← Rich Habits Podcast
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- [00:00]
A
Hey, everyone, and welcome back to the Rich Habits Podcast, brought to you by public.com a top 10 business podcast on Spotify. These are our Thursday episodes where every Thursday Robert and I come back to the microphone to answer your questions. You can ask us questions via Instagram at Rich Habits Podcast or via email@richhabitspodcastmail.com you can send us a little DM, you can send us a little email. Now, nine times out of 10, we're gonna see it. One time out of 10, we're gonna answer it. Let's be real, Robert. We get 10,000 plus questions on a weekly basis. It's, it's pretty intense. But we try and come back here and answer as many as we possibly can. Which makes this a great reminder, if you want to ask Robert and I a question directly on Zoom via a live stream every single Tuesday night inside of the Rich Habits Network, that is what you can expect right now. We're filming this on a Monday, which means tomorrow night, Robert, we're going to be right back in front of these cameras on zoom to about 400 people inside the Rich Habits Network. It's a blast over there. So if you are really a big fan of the show and you want more questions answered, more clarity, more access to Robert and myself, consider joining the Rich Habits Network. There's going to be a link in the show notes below and you of course, can do it via that seven day free trial.
- [01:16]
B
Yeah, I love the network. We've built such a cool thing between the podcast, the newsletter and now the network. And I think it's just the ultimate hack. Everyone wants the hack on how to build wealth and financial freedom and get in the mix. Well, the Rich Habits Network is definitely the way to go. And check out that seven day free trial because that gives you a little insight. You can kick the tires before you actually have to pay us a dime so you can see what it's all about and see what everyone's raving about.
- [01:44]
A
Yeah, everyone includes over 860 people right now inside the Rich Habits Network, which is just super incredible to think about. All right, Robert, now before we answer our first question here on the Rich Habits Podcast, Question and answer edition, we have to give a shout out to public.com, the investing platform for those who take it seriously. We talk about investing all the time, so if you want to start taking your Investing seriously in 2026, public is how you do it. On public, you can build a multi asset portfolio of stocks, bonds, options, crypto and now generated assets which allow you to Turn any idea, any idea you possibly could come up with into an investable index using AI.
- [02:27]
B
And it all starts with your prompt. From renewable energy companies with high free cash flow to semiconductor suppliers growing revenue over 20% year over year, you can literally type any prompt and put the AI to work. It screens thousands of stocks, builds a one of a kind index, and lets you back test it against the S&P 500. Then you can do all of that in just a few clicks.
- [02:51]
A
So generated assets can be thought of like ETFs with infinite possibilities, completely customizable and based on your thesis, not someone else's. So go to public.com, forward/rich habits and earn an uncapped 1% bonus when you transfer your portfolio. That's public.com forward/rich habits.
- [03:12]
B
You all know we love public and definitely generated assets. You have to check it out. Paid for by Public Investing. Full disclosure in the podcast Description all.
- [03:21]
A
Right, Robert, so this first question, weirdly enough, was a comment left inside of Spotify. We normally don't answer comments on Spotify like that on the show, so like don't think that you're going to get your question answered differently if you do that. But we thought this was such a good question, had to snag it and answer it on this episode. So this comment comes from Victoria on Spotify. She says, I loved this episode. Talking about last week's Q and A episode, she said, can you guys please say more about the systems you use to operate multi family rentals, property management systems, finding maintenance professionals, reserves to replace appliances, etc. And finally, why separate LLCs for each property versus a Series LLC? So Robert, you've been investing in real estate your whole life. You just closed a cool deal over in Ohio right now. Nice little flip. Super excited to hear about that later. Oh actually we're gonna get a little sneak peek of that I'm sure tomorrow inside the Rich Habits Network. So consider joining just for that. But regardless, I want to get your thoughts here on Victoria's question. What systems have you used in the past when it comes to property management when you were finding maintenance professionals? How do you like tactically speaking, how are you sort of bird's eye view, like building out everything to ensure that a multifamily rental is profitable and it's running like clockwork?
- [04:41]
B
Yeah, this is a great series of questions around multifamily and owning a real estate portfolio. So let me do my best to get all of it covered. Number one, let's talk about the systems and the Apps we use, we only use two because we're not a huge portfolio yet. So we use Buildium and they're really, really good with their accounting and their dashboard and it's very all in one full encompassing. It's called the Buildium app is really good. Now if you're just getting started, maybe you just bought your first multifamily and you're getting up and running and you want something really intuitive and simple. Check out Door Loop. It's really mobile focused and it's great for smaller portfolios or people looking to save a little money that want something simple and easy to get up and running and using. And if you're really just getting started, something that's kind of a little hack that we like to use is we also use Waves app. You can go into Waves app and it's really good for just keeping track of tasks, keeping track of invoicing and all of that. And that's actually free. So those are the three that I would say out of the box work the best from beginner to mid level to a pretty good size portfolio. But then when we talk about other things, you just want to make sure probably you're going to want to use a Google Drive to make sure you're keeping keeping track of all the day to day stuff. You're probably going to want to look at QuickBooks Online. That's a really good program you can use for all of your small business stuff that we like to use as well. And then how do we find people? I think this is a great part of this question, series of questions is how do we find maintenance professionals, landscape professionals? I don't have a hack for that technology wise, but what I do is if we're new to an area or we're really focusing on an area, I always take pictures of and stop by and get business cards of everyone that I see working in those areas by us. Because that way I can put them into a database, call them up when I have a job and make sure that I'm staying on top of who's working in the area. Because you don't want to use Google as much for that. Because you might see St. Petersburg, Florida landscaping, but they're 45 minutes away and it's going to just be more difficult to get them in the loop. And so I like to find localized contractors that I can get really quickly, get them out and they know the neighborhood and they know what goes on because that's going to save you time and money as well. Because they know where the stores are. They know where the tile shops are. And it just makes it a lot easier to answer the part about the series llc. I don't do this, and I'm going to explain why. I always worry that with a series llc, and there are some benefits to it, so it's not all bad. But I always worry that if I combine a bunch of different real estate projects in one series llc, you don't want to bring the whole house down if one of those projects goes awry. And you have to look at it this way, you're basically taking one LLC and you're breaking all the projects down within that llc. So you might have five, six, seven projects in one series llc, which is totally fine. Some people do it. But if you don't keep meticulous records and you don't keep everything fully layered and separated, you will get yourself in legal trouble. Because you might be perfect on five projects and have two where someone commingled funds or funds were misappropriated. Those two are going to bring the whole series LLC down. So just make sure you understand what you're getting yourself into. When considering a series llc, it does save some accounting dollars and some time, but you really have to be careful. You don't want the entire company coming down because of one bad project.
- [08:28]
A
So I know what an LLC is. What is a series llc? What is Victoria talking about with that?
- [08:33]
B
Yeah, it's basically an llc, similar to a holding company, where you would then have multiple projects within it, so you'd have, like, different divisions. I think that's the easiest way to explain it within one llc. I don't like doing this. Some people that are big in real estate do. I just like the separation and the clarity of each project because a lot of people don't talk about this, but when you're doing these projects, you have five, six, seven contractors. You have all the other people helping. You have the subs. You have random people that might be in house staff. Everyone is running around. Everyone's, you know, working on different bids and different, you know, material lists and picking up product and all this stuff, it's really hard to keep it tracked on a daily basis. I like the separation, so that way there's no spillover if you get bad contractors or someone that's misappropriating funds. So I like to have that isolation in each project. It takes a little more time. But I'll tell you what, it's worked well for me over the last 30 years.
- [09:36]
A
And then to wrap up Victoria's question, about reserves to replace appliances, etc. Walk us through. You know, let's say like percentage wise, right? Let's say you got a multifamily, right? And let's say that it brings in all the rent. That number is 100%. How much of that 100% figure in a perfect scenario should go to mortgage, should go to staffing, should go to reserves, should go to taxes, like stuff like that?
- [10:00]
B
For me, I think to answer this question specifically about the reserves to replace appliances, the general practice is around $250 per year. That's what Freddie Mac and HUD require. I don't do this on larger apartments. If it's a new one, we're going to have a budget, obviously for the initial appliances. But in general, if I'm doing a duplex or triplex or a quadplex, I know what they cost and I don't really have to have a yearly budget for them because we're going to be planning ahead. Let's say we have to replace them every five to seven years and we're going to know what that cost is. So it is going to be in the budget. But I don't do it per annum. But the general rule of thumb is $250 per door. Now, a hack that I will put in on top of this question. Make sure you're careful what appliance packages you buy, because a lot of people buy them based on what they think is a cool brand. You want to buy US Manufacturers that carry US parts regionally and locally because that'll keep you out of the mess when something breaks down and you need something from a Samsung or a leg or something like that, where they don't have parts locally. So keep that in mind. That's why we like GE and some of the more localized US Manufacturers, because you don't want to have these doors where refrigerator or a washer dryer is down for weeks and you end up having to replace them over a part that you should be able to get within 24 hours. So, Austin, to answer your part of this question, I look at more of the net operating income. What is the end result we desire for ourselves and our investors? And that can range depending on project. But we generally look to a 16 to 24% return if achievable. And that's how we place a desired outcome to present to our investors and our internal group to make sure we can achieve the goals we want from a profitability standpoint.
- [11:58]
A
And so when it comes to the net operating income, I'm not A real estate expert is that the pre tax, like that's like you made this money before, like taxes and stuff. It's like this is your net operating income. Like that's like the number net operating.
- [12:11]
B
Income is taking all, all of your income minus all of your expenses to come up with your noi. Then after that you can calculate what the return is. Remember we talked about that desired return, what your return is on that particular project. And then after that you make your distribution to your investors. And then from there they will still obviously owe whatever taxes they owe, depending on how they structure their investment. Remember, all of my investments do not come from me personally. In real estate, they come through a holding company and an llc. So that way you have to understand the differences so you know what tax liabilities you would have given your situation.
- [12:51]
A
That makes sense. Yeah. I think a lot of people listening probably are doing this themselves, although I'm sure some of them are part of like some real estate syndications and stuff and like realizing some of that. But yes, if you're doing it yourself, I'd imagine you would owe, you would probably owe normal taxes and stuff on that, on that noi. That makes sense. Which is a great reminder. Hey, if you're doing this stuff, definitely work with a cpa, not just listen to a couple guys on the Internet. Because I'm sure a CPA is going to help you figure out things that you could write off, things that you could, you know, just. It's always a good idea to work with a certified public accountant.
- [13:23]
B
And that's exactly where I was going next. This is a great series of questions from Victoria. Is there are other benefits besides the NOI and the percentage of return you get because you do have write offs. We just had a situation where we had a property that we didn't sell in 2025, but then it sold in the first week of 2026. So there are tax advantages there in 2025, if you invested in 2025 that you can utilize to gain yourself more reasons to want to get involved in the real estate market.
- [13:55]
A
I love these breakdowns. Robert and shout out Victoria. We hope. I know, I mean this one took a little bit, but I just, I think it's really important, right. I think it's really important to go into the weeds here and help people understand how you and your 30 years of real estate experience and to sort of how you approach these situations. Now our next question comes from Christian C. Christian says, hey guys, I love the show. Thank you for sharing your knowledge and experiences. My name is Chris. I'm 26 years old, living in Tampa, Florida. I take home about $80,000 in after tax income from my 9 to 5. I have $20,000 invested into a taxable brokerage account into the ETFs. You guys talk about 30,000 invested in crypto, 20,000 in Bitcoin and 10,000 in XRP. I have 3,000 in my emergency fund and I only 1 to 2,000 in my checking account at all times. I've got $7,000 in an outstanding auto loan with a $229 monthly payment. My rent is 1700amonth, which I know is above my means. But I do live downtown by my office. So I walk to work and I don't have to put miles on my car. I invest $600 a month in stocks and crypto. 100amonth goes into my emergency fund. And I put 7% of my salary into a Roth 401K that's got over $35,000 in it. Shout out to my employer for the 4% match. I don't have any credit card debt. I cover my expenses well enough to keep that one to $2,000 a month cushion in my checking. But here's the fun stuff. I'm about to get a bonus of $10,000 and I don't know what to do with it. Maybe I pay off a large portion of my auto loan. Maybe I'm using it as a down payment on a rental property or maybe buying a small business. Or I just keep investing in stocks and crypto. I'm not sure yet what to do. Curious to get your thoughts, Robert. What a cool situation our friend Chris here is in. Chris, you've done a Great job at 25, man. 20,000 and a bridge account. 35,000 in a 401k, 30,000 in crypto. Here's the one thing that stuck out to me like a sore thumb. And Chris, I really want to encourage you to do this even though you might not want to, because it seems like your risk tolerance is really risk on considering how much crypto you have in relation to your entire net worth. Here. I would put put all $10,000 into your high yield savings account and treat it like an emergency fund. Right? Your fully funded emergency fund should be anywhere between three to six months of expenses. Now, I'm not positive what your monthly expenses are. I would imagine somewhere around 4,000, maybe $5,000 a month is what you're spending. So if you slap a three against that five, you now need to have $15,000 in your high yield savings account for this emergency fund, right? You've only got 3,000. And essentially what you're doing by not fully funding your emergency fund, what happens if you have a medical emergency and you now need to come up with $10,000 out of pocket to cover this medical emergency and all you have is three? But instead of funding your emergency fund with more money, right now you're investing it in crypto, you're investing it in stocks, right? You are essentially saying, I'm going to try and out invest high interest credit card debt because you got to go into high interest credit card debt to make up the difference on that medical emergency's 10,000 versus the only 3,000 you have in your savings. So if I were you, at least bump it up to 10,000 in that emergency fund. 15 if you can do it. I'd be really comfortable with that.
- [17:14]
B
Now.
- [17:14]
A
Now you're 25. You got 15,000 in this emergency fund. You've got 30,000 in some crypto, 20,000 in some ETFs and stocks. You've got another 35,000 in your 401k. Like, now you're really rocking and rolling. And if you end up getting into investing in real estate like we just did, a great job breaking down, you're coming to it from a place of strength, from a place of authority, from a place of decision making, not a place of, oh, man, I've only got 3k. What happens if this or, you know, whatever's going on there, that's my perspective, Chris, on what I would do with your $10,000 bonus. Robert, what's your perspective?
- [17:49]
B
Yeah, I like all of that. Austin. I think it's a great breakdown. I just want to add two things. Number one, I wouldn't pay off the car unless the interest rate is above 6%. If it's anything 6 and below, I would just keep rocking and rolling, pay those low payments, let it ride. A car's a depreciating asset. That's it. Number two, I don't see anything in here unless I missed it for a Roth IRA. And what struck me was I'm investing $600 a month in stocks, but I don't see anything for a Roth IRA at 25. And I think that is absolutely critical that you get that Roth IRA up and running. So if you just didn't mention that it's a Roth. I only saw a taxable brokerage account. I would consider pivoting some of that money, not necessarily from the bonus, but the invested capital to get the Roth IRA maxed out every single month if you can. That's $625 a month. And that's what I would do. That's the only change I would make.
- [18:44]
A
That is a great suggestion, Robert. So our next question comes from Braxton T. Braxton says. Hi, Austin and Robert. My name is Braxton. I've been listening to your podcast for over a year and I really enjoy it. I'm hoping you can help me understand when a bridge account makes the most sense for my situation. My wife and I are 26 years old and combined we earn $120,000 a year. We are completely debt free. We own our home outright, no mortgage. It's worth 115,000. I have 10,000 in an emergency fund and have $75,000 in CDs earmarked for a new home build in 2027, along with some proceeds from selling our current home. We project paying off our forever home that we plan to build next year over about a 10 year period of time for retirement. Our projections show that about $140,000 a year in income from our Roth IRAs and my employer's 401k is attainable and it will last 40 years while still leaving $1,000,000 to our kids, assuming about 8% growth in average inflation. I contribute enough to my 401k to get the full match and the rest goes to my Roth ira, which I expect to continue to max out for the next several years. My wife already maxes out her Roth IRA annually, but she does not have a 401k. Given our strong retirement outlook and minimal debt both before and during retirement age, should we consider opening a bridge account now? And if so, do you have recommendations on where to open one? Well, answer that second one. Yes, public.com go get your 1% match on anything you move over. Regardless, generated assets, all the fun cool public stuff. So yeah, go use public public.com rich habits. But this is a good question. So let me see if I'm understanding this right, Robert. They're earning about 120k a year. They plan to build their forever home next year. They've got about 115,000 plus the 70. So let's call it a $200,000 forever home and it'll be paid off, which like cool if that's what you're into personally, unless the interest rate's like 6, 7, 8%, I wouldn't but like hey, you do you with your money and their retirement projections are just showing. And now let me like make sure we're on the same page. They are essentially saying, hey, I'm 26 when I'm 66. So in 40 years, my investment portfolio will be so much that between my Roth IRA and my employer's 401k, I will be able to generate $140,000 a year of income. Where if we use the 4% rule to back into how they did that, they're essentially saying they'll have three and a half million dollars in their Roth IRAs and employer 401ks in 40 years from now. And so now they're saying, listen, if we're going to have all that money just doing what we're doing right now, like, why even open a bridge account? Why even do more? That's how I understand your question, Braxton. To answer your question, you don't have to. I mean, I think you're doing great, dude. If you want to have three and a half million dollars at 65 years old and have a great income and leave a ton of money for your kids and like all that stuff, dude, rock and roll. I think that's awesome. The only purpose of a bridge account is to bridge the gap between access to your retirement funds at 59 and a half and where you are when you want to retire early. So, for example, I've got hundreds of thousands of dollars in retirement accounts that will grow into millions of dollars over the next 30 years of my life. But I also have millions of dollars invested in taxable brokerage accounts, bridge accounts, Right. That will allow me at 35, 40, 45, be able to look and make that decision of, hey, I want to retire or I want to, I want to stop working, I want to live off this portfolio income. Right? But that's the flexibility that I want to have at that age with that money in my bridge account. Right? So like, you don't need a bridge account if you plan to work and do your thing until you're 59 and a half, when you can touch this three and a half million dollars, you don't have to do any of that. But if you want to retire early and have some flexibility, then, yeah, maybe having a bridge account in your situation is a good idea. And earning 120,000 pre tax, you mentioned a lot of stuff here that you're already doing with your money, which is incred. I would imagine that there's still probably 2 to 500amonth somewhere in your budget if you wanted to start contributing to that bridge account. And if you were doing that, don't get Fancy, just toss it in the S P or maybe 50, 50 S P, Nasdaq or 33. 33, 33 S P, Nasdaq, Dow Jones, if you want to do some like, you know, little chiller out stuff with the Dow. But that's how I'd approach it. Robert, what do you think about Braxton, like not knowing to have a bridge account? What, when do you think's the right, right time for someone to open a bridge account if, if at all, given this scenario?
- [23:24]
B
I think you broke it down in the nice way. I think Braxton absolutely needs the bridge account because we see so many people in our DMs, you know, in our private lives that talk about how they have this big 401k and they have all this equity in their house, but they can't remodel a bathroom without going and get in a heloc. They can't go buy the little boat that they want for the lake because they have to put it on credit cards. That's because they don't have a bridge account. You don't have access to the money because it's in all of these other accounts that are for retirement. So that is why we like to see the bridge account right along in tow with your 401k, with your Roth and with the equity in your properties because that way you have access to capital without penalties along the way. So I think you should get the bridge account right away. I agree totally with Austin. Start putting that couple hundred bucks a month, even if it's only a couple hundred bucks away, because it will grow without any worries of penalty or anything else if you need it along the way. Because remember, life and plans like this don't always go as you project. But I appreciate the fact that you are doing that.
- [24:38]
A
Yeah. Just want to reiterate what Robert was talking about. Right? So like there are people out there who are 52 and they've got a million six in their 401k because they did it and it was right and we're proud of them. And they've got 700, 000 of equity in a paid off home because they've lived there for the last 22 years. They paid it off a couple years early and they're excited, right? So now they've got, call it a net worth of two or two and a half million dollars at 52 years old. And theoretically, yeah, dude, you're a net worth millionaire. Congratulations. Like you deserve to kind of coast in the rest of your 50s. You did everything right, but you can't because all your money is locked up in a 401k that you can't touch without taking a 10% penalty on it. Right? Or all the money that's equity in your home you can't touch without either borrowing against it at a 7 to 10% interest rate, depending on your credit, or you got to sell the like. Having a bridge account I think is super useful. It gives you a lot of flexibility, the ability to make some decisions in the moment that you might not have been able to make if it was all tied up in these other places. So really good question.
- [25:36]
B
Braxton1 100% have the bridge account. It gives you flexibility, peace of mind without giving money back in penalties because you didn't listen to us.
- [25:49]
A
So our next question comes from Amber C. Amber says after raising kids, I'm finally going back to work. The plan is to invest almost all of my pay into retirement accounts and college funds. My kids still have six to eight years until college. Amber says how do we maximize extra retirement investments? My job is in renewable contract work, so I do not have a 401k. We will easily max out my husband and my own IRAs. Where should we put the rest? Do you just add the rest to a taxable brokerage account? I never thought I'd be in a place where we'd have so much extra to worry about, which is an incredible blessing. We have a high Yield savings with 4ish months of emergency funds, so we don't have to add more to that. I do plan to contribute to my kids 529s. We have 125,000 in retirement accounts and are 43 years old. Any advice would be appreciated. All right, Amber, so I've got some great news for you here. You've got 125,000 doll dollars already invested into the index funds and ETFs we talk about. That will grow at 8, 10, 12. Heck, last year the S&P did 17%. The NASDAQ did 20%. Like you're rocking with the markets here and you're having a good time. Now you're saying we've got, we got, we got all this money to invest and we. Where do we put the rest, right? So let's start with just what you are investing in. Your Roth ira. If you and your husband are both maxing out your Roth IRA now at $7,500 a year, $625 a month. So multiply that by 2, 12, 50. And you do that from age 43 to 65 on top of this 125 you already have invested, we're talking about $2 million at 65 years old, adjusted for inflation. That is absolutely incredible. Right, so you're, you're good, you're not going to retire broke by just doing the minimum. Now you're saying where do we put the rest? I would argue the 529 for the kids is a wonderful idea. Even if you only have six to eight years to do it. I think that's a won I, I do it on Vanguard. Make sure you look at to your own state. Make sure they've got the stuff figured out for the expenses and the funds and the flexibility. Fun fact, you can go into any state you want. I've heard good things about Alaska, I've heard good things about Utah. You don't have to stick to your state. However, if you want to leverage the tax benefits that come with contributing in your state, then you do have to do that. But like just do whatever you want to do. Get money in that 529 any which way you can in a smart and responsible low fee manner there and make sure you've got so much invested that even after your kids go through college, each one of them has $35,000 left in that 529 account so they can roll it over into their own individual Roth IRAs. And they will be able to now have $35,000 invested into their Roth IRAs by their mid 20s. Because you can do the up to the max every single year as a rollover. And then from 25 to 65, your kids have $35,000 each in their Roth IRAs, there will be mil. I'm just gonna do the math for you, Robert, because this is so fun because I love showing people how easy it is to make your children millionaires by just making sure They've got this $1.2 million by not adding a dime. If they don't add a dime to this 35,000 from 25 to 65, assuming 9% annual returns adjusted for inflation here you can, heck, let's bring it down to seven because there's people out there that are going to say 9% is unrealistic. At 7% we're still talking about 600,000 dol. Unreal. That's unreal money. So that's my perspective. That's what I would do with the money. I would make sure you're doing the Roth IRA for sure. That's how you're going to get to 2 million 529s all the way through as well. And if you still have money left over, Robert, tell them where they should put it, man.
- [29:23]
B
I would. Diversify, diversify, diversify. But make sure you understand what your risk tolerance level is for your household. Sit down, have a question. What do we want to do? Is this $2 million going to be enough for us when we're ready to retire? And I love this part. And thank you, Austin, for breaking down the math of setting your kids up. When I grew up, my parents didn't do anything for me. They kind of like, just didn't really understand financial literacy and how to do all these things. But you follow the Rich Habits podcast, so you know all the tricks of the trade to set your kids up and make their lives easier. So, Austin, other than that, I don't have anything to add. I think you crushed it, and these guys are off on the right track and just really need to keep doing what they're doing, make sure they're diversified well and just rock and roll into retirement.
- [30:14]
A
Yes, the answer I was looking for was put in the bridge account, but I think that was kind of a given.
- [30:19]
B
Yes, definitely the bridge account. We already talked about that. But, yes, in this situation, for sure, the bridge account is important.
- [30:25]
A
So our next question comes from Jaden on Instagram. Jaden says, what's up, Rich Habits? I've been listening to you guys for a while now. I invested in Broadcom several years ago before the big boom of A, and I'm currently up a good bit. I have not been contributing to it recently, but I was curious on how I should continue to approach this with concerns of this whole AI bubble. Should I take out a portion of my earnings and reallocate it into something safer? Should I leave my entire investment in Broadcom, continue to watch it day by day? I recently allocated some other funds that you guys have told me about into VOO and qqq, but I'm stuck on what to do with this specific stock. Do you have any tips, Robert? I'll let you kick this one off.
- [31:08]
B
Yeah, I mean, take profits along the way. Jaden, if you've made a bunch of money, I mean, Avco's been up about 56% the last year, so I'm hoping you're taking profits along the way. I don't know what price point you bought it at, but I would definitely consider moving some of that money out. I think Austin does a really good job of breaking down how he has these high beta portfolios, makes a bunch of money, then rolls some of that money over to the voos and qqqs. Now my general rule of thumb when it comes to high beta stocks like Broadcom is once I'm up 50%, I take 25% off the table. Once I'm up 50% again, I take another 25% off and so on and so on. Because at some point you want to be really risk off in these high beta volatile positions. And that's how I do it. But I'd love to hear your thoughts, Austin.
- [31:58]
A
So I've owned Broadcom this whole time as well. I got super lucky. Yeah, I bought Broadcom in December of 22. So I'm pulling it up on the stock chart here. December of 22nd, Broadcom was at $55 a share. Now it's at 350. My all time money weighted return is 609%. So I'm right with you there, my friend. That's great. Shout out to us for being right on Broadcom. So Broadcom makes up such a small percentage of my portfolio that I'm just letting it ride. That's just my reality. But in your case, it might make up a large percent. Anything over 5% of your investment portfolio. Slash, net worth, I think is you're starting to get large, right? 10. You're like, dude, maybe you should begin to like reallocate this. In my humble opinion, this is not a Broadcom strategy. This is an any strategy, right? This is in any stock strategy. If you're listening right now and you listen to Robert and I's 2025 Market Predictions Episode and you made a ton of money on a quantum computing stock or a nuclear energy stock or you are, are part of the Rich Habits network. And you, you know, Robert was talking about micron technologies like nine months ago and now it's up 7,000 billion percent, like whatever, right? Like if you are up a ton of money on something, in our humble opinion, it is always a good idea to take profits, take those profits, pay your taxes on those profits and reallocate the proceeds back into the index funds and ETFs we talk about. No one ever went broke broke investing in the S P over a long period of time. But people did go broke buying Zoom stock back during COVID Rode it all the way up. It was the darling and now it's down 90 since then and it never recovered. I'm not saying Broadcom is Zoom, but what I am saying is those names exist. They might exist right now in your own portfolio and you might be getting a little too greedy to think that These names go up forever. And so the whole reason why I add single stocks to my own portfolio is because I say, okay, what's the opportunity cost of investing this money? The opportunity cost is not having that in the s and P500. So in 2025, the S&P500 delivered 17 returns, which means every dollar that I did not invest in the S P 500 better have returned at least 17 or I left money on the table. That's the sort of like, checkbox I give myself before investing into a single stock. And as we look at Broadcom, that worked out, it was a 55 return in 20. Great. So it's like, okay, going forward, if I am investing into a stock instead of the S and P, and I was right, and that stock went up more than the S and P, then I will take my profits right above what that S and P return is. If you want to think about it that way, put it back in the S and P. So you're kind of back to par with the S and P and keep the train going. Right? If that's how you want to approach it. I think it's a great idea to have blue chip single stocks. I believe Broadcom is a blue chip single stock. I believe Amazon and Google. Right. Google stock. Robert. Google stock price last year was 70. 72% returns. 72%, right. So that's another example of like, hey, I put money in Google instead of the S P. I believed Google was going to do well in 2025. It did. I'm now going to take profits, reallocate back to the S P, because that's my forever up and to the right. It's American capitalism and I'm going to leave some in Google if I like it and just keep on rolling. Or on the flip side, and I did this recently, I was spraying and praying into some of these crazy biotech small stocks and some of these space exploration and unprofitable nuclear. I was having some here with a very small percentage of my portfolio. September, October, November, December, I made about cumulatively on that portfolio about 15% in about two, three months there, which was way more than what the S and P and the NASDAQ did. So I sold it all and I said, cool. And I, I put it back in the S and P. Right. It's like, that's the strategy you want to have, not the, oh, I think it's going to go up forever. Oh, man, it's down 80%. I'm just going to keep this money in this loser Stock and fingers crossed it goes back up. Because, Robert, fingers crossed is not an investment strategy.
- [36:02]
B
I love it. That was very long winded, but so important for people to understand. We always tell the joke of people in the casinos when they say I was up when they leave the tables. And I love that line because it has stuck with me for decades now because people just get greedy and they don't take profits along the way. It's always fine to take profits, reallocate, and just keep on rocking and rolling. So, Austin, thank you for that incredible break down.
- [36:28]
A
Now, Robert, before we jump to our last question, we just talk about investing and, and making sure you're doing it the right way and all this stuff. You guys got to go try generated assets. I'm going to go, I'm going to pull up my public account right now. Public.com portfolio is what I'm looking at here. I'm going to scroll down to my own portfolio. I'm running four different generated asset strategies. I've got S&P 100 index, I've got momentum breakout leaders. I've got high CRO, IC performers, and I've got Growth in Income Leaders. Growth and Income Leaders has actually performed pretty well. It's up about 6% in just a couple weeks here, outperforming the S and P. If you want access to the prompts we used to create these generated assets, join the Rich Habits network. There's like 13 different prompts in there. All the back tests, really interesting. These were three of them. But, guys, y' all need to check out generated assets on public. Use our prompts. Use a prompt that you come up with. I want to invest into companies who have senior executive teams that are from the Midwest. It'll figure it out for you if that's what you're into. I want to invest in companies who have their own podcast. It'll figure out what companies that are publicly traded have their own podcasts and it'll do it for you. Like Goldman Sachs has a podcast, right? Like BlackRock has their podcast, right? Like, who knows, right? But like, that's the type of, like, creativity that you can apply to generated assets. So if you're a creative person that's got their own strategy in your brain and you want to invest to it, but you don't know how. Generated assets on public is how you do it.
- [37:57]
B
We love public, but I'm going to tell you, they knock it out of the park. I think this generated assets tool is the coolest tool, especially for people that are learning on how to think bigger and invest using this generated assets tool. It's incredible. Please go to public.com, play around with it, get your account open and just really check out generated assets assets. You can't go wrong.
- [38:22]
A
I will say, Robert, this growth and income leader strategy, I just back tested it against the S P. I invested into it on December 9th. The S P was up 1.6% since December 9th. My strategy is up 6% since that period of time. So I'm not, I'm not saying I'm outperforming the market over here, but join the Rich Habits Network to get some of our favorite generated asset strategies. Last question comes from Leslie T. Leslie says hi. What are your thoughts thoughts on investing in foreign market ETFs like FLCH, which is the China ETF, EWW, which is a Mexico ETF, VX, US EW, JV and others. I've heard the returns are almost double what American ETFs like Voo and VTI are. Anything we should be cautious about if I'm considering adding them to my portfolio. Robert, what are your thoughts on foreign markets and international stock markets and, and stuff like that. And, and what do you got to say here to our friend LE I.
- [39:20]
B
Don'T think it's a bad idea as long as you're comparing it to the US Markets. People ask all the time, Robert, why don't you have more international exposure? And the reason isn't because I don't want to invest elsewhere. It's because until elsewhere can outperform The S&P 500 in the NASDAQ, I just don't do it. Now I own AIQ. I have a pretty big position that is an international fund in the AI sector. It has done very, very well for me. But I also own an ETF for the India stock market as well. And that one has done okay. Cpse, I believe, is the ticker. But for me, I'm only investing internationally in these other funds if I believe it's going to outperform the funds that Austin and I talk about all the time. And over the past three, four or five years that hasn't been the case.
- [40:10]
A
Yeah, I like that answer. Why not invest into these markets? Markets because historically speaking, they underperform the S and P 500. That's the answer. I had a friend explain the international markets to me a couple years ago in a very interesting way. I'm going to share it with you all now. They said, think about Chinese stock market, Mexico stock market, Japan stock market, or just the international Stock markets in general, VX US is how you track them. Think about them as a spare tire on your car. If you are driving down the interstate state and you blow a tire and you got the spare tire on, yeah, you're going to get there and it's going to, it's going to move you in the right direction. Especially if you think about what was working AKA the all the other normal tires but one of them blue. Right now you're in like a bare market, right? So you put the spare tire on and it's going to move you in the right direction, but you won't, you don't want to drive on a spare tire forever. They explained it way better than I just did. But let me show you with some real numbers here. So V in 2017 was up 21% total return. Return VX US in the same year was 27. So it outperformed by about 6%. Now what about the next year? 2018 the S P fell by about 4 and a half percent. VX US fell by 14 and a half percent. 2019, the S P 500 delivered 31 total returns. The VX US International 21%. 2020, the US stock market was 18 and a half a half VX US was 10. Right. So it's like it sporadically might outperform. Just like in 2025 it, it did 32% when Voo did 17. But what about in 2023 when Voo did 26% and international only did 15? What about in 2024 when V did 25% when international only did 4%. So it's like, it's very much timing the market in my opinion. And I don't know enough about international markets to jump in and jump out one year to the next to try and outperform the S and P. Yes, I've got exposure to the Alibabas, the JD.coms, the Baidu's, the Mercado Libres, some of these international names, specific companies. But I'm not betting on, you know, your specific stock markets at these different countries. It's just I, I don't know enough about it and I don't do things with money that I don't understand.
- [42:36]
B
I agree with that. And if you do the simple math math, if you look at FLCH for the last five years, the total return is negative 25 and a half percent. But if you compare that to Voo, because we're long term investors, we're not trying to time markets, compare it to VOO for the last five years 83% Return negative 25 83% which would you prefer? Of course you want Voo. So just always understand that investing is not about being cool and having the trendy fancy names and international and all this stuff. It's about how can I maximize the returns based on my goals and my risk tolerance for my life and my portfolio.
- [43:18]
A
Everybody, thank you so much for tuning in to this week's episode of the Rich Habits Podcast. Question and Answer brought to you by public.com we are so grateful to have so many of you come back every single week to listen to our show. Just humbled that 77,000 of you had the Rich Habits podcast as number one one in your podcast rotation in 2025. And fingers crossed we have even more of you as the as number one here in 2026. We're back. Full steam ahead, right? We just had our first Friday episode last week. We got another Friday episode coming out tomorrow. We've got incredible interviews. CEO of a firm is going to be on the show. We're going to ask him a little bit about what's going on with this Buy now, pay later. The phantom debt trump just talked about a 10% cap on credit card interest rates. We got some cool stuff hanging out. So be sure to continue to come back every single week. And if you have ask us, send us a DM on Instagram Habits Podcast or email us atrich habits podcastmail.com and we will try and answer it on the show. Or if you definitely want to get your questions answered, join the Rich Habits Network 7 day free trial Using the link in the show notes Just stop.
- [44:22]
B
Being a talker and be a doer. Use the seven day Free Trial. Get involved in the Rich Habits Network. Level up every part of your financial knowledge game whether it's business mindset or how to invest better and what to invest in in and join us on this journey. I promise you won't be disappointed.
- [44:41]
A
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