S4E6 – Chris Miles – Why most financial advisors are broke

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Key Timecodes

• (00:54) – Show intro and background history
• (07:27) – Deeper into his background history
• (14:38) – Understanding his investment strategies
• (19:17) – Deeper into his business model
• (26:43) – Understanding his real estate strategies
• (30:04) – A bit about his business numbers and revenue
• (34:16) – A key takeaway from the guest
• (38:55) – What is the worst advice he ever received
• (39:41) – What is the best advice he ever received
• (41:30) – Guest contacts

Transcription

[00:00:00.000] – Intro

Hey, this is Sean Tepper, the host of Payback Time, an approachable and transparent podcast in building businesses, increasing wealth, and achieving financial freedom. I’d like to bring on guests to hear authentic stories while giving you actionable takeaways you can use today. Let’s go. The title of this episode probably caught your attention.

[00:00:20.590] – Sean

My next guest was a financial advisor, and he learned that he can actually speed up his wealth-building process if he does two things: one, become an entrepreneur, and two, who invest in real estate. By doing so, he’s actually able to achieve financial independence by age 28. So in this episode, we talk about some of the pros and cons of the wealth management and financial advisory industry. We talk about what he does for work or what revenue streams he has, and we talk about some of the mistakes people make with investing. All right, please welcome Chris Miles. Chris, welcome to the show.

[00:00:55.870] – Chris

Hey, glad to be here, Sean. It’s really awesome to be here today.

[00:00:59.280] – Sean

Thanks for joining me. So why don’t you kick us off and tell us about your background?

[00:01:03.000] – Chris

Yeah. Just like every other financial person out there, nothing to do with finances, right? I would like to say that I was born that way. I remember in the ’80s watching Michael P. Keaton on Family Ties. I thought it was cool. He was an economics major. I didn’t know what that really was, but it was cool. But no, honestly, I was raised by good parents, taught me great values. You’ll work hard, your word is your bond, follow your dreams and your passions, that thing. But when it came to money, it was always about how we never had enough. Well, we can’t afford this. We think I have made a money, but it doesn’t grow trees, those things you hear growing up all the time. And so I thought I’d never wanted to be like that. So I went to college, and I was here inonly time your mom goes to college. But I went to college, and as I did that, I realized pretty quickly I didn’t want to take the typical path where I was stuck in a nine to five job or nine to nine job, depending on the job. So I ended up going more in the route of how do I become a business owner?

[00:02:02.270] – Chris

I was going to become a business consultant. And as a student, I thought, well, before I try to get an MBA, shouldn’t have real-life business experience rather than just a degree. So I basically dropped out of college with one class to go, dropped out. I said, all right, let’s just see what’s out there. And the first business that came up that intrigued me was becoming a financial advisor. I didn’t realize the course to be a financial advisor, they take anybody off the street as long as you don’t have a criminal record and you can pass a test with 70 % and you’re hired. And so I did that for several years, never went back to college. I stayed out because getting a sociology degree, I realized that’s great, but I can make more money as an entrepreneur. So I stayed at dropped out. And several years in, I remember my dad reached out to me, he says, Chris, when are you going to become my financial advisor? Now, I understand my dad a little bit. My dad was the guy that all he taught me about money was, besides there was never enough, he taught me just to save it, to save everything you can, be cheap, which is what I was doing great as a financial advisor because they lived great in scarcity and tried to be cheap and all that stuff.

[00:03:03.030] – Chris

So I was doing the same thing, and he was doing that as well. And he had done that his whole life. So for the first time ever, I got to see his finances because he was always very guarded about his money. I see that he paid off his house extra early. He’s totally debt free after 18 years. He’ve been stuffed his money in his 401(k), getting those awesome mutual funds that are high risk, mediocre returns, as you all know. And by the time we looked at everything, I said, Dad, here’s the deal. You’re 61 years old. If you try to retire today, you better hope you die in five years, because that’s when you’re going to run out of money. Okay, well, what do I do then? I said, I don’t know. Honestly, you did everything right. You did everything a financial advisor teaches. You paid off your debt. You did everything Dave Ramsey would teach. Paid off debt, stuffed your money in your 401(k), you should be free because 100 bucks a month will make you a millionaire in 40 years, as they always say, which is crap. So anyways, I see this and it drove me nuts that I didn’t have a good answer for him because I couldn’t just throw him in some other mutual fund or some annuity or something like that and hope that he’d be able to retire because what the market tanks?

[00:04:08.700] – Chris

Which by the way, this is end of 2005, just a few years later the recession hit. He would have been in a way worse situation had I actually tried to put him some of that stuff. So I didn’t know what to do. And of course, when the student is ready, the teacher appears. And at that time, I remember with a friend of mine who actually I hired to be a financial advisor, but he left to go do real estate investing with his dad. And as they’re doing real estate investing, I’m talking to him. He said, Man, it’s awesome. My dad’s doubled his income, his active income that he’s making at his professor at the university here. And I said, There’s no way. That’s too good to be true. There’s no way you can just four or five months later be doubling your income. That just sounds wild and crazy. He says, Man, we’re doing it. And he finally just stopped me and said, Chris, how many of your clients are truly financially free where they don’t worry about running out of money? I said, Well, none. They all worry about that. Okay, great. Good job.

[00:04:57.980] – Chris

How about this? How many of you as financial advisors are financially free, not of the commissions you’re earning, but actually doing these investments you’ve been recommending? And as I really was honest with myself, and you know where this is going, as I was honest with myself and I was starting to realize that there was guys working there since the late 1970s, and yet they couldn’t retire, I knew there was a problem. And so I said, none. Maybe this one guy is. And I found that guy was just all flash. He was driving the fancy cars and everything. But that’s because a boy who was earning in sales, not from the investments. And that got me on this journey to take the red matrix pill and start going down this path of learning about alternative investments. And at the same time, I was already starting to doubt what I was doing as a financial advisor because I actually became a stock coach. I started to teach people how to trade stocks and options. And when you start talking with a lot of other traders, you start to realize, Wait a minute. You know what? The things you teach as a financial advisor are so stupid.

[00:05:56.520] – Chris

You got to diversify. When you don’t really diversify at all in mutual funds, you’re really just in the same paper asset class, and really you just water it down to where you make nothing. And in fact, just an interesting note, just the S&P 500, people talk about even trading the ETF. The ETF has only done 7.73 % in the last 30 years as an average actual yield. So how do you do that? And so as a result, I started to see this whole other world that I would never be taught as a financial advisor. That’s when I started to take different paths. I started focusing on passive income. How do I actually generate passive income, whether it’s to real estate investing or whatnot? And the next thing I know, later that next year, I’m 28 years old, I’m able to retire. I have enough passive income coming in that I don’t even have to work. I don’t even have to coach people trading stocks either. I was literally just doing that as extra gravy on top. And that’s what got me to realize it’s not about how much money you accumulate in mutual funds because you’re only supposed to live on…

[00:06:56.840] – Chris

Now they’re saying the number should only be 2-3 % a year of mutual funds, which is crap. Think about it. You save up a million bucks to live on 20 or 30,000 a year, you’re like a millionaire living in poverty, right? And so when I started to break free from all that, that’s when my life completely changed. That’s when all of a sudden money became easier and predictable, freedom became easier and predictable versus what everything I’ve been teaching as a financial advisor and what everybody’s believing to be true right now.

[00:07:26.340] – Sean

I have to say this. This is one of the best intros I’ve had in a long time from a guest. Tell me a story. Give me the backstory. So anybody listening to this episode right now that wants to be on this show, go back, relisten, relisten to Kris. You just went through the story, the progression, peaks and valleys, what you learned. Brilliant. Perfect. Okay, so music to my ears with financial advisors. Now, I do like financial advisors because as we teach in our community, and you’ll agree with this, if you want to work with a financial advisor, that’s great, but their job is not building your wealth. It is protecting it. If you want to build your wealth, you have to be more focused. We’re all about individual stocks, Warren Buffett style. Get that percentage from seven or eight % is what you talked about. What we do in our communities, we talk about it’s not difficult to get between 15 and 50 %, but you got to be in between 10 and 15 strong value stocks and you can get there. That’s what speeds things up. You’re the mutual fund comment, love that, because you’re going to get maybe 6-8 % returns, but then the fees are two %.

[00:08:36.970] – Sean

We’re going to take that 6 % down to four %. And wow, there you go. Way to go.

[00:08:42.140] – Chris

Actually, I’m glad you brought that up because I just ran the numbers for Fidelity, not to point anybody out, but I’m going to point them out anyways, because they’re the most popular 401(k) company. They have 45 million clients that have 401(k)s and IRAs. Of that 45 million, only 750,000 have a million plus. And I bet itmakes you wonder, Okay, well, yeah, I know. It’s pretty shocking, isn’t it? That’s one and a half % success rate in my mind. That’s a success. Actually, even a million bucks is not success because like I said, let’s just say you’re living on three %, that’s 30,000 a year. This is why those people, trans-America did a study to go along with this, of those people have a million dollars or more, 35 % believe it’ll take a miracle to be able to retire because they run the numbers. The financial advisor says, Well, you pull off three % a year and they’re like, I live in California. Who can live on 30,000 a year? I need minimum three million dollars to be able to do that retirement of 90,000 a year, right? So that rate there has been an issue.

[00:09:42.800] – Chris

And so Fidelity, I looked at their numbers and I looked at their target date funds. And I compared it from 2013 to 2023, I wanted to see the S&P, the S. P. Did a real actual return of 10.1 % over that period because 2010s were freaking awesome for the market. Well, the same period of time, their target date retirement funds that almost everybody picks, especially millennials, their target date retirement funds did eight % flat. So the market did 10.1, they did eight. Like you just said, that’s right there, two % worse than the market. Remember, we said the 30-year return has been about 7.73 % as of the end of September of 2023. Well, 7.73 %, if you take away that same two %, you’re now left with 5, we’ll say, 75%. But guess what? Those same target date funds also have a 0.75 % fee on them. That doesn’t include some of the other miscellaneous fees. Just that alone brings you down to five % a year. So when people say, Well, I get the match. Well, that match long term, when you compound it, really only adds, if you’re lucky, one to three % a year, which means you’re making what you just said, six to eight % a year with the freaking match that you think is free money.

[00:10:55.950] – Chris

It’s brainless. Everybody should be doing it. You’re making 100 % returns on your match. It’s a bull. You can do so much better outside of trapping mutual funds, especially in your 401(k)s, than what you can do on your own, especially when you’re well educated.

[00:11:10.900] – Sean

Right. I’ve used this analogy before. Let’s say you want to compete in the Indy 500, but you show up with a 1995 Dodge Neon. You’re not going to get anywhere. It’s just too slow. And that’s unfortunately what advisors, they talk to these people in their 20s, their 30s, even their 40s, and they’re like, Well, let’s put you in this index fund or that ETF or this mutual fund and you’ll be in ship shape by age 65, it’s like, Nope, you are going way too slow. You have to put the pedal to the metal, get into some individual stocks. Warren Buffett did not make his first million going into index funds, ETFs, or mutual funds. It was individual businesses.

[00:11:51.380] – Chris

That’s right. If I can even throw a plug for you guys with Tykr, because as I was checking out your stuff, the one thing you have an advantage of that I didn’t have 20 years ago is like this AI, automation-type intelligence. Because I remember we had these little alarm bell-type Tykr things that we had, and it was always too late. I would always tell people, I was like, You know what? Don’t even pay for that piece of crap. Even though they would pay up to $50,000 to get stock coached by us. I’d be like, Honestly, those stupid little alarm bell things take too long. Just do it on your own, do basic fundamental analysis, and then do mostly technical analysis, and if you find the actual most productive things to look at, yeah, you’ll be able to find the right picks, and you’ll be right most of the time. At least you should be able to make money, even though you might lose more times. Of course, if you minimize your loss, stop loss, all that stuff, right? You can maximize your gains, let your profits run. Yeah, you can make more money, even if you had a 30 % success rate.

[00:12:51.750] – Chris

But that’s the thing I was trying to do all manually. And just to see what you guys have to be able to say, hey, this is no guarantee, but look, you get a score here to see how much you can get. And it’s so much easier to be able to make money in the market than it’s ever been.

[00:13:05.440] – Sean

It really is. You’ve got the tools at your disposal. I’m biased here, so a shameless plug to Tykr. I created it to help myself mainly. But yeah, thanks for the call out there. And we’ll definitely chat more about it after the podcast. What I’d like to do next is because my audience is pretty analytical and they like to dive into some of the details. You have an impressive journey here of achieving financial independence at 28. Probably one of the earliest, if not the earliest, person to achieve financial independence that has been on the show. Gosh, the inception of the show is July 2020, so way to go there. I’m going back and I want to put this on a timeline. Usually, when you’re in college, it’s between ages like let’s say, 17 or 18, up to age 21, 22, maybe 23. You dropped out just before graduating, which means you were probably about 21 or 22. Is that correct?

[00:14:01.340] – Chris

Yeah. I was probably actually about 23 or 24 by.

[00:14:05.580] – Sean

That point. Oh, really? Okay.

[00:14:06.980] – Chris

I was really close. Yeah, I took two years off to go to Japan, lived there for a little bit, but then I came back and tried to finish up. I was about 23 or so.

[00:14:15.050] – Sean

Yeah. So there was a major mindset shift at let’s say 23 or 24, and then all in on, it sounds like investing, you were in the stock market as well as real estate, and then four years, so we go, let’s just do nice round math here, age 24 to 28, in four years you achieve financial independence. That’s impressive. Could you give us a percentage between allocation, what percentage were in stocks, what percentage in real estate?

[00:14:46.010] – Chris

Yeah. By that point, zero % in stocks.

[00:14:49.210] – Sean

Okay.

[00:14:50.380] – Chris

So I transitioned away from that. Those four years actually was when I was a financial advisor. From the beginning of 2002 to the beginning of 2006 is when I was a financial advisor. Then I quit by March of that year because I couldn’t reconcile it. I was trying to make it work and see if I could live in both worlds. Eventually, I had to pick one because I realized my integrity was at risk here because I couldn’t teach something I don’t believe in. So I actually… I was still trading the market, but I wasn’t really creating any passive income from the market. It was more growth, if anything, because I really stuck to Cufford calls, so I didn’t really do well with that. I did better with Mary Puts and things like that. But the place where I actually made my passive income was really more in real estate and business. The business part was actually accidental. It wasn’t even intentional. But I was starting in the real estate game. I was starting to make money there, some from rentals, some from just lending money, which if you don’t ever want to be a landlord, that’s another great way to go, especially right now.

[00:15:47.490] – Chris

You can lend money for 10, 12, 15 % a year, get paid interest only payments, and then get your money back after X number of months or years, and now you set it up, right? So I was doing that stuff back then. But then the other thing that helped bridge the gap, because I was making probably a good thousand, two thousand bucks a month doing that just with my money working for me. But I didn’t have a ton of money at that time because I was a financial advisor. We suck at it. So instead, what I did have, though, is I basically quit being a financial advisor and I was still a mortgage broker. So basically, after I quit being a financial advisor, I just came on as a mortgage broker part-time, and then I was doing stock coaching part-time as well. And while I was doing that, I remember a friend of mine who had done a lot of real estate investing said, Well, do you like doing mortgages? I said, Well, I like teaching people about how to leverage your equity from your home and get you to pay great cash flow from that, so then you can essentially retire faster.

[00:16:44.460] – Chris

I think that’s pretty cool. I was actually in the process doing that myself to get more money to invest as well. And he said, Yeah, but do you like it? I said, Well, I hate the paperwork. Why don’t you find somebody who likes doing paperwork? Which in a scarcity world, because as a financial advisor, you’re always raised in scarcity about there’s never enough. You got to take all the business yourself. Don’t split with anybody. So when he said, Why don’t you find somebody who likes doing paperwork and let them do all the work for you? That was a new epiphany to me. And so I remember asking the owner of the company, the broker, just said, Who fits the subscription? He says, Well, that’s Clark. Because you can just tell by the name Clark. That’s going to be somebody who actually likes to do paperwork, right? So I go to Clark and say, Hey, Clark, if I just send people to you, they’re already ready to do a mortgage. You just have to do the paperwork and basically do all the work. Would you do it? He said, Yes, and I’ll split you 50-50? 50-50.

[00:17:30.130] – Chris

And that’s what I did. I spent half an hour every hour just educating them about, Hey, you can actually use the equity from your home to essentially pay off your mortgage payment for you and maybe make more than your mortgage payment. And so people were getting super excited about that. Actually, by the way, I was doing no marketing. I was only talking to family and friends. That’s it. A few of those friends would refer friends to me and stuff, but it was very low key. People asked me what I did. I told them I sold drugs because I just had no clue how to say, I’m a mortgage broker, I’m a stock coach, and I’m doing real estate investing. Saying, What do you call that guy? Yeah, he’s a drug dealer. So that’s what I pretty much did. But I’ll tell you, it was pretty awesome. I was making 1,000, 2,000 bucks a month just referring one or two people to the Clark very casually. And then I thought, well, I can do that with other businesses. And so there’s a wholesale jewelry in Salt Lake City. I’d send them business because people would save.

[00:18:19.190] – Chris

They’d pay a third of the cost for a wedding ring, right? So I’d send them there. I remember there’s other businesses I started connecting with just very casually. When people would keep asking me the same thing like, Can you know that this blank? I would connect them. Between those streams of income plus the real estate, I was making about 4,000 or 5,000 a month, and my expenses at that time were only 3,500 a month. Nice. That’s really how I did it faster. On the real estate side, it probably would have taken me an extra couple of years to get to that same point to do the same thing. But the thing that was amazing is the business side as well really helped amplify that, where I was literally working less than a four-hour work week before Tim Ferris wrote the book. It was pretty considering I worked enslaved so hard, sometimes 40, 50-plus hours a week as a financial advisor, to maybe make that same income. So that’s really the secret of how I did it. It was a combination of things together. And then, yeah, at the same time, I was still doing a little bit trading and stuff on the side.

[00:19:15.940] – Chris

So that was just gravy.

[00:19:17.360] – Sean

Sure. So essentially, part of the business I look at was affiliates, which is a common business today. A lot of people are tapping into platforms like Tykr, for example. You can join the affiliate program, promote the business, and then you get a cut of every sale. And that’s essentially what you were doing is getting those commissions. You’re getting a cut for bringing people to businesses. Good on you. It’s simple business model. I know affiliate marketing wasn’t anThe phrase wasn’t so popular back then in the 2000s.

[00:19:49.410] – Chris

It must have been a phrase I even knew of back in the 2000s.

[00:19:53.120] – Sean

Now it’s super common, everybody on Amazon affiliates and YouTubers you see, and their show notes are always promoting something. Not always, but in many cases, they’re getting some affiliate commission. But anyway, pretty straightforward business model. Drug dealer sums it up. I like that approach. The back then, it was confusing. Like, What is this? What do you do? I get it. I totally get it. Yeah. Awesome.

[00:20:16.180] – Chris

Let’s.

[00:20:17.410] – Sean

Dovetail into what is your business called and what does it do.

[00:20:22.180] – Chris

Yeah, my business is money ripples. Essentially the whole goal of it is how to get you to the point where you work optional. You work because you want to, not because you have to. And we do that with two main strategies that we do best, better than anybody else. Anything else, we always just refer out. But one thing we do really well is a strategy called infinite banking, which can actually be used even when you’re doing stuff in the stock trading world, too, using life insurance by using it to invest and get your money to pay you in two places at once, and then also looking for other ways to create passive investments. And so when I say passive, I really literally mean passive, right? I don’t mean like maybe you have some of these people on your show where they say, hey, you can do passive investing with real estate, but then setting up a brand new business doing flipping or wholesaling or something like that. And that’s an active business model, right? That’s something that you’re going to have to work and work and work to make money. Yes, you can make great money, but it’s not passive.

[00:21:18.450] – Chris

I look at this passive. I even have a guy who actually was an options coach. He actually was online showing people how to trade options. He came to me, he says, Okay, Chris, I like doing options and all, but can I just do something I don’t have to do anything for? Can I just get my money to do something else where I won’t have to manage it? I said, Yeah, you can do some other stuff so we can diversify what you’re doing in your stock investing world, right? And some options investing in his case. And so we did, and got them to do things like you could have real estate properties and whatnot, but there are so many ways to invest in real estate outside of that to create passive income. Like I mentioned lending is one way, but you can also invest in equity deals where you partner with other people pull your money together to go into buy an apartment building, or to go and buy self-storage units, which is not recession-resistant. Well, it’s more recession-resistant. It’s not recession-proof, but resistant more so. You got things like that. There’s oil and gas you can get into as well.

[00:22:14.900] – Chris

I don’t mean in the Chevron. I mean literally going into oil and gas where you get paid on the land, the rent of the land, and you get paid royalties from the drilling. So there’s ways you have real equity and real ownership and things. Not to mention you could, of course, have debt funds where you’re and you can loan your money out. Investors just pay you a flat contractual rate of return, and you get paid on that too. So that’s what we do for people. We get those two strategies to work together of infinite banking to get your money to pay you twice, while you’re, of course, passive investing as well. So you’re getting both of them working together, so it gets you out of the rat race faster. And then you choose what you want to do. You can keep working the job because you want to. I kept stock coaching because I didn’t know what to do with my time as a 28-year-old, so I kept doing it. Same thing with you. You could keep working part-time. But the cool thing is you don’t have to keep working. You work optional. You can take that year off if you want to or not.

[00:23:07.040] – Chris

You can just really get to have more time, freedom, which is the whole goal.

[00:23:11.960] – Sean

This is not a pause point, but I sometimes like to break the fourth wall and talk to the audience to bring them in the conversation. So just to take a step back, all the revenue streams that Chris has talked about have actually been talked about in the show before just to summarize the infinite banking philosophy. And of course, Chris, you can step in and correct me if I’m wrong here. But infinite banking is a life insurance product. Let’s say you were to put $50,000 into a life insurance product, that product could be earning 6-8 % a year. And then you can actually let that continue to earn 6-8 % a year and you can pull that $50,000 back out and then you can put that somewhere else. So in other words, it’s building at 6-8 %, slow and steady wins the race. We talked about earlier, it’s not going to accelerate your wealth, but it is moving in the right direction. And you could technically put that $50,000 into another investment, such as a stock market or real estate. So like you said, building wealth in two places at once. It’s pretty cool strategy. Is that correct?

[00:24:13.750] – Chris

Yeah, pretty much. I mean, one thing I’ll give you is a warning with infinite banking in general. It’s pretty cool. Even though you have guys like Susie, Orman, Dave Ramsey say it sucks, but so do they. And in some ways, they’re right because a lot of people that talk about infinite banking, because they’re insurance agents and not investors, that is the biggest danger you have, because they’ll often just say, Well, I only make money because of this. This is my career. They’ll do different things that won’t give you the best deal possible. In fact, when I came out of retirement the second time, because I got my butt kicked during the last recession. So I was back in the rat race, had to get back out by 2016 again. When I did it, I got pulled out of retirement again because I taught an investor, I got a podcast host how to do this infinite banking strategy. And when I came back out of retirement, I started to realize I could do better than the guy I referred them to, because you can actually reduce those costs as low as you can go and still keep it tax-free.

[00:25:05.830] – Chris

So it’s like a Roth. But without all the rules where a Roth says, We can’t do this. You can’t do that, right? We won’t let you do these trades, but we’ll let you do these trades. You’re like, Oh, you suck. You don’t have all those dumb rules like that. But it is cool because you can almost like margin trading, where you can trade on margin. You can get that loan against the money. You do still pay interest. It doesn’t pay to yourself. It pays the insurance company. But the thing is, if you’re earning more from them, they’re paying you on that money in there. And at the same time, you’re getting that money out investing in whatever investments you’re doing. The cool thing is you are making money in two places at the same time because you never pulled your money out. You’re just barring your money at a lower interest rate than what you’re getting paid on. And that’s where you make that money in two places at once. So it’s even better than using a savings account. If you’ve done it, do it right, you become a tax-free super-charge savings account.

[00:25:53.060] – Sean

Yeah. Let’s take a quick commercial break. Are you a beginner investor and want to increase your confidence with investing? Tykr EDU is now live, which includes investing courses. The first course is titled Stock Investing for Beginners, which includes over 60 videos that take you through modules including Overcoming Myths, the Difference Between Stocks, ETFs, index funds, and Mutual Funds, Investing versus trading; the number one reason why stocks go up and down, knowing when to buy, knowing when to sell, increasing confidence, how to invest your first thousand dollars, and real-life exams samples. It’s like looking over my shoulder to see how I buy and sell stocks. Simply go to edu. Tykr. Com or go to Tykr. Com and click the courses link at the top of the page. Okay, back to the show. Yeah, definitely… Going back to the audience here, definitely going back to the audience here. Definitely reach out to Chris if you want to learn more. Again, I’ve had other people on the show talking about that. And then with real estate, right away people think of like, oh, I’ve got to buy a home and then manage the home and fix toilets and change lights or whatever it is.

[00:27:01.200] – Sean

Most of the real estate investors we’ve had on the podcast have graduated from that level of investing to multifamily and making sure you have a property management company maintaining the property you pay them. Usually, the going rate is between eight and 15 % of the monthly rent per month. That way you get the peace of mind. And if a renter leaves, they will help fill the spots as fast as possible because you want that continuous cash flow. So that’s a strategy. And then have been talked about on this podcast, which you’re probably familiar with, where you’ve got a 100-unit or 1,000-unit series of complexes and you invest in the fund and then you get paid usually around 10 % per year of what you put in. But that’s a great, I think, of like if you achieve financial independence or you’re retiring, there you go. There’s a tax sheltering strategy. And if you put in let’s say a few hundred thousand dollars, you’re getting guaranteed kickback every year.

[00:28:02.080] – Chris

Now, I’ll tell you my favorite one right now. Again, it always changes, right? That’s why I diversify in this space a little bit. But the one that’s been doing the best for me right now is actually a business partnership where I essentially partner guys to go and buy and sell raw land. Because raw land is one that’s not often mentioned because most people think you can’t really cash for raw land. But if you can buy it at a wholesale price, sell it to somebody like you’re the bank on terms at retail price, then you can actually get paid monthly on that. And so I partner with these guys. They pay me 70 %, I get 30 %. It does take about 250, 300 grand to get started and get that money invested and working. But right now, that money is kicking off about almost $7,700 a month for me. That’s crazy. That’s a cool thing. It’s like when you start to realize what’s out there and available, and I know you teach about this all the time too, you start to look at stuff like the traditional financial advising, which they tell you they’re trying to grow your money and they’ll try to throw you in all these indexes and stuff, which means they don’t do squad, but they get paid whether you make money or not.

[00:29:05.010] – Chris

That crap, you start to realize it’s just a joke. There’s just no reason to even… No offense to any guests you’ve had, but I really don’t see a whole lot of reason to keep a financial advisor unless you just cannot let go. But still Dave Ramsey says so. I was like, Yeah, but Dave Ramsey made all this money in his business and real estate, not in his mutual funds. He did that later. Correct. You can go do mutual fund stuff. But Dave is an investor. Just like you’re being taught in this show, you’re taught to be an investor. That’s what he is first and foremost. Do what the successful have done, not what they preach to you down the road because they think you’re too dumb to handle it. That’s just not true. I think people are way smarter than most experts out there to give people credit for.

[00:29:48.200] – Sean

Absolutely. The land investment, was that Mark Padolsky?

[00:29:53.310] – Chris

It actually was, yeah. He’s one of my partners there.

[00:29:56.330] – Sean

Nice. I’ve had Mark.

[00:29:57.590] – Chris

On the show as well. I want people to know because there’s a two-year waitlist on this. But yes, he’s awesome.

[00:30:02.330] – Sean

That’s funny. He’s been on the show as well. So we’re hitting all the revenue streams you’re involved in are all legitimate. And my guests have talked about those in the past. So that’s great. Now, when people come to you, you’re structured as a financial coaching business, correct? So people, do they pay you? I like to dive in. You can give me ranges here because I like to find out. I usually ask people if you have a service business or product, what are you charging? Are you charging a project fee, maybe a monthly fee? Go from the low end to the high end.

[00:30:35.310] – Chris

Yeah, absolutely. Now, the infinite banking side, which is separate, we don’t charge anything for that because we get paid from the insurance companies, right? Correct. Even though we cut down the commissions as low as possible. On the consulting side, like the coaching side you’re talking about there, we charge anywhere from like $7,500 to $15,000, depending on the situation. Generally speaking, we want people to have at least $150,000 that they could be investing. The reason is this, is because usually on the low end, people can make at least 10 % a year on the investments that we have available. Again, we’re not investment advisors. We don’t break that legal line there, but we are strategists and help you figure out where to find the money and how you can use it best and what investments are available because we have this 20-plus different investment operators like Mark, for example, is one of them that you can go to. And we help guide you along to say, all right, if you want growth, here’s investments that might fit best there. If you want cashflow, here’s investments that fit best there. But we help you with that part, but you ultimately pick which investments you want to do.

[00:31:33.840] – Chris

The reason we only charge 7,515 grand is because we want people to make at least double in the first year. For example, they got $250,000. We think they can easily make 25 grand. It won’t be from month one, because usually people take the first three months researching and try to learn about it. Of course. Once they’re ready to start getting money in, that’s when the money starts trickling in, whether it’s the next month, next quarter, six months down the line, just depends on which investments you pick. But then they start kicking it off cash on a pretty regular basis.

[00:32:02.370] – Sean

Yeah. Now to the audience here, if you’re using Tykr to invest, that’s great. You’ll accelerate your doing it yourself. When you get to tax sheltering strategies, that’s where real estate is a good play. And again, I’m not a big fan of owning one or two properties and you’re fixing things and then you’re handcuffed to the machine like you would in corporate America and you have to service. You want that passive income. So that’s why I gravitate towards more multifamily or larger syndicate. But it sounds like you have other options. I think the land play as well. Mark Padolsky’s episode was outstanding. I actually quick snippet on him is I’ve been following him for years. He’s got a daily newsletter and I’m just learning about land investing every day. It’s pretty cool stuff. One thing they don’t make more of, more land.

[00:32:54.340] – Chris

That’s right. Exactly. It’s pretty cool. I always told him, I said, Man, if you ever create something where I don’t have to learn to do what you do, that would be amazing. Can I just invest with you? And forever, he was like, No, I can’t do that. Then I found out from one of my clients who talked to him said, Oh, yeah, I got a partnership with Mark right now. I’m like, What? He should have told me first. I was number 11 on the list or something like that. But still, it’s cool. It’s one option. It’s not the only one. It’s pretty good. I would tell people too, that’s more of a growth option, which can be good. Definitely not one to do IRAs. And that’s a plug for… And for you guys too, is that, especially when I was looking at people doing stock trading and things like that, having been in both worlds, if someone’s got a self-directed IRA or an old 401(k) that they’re looking to use, you don’t get any tax advantage with that. So when people try to put that in real estate, again, I’m not giving investment advice, right?

[00:33:47.320] – Chris

But if you try to put that real estate, you lose tax advantages. If you try to use that money, unless you cash it out and take the hit, possibly the penalty and/or taxes. But if you’re doing trading, you don’t often really get any tax benefits anyways. Awesome. You’ve got IRAs or Roth IRAs, things like that. Man, you can create some massive growth and you can do some pretty cool things in that space and get that money to really grow and build for you so you can start eventually really creating some good passive income down the road.

[00:34:15.370] – Sean

Right. I love it. All right, before we transition to the rapid fire round, what is one key takeaway you can give our audience if they want to put themselves on the path to financial independence?

[00:34:27.420] – Chris

Yeah, here’s the advice I generally give: get lean, get liquid, get out. The first thing I’m saying, because I’ve noticed this becoming a trend, people got complacent, especially after 2020. It’s like everything got simple and now it’s complex in people’s lives again. I think people are craving that simplicity, really getting your… I’m not saying live cheap, don’t live on rice and beans and all that junk that you hear people say. Don’t cut out the latte every day and things like that. Do what brings you joy. But definitely be wise with your money, because the more you have to use and invest, the more freedom you can create. So again, don’t delay your life for some day and never take that vacation. I’m not saying that. Have proper balance, but still be wise to your money. So that’s get lean. Get liquid means get your money out of prison. I think one of the worst things that people do is they lock their money in their company’s 401(k) prison. You cannot get to it unless you get fired or laid off or you quit your job. I don’t recommend those as strategies to help get your money.

[00:35:26.580] – Chris

We mentioned earlier, the match is not worth it. So get your money liquid, get it in your possession, your control, so then you can choose how to invest it outside of that traditional norm. Same thing with equity in your home and your mortgage, right? Some people are like, Oh, pay off that house. Well, then you pay off your house. What do I get? I get people that are like Dave Ramsey, poster children that say, hey, I’ve stuffed my 401(k)s and IRAs. I paid off my house, but now I have no income. So I’m asset-rich, cash-flow-poor. You need to get that money liquid. So then you could do that last part, which is get out. Get that money out and investing in places that do generate income for you that gets you to a place where you are work-optional faster.

[00:36:06.870] – Sean

Yeah. Love it. Great advice. All right, let’s transition to the Rapid Fire Round. This is the part of the episode where we get to find out who Chris really is. If you can, try to answer each question in about 15 seconds or less. You’re ready?

[00:36:20.360] – Chris

Got it.

[00:36:21.020] – Sean

All right. What is your favorite podcast?

[00:36:23.200] – Chris

Oh, man. I don’t want to say mine because mine is cool. But no, I’d say my favorite podcast probably is Ed Mylet’s show.

[00:36:30.600] – Sean

Okay, sure. Yeah. All right. What is the recent book you read and would recommend?

[00:36:35.090] – Chris

Most recent that I read again is called The Punchin’ Plan by Mike McAulay. It’s a guy that they did Prophet First, the author of that book. Yeah. How about that book? Pumpkin Plan is amazing, especially if you’re really trying to simplify and hone down.

[00:36:47.450] – Sean

I love Profit First. Actually, recently had a guest on Tara, is her name, and she is a Profit First affiliate and big on the essentially audience. If you haven’t listened to that episode, it’s all about paying yourself first. So many business owners, especially small business owners, are paying everybody else first, which can kill, you can crush yourself doing that. You want to pay yourself first. So yeah, Mike, Steph is great.

[00:37:11.700] – Chris

And if you love audiobooks, he’s so entertaining. It’s awesome to listen to his books.

[00:37:17.470] – Sean

Nice. Yeah, he’s a real character. All right, so we talked about before we got to the record button, you’re into movies and you prefer movies going back to the ’80s, ’90s, and 2000s. So I got to ask you this, what’s your favorite movie?

[00:37:31.890] – Chris

Oh, no. It depends on my mood. I would probably say if there’s one that… I don’t know why this one is popping my head. This is 2010 technically. If I’m looking for a good comedy, maybe romance or a romcom or something like that, pretty much anything with Ryan Reynolds is good. But the one that popped in my head, I don’t know why it was the proposal with him and Sandra Bullock. Really? If I just want a good laugh, and maybe it’s just because I’m a Ryan Reynolds fan, like almost anything by Ryan Reynolds I love. So that could be why. But if I were to go more retro back, the one movie I probably have myself watch over and over, I’m a huge Star Wars buff. But even that, I would probably say the thing that keeps popping in my head is Gooney’s. I love Gooney’s. That was filmed right where I grew up in Oregon. So it’s nostalgic for me to watch that movie.

[00:38:22.020] – Sean

One of my favorites as a kid, I actually was able to visit the Gooney house in Astoria. Not go in it, of course, but you can walk by. My wife and I took a trip from Seattle down to San Francisco. And I’m like, she knew it right away. We’re stopping at the famous, what is it? Sugarloaf Rock? Is that it?

[00:38:41.310] – Chris

Oh, the Haystack Rock.

[00:38:42.560] – Sean

Haystack Rock. That’s it.

[00:38:43.580] – Chris

Yeah, where you end up the thing.

[00:38:45.140] – Sean

Yeah. Yeah, yeah. And then, of course, I had to walk up to the house. Great experience. We’ll stop there because we could talk all day about the goonies. All right, few more questions here. What is the worst advice you ever received?

[00:38:59.460] – Chris

This is advice that just came to memory of the other day. It was actually when I was a financial adviser. And of course, the guy was Chinese, that was just like workhorse. And he just said, Listen, you can’t work too hard because eventually you’ll pass out and get put in the hospital. So just work your tail off. It’s almost like Garyaynerchuk type stuff. Advice is like hustle and grind. I think it’s some of the worst advice I’ve ever received, because it’s okay to have some of that for a season, especially when you’re starting things off, but that is not a lifestyle. That is a sure way to just have a crappy life.

[00:39:38.010] – Sean

Yes, thank you. 100 % agree. All right, flip that equation. What is the best advice you ever received?

[00:39:45.770] – Chris

The best I ever received is actually when I was starting to learn again this world of alternative investing, and they broke the formula for making money for me. I realized asking the question, How do I make more money is a dumb question. Instead, ask, How do I create more value for more people? How do I create value for people? How do I create that win-win? How do I show up to serve people, solve problems, or add value in such a way that money is a natural exchange for that value? When I realized that money was about value and not just getting money, then all of a sudden, money making money became easy because it was always about how do I help people get what they want? And then as a result, money is just an easy byproduct of that.

[00:40:22.100] – Sean

Yeah, I love it. All right, one more question here is the time machine question. If you could go back in time to give your younger self advice, what age would you visit and what would you say?

[00:40:31.000] – Chris

I would probably go back to the age probably about age 15 because not many people know this, but I was a very shy, reserve kid, the kid that sweats when he has to talk to more than one person at a time. So I was really shy. And if my 15-year-old self would see my 46-year-old self right now, he’d be like, Who is that guy? Seriously. But I know at 15 years old, I was reading the autobiography of Malcolm X. I was starting to think maybe I have a voice in me that could come out. I would just say to him, just be comfortable being you. Just be you. And do the best you can to just be more of you. Be the better version of you as you can. If I would even done that in my 20s, and stop worrying about trying to be like somebody else and being an authentic and just being a hoser, basically, I would have had a much higher levels of success by this point had I done that.

[00:41:29.470] – Sean

Right on. Love it. All right. And where can the audience reach you?

[00:41:33.090] – Chris

Yeah, you can go to our website, moneyripples. Com. That’s R-I-P-P-L-E-S, not moneynipples. Com or that website. So moneyripples. Com or you can follow our podcast, Moneyripples Podcast.

[00:41:44.900] – Sean

Awesome. All right. Well, thank you so much for your time, Chris. Appreciate it.

[00:41:48.170] – Chris

It’s been such a pleasure, Sean.

[00:41:49.770] – Sean

Thanks. All right, we’ll see you. Hey, I’d like to say thank you for checking out this podcast. I know there’s a lot of other podcasts out there you could be listening to, so thanks for spending some time with me. And if you have a moment, please head over to Apple Podcast and leave a five star review. The more reviews we get, especially five star reviews, the higher this podcast will rank in Apple. So thanks for doing that. And remember, this show is for entertainment purposes only. If you heard any stocks mentioned on this podcast, please do not buy or sell those stocks based solely on what you hear. All right. Thanks for your time. We’ll see you.