[Music]

When I grew up, everyone said to me that

to generate wealth, get a job, get

money, then get a mortgage.

>> That's one of the worst pieces of advice

you can give somebody. Your future self

is going to be poorer because of it.

>> But that's what everyone's doing because

we're not taught this stuff. So, what do

you think the biggest money mistake the

average person makes is?

>> Being a saver.

>> So, just having your money sat in a bank

account.

>> Yeah. It's a guaranteed loss. You're

becoming poor every single day. But

there are plenty of ways to retire early

and be financially independent.

>> And that's including secret hack that

makes people fortunes. So, let's talk

about making more money. This is the

ultimate money-making master class

>> as we are joined by three financial

gurus

>> with very different opinions and methods

to build future wealth. So, I want to

talk about pensions, credit cards,

renting, bad money habits, debt, passive

income, spending money to look rich. But

first, what is it that rich people know

that the average person doesn't know?

>> Rich people are more disciplined and

they're doing the little things that

compound into huge results like

investing. But for example, the average

American spend more money on Netflix

than they do on their investments. And

if I invest $1,000 a month for 30 years

in something like the S&P 500, I will

have about $1.9 million.

>> Or there's no asset in all human history

that's ever generated as much wealth in

a short period of time than Bitcoin.

>> There's one problem. Bitcoin is high

risk. And if any of those risks happen,

I don't

>> Let me let me finish. Do you want to

have hope that you have the Bitcoin or

would you rather have more security?

>> You can reduce risk. It's our job to

educate them. So, if someone was $1,000,

what would you suggest they did?

>> I have a different take on this. If

you're trying to make more money, I

would. And

>> what about bad money habits? Because

when you look at the stats, money is the

number one source of stress for

Americans, topping work, family, and

health. There's a three-step framework,

cuz I want to get into that. Number one,

>> I see messages all the time in the

comments section that some of you didn't

realize you didn't subscribe. So, if you

could do me a favor and double check if

you're a subscriber to this channel,

that would be tremendously appreciated.

It's the simple, it's the free thing

that anybody that watches this show

frequently can do to help us here to

keep everything going in this show in

the trajectory it's on. So, please do

double check if you've subscribed and uh

thank you so much because in a strange

way you are you're part of our history

and you're on this journey with us and I

appreciate you for that. So, yeah, thank

you.

I think the the first place to start is

people want to know how they can make

more money because if you don't feel

like you have money, saving and

investing in these kinds of things

appear to be pointless. I also

understand that that's not necessarily

true. I think you can you can start

investing and saving with a very small

amounts of money. But for those people

that are asking that question, if

they're listening to this now and going,

"How does one make money?" Like, you

know, I've got this job. I'm working a 9

to5. it's paying me £30,000 a year or

£40,000 a year, whatever it might be, is

the right question to be asking. How do

I make more money? And if so, how do I

do that?

>> I always think it's it's a combination

of making more money and also saving

more money. But let's talk about the

making more money piece. I think that

everyone is unique in their own way,

right? You've probably spent more hours

doing some sort of hobby that I have no

idea about. You play paddle, for

example. I've never played paddle in my

life. So, let's say you were Steve

Steven from age 20 and you're a really

good paddle player. You can start to

monetize this type of skill, which you

have that I don't, but perhaps you know

more than me. I could take lessons from

you. Even if you're not, let's say, the

pro paddle player that you are, I might

still be willing to pay you 20 25 an

hour for a lesson, right? Just cuz

you're naturally better than I am. And

so, I would encourage people to to kind

of lean into what makes them unique and

where where they've spent a lot of their

time. I think everyone has something

that they're good at inherently.

Figuring out what skills you have

internally and how you can kind of

monetize those.

>> What you think?

>> I think one of the the hidden things to

do is you really are a function of who

you're surrounded by. Invest in your

network. And I don't mean that in a kind

of coldhearted, you know, I want to

network with these people, but just

surround yourself by people who are who

are also trying to push themselves to

push their income, push their

opportunity set, and it makes it so much

easier. If you're the only one doing it

and you're around a group of friends,

you're the odd one out and you're

castigated for it. Find other people who

want to do the same thing and you kind

of help each other in that journey. So

at an early stage, that's just one of

the key things is to find people who

also want the same journey as you. M

>> uh that really helps. Then it's still

about the best leverage of your skill

set and being honest with what your

skill set is. Just because you you're a

doctor doesn't mean you should be a

doctor just because you've graduated

because you can do other things. And

it's it's figuring that out. That's not

an easy bit, but you figure out over

time by trying stuff. You know, we've

all done multiple jobs and we know what

we're terrible at and what we've been

good at and you kind of overindex on the

things you you're better at and that

works. So if you're if you're early,

it's the time to make bets in yourself

>> and your network and that gives you the

foundational tools to then earn more

income and then invest more.

>> Was there a pointless seemingly

pointless job you did that ended up in

hindsight making you the most money? And

what I mean by that is I think about my

experience doing teley sales between the

age of 16 and 19 as probably the most

important thing I ever did. Like not

only do I spend a lot of time talking

now, but sales is a transferable skill

across raising investment persuading

employees to come and join you. And I

think there's nothing I did that was

more important than telly sales.

>> The single best skill you can acquire in

life is is to learn how to sell. To be

comfortable around people and to be able

to get a message across is the single

most powerful tool you can have in life.

Everything you do finding a partner in

life doing anything you do is basically

sales.

>> And it's all people.

>> It's all people. So if I'm this 24 year

old and I a 25-year-old and I'm

ambitious. I want something big.

>> Yeah.

>> You got to find more income. You got to

have more income to do it. If I'm a

25-year-old and I just want to be okay,

I don't mind my job. I just want to

invest, you know, whatever. You got to

find the right investments. You got to

have a system for your money. And then

you got to create a plan. Anytime you

get paid, you know how much money you're

going to save. You know how much money

you're going to invest. And then you

spend what's left. Because the

difference between the person that

becomes wealthy and everybody else is

wealthy people save and invest their

money first. Everybody else, especially

in America, I spend all my money. I

wonder where all my money went

>> and then if there's anything left, I'll

try to save and maybe invest and

hopefully I'll get rich.

>> For me, it's all around based around

what is your vision of your future self.

>> You know, how do you see yourself

living? Because that is what we do. It's

one of the sources of unhappiness is if

your current state is not moving on the

path of where your future self wants to

be, how you imagine yourself. So

practically and tactically, how do they

do that? How do they create this this

financial vision board? Is there do they

need to know certain numbers? Do they

should they get clear on if they want to

be on a private jet or easy jet? Like

>> oh man, I think I think you know if if

if you have to ask yourself, hm, do I

want to fly on Spirit Airlines or do I

want to fly on a private jet? I think

you already know that question.

>> But is it important to be explicitly

clear with yourself? Because actually,

if I think of most of my life, I I

wasn't entirely clear. And so you either

end up chasing

>> because more and more

>> because it's generally not a

materialistic outcome. It's generally an

emotional outcome.

>> Yeah.

>> And that's why it's hard to to pinpoint

exactly what it is. But you need to

position yourself in that future self

and say, "What does it feel like? Do I

feel secure? Do I feel this? Do I feel

that?" So it's it's an emotional thing

and not a material thing.

>> Is that is that central to a lot of

this? You talked about emotional

elements. is being okay with

what other people think of you.

>> Yeah, that's the other thing is social

pressure, right? So, you may have the

vision of yourself and you just say, "I

want the the three bed house, you know,

with a little strip of lawn and your

barbecue and that's great

>> and around you people like you should

try harder."

>> Yeah.

>> So, they're questioning your own sense

of happiness and society does that at

scale. And then even the whole media

complex is about kind of how unhappy and

how miserable you are and should be. It

doesn't make it an easy place.

>> We're talking about emotional and

psychological barriers here. How do we

get over people not just being scared of

what other people will think, but so

many people are scared of their own

money? When you look at the stats around

avoidance, 82% of Americans admit they

avoid thinking about their own finances.

And one in four Americans have avoided

medical care because they're afraid of

the the bill and thinking about how much

it might cost. For Gen Z's, 67% of Gen Z

and 58% of millennials say they avoid

checking their own bank account because

it's too stressful, which is compared to

only 30% of boomers. And on in terms of

mental health, money is the number one

source of stress for Americans topping

work, family, and health.

36% of people with debt experience

clinical anxiety and 23% depression. So

people avoid their own money. A lot of

people avoid it because the financial

world's full of jargon.

>> Y

>> you need to go to a professional for

advice. That's what people think.

>> It's intimidating. You don't feel like

you've got enough money. You're going to

let them down, yourself down, your

family down. So, there's this whole kind

of thing around it.

>> It's the confidence that you can learn

because a lot of people say, "No, no,

unless you're from an investment bank or

you're in a RAIA or something, you can't

do this."

>> Right? but just a little bit of

confidence to say, "Yeah, you can do

this."

>> A simple tip that I think people can do

is just kind of figure out how much they

spend on a monthly basis. Track your

expenses for 30 days, 60 days, or 90

days. And you're going to learn so much

more about just your personal habits of

what you do. Cuz sometimes I'll forget

that I door dash something for $30. Or

I'll forget that $15 or $20 Uber charge

and I'll just kind of file it away

because I'm swiping my credit card. I

don't really I'm not aware of it. It's

like if you're going to the gym and

you're not aware of your weight, how are

you going to where where's your starting

point? So you I like to give people a

starting point because then they can

kind of have that small step to kind of

start working towards their finances in

that sort of way.

>> 65% of Americans have no idea what they

spent in the last month according to the

US Bank. And 60% underestimate their

monthly spending by a significant

margin.

>> Right? And that's exactly what I found.

I track my expenses for a month in 2014.

I thought I was spending 1,500 bucks a

month. Guess what? I was spending $2,800

and I wasn't making that much and I was

like, how am I off by an order of

magnitude of I don't know 60 70%. And I

find that even like all my friends I

issue this challenge to mo most of them

don't make it to the 3 months. But I

think as long as you have an

approximation of what you're spending

that can help because that that means

then you're going to have a little bit

of a difference of what you make and

what you spend and then you can save

that money and I think that's one of the

bad money habits of Americans is they

don't save right. So,

>> it's a really good point which is a a

practical step to just heighten one's

awareness because you need to have sort

of informationational awareness of where

you're at to even understand what you

need to do to get to where you want to

go. So,

>> yeah, I think you need to start with the

mindset. You have to build the basics.

You got to get rid of the credit card

debt. You got to save a little bit of

money, but you got to have some

breathing room because investing is all

about taking the extra money that you

have,

>> throwing it somewhere to grow that

money. And this is where uh there's a

three-step framework that I'll talk

about because there's a lot of ways to

invest. At the very simplest is I could

be completely hands-off. I can work with

a financial adviser. I can give them my

money and they can do everything for me.

If you don't have a lot of money, you're

not going to get a very good adviser.

But there's a con and a cost to a

financial adviser, which is the amount

of money you have to pay because they're

going to charge a fee. So, if I invest

my money, $1,000 a month with a

financial adviser, I get a good

financial adviser who beats the market.

They get 11% a year, but I have to pay

1.5% a year. After 30 years, I'm going

to have $1.8 million after paying

$600,000 to my adviser. Stage number two

is I can be a completely passive

investor. It's a little bit more

involved than an adviser, but I can just

put my money into the stock market,

something like the S&P 500, which is a

group of the 500 largest companies in

the stock market. It's kind of like

investing your money into the United

States economy. This has historically

averaged 10% a year, which means if I

invest $1,000 a month for 30 years, I

will have about $1.9 million. a little

bit more work than completely hands-off

but still pretty passive. Then we have

the people that want to be more

involved. What we call is a active

investor. And an active investor is

somebody who now wants to invest their

money themselves. And I don't mean

trading. I mean actually investing their

money. And now I'm going to be doing the

research to find which investments I

want to own. Maybe it's real estate that

I want to own. Maybe I want to invest in

individual companies. So it's more risk

for more potential return. A small edge

can give you outsized return.

Because if now I don't get a 10% return,

I can get a 13% return, which you know,

we're not talking about 200 or 50%

returns. A 13% annual return means that

my $1,000 a month over 30 years is now

going to grow to $3.5 million. So about

$1.6 $6 million more than before just

with this slight edge. And you got to

figure out how involved you want to be

>> on this point of being an active

investor and picking stocks yourself

versus being a passive one. The data

shows that passive investors who invest

in the S&P 500, like you said,

consistently outperform most stock

pickers over a 20-year period, more than

90% of actively managed investors, so

talking about funds there, underperform

the S&P 500 after fees. So, should

people be actively investing or should

they just put the money in an S&P 500

and be patient?

>> I say most people should not be active

investors. In fact, I say 98% of America

should not be active investors. Just be

a passive investor because if you don't

want to put in the work, if you're not

willing to put in the time and the

effort to research, you're probably

going to lose. And many people do.

>> So, why do people want to be active

investors if the if the probability is

stacked against them? Well, if you get a

little bit better returns, if you're

willing to put in the work, you can get

better returns and it is possible. We do

see people that are doing it consist.

>> Is there an element of fun in

entertainment?

>> Absolutely.

>> People like sports betting and

>> that's the problem because the fun is I

like researching versus, oh, I want to

see my money go up tomorrow. If I buy a

house tomorrow morning, am I going to go

on to Zillow in the afternoon, check,

what is my house price? I'm going to

check in the evening, what's my house

price? No. because you know that this is

something I want to own for the long

term. Well, when I go into the stock

market because it's so liquid, I buy a

stock in the morning, I'm checking it 15

minutes later, I'm checking at lunch,

I'm checking in the bathroom, I'm

checking in the evening, I know I'm

getting anxiety cuz if it's going up or

down, I'm I'm a very emotional and

that's that emotional

control as an investor, which is just as

important as the research that you're

putting in. I see I fundamentally differ

on all of this stuff is people are so

screwed. They are coming out of

university with massive debts. We looked

at the stat earlier um off camera when

we were talking about the fact that

percentage of 30-year-olds who have a

mortgage and a and and are married has

gone from 52% in 1950 to 12%.

Nobody can afford anything. So if you

look at the average millennial in the US

and a Gen Z, they generally have a 401k

if they've got a job, right? They have

some sort of savings, but they're taking

massive amounts of risk. A lot of us

would look at them and say, "This is

ridiculous."

>> Why are they taking risk for anyone that

doesn't?

>> Because there is no way of closing the

gap between buying, getting the deposit

on the house, getting into a house,

realizing that future vision of

themselves, however reasonable that is.

Why

>> it's so far away? because the ass the

cost of assets has gone up so much

versus the incomes don't go up.

>> You mean the cost of buying like a house

for example?

>> Yes. Or even however much percentage

share of the stock market the average

salary does, you know, stuff like that.

That you're you're getting less for your

money. So your future self is

automatically going to be poorer because

of it because you could buy less of a

house, etc. Explain that to me like I'm

an idiot, like I'm like I'm 10 years old

and maybe in the context of this mug

here

in terms of the how why is that worth

less now based on what you said?

>> The way of explaining it is money is the

medium of exchange, the thing that you

buy something with. If we all have a lot

of money, we've all got a stack of cash

on this table and you want to sell that

mug. We can pay anything for that mug

because we've got a stack of cash.

>> Mhm.

>> So that mug suddenly is worth not the

$10 it's supposed to be worth. It's

suddenly we're paying $150 for the mug.

Why? Because that money has no value to

us because we've got excess money. So

when you create excess money in the

system, it's this debasement of

currency. It's an optical illusion that

the value of assets are actually going

up. They're not. It's the value of your

money is going down. And this is this

pain point because your earnings

only grow with economic growth generally

plus your progression of your career or

whatever it may be. But those things,

the scarce assets are going up optically

by the amounts they're lowering the

thing. So what you find is salaries go

up at about 2 or 3% a year.

And the house of the cost of the S&P is

about 12% 13% up every year and a house

price is about the same. Gold is about

the same.

>> And that's because they're printing more

and more money.

>> Correct.

>> Okay, that makes perfect sense to me. So

I'm imagining you all have a big stack

of paper in front of you which you're

using it to take some notes on. And if

if I was saying I'm going to sell you

guys this mug for some of the paper you

have there, but then my team said you

guys can have unlimited paper. this mug

loses value because you can all just

offer a gazillion sheets of paper for

this mug.

>> Well, it doesn't lose value. It

optically will give you a gazillion for

it as opposed to, you know, three sheets

of paper because we've got so much

paper. It matters not.

>> So, I'll be I'll be thinking, "Wow, like

this mug is worth a gazillion sheets of

paper, but actually the each sheet of

paper is now worth nothing."

>> Correct.

>> Okay, got you.

>> And this is the problem that people are

finding is they put money in a 401k, you

compound it at 10%. for my generation.

Yeah, that was that was how the world

worked and it was great and it worked

and now it doesn't work. So, they need

assets that go up 50% a year, 100% a

year, which is ridiculous, but luckily

we've been gifted a few. Um, and so

that's helped.

>> Go on and say it.

>> Well, it's crypto. Simplistically, it

just outperforms all other assets even

with the excess volatility. So, Bitcoin,

for example, produces about since 2012,

it's produced about 145% a year returns.

So that's 10x the stock market

and that's including three 70% draw

downs in the middle of it.

>> A draw down being a drop.

>> Yeah. Well, you feel like you're an

idiot. You're losing money. It's all

going to go, you know, you've made the

biggest mistake in your life and it

recovers and it keeps going because it's

a it's a technological network adoption

model that's happening. So, it's just

sucking in more and more people. So

there's now 650 million crypto brokerage

accounts in the world, which is more

than all the stock market brokerage

accounts added together in the world.

And we're seeing it all around the world

because everybody can buy a share of

something. So as opposed to be able to

buy, nobody can buy a Fifth Avenue

apartment here. Everybody can buy a

fractionalized share of Bitcoin, which

is in theory $100,000 asset. But we can

all put in 10 bucks, five bucks, a

thousand bucks, 10 billion.

>> Let me challenge it then. So, Bitcoin

isn't based on anything, though. Okay,

I'm being I'm being a futter here.

That's my job.

>> Bitcoin isn't based on anything. It is a

database in the sky that isn't backed by

gold or it doesn't produce any sort of

valuable asset as its byproduct. So, why

how can we have faith in Bitcoin? It's

essentially in its essence before

someone clips me, this is I'm playing

devil's advocate cuz I know they're

going to clip this part out. It is

essentially many would say a Ponzi

scheme.

>> Mhm.

>> Which is it only goes up if other people

take part in it and if everybody decides

that it's um not worth anything then

it's going to go to zero.

>> So all money is social consensus.

Everything. Gold has no real value.

>> I can build a table with gold though. I

could rest some things on it and it's a

good it doesn't rust.

>> If you're building a table of gold, then

the value is going to be much less if

everybody's building gold tables.

>> Trump has

>> we do

um and so really it's just social

consensus. What do we as humans ascribe

value to?

>> But the problem with the 145% like you

mentioned, Bitcoin has fallen by 70

plus% on multiple occasions.

>> If we let's go back to the S&P 500. A

lot of people invest in the SPY, the S&P

500, and still lose money. Why? Because

when the we go through any downturn,

people panic and they sell.

>> And and if we look at I mean Bitcoin's I

think Bitcoin's 2009 if when it started

if I'm not mistaken.

>> Um

>> if we look at the crashes from you know

recent history 2020 stocks fell by 30%,

Bitcoin fell by 50%. 2022 stocks fell by

20. The S&P fell by about 20%. Bitcoin

fell by 60%. So in those times, people

who are in the S&P are freaking out

selling.

>> Yeah. But here's the thing. This is the

riskreward that people don't understand.

If you've got a time horizon, let's say

the average draw down in the S&P during

a a bare market is 25%.

>> A draw down being a a drop.

>> A lot. Yeah. A drop. A drop in prices.

you're getting compensated 15% a year

returns for that at best. In Bitcoin,

the average draw down over the same

period will be about 70%. But you're

getting 150% return.

>> If you're on the winning side, though

I buy it and I can sell it for a higher

price,

>> hold it. Just hold it.

>> That's the key.

>> So all of these are in a nice trend

channel. They go up. So anybody can buy

something and hold it long enough it

will go up. Well, what about let's look

at housing. We could say the same thing

about housing. 2008, housing crashed.

Just hold it. I have too much debt. I'm

underwater. My bank's taking it from me.

People are buying Bitcoin with debt.

>> Yeah. I mean, that would not recommend

that. But housing's different because

you can endlessly create more housing.

>> And we have a demographic problem in

housing that makes it more complicated.

Demographic problem is A, everyone's

leaving the cities now.

B, the generational gap. Nobody can

afford the boomer houses. We don't have

enough cheap housing for young people.

People are relocating, moving around.

So, we got a very interesting mismatch

in real estate now that makes it more

complicated than it used to be.

>> Absolutely. And and I do want to say I

think the part that we fundamentally

differ is not that there's value in

crypto. I own crypto,

>> but the difference between you and I is

you are all in crypto. For me, it's a

speculative piece of my portfolio. So, I

invest in my own business. I have real

estate, stocks, my speculative assets,

and then a little bit of gold.

>> Imagine how difficult to replicate what

you've achieved in your amazing career

is for the average person listening to

this versus buying one thing in your

Coinbase account, your Robin Hood

account, and doing nothing. It's so

there's no cost. It's not like buying a

house. It's like servicing all the

stuff. There's no debt involved. There's

nothing

>> in theory, but theory isn't reality. How

many people end up losing money when

things go down? How many people panic

especially with Bitcoin? Because if we

look at especially the early adopters of

Bitcoin, who are those people? These are

the people that well a lot a lot of the

average person is I want to get rich. I

want to get rich quick. It's I want to

make money fast versus the average

person who's buying the S&P 500. This is

somebody who is I want to invest and

build wealth for the long term. It's a

very different mindset. The average

investor of this is 32 years old. And we

said, "No, you need to invest for the

long run. They're never going to have a

house. So they their whole vision of

their future selves is utterly

destroyed."

>> So it becomes a logical thing to

actually take more risk. It's logical

for them because they've got nothing to

lose.

>> So Bitcoin you're saying is 145% a year.

>> Yeah. And in recent years as the trend

rate of adoption grows, it's probably

down to about 100% a year. Let's call it

that for easy maths. But now let's think

about this just from a practical

long-term perspective. Warren Buffett is

arguably the best investor in the

history of time.

He has averaged about 19% a year over

the course of his decades making him a

multi multi multi-billionaire.

And so when we compare a 20% return from

one of the top investors in the world

versus hey Bitcoin is going to give you

100% a year there's there's some sense

of something wrong. So, even if I'm

wrong by 50%. You still outperform

Buffett. To put it in perspective,

Bitcoin since 20 2010 has done I think

it's about 90 million% returns. There's

no asset in all human history that's

ever generated as much wealth in the

shortest period of time. And because

it's not a random thing, it's actually a

technology. It's a network model of

technology. as more people use the

network and we see with Bitcoin,

governments buying it and asset

management firms buying and everybody

else you have this network adoption

model and so what it creates is the same

chart as Google or Amazon all of these

it just goes up in a log trend over time

with some volatility so you've got a

secular bull market which means that

over time prices go up for measurable

understandable reasons and it happens to

be the highest performing asset of all

time. There's one problem

>> and it's volatile. The psychological

thing you're dead right about. It's re

very hard when it falls 70%. I've gone

through three of those. They're hard.

>> The problem is

just like with real estate,

everyone has said real estate only goes

up. Well, how do you make money on the

real estate? You make money when you

sell or you lose money if you sell.

Ultimately, it comes down to that. You

make or lose money only if you sell.

Well, what about everything along the

way? And what if I need to sell during

that 70% crash? Because what happens

during those crashes? A lot of times

people lose jobs. A lot of times people

lose their income. A lot of times people

need that money during that time. And so

now I'm desperate or I'm panicking.

There's there's two things happening and

now maybe it's the end and I go in and

now I lose money thinking that I'm going

to make all this money.

>> I think I can appreciate your love for

cryptocurrency and your 100%

concentration in cryptocurrency.

>> You're saying it's suitable for

everybody, right? I've got my the you

know bottom of Maslo hierarch of needs

taken care of. I've got houses. I don't

have debt. You know, it's easy for me.

I've got multiple sources of income that

I can take that back. I'm not saying

that for everybody, but I can also

understand why a 25year-old can do that

too because they got nothing to lose.

>> But do you think that if a 25year-old

puts their entire salary and savings

into Bitcoin and they lose it, let's say

they run through a 70% draw down, aren't

they just putting themselves in a bigger

hole for their future as well? like

maybe before there was a a glimmer of a

chance that they could that they buy a

house and then now they can't.

>> The most important um part of financial

markets is the least understood is time.

>> Mhm.

>> It's not just price, it's time. So if

you're 25 years old and you get wiped

out,

>> we've all done it. We've all kind of

screwed up and you know had to move home

to our parents or do whatever. We've all

done it. You can do that several times

when you're young and it's okay. You

just don't want to do it.

>> At age 50. Sure,

>> you really really don't. You become more

risk averse generally speaking.

>> It just depends where you are and how

much time you've got to take that risk.

>> But now, if I'm investing my money in

Bitcoin or really anything, a lot of the

value is what some people refer to as

like equity. It's it's I bought it for

like I started buying Bitcoin when it

was $3,000.

That other stuff is equity. It's

invisible money, which in my view is is

theory. It's not actual money in my bank

account. It's sitting there waiting for

me to sell, hoping that when I go to

sell, it's going to be a profit versus

cash flow.

>> If I buy a dividend paying stock,

>> what's a dividend paying stock?

>> Some companies have big profits. For

example, McDonald's has billions of

dollars of profits. There's three things

that they can do with their cash. They

can save that money for an emergency.

They can take some of that money and

reinvest it and open more stores and

create better burgers. Or the third

thing that they can do, which some

companies do, not all, is they can just

give this money away to their investors,

the shareholders. It's called a

dividend. So, it's a cash payment for

doing nothing except owning that

investment. So, if I buy something,

whether it's ETF, stock, or whatever,

that's paying a dividend or a rental

property that's putting money in my bank

account every single month or year,

that's money I can use to buy food, go

on a vacation, do something. Here's

here's what Let me tell you.

>> You're getting paid 4%.

>> Listen, who cares? I started buying

Bitcoin at $3,000 a coin when it was at

I went through multiple crashes. I

remember when $20,000 of Bitcoin was the

oh my god, we did it.

And once it hit around 70,000, I looked

at this and I said, "Wow, I have my real

estate, my stocks, my speculative, which

is crypto and startups, and then 2%

gold, which is now looking extremely

inflated. I need to lower this. That way

I can have some more income." So what

did I do? I sold some Bitcoin about

rental properties. That now rental

property is putting money in my bank

account every single month.

The Bitcoin, it's a big number on paper,

but it doesn't actually mean anything

unless I do something with it.

>> Could you have staked it, which means

you can stake the cryptocurrency and

make a monthly yield from it,

>> get a loan against it?

>> Now, that's adding risk. Well, what

happened into if I take a 80% loan, 70%

loan? Let's let's uh 50% loan.

>> Yeah, it's it's very volatile. So

>> So let's take let's take a 50% loan

>> and Bitcoin falls by 70%. Which it has.

Now I'm underwater. Now what? Now the

bank comes knocking on the door. Margin

call. You're forced to sell and it's a

foreclosure.

>> My point being on my Bitcoin.

>> I mean, I don't disagree and really

speaking, people should have the ability

to have cash flow or cash for if things

go wrong, right? That's really a super

important thing to be able to have a

long-term view to be comfortable with

draw downs to be able to invest in

startups or to to invest in crypto or

technology and all of this stuff. Um,

that makes sense, but I just don't think

a dividend of 4% makes any difference to

anybody.

>> Well, it does if you do it consistently

month after month, year after year.

>> You need huge capital to start with to

be worthwhile.

>> No. If if you if you start investing for

dividend income, I call it a decade of

sacrifice. And this is why it's so hard.

>> Yeah. But if you're 33 years old now,

you're sacrificing till you're 43.

>> You're going to become 43 at some point.

And imagine if you're 43 and now you

have the income to pay for that car, to

pay for the house, you don't have to

worry about it. Well, do you want to

have hope that you have the Bitcoin or

would you rather have more security? I'm

again Bitcoin in my perspective high

risk high potential return and I'm not

saying don't buy it. I'm saying allocate

it in your portfolio in a way where you

understand you are arguably one of the

top crypto experts in the world.

>> I'm not I also am not the stock expert

in the world. I'm also not the real

estate expert in the world. What I doing

is I'm probably going to be wrong. If my

stocks crash, I have my real estate. If

real estate crashes, I got my stocks.

Crypto crashes, well, that's part of my

speculative portfolio. I really don't

care. And if everything crashes, I got

some gold. So, for me, I have to

diversify against myself because I know

stocks crash. I know crypto crashes. I

know real estate crashes.

>> But if you're not starting with a lot of

money, your your strategy is the

strategy of a rich person. Oh, I've got

houses and I've got dividends and I've

got some gold and I've got a bit of

this. That's the strategy of being

>> But I didn't start with all of those. I

didn't start with all those at all. I

started with one.

>> Where did you make most of your money?

Being an entrepreneur. What would you

taking obscene risk?

>> I did. That was me.

>> An entrepreneur is taking obscene risk.

>> But if I'm making $50,000 a year, the

first step, let's assume now I'm putting

$5,000 aside, $7,000 aside a year. I can

take high risk, high potential return or

I can be conservative or a hybrid

and not everybody should be taking all

the risk because there's Bitcoin has

risks and again I'm telling you somebody

who owns it the government could come in

and change policies on Bitcoin.

Quantum could change Bitcoin.

people could stop caring about Bitcoin.

And if any of those things happen and

all my money is in this very speculative

asset, I'm the one that's carrying all

the risk.

>> So, if you if someone was $1,000 in

disposable income to invest, what would

what would you suggest they did,

Humphrey?

>> My take on $1,000 is as has changed over

the years. I used to say you could

invest $1,000, but as as rule probably

mentioned, 10% on $1,000 is is not that

much, right? So, like, you know, if you

invest $1,000 bucks in the S&P 500, you

get 10%. Next year, you'll have $1,100.

That $100 is not going to change your

life dramatically. So, if I had $1,000,

I'm investing in myself. So, trying to

improve my skills to make more money at

some point.

>> How exactly would you do that?

>> When I was uh still coming up, I was

trying to take a lot of courses online.

So, I try to figure out different types

of skills that I could that I could use

in the marketplace. So, I took a AdWords

course back in the day for like 150

bucks that taught me how to do Google

Adwords and I would try to consult for

for businesses out there to try to make

more of an hourly income on the side.

>> And Google Adwords, for anyone that

doesn't know, is Google's advertising

platform.

>> Yeah. And now there's Tik Tok ads and

Facebook ads, but you know, anywhere

where I could be more of value to

another business, I knew that

economically speaking that I could

command more in the marketplace.

>> So, something with that like that would

be great. So, so right now clearly that

is AI because what what you saw there is

like a knowledge arbitrage with a new

technology where most people didn't

didn't understand AdWords and you could

be the young guy bridging the gap for

people's ignorance. So most businesses

now would be dramatically more efficient

and effective if they understood even

the basics of AI.

>> Yeah.

>> So a kid could take a a course in AI and

do you know what's crazy? If you read

the top 10 books on AI, you'd be in the

top 1% in the world in terms of

knowledge.

>> Yeah. I mean if you just read the

instruction manual of how chat GBT or

you know quad works you you could

probably be in the top you know 1% of

prompt engineers right and that could be

a that could be a value to a business or

service right so

>> that's probably where my career came

from was we were the kids 18 19 20 years

old that knew social media cuz we'd

messed around with it so we sold it to

companies right

>> and that started my first business and

then there was soon hundreds of us

>> and there's there's a lot of these apps

right now coming out from 18 19 20 year

olds have you seen that that one profile

of that guy who created Calai. Uh Calai

is this this app where you take a photo

of your food and then you know it sends

it to to AI and it tells you how many

calories are in it. Well, the guy's

making 50 million bucks a year or

whatever it is. And

>> yeah, I saw that this morning, funnily

enough, for $4 million a month he's

making from a

>> like Chad basically it's an AI rapper

obviously. I think he has some, you

know, secret sauce that he puts into it,

but a lot of a lot of kids these days

are using AI to try to leverage that and

and try to turn bit turn them into

businesses. I do want to say though, I

think with $1,000 and with with what

Jess Breit said, I think you can still

make a decent if you can make a decent

income, you can start to slowly save and

invest your way to some sort of

semblance of retirement. I think you can

still be able to retire and be

financially independent without having

to, let's say, bet your life savings on

on crypto. I know that I personally

bought Bitcoin at $100, but I've sold it

many time. You know, I bought and resold

it so many times because, you know, when

it's up 10x, you're like, "Oh, like, you

know, if if you had given me a 10x

return when I first bought it, I like,

yeah, I'm taking that any day of the

week, right?"

>> Mhm.

>> And so, I think that's why it's so hard.

It's like Bitcoin does produce 145%

return since 2012, but in 2012, no one

knew how to buy it. I bought it on some

random sketchy website. I got this like,

you know, this this string of characters

for my wallet and I I try to buy, you

know, I try to buy a coffee at a cafe in

Palo Alto and I didn't know that bitcoin

transactions took 30 minutes to go

through. So, I sent Bitcoin twice for a

$5 coffee. Now, keep in mind this is 0.1

bitcoins, right? This is 10k worth. It's

an expensive coffee.

>> I sent it twice and they didn't get it.

And guess what? I still had to pay for

the coffee with my debit card.

>> So, where did my go?

>> You spent what? 20k on

>> I spent 20k on coffee. Yeah, that could

be the title of this video. just

spent 20k on coffee. Yeah, I literally

was I I sent it to Koopa Cafe in Palto

if anyone wants to go there.

>> I think the average person

psychologically speaking,

>> it's really hard when it goes down 80%.

And if Jasp Breed says you need money

like at that moment, you're going to

sell it.

>> But your your point about I mean the

primarily important thing is income.

>> Yes. I mean, and that and we talked

about last time I was on the podcast,

he's like, "How do you just leverage the

same skills in different ways that you

can earn more money from it?" Like the

story I was told when I left university

was speaking to a friend of my dad's, he

was like, "Well, what are you going to

do?" And my father was in marketing and

I liked marketing and but it was like

late '8s Wall Street thing was going on.

And I'm like, well, I'm thinking about

either going uh to work for somebody

like Mars, do marketing, you know, great

company, or or going work in the city in

London. And the guy looked at me and

said, it's really simple, Ral. It's the

same job. You're a salesman in both.

One, you get free miles, and the other,

you get free money. And he realized, oh,

there's actually arbitrage in what you

can do with the same skill set.

>> Mhm. Well, I would say there is a point.

So, I agree. If it was me with $1,000,

I'm going to go out and invest in my

income, read some books, get whatever I

got to do, go start something because

that's enough. But if we look at time,

$1,000 compounded is decent. If I if you

go back 1971,

>> but how do I pay for my college loan and

my house deposit and I want to get

married and have kids?

>> You're telling me I can't do that for

another 20 years? If I took $1,000 in

1971, I invested that into the S&P 500

and I did nothing else. I keep doing

whatever I'm doing, my job, and I only

invest $1,000. I never invested another

penny again. Today, that would be worth

if I reinvested my dividends about

$330,000.

And I never invested another penny after

the first $1,000 investment. Why?

because the S&P 500 has grown by a

little bit over 10% a year from 1971 to

now. It's something. Now, imagine if I

invested $1,000 a year, $1,000 a month.

Now, I can't say that about Bitcoin

because Bitcoin didn't exist 50 years

ago. I can't say that about Bitcoin

because Bitcoin didn't exist 25 years

ago. And so,

>> how about Amazon?

>> What about Amazon?

>> That's that started trading in 2000 or

even better, Facebook 2012.

How do I

>> do we not invest in it because it wasn't

around? It hasn't been around as long as

gold.

>> I mean, it's been has been around less

than Bitcoin has shorter of time

>> creates a profit. It has a tangible

value that you can see and feel because

I can go on to Amazon and order myself a

brand new guacamole set. They'll be

there in 2 hours.

>> They didn't make a single profit until

what, 2018?

>> Well, but that was that wasn't because

they weren't producing a value. It's

because they were growing so

aggressively. So, you think if you had

$1,000, you should you should invest it

in the S&P 500.

>> Well, I'm not saying you should. I think

personal finance is personal. I think if

it was me, I'm if I have $1,000 extra

and I'm just trying to figure things

out, I'm going to go buy some books. I'm

going to buy a class. I'm going to do

something about how do I increase my

income? Going back to what you said,

>> but if I'm saying I just want to work my

job. I don't want to go out and do all

that. I would do half into the S&P 500.

Yeah.

>> And I would go half into uh individual

companies. So, more risk than the S&P

500. not as much risk as the Bitcoin.

And the reason why I would do this is

because this is something I enjoy. I

like that research side of things and I

understand this is something that I

could see returns with. Like you talked

about Amazon, like you talked about

Microsoft and whoever, there's

potential.

>> And what about you, Humphrey? If

$10,000, does your strategy change?

>> My strategy is a little probably more

conservative or traditional. It's

probably 90% index funds. Uh so tracking

the S&P 500 and then 10% speculative.

And my whole goal for that 25-year-old

would probably be to get to $100,000 as

quickly as possible because at that

point I think they have more options and

flexibility and they're able to kind of

use that capital to maybe take more risk

after

>> that's still 10 years with the S&P.

Well, eight years of the

>> S&P about 7.84 years. Yeah. But that

also assumes that they're only doing the

10,000 bucks a year. Maybe they they can

save and invest a little bit more.

That'd be nice. But I think for a lot of

people in America, if they can get a

guaranteed $100,000 in 7.84 in 84 years.

I I think a lot of people might opt for

that.

>> So, I agree, but I'd remove the S&P.

>> You do all crypto?

>> No, I just do NASDAQ.

>> Oh, yeah. You do NASDAQ.

>> So, NASDAQ compounds at 18% a year.

>> What is NASDAQ?

>> The NASDAQ is um the NASDAQ 100, which

is the top technology stocks in the

United States, right? We live in a world

that tomorrow will be more digital than

today, guaranteed.

Um and so therefore, these stocks tend

to generate the most performance. And

we've talked about many of these names

that is all in the NASDAQ. So a little

arbitrage is if you want to shorten your

7.8 years

>> to 5 and a half years, 6 years,

>> buy the NASDAQ 100. It's an ETF, zero

cost, easy. And then I would say and

then do 70% that 30% crypto and you

don't have to care about anything. True.

>> You're fine. Now, if you have a

different risk tolerance, you can tweak

those dials. Or if you are more

risk averse, then you up your cash dial

or or some other more stable flow,

whether it's gold, although gold is

still driven by the debasement of

currency. They're all the same thing.

They're all driven by the same macro

factors. But so, yeah, similar kind of

idea.

>> And the NASDAQ is great. If I just say

one thing, but just like with Bitcoin,

the difficult part with the 18% is you

got to be willing to go through the

downturns. And I want to make sure that

that's clear because I mean the big drop

2000 the NASDAQ fell by 78%.

From its peak during that time the S&P

500 fell by 40%. So it's a bigger drop.

Not to mention the NASDAQ didn't get to

its level until 2015.

15 years later of no money.

>> It is still compounded more returns than

the S&P.

>> Absolutely. If you held on,

>> you can't live your life of the drop.

>> 100%.

>> It's got to be in the riskadjusted

returns versus the gains.

>> But how many people can hold on for 15

years and say year one, h no big deal.

Year two, okay, year three, year five,

it's going to go up. Year 10, it's going

to go up. And by the way, year 10 was

also another crash because

>> all you have to do is dollar cost

average.

>> What's that? So dollar cost averaging is

if you're young and you're you've got a

bit of excess cash now. You know, you've

sold your income a little bit as opposed

to just chucking everything in or you do

you put your large sum in. You've saved

up your 10 grand, but now you've got

maybe $500 a month of of free capital

you want to put into your savings. So

when you have these drawdowns, you're

actually keep buying. And what happens

is it lowers your average cost over time

and you get to new all-time highs in

your portfolio much before the market

did. So for example, in the last crypto

down cycle in 22,

in 22 all I did was add as much as I

could to my crypto. So I was at new

all-time highs in my portfolio well

before the market was because I'd

lowered my average entry. That compounds

your profits over time incredibly. And

is there something psychological there

where if you commit to the habit of just

putting $500 in regardless of what

happens,

>> you remove emotion.

>> You remove a bit of emotion from it.

>> And the emotion is the thing that people

struggle with. If you're investing in

things that are more volatile,

um you firstly understand that you will

see larger draw downs when markets go

down. Usually they're all correlated.

They all go down at the same time, all

up at the same time.

>> So you're going to do that. But if you

tell yourself that's an advantage for me

because I can buy more, that's a secret

hack that makes people fortunes

compounding. This is Warren Buffett's

thing.

>> I% agree with that.

>> More companies in a bare market than in

a bull market because

>> I agree.

>> Yeah, I I 100% agree with that part. I

call it poop.

>> Uh panic leads to overselling leads to

opportunity leads to profit. So I am on

board with that.

But that requires a specific level of

financial sophistication.

>> No, even your Coinbase app can just you

can

>> dollar cost average.

>> But how many people can dollar cost

average down 70% for 15 years waiting to

see that?

>> It wasn't 70% in 15 years. It was it was

70% in one year and then rallied ever

since. Every single year after year

after year it went up.

>> Did you see that down? Well, no. After

the 2008 crash, the Nasdaq also again

crashed more than the S&P 500.

>> And then step back and look at the

returns of the NASDAQ first.

>> I agree. Over the long term, it's a

great investment, but volatility is hard

for the average person who doesn't have

the emotional IQ and the financial

sophistication to understand.

>> That's our job to educate them.

>> Yes,

>> our job is to help people in this

journey

>> and not get them to make decisions that

compromise their future. we have to help

them. I agree. And riskadjusted returns

and time horizon are two of the single

most important thing.

>> And so what I hear I mean through

history contrarians have made the most

money. Um and also I think what the

other thing that I've really pulled out

from what you both were just saying

there is you need to set up a system

that removes emotion and requires you to

not make decisions because it's in

making decisions that your amydala the

emotional center of your brain is going

to do make a bad one. And it's that I

think that that self-awareness emerges

from what you were both saying, which is

okay, my brain is going to panic. It's

going to poop or whatever you were

talking about there. And I need a system

which is panic proof. So you know that

the best performing brokerage accounts

in the United States are dead people.

>> That's true. It's a known fact because

they don't do anything. So they have

these accounts that haven't been closed

and they're inactive. They outperform

all the active people. You are 100% in

crypto in terms of your investment

portfolio.

>> Yeah.

>> So, you must be sat here thinking that

actually when I ask that $10,000

question, what what would should someone

do with $10,000? You must be thinking

that the right answer is to put it into

crypto.

>> The right answer for me is that to his

point,

>> but you you I actually would say but you

know this is it's an audience of people

and people misinterpret things. Yes. The

answer is we've been given the gift of

the greatest performing asset the world

has ever been given. That's not just

Bitcoin. That's the the crypto complex.

If you're very careful in investing in

like top projects, you can even have a

more a broader diversified portfolio of

that. Like you've had Ethereum, Bitcoin,

Salana, Sui, all of these things great

they will definitely outperform for a

period of time and that's based on

macroeconomic factors which is the

debasement of currency which we've

talked about. That means all of these

assets go up by a certain amount and

some outperform it. The only two assets

that outerform the debasement of

currencies is the NASDAQ

and crypto.

This has been a persistent trend that is

observable and measurable. So this is

not a speculative asset. What it is is a

met law adoption model. Bitcoin is the

adoption of let's say a money or

collateral layer like gold, digital gold

we'll call it. While the rest of crypto

is the new rails for the internet. So

it's a tech technological investment. It

is growing at twice the speed of the

internet in terms of adoption and has

been since the first 5 million IP

addresses for the internet and the first

5 million wallets. Twice the speed of

the internet makes it the fastest

adoption of any technology the world has

ever seen aside from AI now which is now

outpacing it.

>> If if we sit here in 20 years time

>> Yeah.

>> and you were wrong.

>> Yeah.

>> What happened do you think? Well,

firstly, in terms of investments, you

have to always once you have a high

conviction bet, your entire job is to

question yourself, not to keep

reaffirming yourself. Sure, you end up

reaffirming by questioning and then you

you figure it out. For it not to have

been true, what would have happened?

The AI would have had a new system of

money that it created. This there has to

be a competitor to this because we're

now in the game of nation.

nations are acquiring this. The Middle

East nations, nations in Asia, the US

wants to acquire it. So we've got and

we've got South American nations. So

it's now the game of nations,

geopolitics. This is a real thing.

But what changes in 20 years time? Well,

in 20 years time, we're in a very

different world. The economic engine is

driven by robots and infinite

intelligence.

We don't know how the economic machine

works. We don't even know what the value

of money is when we go into that world.

So I've talked about this before, the

economic singularity. Past 2030, the

economic model breaks down.

So the the economy generally grows by a

measure of population growth, how many

people are in the economy

um or coming into the economy or being

born. Productivity, how much output they

create, and then debt growth is is the

other lever. What's happened here is the

population of the entire western world

plus Japan plus China has been aging.

So the rate of change of population

growth is shrinking. They tried

immigration but that became politically

unacceptable. So that's stopped. So

you've got this slowing economy. GDP

growth has been slowing over time.

Productivity. Old people make less

things. So it makes less economic

output. So we've got this mess and then

we got this debt and we stopped that

whole engine in 2008 and we need to

service this debt. So okay, so that's

the system we're in and this is why

we're printing money to service this

debt cuz we're not generating enough

output in the economy.

But after 2030, this population part

changes. We've got infinite

artificial humans.

>> You're talking about AI agents and

robotics.

>> Yeah, infinite. So what does that do for

that that the multiplier of that

formula, you know, population growth

plus productivity growth plus debt

growth? It breaks because you can have

20% GDP growth because you've had an

huge rise in the number of AI agents

creating economic activity in robots.

>> And so what does that mean for for me as

a average person?

>> For me is like the economic system

starts changing. We get to this world of

abundance. We don't know what has value.

what we as humans do, we we we change

and retool to become more humans because

AI and robots can't be humans. So, we

have to figure all of this stuff out.

Investing, we were talking about this

earlier, is like, well, does the the AGI

is that going to be a better investor

than any of us? Yes.

>> Artificial general intelligence.

>> So, that's the next stage where it's

smarter than any human that's ever

existed and we're very close to that.

So, in which case, well, how do markets

work? And when businesses are agents

selling stuff to other agents, where do

we play a role? So all I'm saying is my

job my whole life has to been to look

into the future sort of 10 years out and

try and probabilistically understand

paths.

Here I get to like 2030 and it's like a

dark curtain. Just to flip that for a

second, how could AI actually positively

influence your hypothesis? I'm very

positive about AI. I think humanity will

come out this just fine. I think

economic growth that explodes is we can

work a way of accreing it to to humans

or society or whatever we want to do

with this. I'm not an AI doomer

>> specifically on Bitcoin's value and

price. How could AI make it even more

important in

>> Well, in the end, an AI is a it requires

two inputs. It requires it's it's

Maslov's hierarchy of needs is basically

two things comput and energy and it

needs to be paid. These agents can't you

can't build all this agents of billions

of agents running around doing things

without paying for them. And agents will

use agents. So they will one agent will

get another 10 agents to do all this

task. They're all going to have to be

paid. And the way of doing that is using

crypto rails,

>> stable coins,

>> whether it's stable coins, whatever it

is. But that whole crypto rail, you

know, all of this new infrastructure for

the internet, the the blockchain, that's

where it works.

>> Often the difference between a company

succeeding or failing isn't down to its

product or strategy. It's down to the

people on the inside. After all, the

definition of the word company is group

of people. And some of the best

companies in the world have been largely

built by a players. Because I'll let you

in on a little secret. When you hire an

A player, they go on to hire more A

players. And it perpetuates. The

challenge is finding those first few A

players. I found the majority of mine on

LinkedIn who are a sponsor of this show.

LinkedIn provides talent I could not

find anywhere else. Talent with the

necessary skills and culture fit that

I'm looking for. Whenever I've paid to

promote a role on LinkedIn, I've been

able to hire faster and of course

better. Their data supports this, too.

You'll actually get three times more

qualified applicants than if you posted

the same role for free. So, if you're

trying to build something truly great,

you can get started by posting a job for

free by visiting linkedin.com/doac.

That's linkedin.com/doac

and you can post your role for free

there. Terms and conditions, of course,

apply. Do any of you remember a

conversation I had on this podcast with

anthropologist Daniel Lieberman. It was

one of our most viewed conversations of

all time. And the most replayed moment

in that conversation was when I talked

about this product. These are what I

call barefoot shoes by Vivo Barefoot,

which have significantly reduced

support, which gives my feet the

opportunity that they desperately want

to need to strengthen. If you've learned

anything from this podcast, it might be

that we're living in a comfort crisis.

And that at all times in our lives,

we're making this trade of whether to

have more comfort now and therefore more

discomfort in the future or a little bit

less comfort now, but to be stronger and

healthier in the future. And for me,

that is the choice to wear barefoot

shoes. So, if you want to start

strengthening your feet and your body,

visit vivobarfoot.com/stephven

and you'll get 20% off when you use code

Stevenb20

at checkout. That also comes with a

100day money back guarantee. What have

you got to lose?

>> I wanted to ask you a question. The

reason I went and got my phone is

because um

>> I had someone contact me that I knew

from my childhood. Used to be one of my

best friends. Frankly, not spoke to them

in 10 years. sent me a text

message and

the text message they sent me is

and I wanted to get your opinion on this

because I I said I ended up saying to

him, listen, I'm not the guy to ask

about this. I think you've misunderstood

who I am.

>> Hi, mate. I hope you're well. I got

myself in a bit of trouble with some

debt about £40,000.

some more than a bit of trouble after

I'm after some advice and direction in

terms of maybe passive income slash an

avenue to try and work my way out of it.

Is there some material I should be

reading watching that you might know of?

And I asked him I said what kind of debt

is it? And he said personal loans and

credit cards, mate. Um and I said like

how I need to ascertain how urgent those

debts are and if it's causing any any

immediate issues. and he said, "Well,

they're not super urgent, but as a

result of the high monthly outgoings,

I'm a month behind my mortgage payment

this month. So, it like is, but it's not

because I don't want to keep being in

that position moving forward. It's

costing me circa $1,000, £800 a month in

repayments at the moment, and I can't

get a consolidation loan. It's a perfect

storm starting because I've just started

a new job, and my partner is on

maternity leave, and I have this debt

mountain. It's starting to affect my

family

>> if I can't pay the mortgage, you know?

So, I've got to change moving forward

and figure out

>> what to do. And you're the man to ask

for advice. I was like, "Fuck, I'm not."

And then he messaged me again within an

hour and said, "Hey, sorry, man. If

you're busy, just wanted to nudge this."

Then messaged again an hour later cuz I

was on a flight and said, "Hey, I really

need some help and direction, man. I'm

quickly running out of places to turn."

He's kind of in a hard spot because

£40,000 in debt with the interest

payments of let's say your interest rate

is 15 to 20% that starts to spiral out

of control a little bit. Like if he was

under £10,000 in in debt, it's a little

bit more manageable. But at 40,000, the

interest starts to compound quite

quickly.

>> So, you know, you said he had a

mortgage, he might even have to consider

moving, selling, selling the home to at

least get the interest payments under

control or like reduce that amount of

debt. It's kind of that one of those

situations where you just need to reduce

every single expense possible and start

really pouring all your money into the

highest interest rate debt that he owns.

So like, you know, you can rank your

interest rates of all your debts from

highest to lowest and start start at the

very top, right? If it has 22% interest

rate, you want to get rid of that first

because that's what's killing them. At

those levels of debt, it's really tough

because I think a lot of people consider

bankruptcy at that point just to kind of

clear that amount of debt. uh depending

on what his income is. I know I've

known, let's say, a waitress or a server

that had $50,000 in credit card debt and

just unable to get over it because the

interest payments were as much as her

salary. So, in those cases, unless you

can get a personal loan from, let's say,

a family member and, you know, kind of

clear that debt, you're in a really

tough spot. Reduce your expenses as much

as possible, put any extra money you

have towards that debt at the highest

interest rate possible, the first the

highest interest rate thing, and then

consider selling some assets if he has

assets. Bankruptcy.

>> Bankruptcy.

>> When should someone consider bankruptcy

and what's the trade-off?

>> The trade-off is seven years. Uh I

believe your credit is shot in America.

So, um but I I believe that uh actually

I think if you pull up a chart, someone

sent me a tweet the other day of like

bankruptcy lawyer searches in America on

Google and it's like been kind of like

going up and to the right, which is not

a great thing. Uh bankruptcy just you

know there's different types of bankrupt

bankruptcy that you can file for but I

do know that it usually clears some if

not all your debt and you basically have

to start over but as a result you lose a

lot of your privileges like for example

no credit score.

>> I read some stat I'm not you might know

if this is true but I read a stat that

it said something to the effect that

people avoid going into bankruptcy

because of the stigma associated with

it. But when they looked at the

financial performance over 10 years of

people that did go into bankruptcy,

those that did typically were better off

than those that tried to avoid it for

the next 10 years.

>> Um, so yeah,

>> I don't know. That could be anecdotal. I

don't know. That's tough because if you

have $50,000 in debt and you make

$50,000 a year, it's Yeah, it's

different.

>> Bankruptcy in some ways is a good thing

because it forces you to do crisis

control. It's like your expenditure,

what you're doing, what everything

becomes hyperfocused. Like you you led

in the beginning with about you know how

people should look at their expense

expenditure, right?

>> When you're $40,000 in debt, you've not

been doing that.

>> Correct.

>> And bankruptcy actually forces you to to

actually discipline that for a extended

period of time where it becomes a habit.

So Stephen, that's why they outperform

in the end because you've created the

habit that you talked about right in the

beginning of this discussion.

>> Yeah. So I I just found the stat here.

It said, "Yeah, this is one of the

uncomfortable truths in finance." And

the answer is often yes. Those who file

for bankruptcy end up in a better place

long term than those who try for

prolonged periods of time to avoid it.

And the research shows uh that people

who file for bankruptcy typically get

their debt wiped out and cleaned. And

they um removing unpayable debt. Um and

it's bankruptcy can bring immediate

mental relief removing the crushing

stress of unpayable debts. People who

avoid it often live in chronic financial

stress which spills into their health,

relationships and work. So in short,

those who fa face bankruptcy head-on

often recover faster and end up in a

long a stronger position than those who

keep limping along trying to avoid it.

And I think somebody who's listening who

may be in a similar or the same

situation ultimately wants to know how

do I get relief? Bankruptcy is one

option, but at the end of the day, there

has to be change. And that change is

difficult. And that's the part that I

think a lot of people have hard time

talking about or comprehending. There is

relief, but it comes with severe,

extreme, and quick sacrifice. What do I

mean? Number one, you got to cut back

your expenses as fast as possible. In

that situation, you have to sell as much

stuff as possible. I mean bankruptcy

obviously works but you also lose your

house. You also lose other things along

with it. There's a lot of emotional toll

with it. You have a family, you have a

kid. I mean it's also a big reason

people end up getting a divorce. So it

can also impact your life in many

different ways. So you have to make

extreme sacrifices and I mean get rid of

the Netflix subscription not because

it's just costing you $15 a month but

because the average American is spending

more than two hours a day watching

Netflix. And if you're in that type of

situation and you're spending two hours

sitting there watching whatever the heck

is on Netflix, how do you sleep at

night? You shouldn't be sleeping eight

hours a night. You better be getting up,

going try to get some more money. I

don't care if it's Uber. I don't care if

you're working at McDonald's.

Find some extra money and learn how you

can earn some more money. And I mean, it

sounds harsh, but the reality is if you

want extreme change, it's not going to

happen without extreme change.

>> So, could he sell his house? Do you

think that assuming he's making the 50k,

which I think is probably accurate,

having a vague understanding of his job

and where he lives, etc.,

>> sell his house and then move in, rent an

apartment, would that free up capital?

>> I mean, that would alleviate his current

problem immediately. Sure.

>> He says here after some advice,

direction in terms of maybe passive

income, this word passive income, I know

nuts.

>> Why does it drive you nuts? It is a

there's like a passive income

industrialization complex that is I mean

it is literally every millennial's dream

is I'm going to get passive income

>> and it doesn't exist. We talked about

property. Property is the least passive

income you can imagine. It is awful.

Every time I've tried to rent out

property there are so many costs.

Everything goes wrong. It's just

endless. You're paying fees. And people

think there there's a magic passive

income. Everything comes with effort.

There is no such thing as returns

without effort. That's well even robbery

comes with effort. You know there

there's no way of making money without

effort or risking something. And so when

you're 40 grand in debt, how on earth do

you think passive income is going to

rescue you? But he's seen that on Tik

Tok and uh on Instagram. Oh, we're we're

are millennials in our in our 30s and

we're now living in in the in in Lisbon

and we've got passive income from our

house. It's like it's It's

social social media dream that doesn't

really exist and that's never going to

save him from £40,000 debt.

>> Passive income can exist.

The perception of what it is is the

problem. I am struggling with money. I

have no money. I got bills to pay. I

need passive income. Well, that's not

how it works.

>> So, how it works?

>> The way it works is you you take an

extra money, right? I have I'm going to

work and I'm I'm I'm saving and

investing some money. I take the extra

money that I'm want to put my to my

investments and I can put it into an

asset, an investment that can pay me for

owning it without actually working,

without going to work to own it. Now,

let me ask you about your real estate

because I got to I got to keep coming

back to you, man. Did did you did you

manage your real estate yourself or did

you have a manager? I've

>> done both. I've had management agent and

a management myself.

>> Managing yourself is probably a a

absolute nightmare.

>> It's horrific.

>> And managing it with a manager is also

probably a nightmare just in a different

scene.

>> Yeah. And because your yield is

massively reduced as well.

>> It is reduced.

>> And then you take the trade-off between

whether you're going to do short-term

less or longerterm rentals. And there's

the volatility in the short-term less

that you don't know what your yield's

going to be. long-term different as

well. Then you've got the tenants and

how bad the tenants have been and the

damage that they've done. Y

>> by the end of it, you walk away and

think really it was just wasn't worth

the effort.

>> Well, I would disagree with part.

>> Yeah. I mean, obviously people can do

really well out of property.

>> The work in real estate investment