about it. So if you did that for 30 years, that's worth a million $51,000. Yet another 10 years.

Guess what that's still worth now?

Now it's worth $4.7 million. Now, obviously, you can invest more than $150 a month if you were committed. So you say, what if I could save a lot? What if I could go and do something like $250 a month? Well, $250 a month, to give you an idea, is worth $7.8 million in that same 40 year period of time. So that's the power of compounding. If you're starting with nothing, you can make this happen. Let's go back to the example in golf. Remember I said it's worth $13,000 on the 18th hole? Well, remember on the 15th hole, it's only worth $1,600. There's a big difference between 1600 and 13,000. What if you waited three holes to start? What if you said, oh, I got time. I don't have that much money. You know, I got a little more money. Then I'll start betting dimes all the way to the third hole to start doing it. Then the most you can make is $1,600 instead of 13,000. The lesson I want you to get is no matter how little you're starting with, you must get started. Now, I don't care what it is, you've got to put that money aside and you've got to make sure you invest it. And I'll give you one more good example. If you want to make sure you can take care of your child's education, all you'd have to do, even with today's sky high prices for traditional education, is put away $100 a month beginning at your child's birth. And if you just reinvest that at a 15% rate of return, which many people today are looking at returns, as you well know of 40, 50, 60% or more. But if you kept it at 15, as the average through the years, then you'd have $110,000 by the time your child turns 19. Now, if you don't ever add another dime, you don't keep adding $100 a month. You don't add anything. You just keep reinvesting it. If they don't touch that money like you put it in trust, by the time they reach age 50, they'd have $9.6 million from that $100 a month you did till they were 19, think about that. By the time they're 60, they'd have $39.2 million. And 60 is young. If you want to wait till 70 to touch it, they'd have $158 million. Now you say, well, you know, 50, 60, 70, I don't know. That's old. Well, you know, many of you listening are older than that. But I want to tell you something. A woman today who reaches the age of 50 can expect to see her 92nd birthday. If you reach the age of 50 without cancer, without heart disease, you're going to live to be 92. That's what the statistics say. Men, it's not as good for you. I'll just leave it at that. In contemporary America, 8 in 10 people now sail past their 65th birthday. That's an amazing statistic now, especially when you realize that in 1900, the year 1900, the average life expectancy for an American was 47.3 years old. 47. In 1998, the average life expectancy was 76.6 years. We virtually doubled the life expectancy of a human being in one century. Now, that was before we had the kind of technology we have today where we're decoding our entire DNA as a species. I mean, if you think about that and you think about where we're going, our life expectancy will explode beyond what it is now. So the question is not whether you're going to live a long time, at least not if you're going to practice what you've learned in this program, but also what are you going to do when you get there? What are you going to do to enjoy your life, and how are you going to support yourself? So handling your finances is so critical and compounding is the ticket. And don't kid yourself and say you have no money. If you say, well, you know, I have so little money, I'll take 10% and invest later on, you're wrong. If you're not willing to take a dime out of a dollar, you're not going to take 100,000 out of a million. It won't happen. And so the question people always ask is, well, where do I start? And the answer is, you must start with a minimum of 10% of what you earn. Being invested and not touching it, rein and compounding it. I've never met a person. When you go to our Wealth Mastery Program, we help you figure out exactly where you are today financially, because most people don't really know. And we have you describe exactly what you want to do at many levels. Short term, midterm, long term. And we have you come up with your ultimate dreams. And you'll find out your dreams are possible. They're totally achievable. And we run a computer program. We keep changing it till we come up with examples that are incredibly conservative, and you know you can achieve them. In all the years that I've done this, virtually anyone that I've talked to, whether starting from zero in the hole or ahead saving 10% reinvested, can achieve their goals in 10 to 14 years. It's extraordinary because of the power of compounding. In the beginning, you know this will never happen. It's like the 10 cents a hole, and then all of a sudden, bam, bam, bam. You have this huge growth. I'll give you another example. I was reading in People magazine about a man named Ted Johnson. He was an African American UPS delivery man. He grew up in the south, and he just recently passed away in his 90s. So you can imagine in the south when he was growing up, in his youth, he wasn't exactly treated as an equal. And so he didn't seem to have the same economic opportunity that most people would have. In his entire life, he never made more than $30,000 a year. But when he died, through the power of compounding, he left a legacy of more than $70 million. $70 million. And by the way, he gave away $36 million of that money while he was alive. It gave him such joy. You're going, I'm going to work for the ups. No, it's not the ups. It's that he took his money he set aside, he compounded, and he didn't touch it. And now he's left this legacy for his family and for his friends and from the city he grew up in. He was so thrilled in his passing because he lived a full life into his 90s. He loved his life. He had a great lifestyle, but he also created incredible abundance for the people around him. And he now has a legacy that lives beyond him. This is the power of compounding. You must get started today. You say, how do I do that, Tony? Here's how. Decide today a percentage of what you earn that you're going to save. You go, yeah, but I spend everything I've got and all my bills. Make your bills wait. Pay yourself first. Remember we said you got to give time to yourself first. You got to invest in yourself first, above everything else. So you'll always be running to pay bill collectors. And I'll tell you the secret to how to do this. Don't ever see the money. What do you mean, don't ever see the money? I mean, go to Charles Schwab, go to your bank and say, I want you to deduct 10% of my paycheck before I ever See it and put it in a money market account. A money market account, if you're not familiar with it, is very simple. It's like a savings account, but it gives you more flexibility and a little better return. And anyone can advise you on it. But it's very simple. And you put it there for holding purposes while you decide where to invest your money. But you don't ever see it. If it's in your bank account, you will spend it. If it's in your investment account and it can't be used for anything else, you won't spend it. Does that make sense? You can do that today. They have these automatic withdrawal processes that are available through all kinds of companies. Do it today. Now, you might say, okay, I understand the emotion of this. I gotta start by really mastering this. I understand a little bit about how you've changed and other people have changed. I understand this compounding. I mean, this is pretty simple. I've heard of it, but I'm getting associated to its value, and I'm willing to use it. And let's say I've set aside 10%. I've set aside for my year, $1,000 or $10,000 or $100,000, whatever it is, where do I put it?

Ooh.

That is the million dollar question. And I'm not talking Regis Philpin here. I'm talking the real question. How do you really make a million dollars? You want to be a millionaire? Answer this question. Where do you put the money? Well, first of all, you have to understand what the best investment you can make is. Hey, let's go back to the seminar. Just so you can be with the people.

Stocks are the fastest way traditionally for someone to be able to grow their critical mass. They also provide a great deal of flexibility.

Why?

If you want to get out of a piece of real estate, how fast can you do that? Who knows? You want to get out of a stock.

If you've made a mistake and you

do need to get out of a stock, can you, yes or no? Absolutely. Give me an idea. Since World War II, the finest investment you can make through time has been what then? Stocks. They've delivered nearly a 12% rate of compound return for nearly 50 years. Is that a pretty good track record?

Half a century.

What has happened in the last half century? Recessions, wars, famines. I mean, you name it. The world has changed more in the

last 50 years than probably any time in human history.

So it gives you an idea of the value structure. So I'll give you an example here. Rip Van Winkle and the Wall Street Wizard. If, at the end of 1927, a modern rip Van Winkle had gone to sleep for 60 years on $20,000 worth of corporate bonds paying 5%, compounded, which is what they've averaged, he would have wakened with $373,584, enough for him to afford a nice condo, a Volvo, and a haircut. Whereas if he invested in stocks which returned 9.8% per year during that time, he'd have 5,459,720. Since Rip was asleep, neither the crash of 29 nor the ripple of 87 would have scared him out of the market. Now, by the way, how much money did people lose in 1987 in a stock market crash in the United States? How much did they lose? Nothing, unless they.

What?

Sold. Sold. Those people got seduced in here when, oh my God, the sky is falling. Sold down here. And by the way, did the market return how quickly?

Staggering.

Less than a year. All of a sudden it's exploded back up. And where is it now? So if you didn't sell, you didn't lose anything. In fact, more people made money on that day than any day in decades, my friend. I told you, made half a billion dollars that day. Because while everybody else was freaking out, he was looking at companies going, they're worth so much more than what they're selling for. Yes, instantaneously. So give me an example. So let me show you why companies are growing. Companies are one of the most unbelievable investments you can imagine. Walmart. In 1974, Walmart had 78 stores. Kmart had 1326, and Sears had 851. The combined equity market value of Sears and Kmart was 65 times that of Walmart. Now, before you look at the next thing, I want to give you a little clue. All the analysts at that time who were evaluating, looked at the resources that Sam Walton had and his current growth rate based on what he'd done. And they said, the guy's maxed out. What they didn't look at was his

ultimate resource, which is Sam Walton's ability to innovate and model.

He spent two days a week going to other people's stores modeling what other people did. He was not, had no shyness about anything they did that worked. They went and did. They did not evaluate his ability to motivate his employees to give their all and create a relationship with customers that had never been seen in that environment at that price point before. And as a result, Walton has done Something Walmart. That's just staggering. Give you a perspective. In 1989, the market value of Walmart was 24 billion. 3 times Kmart and 2 times Sears. By 1996, the market value of Walmart was 51 billion. $100. Investment in Walmart in 1974, never adding another dime, was worth $23,000 by the end of 1989. And by now it's worth $42,000. 100 bucks worth 42 grand, never adding another penny. Is that staggering? Okay, so this is not $100 a month. That was a one time $100 investment. If you did $100 a month, can you imagine what the compounding of that would have been beyond your imagination? Here's another one. Disney. The market value of Disney in 1984 was 2.1 billion. Today it's 43. 6 billion. That's actually old. It's changed since they bought Cap Cities. But. But a $100 investment in 1974 is worth 6,000 a day, $100 a month. You look to the right there. Invested every quarter in 1974 would be worth $437,000 today. Just to give you a perspective. And then Subaru, if you would have bought in the early days of Subaru, if you would have bought stock, rather it sold for $2. It then went up to $167.33bagger. That's if you bought a $6,000 worth of stock in Subaru, started in 1967, hung onto it and sold at its peak, your 6,000 would have left you with a million dollars instead of a rusty old car. Same price as a car. If you bought the stock, you'd be a millionaire. How many fall? This is the place you want to have a significant amount of your assets.

Now I've made a big point here to talk about how stocks overall through time have been the best investment to make. But obviously your individual decisions are going to shape that. And if you know so much more about real estate or your own business or any aspect of investing, then that's obviously where you're going to want to spend a good deal of your time. Whatever you invest in, you've got to understand it. And of course there are many choices. And I'll tell you something else. Often people say, well, that's true when stocks are going up, but what about when the economy goes down? What happens when we go in a bear market? Well, the truth of the matter is you can make money in any market. And if things are going down, more people became wealthy during the American Depression than any time in US History. I can tell you, for example, in the recession we had many years ago here in the United States, I remember a lot of people were freaking out. But if you've managed yourself well, a recession is a great place. I remember one of my sons was very concerned because he thought, oh, my gosh, you know, there's been this big boom in stocks, and it looks like it's over, and I'll never really be able to participate in a victory again. I'll never have that big victory, that big achievement. But the truth of the matter is, he was looking at the high prices of homes at that time in various parts of the country and the high price of automobiles. And I said, listen, let me tell you a story. You know, during the last recession, I remember I wanted to buy a car. It was an 850i BMW. I remember it would just come out, and the sticker price on it, I think, was around 80,000 or $90,000. But the price to get one in California, when they first came out, there was such a waiting list that it was $110,000. People were buying the cars and then reselling them and marking them up. And I thought, this is insane. I'm not going to spend this kind of money for a car. Literally, less than 60 days after these cars were so hot and everybody wanted them, the recession came all of a sudden. The economy tightened for the short term, and those same cars were just sitting in the lot. No one was buying them. I eventually got that car for just above $40,000. Now, this is two months later. So when you start looking around, thinking, you know, real estate in the northeast of the United States, it's exploding, exploding, exploding. It'll never go down. Trust me. There are always adjustments, and you can win no matter what. If you got a lot of cash during that time because you've handled your finances properly, you can do extremely well in your lifestyle. So, yes, take advantage of whatever the economy offers. You don't operate out of fear that you can only do well in a great economy. A great economy is one you're prepared for. All right, let's recap. What have we learned? Financial abundance comes from an abundant psychology. You've got to be willing to take risks. You got to put yourself on the line. But they don't have to be huge risks. You don't have to be an entrepreneur to be wealthy, but you do need to become an investor. If you become an investor, you can become wealthy beyond anything you could earn in your job. Because there's only so much you can earn by yourself. But compounding is unmatched in its power. And we've learned the power of compounding. We've learned that of all the investments we can make, the one investment that traditionally has brought back the greatest return is investment in companies that are growing, that are expanding. And so we understand that the stock market has been one of those primary investments, not the only one. So we know we've got to take 10% of what we earn and invest it. The question is, okay, let's say I've committed to this and I got Charles Schwab or somebody to deduct 10% of my money. Where do I put it? Well, let me just tell you this. You're going to screw up. You're going to put it in the wrong places. You're going to invest in companies that are going high flyers, and they're going to be cut in half overnight. It's going to happen. You're going to buy a piece of real estate, and then the market's going to crash. This is going to occur. I don't care how good you are. The greatest investors in the world screw up. I work personally with one of the top financial traders in the world. I've worked with him now for six years.

Now.

This guy pays me a million dollars a year plus to coach him because I get a percentage of his profits. Anyway, I turned him around. I helped him create a system. And part of what I did with him is focus on where he was putting his money, asset allocation. And I learned this from Sir John Templeton, a different investor, probably one of the greatest investors in history. Sir John was one of the first international investors. Way before you ever heard of somebody like Warren Buffett or Peter lynch, there was Sir John, and Sir John is a genius. And I went with him. And I sat down with him one time and I said, what is the secret to investing? He said, do it. I said, that's pretty simple. He said, but also, I'll tell you this, Tony, everyone makes mistakes. He knew the man I worked with. He said, he's not even right half the time. I said, you're right. He said, but he has the right asset allocation. He said, you're going to be wrong a good deal of the time, but the most important thing that's going to determine your success or failure long term, more than any individual decision you make, is going to be your philosophy towards investing. What he taught me was, you got to think of your money as having three buckets. So let's say, for example, you're saving 10% a year. And if you made $100,000, to keep the numbers simple, that means you have $10,000. You're going to need to put a percentage of that in a bucket we call the security bucket, a percentage of that in a bucket we call the growth bucket. And then any profits you make, you're going to split up into the third bucket also, which is your dream bucket, dream goals, and I'll walk you through each of these. So for example, if you made $10,000 a year and you saved 10%, you'd have $1,000. You might put 50% of that in your security bucket, $500, 50% of that in your growth bucket. Or if you made $100,000 and you saved 10%, $5,000 might go in security, 5,000 might go into growth. The percentage you're going to split isn't necessarily 50, 50. Let me explain the buckets and their purpose and then you can decide your percentage. And you need to decide this in advance, not hear about some high flying stock and go and put all my money into that. Because you're going to find something that flies real high, can fall real quick, and if it does, you've lost everything you've got because you didn't do what we call asset allocation. You didn't allocate your assets, your money in a way that guaranteed. So he said, here's how you understand it, Tony. Think of the first bucket as being like the highest bucket. He said, you're going to take a percentage of your money no matter what, and you're going to always put it in the security bucket first. Now, what goes in the security bucket are investments that are by nature very secure. They're not very risky. Since they're not risky, they also don't give a really large rate of return because in life and investing, the greater the risk, the greater the potential return. There's also the greater potential loss, less risk, less return. They just go together. He said, that's not bad though. That's important if you understand the power of compounding. The money you put in there can get you to your goal long term. It'll look like it's growing at the speed of grass, but he said, truthfully, it'll get you where you want to go. So the kinds of things that fit in this are fixed income investments. Now, if you're not familiar with that term, a fixed income investment is, for example, like a treasury bill or a money market account, a municipal bond or a corporate Bond. What a bond is, is you give your money to somebody, you loan it to them, and they give you a bond. They give you an agreement that says, I will pay this back and I will pay you 5%, 6%, 7%, 8% on your money. So I'll pay you all your money, plus I'll guarantee you a 7 or 8% return. As an example, that's called a fixed income investment because it's guaranteed, but it also limits the return you can get. It's fixed. It can't get any higher than the 8%. It can't go any lower than the 8%. As an example, does that make sense? These are secure investments. Your insurance policy, where you're building a policy value that you can borrow back later that goes in your security bucket. The home you live in, you're probably not trying to sell that home. You're really just living in that home. You want to hang on to that home. You don't want to sell it and use that money to eat on. So this is something that you're using purely to have security in your life. Now, he said, once you put money in the security bucket, you don't touch it. You don't take it out until it's time to retire. You leave it alone. And even though it looks like it's growing slowly, you'll be surprised. Before you know it, you'll be the UPS guy. Now, the second bucket is the growth bucket. So in the growth bucket, this is where you put a percentage of your income, and this is where you're investing in things that have the potential to grow and give you a much greater rate of return. So in this area, the reason you don't put all your money in this bucket is it's more risky. Because it's more risky. Again, you have the potential for more growth. So what fits your growth bucket? Mutual funds, collectibles, real estate, art, Any form of securities or stocks. You know, if you're a momentum trader, if you're a sophisticated investor, this is where your options, your puts, your calls, your indexes, where all this goes. Now, no matter how high things go up, they will have a time when they get corrected, whether it be the market, whether it be art, whether it be real estate, there's always a correction. So things don't go up forever. They may over the long term, but there are going to be times when they change. So if you'd invested in real estate, there thinking, oh, my God, it's guaranteed for years and years, it's gone up, up, up and you put all your money in it, you would lose all your money. You'd have nothing to show for it. You'd be starting completely over. On the other hand, if you don't put any money in your growth bucket, you don't get to grow more rapidly. You don't take advantage of the chance to grow at two to five times the speed that your security bucket would grow. So here's the secret. You figure out a percentage that goes into security, a percentage that goes into growth. A common percentage for most people is 70, 30, or 60. 40. In other words, if you're older, if you make a mistake, you're in deep trouble, right? So you're going to have to put more money in security, even though it grows more slowly, just to be safe. If you're a young buck and you're just starting out, you can afford to make a few mistakes and start over still. So you might be more aggressive. You might be 50, 50. Some people have been 40. Securities, 60. On the growth side, I really wouldn't go 30, 70. Unless you're real young and got time right, and the money you have is money you can just throw away. The point is, whatever number you come up with, that's what you stick with. So if that money is $10,000 a year, you're gonna invest and you're at 60, 46,000 goes security, 4 goes into growth. It can be art, it can be real estate, whatever you want. You know, if it was 70, 30, then the obvious is 7,000 security, 3 into growth. If you're really aggressive, and it was 3,000 in security and 7 in growth. But whatever the percentage is, don't let the moment grab you. Because the moment of saying, oh, my God, this is amazing opportunity, I put all my money into it, is what bites you. Now, I've taught this principle, and it's probably the least sexy and the most important principle I could teach you. Because I see this with the guys that make half a billion dollars a day, they forget their asset allocation. They put all their money into something they lose and it's over. And they call me up with a gut check and they say, I lost $100 million this morning. I mean, that'll get your attention. And it's because their asset allocation wasn't there. I'll give you an example that may be more relatable. I remember years ago, probably 12, 13 years ago, I had a woman who came to one of my seminars and I explained this asset allocation, this bucket theory. And by the way, I'm going to Explain the third bucket if you're going. Wait a second. He forgot that. I didn't forget it. I'm going to get there. Just stay with me a moment. Don't let your mind wander. Now, I explained this asset allocation theory, right? The bucket theory. This woman stands up, she raised her hand. She goes, Listen, Mr. Robbins, I am a builder. I'm making an average of 100% of my money. I'm building homes right and left. She was building them in Northern California during a great building boom. And she says, I can't afford to put my money someplace where I'm going to get 5, 6, 7, 8%. That's total waste of my money. I can be making 100%. And I said, listen, please listen to me. I don't care how successful you are. There's a time when things change. And if all your money's in one basket, right, one bucket, I said, you really can't afford to do this. Take a percentage out, even if you're going to be aggressive, take 30% out and put it in that security bucket, so if it all goes boom, you're still set. Well, P.S. 10 years later, 12 years later, she comes to a seminar. Probably a decade later, same lady, I go through the same instruction, true story. She stands up and she said, I just want to give a little testimony. I didn't recognize her, frankly. She said, I came to this program almost 10 years ago, whatever it was, 11 years ago. And she said, Mr. Robbins walked through the same description. And I thought I was so hot, and this is so overly simplistic, and I already make 100% on my money. I'm making 100% every three months. And I thought he was just, you know, he was being overly secure, overly protective, not enough of a risk taker. And she said, I got to tell you something. The bottom fell, the market so fast, it made my head spin. I had all this real estate that I had my money in, and I couldn't liquidate it, and I lost everything. I went bankrupt because I didn't practice this principle. She said, I'm here to start over, and I'm here to make sure that I practice these principles to get what I deserve. I know I can rebuild it, but it's so painful to do it. I told her, the second million is much easier than the first million, my dear. Somebody in the room said, well, then I'm going to start on my second million. So the bottom line, though, is you got to practice this. There's no way around it. Asset allocation is everything. And whether you're talking to John Templeton or Peter lynch or Warren Buffett, they understand this. You got to understand it, too. Now you might say, well, you said there were three buckets. That dream bucket. What's that for? Well, here's what's neat. If you don't reinforce yourself emotionally for making investments, if you just put it all aside and wait till you're 50 or 60 or 70 to touch it, it's not very reinforcing except to see the numbers growing in your bank account. So you got to find some joy. And so one of the ways you can do this and still compound rapidly is to do the following. Once you put money in your security bucket, what do you do? You don't touch it, leave it. When you put it in your growth bucket and you get a big hit, right? A company you invested in goes crazy. You invest in Yahoo and It goes up 5,000%. I don't know. And you get this huge hit. You take your profits. It's like gambling. You know, if you stay at the table too long, you know what's going to happen. They're going to win. So you take some of your profits off the table. And the figure I use for most people is you take a third of those profits and you put them in your security bucket. Why? Now that money is protected, you get to keep it. Not only that, but now you're going to grow much more rapidly. You're going to compound a larger sum of money in that security bucket, and you're guaranteeing you're going to achieve your financial goals long term, even if it all goes boom. On the other hand. Well, if it all goes boom, I guess really, literally boom, then I don't think anybody's going to be worried about money. But you know what I mean? Figuratively now, you take a third of that money and you put it back. You reinvest it into growth. What are you last?

Third.

Put it in your dream bucket. Put it in that bucket where you're saving money to buy that condominium, you say, well, that condominium is an investment. Yeah, maybe. But the truth of the matter is, if you're doing it just for fun, it's kind of an investment. But it's really more of a dream, right? Or a better example is to buy the island. I bought an island. You know, let me tell you something. Once you put money in your first two buckets, don't touch it till you make profit. Because if you start pretending your island is an investment, I got news for you. It'll Drain your security bucket, your growth bucket and everything else. Or if you buy a boat, that is definitely not investment. A boat is a hole in the water that sucks money, right? I mean, it's like. Or you buy a bunch of horses. I got seven horses because I play polo. Let me just tell you something somebody said a long time ago. Anything that eats while you sleep is not a good investment, right? I mean, you can't. They're wasting your money they're sucking out. So those are dreams. So once you put money in your security and growth, you don't touch them until you make a profit. You only take profits out of the growth bucket. You take a third of it, put it in your dream bucket and enjoy it. If your dream bucket requires more money than that, don't make that dream a reality yet or it's going to drain your life. Does that make sense? Everyone's got different levels of dream. From an outfit to a little boat, to a big boat, to a condominium, to, you know, a sports team, to an island. Whatever it is you really want in your life, you should have a way to start building towards that and compounding towards that as well, separate from everything else. Does that make sense? So let's just recap real quickly. The most important investment decision you're ever going to make is your philosophy towards investing called asset allocation. You must decide today out of whatever money you're going to decide to Invest, whether it's $100 or a million dollars, a percentage of it's going to go in a security bucket, a percentage is going to go in growth. Decide right now what that should be. Now if you're risk adverse, like you know, you don't like losing money, then you better put more of it in the security bucket. If you're more of a person who's willing to take risks and it's a gut check for you, but you do it anyway and you're young enough to take it, then maybe you put a little more in the growth bucket and a little less in the security bucket. But everyone must put a substantial amount in the security bucket to guarantee your long term success and to insulate yourself from failure, from the things you cannot control called the market. Whether it be the real estate market, the art market, the market for your business, the market for stocks. You've got to make sure that you have a way to guarantee your success if nothing else on this tape grabbed you. But understanding that getting started now is a must. Going out and getting 10% deducted so you can't touch it and making sure you use this form of asset allocation, then this tape was well worth it and can make the difference between whether you succeed or fail financially. It's that important. So decide right now what your percentage is. Make a decision and write it down. So the next time somebody says, oh, I got this great investment, you go, you know what? Can't make it right now because I got to put this much in my security bucket first. Or I can do a smaller amount of that. I'd love to do more, but I got to do a smaller amount because I got to be smart long term, not get seduced by the short term. This is the difference between someone who becomes wealthy and someone who is struggling. So if it's really this simple, why don't more people become wealthy? Well, really, I'm going to give you 12 reasons. There isn't just one, there's lots of them. And they're actually pretty simple. And as I describe these 12 reasons why people fail to become wealthy, with each one, you should think about doing the opposite. And you have basically 12 simple steps to becoming wealthy. The first reason people never become wealthy is they never clearly define what wealth means to them. See, if you go to our Wealth Mastery program, you're going to find that you might be sitting next to somebody who's worth $100 million, and you might be sitting with someone on the other side of you whose net worth is minus $10,000. I mean, we literally have that diverse a group that comes to the program, people that are totally sophisticated and unsophisticated because the principles are the same. What's interesting, though, is most people never define what it takes for them to feel wealthy, to feel abundant. See, one of the things we do in those seminars is have you define precisely what it would take for you to feel secure. As an example, for most people, if you ask them what would it take for you to be financially secure, they can't tell you. They go, million, $10 million? But it's random. They've never taken the time to really define it. So, for example, if I told you there was a way to be able to pay for the following things without ever having to work again as long as you live? How would you feel if you knew for the rest of your life all of your housing would be paid for, all your utilities, gas, electric, etc. All your car costs, automobile travel costs, all of your food costs, all of your insurance costs, and all your taxes, if all those were paid for the rest of your life, and you never had to Work for it. How would that feel? Wouldn't that be unbelievable? Now, for most people, that amount of money is so small, it blows you away. They think in terms of $10 million, $100 million, a million dollars. When the truth is, for most people, all they'd have to do is be able to generate enough money to cover 30 or $40,000 a year max. Maybe 50. Not for some people, it's 100 or 200. It's all relative. But the point of the matter is, whatever you think the number is, it's so much smaller than you can imagine. Now, that may not be your ultimate goal, but the point is you have to define wealth at different levels. Otherwise you'll never get started. The second reason people never become wealthy is they make it a moving target. They say, okay, I need, you know, $100,000. Then they get it, and they go, I need $10,000. And they get it and they go, I need 100,000. They get that, and they say, I need a million. Then they say, I need 10 million. I mean, 200 billion. And what happens is they never win the game of life. They never get to ring the bell and say, I won. That doesn't mean you don't keep accumulating or achieving or expanding, but you never feel like a winner because you're always moving the target so you always feel like you're losing. No one wants to play a game where the minute you shoot the ball, they move the target. You got to be able to win. Third, they define it in ways that make it feel impossible to achieve. If you're thinking you need $10 million and you don't make more than $50,000 a year, that sounds pretty impossible, doesn't it? But the truth of the matter is, you probably don't need $10 million to achieve the lifestyle you deserve. That's why you got to define it and go through this process. Four, because they make it so big, they don't believe they can ever achieve it, so they never even start. Five, they never make it an absolute must to be wealthy, to be abundant. See, for most people, it's a should. And I just got to tell you, everybody gets what they must have, not what they should have. I said this before. Right now, you're earning exactly what you must earn, not a dime more. I know your goals are higher, but your goals are shoulds. We get what we have to have as the nature of human beings. If you have to be in a quality relationship, you will find it. If you should or you'd like to you're in one if it's convenient, if it shows up. That's true of any area of your life. So you've got to make it a must to be abundant, to be wealthy, to have more than enough. 6 Reason people fail to become wealthy, they don't have a realistic plan. Now again, if you come to wealth mastery, you can put together a plan that's very real, very realistic, conservative for that matter, and still know you can achieve it. Because using the power of compounding and asset allocation can produce results you never thought were possible for. But you got to have a plan. And I'll tell you the next one. Number seven is some people actually get a plan, which is very few people, but then they fail to follow through. If you don't follow through, obviously it's not going to work. That's why you want to make sure you can't help but follow through. Get that 10% taken right out of your paycheck before you see it. Number eight, they tend to fail because they listen to experts and give experts the responsibility to make things work rather than making themselves responsible. So you gotta realize something. No matter how great a person issue you work with, no one's gonna care about your money as much as you do. Nobody. And you can't afford to have someone else be the expert and then wake up one day and say, what happened? That happened to Elton John, to Billy Joel, to Kareem Abdul Jabbar. There's some famous names from the past. I mean, all these people got nailed because they gave all their money to somebody else to watch. And they just did their music or did their play, did their basketball. This is so common. You don't have to be rich and famous to make this mistake. You got to look at people for coaching advice. But you've got to understand it before you make an investment. If you don't understand it, don't invest. Because in the end, if you make a mistake, then you can learn from it. If someone else made the mistake, all you learn is you're an idiot. You trusted somebody else, and you're paying the price. That's not the way to learn. And by the way, I learned this way too. That's why I know about how dumb this is. Number nine, they give up when they face major financial challenges. I'll tell you something. More than anything else, one of the reasons I'm wealthy today is because I've been through so many times when I should have quit, when it looked like there was no way to turn around, but I wouldn't give up. I got a chance to talk with Ted Turner recently right after the announcement of the merger between AOL and Time Warner. That day, he had made $3 billion billion in that day. Now, it was only 12 years earlier that he made his first billion. The next day, by the way, he lost a billion and a half because the stock price changed. So this is an interesting thing that happens. I've experienced this myself. I've looked at my stock one day and go, oh, my God, I made $50 million today. Oh, my God, I lost $25 million. If you do that, you're crazy. It's all on paper. Plus, you know, I asked him, I said, how much money did you spend this week? He said, well, actually, all I spent this week was $2.57 on an egg McMuffin. Meanwhile, I made 3 billion. He goes, I guess I got some abundance, you know. But one of the interesting things he told me was, he said, the secret to his wealth is that all the bad times he made it through where everyone told him to give up and he wouldn't. He said, I got to tell you, Tony, there was just a few years ago, it wasn't that long ago, where, like, we had the executives in our company at cnn, well, we told them they couldn't cash their checks. He said, we didn't tell that to the rank and file because we knew they'd freak out. But we took the executives, said, you got to hang on to these things for two weeks. He said, even then, we pay people dirt cheap to keep this thing going and grow it and get it where we need it to be. He said, I gotta tell you, man, I'm here today because of the losses I've been able to absorb. He said, when I took over the superstation in Atlanta, I lost $900 million, 900 million, almost a billion dollars. And I found a way to hang on. That's why I was able to make $3 billion in a day 20 years later. That's how you make it happen. He said, I lost a million dollars in an hour on a TV show. He said, the Goodwill Games. He said, we saved the world, but we lost millions of dollars. Ted's real quiet and gentle in his approach, right? But the point of the matter is, he said, that's what it takes. The people that succeed are not the ones that never failed. They're the ones that fell down and jumped back up as fast as humanly possible. And that's what you've got to do. Here's the 10th reason why most people fail to become wealthy. They fail to think about their life and to conduct their life like it's a business where they have to have a profit at the end of each year. If you conducted your life like a business, most people will be bankrupt. Would you be willing to go run a business year after year after year after year, where at the end of the year you had nothing or you were in the hole? Pretty soon you'd say, get rid of this business. Well, this is your life. Your personal life must be conducted. So it's a business. So at the end of the year, you say, okay, I worked for a whole year of my life, and here is my profit that I'm building a new future out of. You must change your mindset, because otherwise you'll accept losses each year. You'll accept breaking even is okay, and time is passing you by. You got to change your mindset. If you haven't already created that. Your life is your business. And finally, our last two, number 11, they allow other people's pessimism or other people's optimism to affect their intelligent implementation of their plan. Listen, guys like Ted Turner, guys like Donald Trump, these are people that go against the grain. Donald Trump became wealthy initially because he bought real estate in New York when every other developer was fleeing the city when they thought the city was going to go bankrupt. So not only did he buy things dirt cheap because everybody else was pessimistic, but he got the government there, the city government, to give him, I believe, $100 million in tax credits. You can't do that normally, except when people are totally pessimistic. People are wealthy, go against the grain. They do not allow other people to control their thought process. If you become one of the crowd, you're going to get slaughtered. You've got to think on your own. And finally, 12, they never get quality coaching. Nobody's an island. Listen, the guy I work with is worth billions of dollars, and he hires me to coach him and pays me a fortune to do it because he needs a fresh point of view. He needs somebody who looks at it from a totally different perspective. So if you want to be wealthy, you got to do the opposite of these 12 things. You got to first, define what is wealth for you? How much is it going to take? Secondly, lock that definition in place. Don't keep raising the bar continuously. You can raise the bar for what you enjoy. But know when I hit this number, I'm financially secure, I'm financially free. Third, make sure you define it and you create a Plan that you believe is achievable. That's third and fourth. Fifth, make it a must for you. Write down a paragraph. Why you must be wealthy, you must have abundance. What it'll do for you, your family. Not why you'd like to be, why you have to be. Six, get that plan. Seven, make sure you follow through on that plan. The minute you have a plan, do something towards its attainment. The first thing I do when you end this tape is I call Schwab, I call my bank, I call whoever I do business with and say, deduct 10% even if I don't know where I'm going to put it yet. Put it in a money market, hold it there while I decide where to invest it. Eight, make yourself responsible for what shows up. Don't just trust the experts. Let them coach you, but don't give them the responsibility. Nine, do not give up when the going gets tough, right? Most people are tested when you're five feet from the goal. That's when most people give up. You got to keep pushing and you will get there. 10, do the opposite of everybody else. Make your life a business. Say, I'm gonna have a profit at the end of the year, financially, personally. 11, don't let other people's emotions control you. They're pessimistic. You still think it through. They're optimistic. Don't run and do it. Think it through. Make sure you understand what you're doing. And make sure, no matter how optimistic or pessimistic they are, don't vary your asset allocation. That's what protects you. And finally, get good coaching. A coach is so invaluable for your body, for your relationships, for your finances, for your career. I really encourage you to really test out our coaches because I think you'll be thrilled. And if you want to do that again, I'll tell you. You can call us at 1-888-834-9096. So, in summary, what is this really about if you're going to be wealthy? Well, to be financially wealthy, all you got to do is this. Spend a less than you earn. This is the magic formula. This is the thing nobody wants to hear because it's so basic, but it's the whole secret. Spend less than you earn and invest the difference and then reinvest that for compounded interest until you have an amount of money that sets you free for life. That's all it takes. And the only way you're going to spend less than you earn is if you make it a must by not having a choice. And if you guarantee you're going to reinvest it, that's what you gotta do. Put in the right asset allocation and you will win. You got it? That's it. There's no way around it. And if you can save more than 10% and make yourself do it. John Templeton literally saved 50% of what he earned when he was struggling. See, you gotta remember the power of compounding. So what do you need to get started? Here's what you need to get wealthy. Only four things, and we're wrap this tape up. Number one, you need time. And guess what? You've already got that. You know, everybody I talk to says, God, you know, if they're in their 40s, they go, I wish I started in my 30s. If they're in their 30s, they go, I wish I started in my 20s.

Right?

If they're in the 50s, they go, I wish, I started in my 40s. If they're in the 60s. God, I wish I started in my 50s. If they're in their 70s, I wish I would've started in my 60s. I mean, guess what? Start now. You got the time, and time is your friend. Compounding. The more time you have, the easier it is to win. You start out at 25, and you can start with a tiny amount of money and have millions. You start out at 50, you're gonna have to invest a bit more because you got less time. Two, you need compounded growth. And you have that the day you make the decision to utilize it. The day you start investing, you've tapped into compound growth. And you don't want to wait three holes to start investing in that golf game. Otherwise you cheat yourself out of a giant return. Three, you need to make intelligent choices. And you accomplish this by learning about what you're investing in and most importantly, by defining your asset allocation. Those three buckets, deciding what that percentage is today. And finally, four, you need some money. But that's available. It's available in your own pocket. You can earn it. And if you have a reason to earn more, to invest, you're going to be inspired. You may find a way to earn more than you ever did before. And finally, I'll say this about this subject. You're not really wealthy unless you're abundant in all forms, mental, emotional, physical and spiritual. And I will tell you, to me, money is a game. And all it is is that the money can go away. You can take it all away. You can't take away the experiences of my life and who I'VE become as a man. Because the purpose of a goal is not to get the goal, because you get a goal and then your brain goes, is this all there is? The purpose of a goal is what it makes of you and your pursuit of it. So if you're pursuing your goals and you become more successful financially, you're going to provide opportunities, jobs, capital for others. You don't have to worry about being selfish. Expand financially by expanding spiritually. And I also personally believe that it's really about how to take the invisible and make it visible. How do you take ideas, thoughts, desires and convert them to physical reality? The ability to manifest seems to be being alignment with your higher purpose. And I'm sure there are people that have done that and done it in a harsh way, but there are rewards for that, too. Everything you put out comes back tenfold. But it's an emotional, spiritual game. And I'll tell you how to be wealthy right now. I asked Sir John Templeton, I said, what's the secret to wealth? He told me, the secret to investing was asset allocation. What's the secret to wealth? He said, tony, you know, you teach it. I said, what? I teach a lot of things. He smiled and he said, gratitude. He said, think about it, Tony. I know a lot of people you coach, they pay all this money and you help them in their businesses. He said, but the real reason they hired you is because when you came in their life, they now felt rich because they felt so happy and fulfilled besides being successful in their business or trading more effectively. He said, that's what they got. He said, how many people do you know who have everything but are unhappy? He said, they're not grateful. They're not grateful what they have. How many people you know seem to have nothing in financial terms, but they're so grateful and so they're rich. Gratitude is the key that unlocks the door to wealth. If you can feel grateful right now, remember we talked about relationships when we said, if you can feel that love already inside of you for yourself, for life, for people, you'll attract people of a similar level of love and intensity. If you're not in scarcity, the same thing happens with money. Same thing happens with anything. So if you can be just so grateful, if you can start your days with that hour of power or your 30 minutes to thrive or at least 15 minutes of fulfillment, you know the game plan here, where you spend those first 2, 3, 4, 5 minutes thinking of all things you're grateful for, you know, making that circle of your friends and Your family and your health and the country you live in, the time in history we're here, and all the food on your table that you didn't have to grow and just all the clothes you wear, you didn't have to sew. The Internet, you didn't have to create, you know, the $200 million movie that was created so you could be entertained for two hours, and it costs you five bucks, ten bucks. I guess. Whatever it is these days, think about it. You are so fortunate. I am so fortunate. The more grateful we are. The moment you feel total gratitude to life, to God, to your friends, to your family, that's the moment you're rich. So you never really get beyond scarcity. You got to start beyond it. And when you do, you'll make the right decisions. And when you do, you'll be rich in that moment. And then all it'll be is a game for you to see. How much more free can you be? How much more can you learn? How much more can you expand? How much muscle can you develop? This is one of the critical areas of your life, and you deserve to master it. This tape is not designed to be the end all and be all. If you want that, come for immersion with me for four days in wealth mastery. But I wanted to get you started, and I hope you found it to be valuable. There's some action steps you want to take. Listen to this tape again if necessary, but make sure you make the decision about asset allocation. Make sure that 10% gets deducted, and go get your plan. That's the end of this session. We've got one final session which is on the power of your life purpose, discovering why you're here. In the end, it's the most important issue of all. Please join me for our final session. Till then, enjoy your life, master your money, have fun, and live with passion.

[Howie Mandel]

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