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- [00:00]
Grant Cardone
Don't tell them that it's going to be a rental.
- [00:03]
Brian Preston
Complete fraud. Oh, wait a minute.
- [00:05]
Unknown
Because I pay for things with offers. Everything costs the same amount.
- [00:09]
Brian Preston
How does Grant say this when he owns all this real estate? Welcome back, moneyguy family. The team is once again put together what they tell us are 10 insane videos.
- [00:22]
Bo Hansen
And Brian, I am so excited about this because it sounds like these are truly unhinged. And they said to make sure that we pay special attention to the very last one. So. So let's dive right in.
- [00:34]
Unknown
I'm gonna say this, and I might get a lot of criticism for it, but I will take that loan from your 401k.
- [00:38]
Brian Preston
What?
- [00:39]
Unknown
Take that loan from your 401k only if you have been fighting for your life to get a little breathing room with your finances, you've been budgeting, you've been cutting back on expenses, you've been trying to save, you've been trying to do everything, you've been trying to do right by your money, but nothing is working out for you. You just can't catch a break. Number one, that's your money. Now, the employer may match up to a certain percentage, but some of that money that you earned and worked hard for has been contributed to that as well. Number two, the interest rates on the loan is usually lower than a bank loan or anywhere that you can get from a financial institution. Number three, only use it for, like an immediate fund. You're trying to build up your savings, you're trying to pay off debt, or you're trying to, you know, use it towards a down payment on a home or something. Do not, and I repeat, do not go and use this for no bs. This is not for no clothing. This is not for none of that, not even for a vacation. And lastly, if you're going to use it to pay off debt, please. And I'm, I'm, I'm really hesitant even sharing this because I don't want anybody to take this and say, oh, I did this, but you're not responsible with it. If you're going to use it to pay off debt, do not go and get the debt that was freed up from you paying it off with the 401k loan and run that debt back up because now you just right back in debt with the credit card specifically, and then you still got to pay back this loan. It's just like a. A balance transfer, which I ain't going to get too deep into that. Matter of fact, I'll make a separate video about it. But again, Like I said, I was hesitant making this video, but it can really help some people if used responsibly, if used intentionally, and you have a plan for the money. So please only use this if you're going to be responsible and it'll really benefit you. Do not use this to enhance or increase your consumerism.
- [02:10]
Bo Hansen
He went both directions here. He started off really, really bad because he's basically saying, hey, the 401k is there. You need to go rob from your future self. Rob from your future self. Rob from your future self. But then he did kind of bring it back. And he said, if you do find yourself in the situation where you must take a 401k loan, don't do it for this. And don't do it for this. And don't do it for this. So I'm conflicted. Some of the advice he gave there was, okay, I just, I don't like the way that it's done.
- [02:32]
Brian Preston
Here's the thing. You dig a hole. What I want you to know. When you're young, you are a billionaire of time. And when you're a billionaire of time, your time just can grow exponentially. So you get to choose your hard. If you are young, you only have to use a little bit of discipline in your savings because your money's just going to grow upon itself so much that it's going, your life is going to be great and that discipline is going to be rewarded if you dig the hole like he's talking about. Because everything he was talking about there, a lot of it was consumption decisions, bad decisions with spending more, lifestyle and so forth. If you take a loan and you also have these consumption habits, you're never ever going to get out of the hole. And that's just the reality of the situation. And that's why it made my stomach hurt watching that video, because I didn't see a way out. And that's why I try to tell you, just take a little bit of today and you can build your great big beautiful tomorrow.
- [03:26]
Unknown
You have to trade at the right times, because if you don't, you can actually lose a lot of money. If you look at all the profitable traders, they are trading at a certain time. And the best time to trade is actually when your session opens. Trading forex, you have your session opens. If you trade in stocks, you know it opens at 9:30am, right? If you trade in indices or NASDAQ or futures, you know that certain instruments open at a certain time, that's when you need to trade, because that's when all the volume comes in. That's when all the volatility comes in and actually give you decent moves so you can make profits. You can't just open up your laptop and say, oh, you know what, it's 5:00pm Let me take a trade.
- [04:04]
Brian Preston
Probably underperform.
- [04:05]
Unknown
It might be slow that time. Take trade when a market has volume.
- [04:09]
Bo Hansen
If I knew where a hidden treasure was buried and I did a YouTube video and I said, hey, here's how to find the hidden treasure. Here's how to find, you know what immediately happened. Everybody would go get the hidden treasure. The hidden treasure would not be there. So him saying, hey, if you're going to day trade, the best time to trade is just when the market opens at the very beginning. Then everyone's just going to trade when the market opens the very beginning. If it were that easy, then everybody would do it. That doesn't even pass any semblance of common sense that just picking what time of day you trade is going to dictate whether or not you have some sort of profitable trading strategy.
- [04:37]
Brian Preston
Whenever I meet people and they find out what I do for a living, they immediately want to talk about stock tips, trading. And then I think I break their heart because I tell them, do you want to know what I do with my money? I buy index funds. All of this. And what's funny is I've had neighbors who are telling me the latest and greatest. I can name off all the, the different stocks. And then they come to me usually three, four years in the future and they go, you know what? I actually started paying attention. And that S&P 500 fund that you've been talking about seems to outperform. And I'm meanwhile I'm wasting hours. My tax preparation fees are higher. I feel like I'm just upset because my portfolio is bad this day or I'm to the moon on days that it's up. That's just so much hassle factor. Instead of timing the market, I think you ought to focus on time in the market.
- [05:23]
Unknown
Here's how you get ahead of everybody.
- [05:24]
Bo Hansen
In your high school. Go get a side job, use that.
- [05:27]
Unknown
Money to build a side hustle.
- [05:28]
Bo Hansen
Get 500 saved. Now you can go to Nike and Adidas and buy sneakers at discounted rates and then flip them for a profit on ebay, Amazon and Facebook, marketplace like.
- [05:39]
Unknown
And follow for more money making tips.
- [05:41]
Brian Preston
I do like the hustle factor. I knew guys who cut grass in high school and actually made like adult money in high school. So you can go side Hustle and make good money. Look, I don't get the whole I'm not a sneaker head. I know people struggle with boats too. Because, you know, the best two days on boats is the day you buy it and the day you sell it. But we knew somebody who actually made money because they knew the market so well in boats that they could buy and sell and turn a profit. But that is so obscure that I just, I think there's too many transaction costs. Because if you buy these sneakers, there's going to be a cost to list to sell to. I just, I don't know if that's.
- [06:19]
Bo Hansen
Gonna be a cost to list, a cost to sell, a cost to just hold them. Here's what I'd rather you do. If you're going to go get that side job and you're going to go make $500, don't go buy a pair of Nike shoes. Go buy some shares of Nike. Go buy the company itself. Or better yet, just buy the s and P500 index and let your money do that way. So rather than you have to create this private exchange where you're buying a product and trying to sell a product for upcharge, why don't you go to the original source? That's what's beautiful about publicly traded markets is you can actually be an owner in these companies. So if you're doing the hard work of creating the side income, doing the side gig, it is much easier to put your money to work than having to go figure out how to go create a separate business on top of the business that you've already created.
- [07:00]
Brian Preston
Beau, I have a question. How many clients have come to us as prospects that made all their money in sneakers?
- [07:05]
Bo Hansen
We have zero sneaker millionaires right now.
- [07:13]
Brian Preston
Look how high that is. Do you realize what a shot in the dark each one of those is? Oh, yeah. I mean, it's like playing the lottery. I mean, every one of those things was some speculative play. And Also, even like YouTube, it is not easy to get work, make a lot of money on YouTube. And this is. We're content creators, we have larger platforms. It's work. So I don't. I mean, it cracks me up that so many people aspire to it and they don't. I don't think they realize the commitment you're actually signing up for because there's a lot of quit that happens before you actually reach success.
- [07:56]
Bo Hansen
This video could have said, hey, here's one of the ways if you want to go be rich in 20. That's it. 2023. Just go be a professional athlete. Oh, okay. Well, that makes tons of sense. Well, I may not have the skill set or the ability or the wherewithal to be a professional athlete. That's the same way if you want to be some sort of social media marketer or you want to be some sort of YouTube person, or you want to get into forex trading, there's not a high level of success in any of those markets. There are levels of success, but to think that you're just going to start out and go do that in one year, be rich and successful, I think it takes a little bit more work, a little more effort than that.
- [08:28]
Brian Preston
That is the fine print wealth, meaning that there, yes, there are people that have made money in every one of those things, but it ain't going to be you because it is the smallest of small fractions. If you want to know how real wealth happens, it's the index funds, it's buying the markets, it's putting hard work to work so your army of dollar bills can work harder than you can. Or with your back, your brain and even your hands said, a home is a terrible investment.
- [08:53]
Unknown
It is a terrible investment. Doesn't cash flow. You don't get big tax write offs because of it. You have no leverage. You're living in it, you're paying for it. You never own it. Even when the loan's paid, you don't own it.
- [09:03]
Really?
- [09:03]
Brian Preston
No.
- [09:03]
Unknown
You still got to pay property taxes, still got to insure, still got to maintain it. If you just break it down and don't become emotional because people.
- [09:10]
Brian Preston
How does Grant say this when he owns all this real estate, your house.
- [09:13]
Unknown
You'Re a partner in this house with the state.
- [09:15]
Brian Preston
Your recommendation to normal family would be to rent.
- [09:17]
Unknown
Never buy a house, Rent where you live, take all your money and invest in properties, the cash flow. I'm not saying don't own real estate. I'm saying live in a house and pay rent. Take all the money that you would have spent on that house and invest in real estate. The cash flows that pays you every month could be retail storage, apartment buildings like we invest in could be land. If you're a farmer or rancher and you know how to get cows to cash flow, then do that.
- [09:40]
Brian Preston
Here's the question, does Grant rent his houses?
- [09:42]
Bo Hansen
Well, honestly, I don't know the answer to that question. There's a good chance for Grant may say, oh yeah, I do.
- [09:45]
Brian Preston
No, I've seen. If you, all you have to do is go on YouTube and you see he has beach property. He has all this other stuff because he's made YouTube videos with it all in the background. And I can't imagine maybe he is, maybe this is MTV Cribs edition.
- [09:57]
Bo Hansen
But I disagree with about 112% of what grant says all the time. However, he did have some glimmers and they said, hey, you can invest in rental property, you can invest in cash flow businesses, you can invest in assets that will have a real return for you. That's true, that's true. Those are all true and factual and actual things. That is different than hey, if you want to live somewhere and you know you're going to be there for five to seven years and you want to be able to set roots and you want to be able to own it, or as he says, be in partnership where all you got to pay is property taxes once the mortgage is paid off. There's nothing wrong with that. A lot of millionaires do that. If you actually look at the recent studies, most Americans, the majority of their wealth is locked up inside the equity, inside the home that they own. So owning a home can be a wonderful way to build wealth over the long term. Certainly not an absolutely necessary way. But suggesting that everybody should rent because trying to own a home is a terrible investment. Your primary home is not supposed to be an investment. It's supposed to be a use asset. It's supposed to be sheltered. It's supposed to be where you raise your family that is different from money you are deploying to go work hard for you for the future.
- [10:59]
Brian Preston
Well, how about wealth is beyond the money. How much fun is made by having neighbors that you become best friends with, that you raise your kids with? There is a lot more to life than just what's on your net worth statement. There's something to be learned by that.
- [11:12]
Grant Cardone
Is one Airbnb to retire. So I pay 700 a night for this Airbnb. As you can see, this is just an average setup. It's not anything fancy, but it's the location. If you take 700 times 30 days, that's $21,000 a month. This house, probably because he's renting it all 30 days, $750,000. So when you go get a loan with the bank to buy a second home, don't tell them that it's going to be rental complete fraud. It's a rental you have to put 20 to 25% down. So what you do is you tell them that this is your self incriminating vacation house. So you only require to put 10% down.
- [11:47]
Brian Preston
Oh my gosh.
- [11:48]
Grant Cardone
The average income in America is around $54,000 a year. And just by renting this house out for three months out of the year, you make $63,000.
- [11:58]
Bo Hansen
That's if you rent it every single day for 90 days consecutively. You would do that. And he just encouraged you to commit fraud and likely get arrested. That was the advice that he suggested.
- [12:08]
Brian Preston
I've often wondered, you see content creators all the time post on social media that I just did this and I made $10,000 in 10 days. And then they, what they want you to do is they want you to do exactly what he does. Extrapolate that 10 days income and assume they do that every 10 days and they make a gazillion dollars a year. That's not the reality. I can promise you that Airbnb is not rented 365 days. I had a beach condo, my own. Learn from my mistakes. You only make your money in those peak seasons. The rest of the time you're just praying that you can get a snowbird to live there and pay your notes or your mortgage payment. This is. People mislead you. They act like every day. The best days are every days when that's just not how this process works.
- [12:54]
Bo Hansen
When you go to borrow money, when you sign any sort of loan documents, there's going to be a thing at the very bottom, at the very end before you sign that says I attest that all information shared in this document is truthful and accurate to the best of my knowledge. If you are doing something and that is not true and you are signing saying that it is, there's a good chance you can have in a world of hurt, don't.
- [13:13]
Brian Preston
You could end up in jail.
- [13:14]
Bo Hansen
Yep.
- [13:15]
Unknown
About to buy a million dollar home for half the price. The thing is, you can only do this if you know how to utilize cryptocurrency. Oh, the house that I'm gonna buy and it costs about 1.4 million, so I'll have to pay around seven grand a month. But for this entire house, the total that I need to pay is 740k and it's because of crypto. For the down payment I'll have to pay about 20% which is 290k. With the remaining 450k, I'm gonna put that into the anchor protocol. Once I deposit the 450k, it'll yield me 19% per year, guaranteed a year. Now divide that by 12 months and that's going to make me 7.3k a month. Just Enough to cover the monthly cost of this mansion after it's paid off. I'll have a $1.4M home plus be making 7.3K a month doing nothing. You want to learn more about crypto, check out my bio.
- [14:02]
Brian Preston
Somebody go check on the status of this guy because I think a lot of these protocols have busted.
- [14:07]
Bo Hansen
There's no way I've seen that video before. I want to know where this guy is. That's not the way that the real world works. That's the way that you actually go out and build wealth. That's just not possible. That's not something that could actually happen. Oh, I'm going to go do this. I'm going to make 15% every month and dah, dah, dah, dah. That's not the way that wealth is created. That's not the way investment returns work. If you happen to see somebody telling you that's what happens, or you happen to be in something where all of a sudden I'm getting double digit monthly returns every single month, I would caution you, be very careful. That's likely you are involved in something that you do not want to be involved in. That does not stand up. That's likely scheme.
- [14:40]
Brian Preston
Trees don't grow to heaven.
- [14:42]
Unknown
When I go to a house party, I always ask the host, how many bedrooms are in your house though? They're like, I don't know, four bedrooms. Okay.
- [14:48]
Brian Preston
Why are you asking me that?
- [14:49]
Unknown
Four bedrooms. Legally, you are required by state law to have nine smoke detectors in that house. That's nine smoke detectors I can steal batteries from.
- [14:57]
Brian Preston
Yeah, because while you're partying, this is tongue to cheek.
- [15:00]
Unknown
I'm upstairs profiting. I'm looting your house. I'm unscrewing Philips light bulbs, the LED light bulbs. The really nice ones you can control with the. Your phone. I can unscrew those. And now they're in my pocket. Now they're in my backpack. Now I'm walking out the door. Now I've got.
- [15:11]
Brian Preston
Wait until he finds out about Cadillac.
- [15:13]
Unknown
Converters to make on Facebook Marketplace when I resell them. I've positioned myself to be in a place to succeed. And I won't go to house parties that are less than three bedrooms.
- [15:22]
Brian Preston
Might as well take the air conditioner and get the copper out too.
- [15:25]
Bo Hansen
Could you imagine a dude walking out of a party with just light bulbs just sticking out of his pockets everywhere? That's not. That's not.
- [15:32]
Brian Preston
They put that one in there to see the leg still.
- [15:35]
Bo Hansen
And look, if you go to a house party and you steal all the batteries of the smoke detector and then you unscrew all the light bulbs and steal all the.
- [15:40]
Brian Preston
You're only getting invited to that party.
- [15:41]
Bo Hansen
I assure you that will be the last house party you get to go to because all of a sudden you're going to be called Sticky Finger Steve and you don't get to go to house parties anymore.
- [15:48]
Brian Preston
That's an important lesson to teach your kids. You gotta be careful how you behave because you don't want to get one of these bad nicknames and then get labeled and carry that for the rest of your life.
- [15:56]
Unknown
Because I pay for things with offers. Everything costs the same amount. It doesn't matter if it's this watch or this phone or a brand new car or a private jet, it all costs the same amount. Now I know that sounds crazy. I'm going to look at something I'd like to buy and it's outside my current spending comfort zone.
- [16:15]
Brian Preston
A car.
- [16:16]
Unknown
I'm going to buy a hundred thousand dollar car so I can look at that car. And if I make a hundred thousand dollars a year, I ask the question, is this worth a year of my life? You know what I'm going to do? I'm going to create an offer. I'm going to create a five thousand dollar offer. And this five thousand dollar offer is going to create a transformation for somebody that's worth $50,000 to them. So they're going to pay me $5,000. So when I create the offer, I have to use creativity to create the offer. I have the. I gave them the offer, they paid me for it, but I still have it. They bought it, but I still have. Which means I can sell it to somebody else. So this one person gave me $5,000. That doesn't preclude me from selling that same $5,000 offer to another person or another 10 people or another 100 people or another thousand people. So I still have the offer. I still have the creativity that I use to create the offer. And I have the money. Now I take the money and I go buy the car. I don't have the money anymore, but I have the car, the creativity and the offer. Which means I can go sell the offer again and replace the money that I no longer have because I spent it on the car.
- [17:07]
Bo Hansen
You ever seen the movie Inception where it's like a dream within a dream within a dream? I feel like that's what just happened. I didn't.
- [17:13]
Brian Preston
He was well spoken, but I couldn't tell where he was going with it. That's what you always had to be careful. The silver tongue, people that make everything sound good. But I just was like, I'm lost in the woods.
- [17:23]
Bo Hansen
He said, I'm going to come up with an offer and that offer is going to be 5,000.
- [17:28]
Brian Preston
But somehow he's selling the offer and then he's buying the car. It made me think of, you know, if you're old, my age, chain letters where you send out supposedly and convince people to send you a dollar back and you supposedly be rich.
- [17:40]
Bo Hansen
If you go to a car dealership and you try to buy a hundred thousand dollar car and you tell them, I have a single $5,000 offer for you that I can give you that you can sell over and over again, they are not going to let you drive off. The odds are you may be leaving that dealership in the back of someone else's car.
- [17:57]
Unknown
It's whole life insurance. And this is probably the most underrated, underrated, undervalued investment of all time. And I think, I believe in all my heart it's kept this way because they don't want it to become some public thing. Oh, Chase bank owns the most whole life insurance of any bank. 500 billion or something like that. Right. And all these millionaires and billionaires and private equity funds, all they're doing is taking this money that they're making from their businesses. When they, you know, go and buy a business small and build it up and sell it, they take that money and stick it in your real estate and then. Or stick it in whole life insurance. Oh, or whole life insurance and whole life insurance, you can leverage it again.
- [18:38]
Bo Hansen
Okay, so what do you say there at the end? Wow. All these millionaires and billionaires, Brian, we know a bunch of millionaires, they all take all this money they're getting for their business businesses and they dump it in real estate. Yeah, true. Some of that happens and they dump it in a whole life. Ah, not so much. And then what they do is, and he did this thing, he goes, then they leverage it.
- [18:55]
Brian Preston
Oh, I don't think I'm a lot.
- [18:56]
Bo Hansen
Dumber than you thought that I think.
- [18:57]
Brian Preston
That I thought I was once.
- [18:58]
Bo Hansen
Then they can borrow. Yes, that is true. If you have a cash value whole life permanent type insurance policy, you can borrow against that. But my question is why on earth, if you're a business owner who's making all this money and has all this money, why would you go buy a thing, an insurance product that then you'd have to borrow money from in order to access the Capital. It does not make sense. This is not in fact what wealthy people do with their money.
- [19:22]
Brian Preston
Yeah, without a doubt. Look, insurance has a place in your wealth building journey for de risking protecting you in case you prematurely die or have accidents or things like that. And it is true wealthy people can use life insurance and other things for planning methods. But I believe what he's describing. I think he's just setting up a honey trap to try to get seven figure people in to BE because look, people hate paying taxes. So they hear somebody who's once again silver tongued goes in. It wouldn't surprise me if we find out later that this is, this is not on the up and up. Holy cow. You guys were not kidding. This was true insanity. And it just shows me. Be careful who you let in your head because there's a lot of people trying to get into your wallet, into your purse, into your. You gotta pay attention and know that there's a better way to do money.
- [20:13]
Bo Hansen
If it sounds too good to be true, it often is. The things that have worked for the last hundred years when it comes to building wealth are likely the things that are gonna work for the next hundred years. Be careful of folks who are trying to sell you something that is not real.
- [20:26]
Brian Preston
Hey, like our feedback? Go to moneyguy.com check it out for yourself. I'm Brian, this is Bo. Money Guy team out.
- [20:34]
Bo Hansen
The MoneyGuy show is hosted by Bryan Preston and Bo Hansen. Brian and Bo are partners with Abound Wealth Management. Abound Wealth Management is a registered investment advisory firm regulated by the securities and Exchange Commission. In accordance and compliance with the securities laws and regulations, Abound Wealth Management does not render or offer to render personalized investment or tax advice through the Money Guy Show. The information provided is for informational purposes only, may not be suitable for all investors and does not constitute financial tax, investment or legal advice. All investments involve a degree of risk, including the risk of loss.