Ownership is THE Key to Wealth Building #425

nasty brown ones. But we're talking about what we do with our money when it comes to investing, primarily. But we're dedicating an entire episode to changing the way you think about how you spend your money, what we spend our money on, and we're gonna gonna essentially, we're gonna trying to introduce you to this paradigm shift that we hope changes the way that you view all of your expenses moving forward. Those roller skating days, man, those are

your salad days too. It's only been down hills, is them? So wait, when you say salad days, I always hear saladays, and like I always think like young and immature, not they're not like the golden days, right, Like is that how that's how you think your best years? Best years? I always hear saladays, and I think like you're green and your immature, like like you've got a lot of years of growth ahead of you. Okay, all right, that

makes sense makes I don't know. I think you can use it the way you're using it as well, kind of like the pinnacle like, oh, the good old days. Well, I'm pretty sure that was for you, right, just like taking your inline skates out there on the on the roll. So I didn't have I no, no, you cann I was like I didn't even splurge on the speed skates.

You know, you could like upgrade and get the instead of the brown crappy leather skates, you could upgrade and get the black ones, and those had I don't know, like wheels, extra fast ball bearings and so those jokers would haul Like for real, I didn't need that, man, I just throw those standard skates on my feet and I'll just like keeps getting until I had, you know, like twenty blisters on each foot, on each foot always. I had so many blisters from skating on a on

a Friday after school. Yeah, well before we get into talking about my ownership is such an important concept, and I agree, man, it is paradigm shifting. I just wanted to quickly mention my sister and brother in law they just bought a scooter to zip around town. They actually did. Yeah you're talking about they that they were considering it, and I feel like, scooter, you have to actually define it. Now.

There's so many different variations of scooters, like a not a bird scooter, No, not one of those, not one of those, but one of the the ones you actually sit on, Like they can get two people on their scooter. Uh, and it's like dumb and dumbers say exactly exactly. So it's gas powered and it's I think. And I just wanted to mention that this was something that they've gone

down to becoming a one car family. But they were like, you know what, we kind of feel the need for some other mode of transportation that isn't a bike, because I know they should. I mean, they've got bikecause I see him rinning around the neighborhood. Actually they lived nest to us, but they wanted something else. And I will say that a scooter like that is a perfect in between vehicle for a lot of people. And one of

the great things about these scooters one they're not very expensive. Yeah, they're not very expensive to maintain either, if you get the right one, by the way, because you can get some really crummy ones. You can cheap out buying a scooter, and oftentimes those don't last long at all. But yeah, they opted for something decent, and so I just wanted to mention that sometimes, you know, one of these nicer scooters,

it doesn't cost a whole lot of money. Uh, and it's really not that expensive to ruy to maintain, and it could be a better decision than having a second car or you know, even a third car in the case of some families. This might help you get some of those trips in without needing to hop in the car. I'm just gonna wait on the day that Evan pulls up in front of our house and just calls over. He's like, I get seventy miles per gallon on this hog. There are actually two guys who have you have you

seen this story going around internet. There's these two guys who did that trip, the dumb dumb, dum dumber trip you know, up through Colorado, or what ever, like to aspens. Yeah, that happened, uh, I guess a couple of months ago. But maybe we'll link to it in the show notes. Okas pretty funny. I want to read that they like dressed up like him as well in the two tuxedoses, don't orange in the like they had on like I feel like a member's only style jacket. Can you think

you know what I'm talking about? Yeah? Um, yeah, it's been a while since I seen it, but still a classic. It's still burned into my memory of how fantastic it was. Yeah, for classic. Alright, Matt, let's move on. Let's mention the beer that we're having on the show today. This one is called Money Blend by American soul Lara and this is a perfect name money for beer, exactly said to us by a listener, by the way, that's right, Yeah, listener James sent this one away. So James, big thanks

to you. Looking forward to having this one, and we'll give our thoughts on this beer at the end of the episode. You know what a perfect beer for how the money? All right, Well, let's move on, Matt. Let's talk about why ownership is the key to wealth building and We put the in all caps because we believe ownership is this crucial, essential building block of being able to grow your money the time. It's often overlooked as well, because there are other practices that people tend to employ

when they're looking to, you know, save up some more money. Right, investing doesn't come as natural to us as some other practices. Yeah, and I still I still remember, you know, becoming a dad for the first time, Matt. Uh, it was like this immediate game changer for me somehow in one moment, by just by holding my brand new baby girl, I was able to quickly see so many of the ways in which my life was kind of currently revolving all

around me. And like, even even though I've been married for a few years and I've been able to see some of those aspects, you know, during during those first years of marriage, becoming a dad really cemented that for me. And it was like a game changer in you know, what it looks like to serve other people and actually to shed some of that selfishness that I would really

come accustomed to. Uh. And Yeah, it also helped me see my parents in a new light instantaneously too, Like I was able to see maybe their parenting mistakes differently as I started to make similar mistakes in parenting myself. And yeah, we don't really get many paradigm shifting experiences in our lives, right where just in an instant we see everything with clarity, but you can look differently because I was there, you know, Kate, and I shoot up the next day glow about me or something of that

is that. I think it was just the adrenaline for from having labored with Emi, labor for hours whatever, almost a day, right, but those are the salad days. No, those are the salad days. But yeah, I think you and I we believe that understanding the necessity of ownership and the long term benefits that ownership provides can provide like a similar epiphany for people that are producing financial independence, just thinking about the way we invest and realizing the

power of ownership is really powerful. Yeah. Absolutely, I mean to put it bluntly, you know, if you want to stay poor, well don't own anything, right, And I don't know, maybe that's kind of harsh, but it's true because in our consumer driven society, we actually are encouraged to buy things. It's just that we're god on to purchase the wrong things. Uh, And it's exactly that we're pushed to buy stuff that quickly loses its value instead of directing our money and

ownership of different assets that will grow our wealth. And there's what we see around us in media and advertisements and the general keeping up with the joneses vibe that we feel because of social media and peer pressure. This all directs us to pursue the wrong things, buying more stuff. But oftentimes, man that pursuit leaves us wanting more, and it keeps us from the more important work of becoming owners. And specifically we're talking here about owners of things that

gain value. That is what will provide the real financial freedom in our lives. Yeah. Yeah, it's really important to own the right things, right, Like some some places that we put our money will cause our net worth to go up over time, while other places that we put our money, we'll cause it to go down. You know, Obviously we need to consume some things, right, Like we can't put of our resources towards ownership or we'd starve.

Compare that grocery budget down from to zero, yeah, exactly, And let's just dumpster dive for dinner every night probably, Yeah, it's probably not going to be a fund, you know, I'm gonna be able to do that for long. But knowing the difference between purchase in an investment is crucial, and that that might sound stupid. You might say, I know what that is, like that that's a simple distinction and you don't have to spell it out for me. But Matt, I've just heard so many folks refer to

consumer purchases as an investment. Um and maybe it's just petty on my part, but owners, I think, think differently, and just that mindset shift is powerful. Developing an owner mindset means that you're prioritizing, uh, the long term, and I think it's a really exciting concept for people to

grasp onto two as they're striving towards financial independence. Yeah, and you know, as we're talking about buying the right stuff, Like we were joking about how a bike could or couldn't be an investment, but obviously really it's not, and it's it's still one of the best consumer purchases you

can make, but it's not an investment exactly. Yeah. Yeah, I mean, so for the sake of the show, you know, we define an investment as money that you put towards something that we expect to steadily increase in value over a number of years. And yeah, you know, as much as we love our bikes, were not expecting them to inherently gain and value. You can't expect to sell your

bike three years from now out of profit. Now, you know, there might be tremendous value, tremendous enjoyment that we receive from our bikes, but the object itself, uh, isn't going to increase in value. And similarly, you might hear someone say that new clothes for work, like that's that's that's also an investment. I need to do this in order to get ahead, to get that promotion. Nope, you don't. That is not how it works. Like you won't be

able to yourself. Yeah, Uh, those value that the value of those clothes is not going to be higher in a few years. Uh, you're not gonna gain more money from selling those clothes and in three to five, ten years whatever than the money that you pay for them right now. Uh. You certainly will look nice and you look professional, but it is not an investment. So that's one of the big differences between purchases that bring you value compared to actual investments, and we're talking about investments

and owning those today on the show. Yeah, so so let's let's talk about the continuum of ownership, Matt, because sometimes saving money can accidentally become the top goal in somebody's life. And I think some of our listeners maybe fall into that camp where right now they are in the phase where they just have to start saving. And you gotta start somewhere, right You've gotta be able to cut down your expenses, uh increase the gap so that you can and are able to save more of your

money over time. And that is the first thing that you should be doing, by the way, is that is making sure that you're saving money so that that money is available as an emergency fund in a savings or a checking account. But some people, some of our listeners might be so risk averse that they stay in that

space and they don't make the leap to ownership. And so you might be of the mindset that, well, I'm not spending all my money anymore, I'm saving some and you might be super proud of yourself, and like we said, that's the first step. That's great, it's a start, but saving money is really just the absence of spending. It's it's obviously a crucial thing that needs to be mastered in the area of personal finance. But just doing that doesn't mean that you're on the all important path to ownership.

And yeah, sure, sure you've got more cash on hand now, but what are you actually doing with that money? Becoming an owner means thinking beyond just the realm of budgeting and frugality. Matt, I think reality is a skill. It's a good skill. It's an important scale. I think if we leave our personal financial knowledge there in the camp of frugality, though, we're missing out on a whole other section,

probably the most important section growing our wealth, becoming owners. Yeah. Absolutely, again, it kind of makes me takes me back to the seven money gears what we talked about here in the show. But imagine, and I know this is hard because most folks don't have stick shifts, but imagine you've got a stick shift and you're in that first gear and that gets you off the line and you're going But I mean, what are you gonna talk about at like ten miles per hour? I mean, you can't go fast in first

gear without completely blowing up your engine. Right, You're gonna just destroy it. But that's in a way, that's what we're talking about here. When it comes to your money, You're going to limit yourself if all you're doing is just saving your money. Like sure, you'll have maybe a massive emergency fund that you have a lot of liquid funds in the bank, but that is not the goal. We want you to gain speed, and that's why you have to shift to the other gears where you are

going to be investing your money. And man, there's another problem too when you have all this money just sitting there, maybe in your savings or your checking account, because you know, in those moments or phases of life where maybe you have your head in the right place, you know you're not spending and instead you're funneling that money into your savings account. Uh, there's gonna be times in your life

where that's going to be easier to do than other times. Right, Like, maybe you just got a new job, you've got a higher salary, you're busy with work, so maybe you're not spending much money at all. That is a great first step, but then they're gonna be times where you you might feel a little bored, right, and you look and see all this extra accessible cash just sitting there in your bank account, and you're gonna be tempted to spend it. You know, why not get a new car? You earned

all that money. Maybe it's time to splurage on a on a peloton they seemed pretty cool, even though you can't run on them without paying run although maybe they've updated that that software problem by now. But essentially, like this is almost like an argument against savings. We want you to have enough savings in the bank that's liquid, that acts as a cushion for you. But beyond that, we do not want you to have that money just sitting there that's accessible. We want you to invest that money.

Having too much savings it almost burns a hole in your pocket, you know, and you and having some of that money in investments owning things kind of ties that money up in a positive way, like it's building your net worth, but it's also not readily accessible for you to spend, and that's a good thing. So yeah, going going back to the idea of the continuum of ownership. When you buy items, even purchases that bring you a lot of joy and value, those objects drop in value

right over time. Uh. Some more quickly than others, like buying a new car. Uh, the initial depreciation hit is rapid, right, and over the first three or four years, your car is going to go down in value by on average, And so yeah, that means that your net worth is decreasing at the same time, think about a chart that maybe looks the opposite of the way the SP five has looked over the over the last ten years. And that's what you're doing when you're buying consumer goods that

rapidly depreciate. And then yeah, when you're sitting on your money as cash, you flatlined. Right, your line isn't going down, but it's also not going up. It's just not doing much of anything. But when you invest your money and you own the right assets, the line on that chart, it's gonna grow, it's gonna go up into the right and that is the key to wealth building. Ownership is how you get their. Ownership is how you build wealth. And so, Matt, there are three main ways to become

an owner in this country. We'll talk about them from easiest to hardest, and let's kind of discuss maybe how our listeners should go about the process of becoming an owner. Let's get to that right after this break. All right, we're back and we are talking about the key to wealth building and Jil, let's talk about some of the most effective ways to pursue ownership. Uh, and investing in the market is by far the easiest path to ownership. I love easy paths, Matt gonna li who doesn't. I

don't want to climb everest. If you've got me like an easy little hike, I'm in the little nice hike path around the lake like that sounds more attainable. But even probably not too much elevation change as easy as it is, here's the problem. Nearly fifty percent of Americans have almost zero exposure to the stock market. This is according to Gallop, and that's a real problem. Man. That

means that essentially half of Americans aren't building wealth. And what is basically the simplest way to do it buying index funds that allow you to share in the gains of some of the biggest businesses and industries in our country. Uh and even in the entire world. There are, of course, many reasons that like so many folks aren't investing. I think a lack of financial literacy is is one. And you know, truly not having enough money to be investing

is another. Real wages adjusted for inflation, actually haven't kept up with the rising costs, which has squeezed the budgets of many Americans. But we also know that there is a big swath of that fifty who could be investing in pursuing ownership, but they've actually decided to put it on the back Learner, they don't feel that it's important. And if that's you, we wouldn't convince you to do

something different with your money today. Starting sooner as opposed to later is important, and I think there are a lot of people if you talk to him now, they would say, I wish I'd started earlier because of the compounding returns that you're going to experience the longer you stay invested. So let's talk about that time frame. Maat Like, when you invest with an ownership mentality, you are buying

for the long haul. There's a difference between owning and speculating, and I think a lot of what we've seen recently is more of the speculating Friday right, short term ownership isn't really ownership at all, And that's just not what we're talking about. That's not what you and I are

all about. So, yeah, could you make a quick buck from buying Meme stocks or from some quick investments in crypto, Yeah, it's possible, right, But but owners are less focused on getting rich quick by trying to time the market because that path is fraught with pitfalls, and uh, yeah, you could potentially lose a lot in a short amount of time. Real owners by meaningful assets that they planned to hold

for years and years and preferably for multiple decades. So yeah, when it comes to being an owner, Matt and I say, it's really really important to be in it for the long haul, to be buying share in companies basically all the companies ideally and holding them for the long haul. Yeah, And like you said, we've seen a pretty dramatic uptick in that speculative type of investing over the last few years,

especially over the last maybe eighteen months. I think that that rise in investing has a lot to do with the ability for folks to be able to trade, buy and sell stocks on their phones, right with different apps

like robin Hood. There's pros and cons, but at the same time, it makes it too accessible if you can just sit there, pull out your phone, while you're waiting on the light to turn green or something like that, and all of a sudden, you've like, you know, sold some stocks just because you had a feeling in your gut, just because somebody texted you was just like hey, by this. It's like, that's just what you ate this morning. That's

not a good reason to trade. Yeah, but again, this is basically short term trading of assets, where you're hoping to make a quick buck, and that is not our style. A long time ago, back in the nineties. Uh, there's this quote by Warren Buffett, and he said that if you aren't willing to own a stock for ten years,

don't even think about owning it for ten minutes. I love that the best investors have been able to view their their their investments as buying a piece of a business, not just buying a piece of paper, not just buying a number on the screen, not just buying a feeling, which oftentimes is what's happening with these day traders now. And so that subtle shift in thinking is important. And uh, it'll it'll feel your likelihood of you know, taking the

long term approach, and that's what we want folks to do. Yeah, I agree, man. I think if all you see is numbers on a screen and you don't see the underlying thing that you own, the asset that you have just purchased, then you're just not going to think about it properly. So let's give a couple of examples maybe of how this plays out, of how becoming an owner would make you rich, whereas instead consuming that money would do the opposite.

For instance, if you were to have bought Tesla stock instead of buying an actual Tesla when they put out the first model, as when when that came on the market, you would be a multimillionaire, right Uh. Buying that fancy new electric vehicle nine years ago would have set you back seventy seven thod dollars. It's a lot of money.

It's a lot of money. But if instead you had invested that money, if you had seventy seven thousand dollars randomly on hand, and you had decided to instead of opting for the car, decided to purchase Tesla stock, you'd be sitting on over eleven thousand shares of Tesla stock, which is worth now well over ten million dollars. And

that's the power of ownership. I feel like that helps drive the point home, right, that this money can go towards buying things, or it can go towards building your wealth. And by owning shares in an actual company like Tesla that has done so incredibly well, that's obviously kind of an outlier. But still even if you just put that money, that's seventy seven thousand dollars in the SMB five hundred, that would be worth a whole heck of a lot

more money today too. Yeah, and it's not that that models is worth nothing today, but it's not worth ten million dollars. I'll tell you that on a on a slightly smaller scale, or at least a you know, smaller numbers here, if you had purchased Apple stock back instead of buying the first generation iPhone, that five dollars would have actually turned into fifteen thousand dollars, which is that's a pretty nice gain right over the years. Not nearly as impressive as Tesla, but but yeah, what do you

think about it? Though a lot of people could invest five hundred bucks, but what he's got seventy seven exactly, And the yeah, Tesla example, that's more like can I cherry pick a nups? But let's ratch it up a little bit. If you put four hundred dollars into apple Stock instead of buying the first generation of the iPod, you'd have over a hundred and fifty thousand dollars right now.

But that click wheel was pretty cool, so you know, the first ones didn't have to click, they didn't have the most I got the click wheel that was like a worse pop party had like the four touch screen kind of buttons at the top before they moved to the quick. Well, then you're definitely investing. That one sucks, But you don't even want to know what the numbers are.

If you had invested in apple Stock instead of buying the original Macintosh back in the mid eighties, back in eighty four, but we're gonna tell you anyway, because it's just incredible, you would have over twenty eight million dollars.

I feel like sending that one to my dad because I know that they had purchased one of those first McIntosh is back in the day, and uh, I don't know if this would make him just depressed or if you'd be like, no, that was a good decision, Like we still needed to have learned how to you know, do personal computing back in the day. You learned a lot as a little tiny kid. See if you say I did. But if you sent me that email and I had done that, I would have been like, I've

made a huge mistake. I'd be able to admit it, right, Like, because right, I mean, that just goes to show the power of ownership. Right. So, Yeah, when you look at the difference between consumption and investing, it can be really really stark. And these are obviously examples from some of

the most highly valued companies in the world. Right. But like I said, even if we opted instead to give the numbers of what you would have earned in the total stock market, right, you would still have seen just a ridiculous amount of growth on that four hundred or five hundred dollars that you would have used to buy something that Apple created and instead invested in the stock

market as a whole. But I just love seeing those numbers and the disparity map between the autem that you get when you make a purchase and then what happens with your money when you choose the path of ownership instead. It's really astounding, and for me, it drives the point home, just makes me want to be even more conscious of my spending so that I can prioritize ownership even more. And you're gonna put your money towards things that appreciate,

not things that depreciate. And so that's yeah, we're talking about investing, you know, ownership and investing again, it's the simplest path to doing that. Real estate that's another vehicle where ownership makes a whole lot of sense. And uh, you know, we'll talk about real estate investing in just a second, but just even owning a home to live in, if your ownership cycle is long enough, can also help

you to build wealth over the years. The largest asset honestly held by the typical American family is in fact their home. And of course we want how to Money listeners to consider even going beyond just single family home ownership. Uh, it's definitely a traditional path that works, although it's certainly not the highest performing path, right, but even still, it's worth mentioning that buying a home and owning it for decades is still a solid ownership move and the one

that Americans seem to to feel the most comfortable pursuing. Yeah, for sure, and a lot of people are just naturally going to gravitate towards that type of ownership over time. Right, Just that's a desire of a lot of people is to buy a home be planted somewhere. We totally get that. Even though it's not always the best investment, sometimes it's a good purchase for other reasons, and oftentimes it does

over time work out to be a decent investment. But there there is a big difference between purchasing a home for you to just live in and then buying a home as an investment property. Right. The former can be this slow, methodical wealth builder, But it turns out that the way people analyze a home that they want to live in is often completely different than the way they run the numbers on a home that they're buying to

generate a return. Right When when I bought my house, When most people buy a home to live in, they're not thinking about the potential return if they were to rent that out instead. And so, yeah, we are fans of people thinking about their primary home purchase a little more like it were, you know, a traditional investment property. But there's more that goes into it than that, Right, And we're actually hoping to release an in depth episode about real estate investing soon, but it really is one

of our favorite ways to build wealth through ownership. Right, if you're savvy, you can buy a home that makes you money when you buy it, that makes you money every single month as you're getting paid rent by your tenants, and it makes you money as it appreciates over time. Hopefully it saves you on taxes too. Reallyses like the trifecta, right. Owning a real estate investment property is I think one of the best ways, in a decently accessible way for people to become owners. And I think it can be

even more fulfilling to a degree, Matt. You know we just you just talked about owning a sliver of a company as opposed to owning a piece of paper or owning a feeling, and when you own an actual property, it's a lot more tangible to Yeah. That being said, home ownership isn't for everyone, though, right Like so, first of all, it typically takes a lot of money on hand in order to buy a property. Saving up for a solid down payment ideally is no joke. That takes

some time. Yeah, not to mention the additional costs that typically come along for the ride when you own a home. So Yeah, don't listen to us talking about saying the family homes and immediately think that we hate renting. Sometimes it makes a lot of sensor folks, because aside from the additional costs of purchasing and owning a home, just the lifestyle that renting provides you might be more of

what you're looking for in your life. When you own your own place, there are a slew of additional responsibilities. Like I wouldn't go as far to say that it's a part time job, but it definitely takes more time than investing in the stock market. Angel. This makes me think back to like, so that'st out earlier about half

of Americans are invested in the stock market. So obviously that means half of Americans have a zero exposure, right, Well, sixty percent of Americans own their home, right And so when you think through all the hurdles and all the difficulties involved with purchasing home, it makes you wonder how in the world are there more people who own a property or who have a mortgage on a property then

there are who are invested in the stock market. It is so easy to invest in the stock market to get a retirement account, going that It just makes you wonder why there are not more folks invested in the stock market. It's it's just the easier way to achieve wealth, right owning you know, little slivers of different companies at and extremely low cost are virtually free with fidelities, you know,

zero expense funds. And you kind of touched on how there's like something else that comes along with real estate. How it's like, Okay, this is my home, this is my property that I that I fully own. I've gotta think that that's a huge part of it. Right, Like folks, I think your own it's tangibly like it's something that you can see, Uh, it's something you can touch. And for a lot of folks it's something that they're living in, and so it to them, I think it just feels

more real. But the stock market is a real thing, even though it's just numbers. For most people on their phone or you know, on a read out on their on their computer screens are numbers you can eventually cash

out and spend. It's like that is real money, and there's I don't know that We've got to find a way to convince more Americans to start investing in the stock market, especially to when you look at the return on your investment over the past several decades, right from the sixties and seventies, uh, the market, the stock market has returned numbers much much higher than single family homes.

And so again we're not saying that you can't grow your wealth via a single family home, via your house, but the stock market is going to be so much more effective and it's going to require so much less hassle and time and energy. When you're looking at the numbers, it just blows my mind that there are more folks who own a home compared to the number of folks

who are invested in the stock market. Yeah, if we're talking about the difficulty level of pursuing investing in the stock market versus pursuing investing in real estate, it's so much easier to start investing in the market. And really, you can kind of put it on autopilot. Do dollar cost averaging every single month, Toss twenty fifty bucks a month into a roth Ira through you can have. It's a it's a no brainer premi your account like it's so simple, Yet a whole lot of people just aren't

taking advantage of it. And even when you can get started with very little money, which is so much more difficult in the housing market, right, yeah, Yeah. We've got a friend of ours who has been teaching a piano lessons, like she's accomplished pianist, and she teaches some other kids

as well. But it makes me think of like some of some of the simple songs you could play on the piano, and it's almost as if Americans are sitting down to the piano for the first time and they're saying, all right, I'm gonna learn how to play what is it for? At lease? You know, like yeah, yeah, which is kind of a classic, but it's also kind of a complicated song, more difficult than chopsticks. Yeah, way more.

And I was thinking hot cross buns, but like investing in the stock market is the hot cross buns, and only half of Americans are doing it. There are more folks jumping straight to the more complicated endeavor when it's a lot easier, and you know, well, I guess the metaphor breaks down, but it would be a lot easier, and it would be much much more gratifying to play chopsticks. And granted, like you said, people buy a house because

it provides other benefits like a place who live. And that's understandable, right if you if you want to plant your roots, there are additional benefits. But you know, we're we're in favor of an all all the above approach to ownership, but that there is another path ownership that we haven't talked about yet that's more difficult than investing in the stock market, but it can also provide higher returns. Let's talk about starting your own business. Let's do it.

We talked about this recently with Rachel Richards. There is a huge difference between working as an employee for someone and owning your own business. And uh, there's a lot of routes that you can take to starting your own thing. You know, it doesn't have to kind of be this all or nothing approach. You can and I think most people do start a business when they've got steady income

coming from somewhere else. You can start it off as the side hustle, and then over time you kind of kind of rotate that dial and start cranking up the income on that side hustle, and pretty soon it becomes your main gig. But not only can you increase your income by owning your own business, but that business over time becomes worth something if you're able to sell it again. You're able to sell it because you own that business.

And we're talking about ownership right now. Uh. And the other thing too, You can even start a business for little or no money. We talked about that in episode to forty seven with Alan Donagan. Just some different ways to start your own business without taking on boatloads of debt. Yeah, Matt, my wife's best friend, her dad had a cleaning business, and he would go over and clean the houses himself.

But what he had built up was this book of business, was all these people that used him over the years, and so what he was able to do when he reached retirement was to sell this business. He didn't have to clean houses anymore. But it wasn't just the fact that he got paid money for the houses that he cleaned, but it was that the business he had built up was worth something to someone else. And that is ownership, right,

That is that is a wonderful thing. And yeah, Matt, we also have friends in the personal finance space who started their own sites years ago in an effort to document maybe like a debt payoff journey, and some of them ended up writing such great content consistently that their site started to make legitimate money, and you know, for many of them, it turned from a side hustle into

a full time gig. But yeah, so not only is it awesome from that standpoint, but over time their sites increased in value and a few have had bigger companies approached them along the way, and some of them have been paid a pretty large chunk of change in order to purchase that business, like six figures or seven figures. So yeah, owning that site and building it are the

keys to that happy ending. They could have written for another publication, but they risked their time to create their own thing to become an owner, and it paid off in the end. Ownership when it comes to small businesses, can provide the most potential r o I compared to

really any other form of ownership totally. And all that to say that, right, if you're gonna start blogging or you're gonna start a site, that there's there's not a guarantee that you're going to be able to have this this massive payday, right And none of those people made huge chunks of money because they didn't do much work and it was pretty chill. It's like they poured a lot into it, and they poured a lot into it over a number of years. Right, It's took a long time.

And you know, to be an owner means that you're going to have to sacrifice, like you you sacrifice money, your capital, your time, and you know some of the things that your dollars could be buying you and the here now, and so as we're making smart money moves, it's almost as if we're in this purgatory waiting period right before we're able to realize it of the benefits

from the steps that we've taken now towards ownership. This is you know, one of the reasons that we are such fans of investing in real estate because it's almost like this hybrid model that it does cash flow today, but it also appreciates for tomorrow. Do you have that dual benefit, And that's one of the reasons why we're

big fans of real estate. But obviously when it comes to investing in the stock market, though, like if you're investing in pumping money into a retirement account, but yeah, I mean you're looking at decades, like multiple decades potentially before you're likely going to be able to see that that payout before you're going to realize any of those benefits from the sacrifices that you're making today. But you are becoming an owner and shifting into that mindset and

knowing that that's what you're doing. Not just that you're setting aside of money for your future, but you are an owner of business, of many different businesses in all likelihood and and I think that mindset shift is important, Matt. And I think what you said about sacrifice is key, right. It does take sacrifice, It takes uh, it takes long

term thinking in order to become an owner. And yeah, let's talk about risk verse reward two when you decide to become an owner, because the length of time that you plan to own something has a massive impact on whether or not you're gonna be able to make money right, the shorter timeline that you attempt. We talked about this when it comes to investing, the higher risk that you're

gonna face. We're all about owning and building quality assets for decades because yeah, there's just this risk in all of the ownership categories that we mentioned. As an investor, you can see the market dip for a period of time. You know, if you put money in today, five years from now, it's unlikely, but you could have less money than you started with. And as a real estate owner, you can see the value of that property decline or you could endure a time where you're not making any money.

Right because vacancy, tenant problems are potential risks as an owner, and every owner, anybody who has been an owner, they know that right that there can be some really hard financial and emotional times. There are risks, but they're manageable risks, and the reward at the other end of deciding to opt for ownership, those rewards are potentially huge. And you know, ownership it's not all rainbows and butter flies in unicorns always.

Although three of my favorite things. When you're the owner, you're you're gonna have more responsibility, even kind of going back to to owning your own home, right, you often have some hard decisions to make. Not owning a home means that you can call your landlord for any maintenance request to pop up. You don't have to fix the

leaky fasce at yourself. You don't have to replace the broken water heater, and you're like, godge that bullet, and that's one of the benefits, right, but you also don't get to realize the wealth building upside that your landlord is experiencing. Even when it comes to owning stocks in an index fund, there are going to be bear markets and you're gonna see your portfolio decline some which could

lead to some tense shoulders. It doesn't have to uh if you know that that's your your your tendency to get stressed out, find ways to ignore the news, find ways to uh turn off that flow of information that's going to cause you to stress out. But at the same time you're gonna need to remind yourself that this is all a part of being an owner. We feel that the financial benefit is going to be well worth any small amount of stress that is most likely manageable. Yeah.

One of the things you said at the beginning of the episode, you said, if you want to stay forward, don't own anything. And I think that's true, and I think it is Uh. You might be able to be secure, but you're never going to be able to build wealth if you don't ever choose to become an owner, if you only choose to be a frugalites and a saver. And we're all about frugality, and we're all about saving money, but ownership is the next step because wealth flows to

owners and at how the money. You know, we're all about building that wealth slowly but surely over time. Spending less is really really important to growing the gap and being able to save more of your money. That's an important first step. Of course, you don't get rich by paying interest to the credit card companies every single month, but you also don't grow wealth by keeping your money

into savings account either. So becoming an owner is the next logical step, and it's the most important step to take, and it's a step that none of us can afford not to take. Yeah, and so if you're listening and you're already investing your money, congrats, because that means you

are an owner of something. We're not sure what you should pack yourself on the back, because, like I think, Matt, part of what we're talking about here is not just encouraging people to become owners, because there are some of our listeners who haven't taken that step yet and we're saying, yeah, it's time, but also for the folks that have started doing some of these positive steps, thinking of yourself as an owner is important that you are doing the right thing,

but at the same time, it's worth considering how you can pursue other paths of ownership in your life. And as as someone who is already on the path to to financial independence, if you own something well, having that ownership mindset can propel you to to to reach even bigger financial and bigger wealth building goals because when you can you know, see yourself as an owner and you realize the financial benefits that it creates, it's just one of those things that you can't unsee. It's really is

paradigm shifting. It's a game changer for the way that you view and handle money moving forward. And it's not we're not trying to add undue stress in your life, right Like, if it's time to go to the grocery store and buy some groceries, all right, that's something that

you have to do. But at the same time, realize that, I don't know, maybe some other purchases that are more optionalous, a little more frivolous, or there there's something that could provide you maybe some value now or maybe it's just fun. Realize that you're doing that at an expense to your future self. We don't want all of your spending now to hamstring your future self. Even though it's so difficult for us to picture ourselves in the future, realize that

what you're doing today is going to affect tomorrow's bottom line. Yeah, so if you're not there yet, we encourage you to, you know, look at your finances and see have I saved enough in order to start pursuing ownership or do I need to start saving more so I can get there more quickly. And if you've already started investing, then think of yourself as an owner and doing that I think will help you take your pursuits more seriously. It's a game changer for how you think about where your

money is going. But that's enough talk about ownership map. Because you know, every once in a while, people do need to buy their groceries. They do need to buy their delicious craft beer. Let's talk about the beer that that we had on today's episode. This one is called money Blend. It's by American Solera. It's an oak aged farmhouse sale. What's your take on this beer, man, Yeah, this is money Blend Bash number two. And you know it says it's aged in oak tanks. But we know

what they mean. They're talking about oak footers, and so basically they look like like everyone is seeing pictures of wine barrels kind of stacked on their sides, or even barrels of whiskey. Uh. You know, I don't know if you've ever been on like the Bourbon Trail, but not yet, sadly I haven't. Dude, we need to do a how to money trip. Maybe take the wives up there as well. I'd be a lot of fun. But imagine one of those barrels not turned on its side, but like standing

on its end. But then like, I don't know, ten times bigger, that's what it is. And yeah, this is a farmhouse style aged and one of those giant oak footers or tanks. And man, this was a delicious farmhouse beers. So it had a little bit of kind of like that farmhouse funk going on. It also had a nice

touch of acidity. Uh. But before we even started recording, you and I both we ad made a comment and there is undoubtedly a flavor profile of honey going on with this beer, right, A little bit of that honey sweetness, I agree. And it was also like I would say, deliciously mellow, like oh yeah, and then he does that. It almost has like this mead light quality where it just makes you want to just relax and the beer

interacts with you a little bit. It does something similar in just giving it kind of like a chill rustic but also like a buttoned up vibe, like I don't know, it's just the beer. Chill rustic, buttoned up. It's like, uh, country fancy exactly, that's what it's. I mean, that's a perfect way to describe this here, country fancy. So instead of calling the farmhouse sales, it's like, oh, that's a nice country fancy farmhouse fancy exactly. That's what I say

about this beer. So yeah, big things to James for sending this one in our way. Seriously, the naming convention was perfect for this beer. Batch number two. Yeah it was delicious, So yeah, we appreciate you sending us one of the best local beers where you live. Yes, really taste, Thank you, James, And honestly, this is just perfect up our alley. So great job picking one specifically for Joel

and I no doubt. All right, well that's gonna do it for today's episode for folks at want the show Notes and links to anything that we mentioned on today's episode. You could find those up on our website at how to money dot com. That's right, And if you've been listening to the show for a while but maybe you have not left us a review, we would be incredibly grateful if you were to head over to Apple Podcasts or wherever it is that you listen to your shows

and leave us a nice five star review. And so many folks have been doing this, and specifically they've been writing in how the show has helped them to either find more money or save more money, or earn more money and hopefully, after this episode, invest more of their money. And so we would love it if you did something similar, and that just helps folks out there to know what

they're getting into. And that way, if they're like, oh, yeah, I don't want to do any of those things with my money, they can I guess they can skip the show. But we all know that there are a lot of folks out there who need this advice. So thanks in advance for that. Joel is at it. That's it man, alright, man, So until next time, Best Friends Out, Best Friends Out. M