Wealth Building Step by Step | 409

Hello, my fellow Ripplers! This is Chris Miles. Your Cash Flow Expert and Anti-Financial Advisor. Welcome you out for a wonderful show. A show that’s going to be for you and about you. A show that’s about you that want to work. You’re sick and tired of working so hard for your money. You’re not ready for your money. Start working harder for you right now. You want that freedom. That cash flow. That prosperity. Today. You don’t want to wait 30 or 40 years for that retirement. You want that freedom now. So you can live that life that you love. With those you love. Doing what you love. And guys, it’s so much more than just being comfortable. It’s so much more than just having a lot of money and having a lot of cash flow and passive income. It’s about creating a legacy. A life that is amazing. A life where you can be a Rippler. Creating a ripple effect in the lives of your family, your community, and ultimately across the world.

And that is the ripple effect I’m here to create. That’s why I’m here day after day. In this case, in this podcast, week after week. But this is why I do behind the scenes too. The after day living the life that I love by serving you and thank you so much for allowing me to do that. I appreciate you guys so much for sharing this and having conversation with other people and saying, check out this podcast! It’s amazing! Thank you! Like I really appreciate that. I appreciate you guys reaching out saying you’ve enjoyed listening to this and you’re bingeing on it and everything else. It means so much to me that you guys are doing that and I cannot create the ripple effect without you. So thank you for being a part of this.

Here’s a real quick reminder. Check out our website, MoneyRipples.com. There’s our free ebook Beyond Rice & Beans. Seven Secrets. If you have cash today, if you want to find ways to find more money and be able to use it to create more money with you, as well as other blogs and things like that, you can check out. So check that stuff out of MoneyRipples.com.

So today guys, you know, I was thinking over the last few months about, you know, Dave Ramsey, he’s got his little baby steps, right? And I thought, okay, what are my baby steps? And I kind of had my own little thing that I gave you earlier. I think it was last year. Actually I talked about Dave Ramsey, where I agreed and where I disagreed. Right? But I want to give you some basic five steps, you know, five different things you can do. And this is really kind of in order, right? This is really an order.

Although one of these steps applies throughout. But these things are in a particular order because I get so many of you that will reach out, right? And a lot of you are at the place where you say what I call step three, which is Buy Cash Flowing Assets. Where you’re at that place, where you need to do that. But I get some of you that aren’t ready yet. And you’re so anxious. You want to get started and you get impatient, but there’s some ultimate steps you gotta take first. And so I want to talk about this wealth building step by step, right?

So without further ado, step number one. Is that Emergency Savings. This is something you need to build up. Now the ultimate goal is to get at least six months of your expenses there. So if you have expenses of $8,000 a month, ideally you want to have roughly almost $50,000 in savings. It’s like money that’s available. Now I’ve had several people reach out and say, Chris, I want, I got 10,000 bucks. Where do I invest it? Okay, well, I’ll ask them well where you know how much savings you have? 10,000 bucks! That’s all I’ve got great. My advice, save it. They’re like, yeah, but how do I make money? I’m like, save it. You will get there way faster. Even though it feels like you’re watching grass grow. You’ll get there way faster. If you do this step first, because what happens with most Americans is that they get a little bit of money and they think now I can do something with it. And they get desperate. And then they throw it all away. They gamble it away. Whether it be in the market, trying to buy some crazy stupid stock, they go and buy Bitcoin at a high.

They go and they try to buy gold and silver or whatever. But then they don’t really make money on that, even though they could, but they don’t, you know, are they going to try to do this or that? Right? Or they go throw into some Ponzi scheme. You know, they think, Oh, I heard about this. Listen, people that run Ponzi schemes or run scams like this. They love you. If you’re the kind of person that’s desperate to take a little bit of money and make some money with it. So, or go gamble in the stock market. That’s my, again, that’s my favorite. You know where people are like, I’m gonna throw the stock market by these penny stocks and then they lose it all or they lose most of it. Here’s the thing, guys. I don’t recommend that. You know, what I do suggest is you have Emergency Savings in place.

It gives you a peace of mind. And what I’ve noticed. And this is true with my own life. Even when I didn’t have the money and I had to start building from scratch, right? When I was starting over after recession, I had to start over from scratch. Heck even after a divorce, there was a lot of ways. I felt like I was starting from scratch in some ways. And I’ll tell you, the best thing you do is build up those reserves, especially if you’re a business owner, but this is true of anybody because otherwise there’s a rubber band effect. If you try to not build up your savings right. You just build a little savings and use it to either pay off debt right away, or to invest it immediately. Something comes up that you need that money again.

And then you’re charging credit cards. And then you’re stuck in this constant cycle. I call it a rubber band effect where the money grows and then it shrinks. And it grows and shrinks. Like stretch and contract, stretch, and contract. And you really don’t get any headway. You gotta start here first. Now, do you have to have all six months saved up first? No, not at all. Not before step two, but I would say this, is that you need at least five to 10,000 bucks. If not more in savings before you move, worry about step two. All right. So that’s my advice for you. So the whole baby step of save a thousand bucks. No, no. You need at least five to 10,000 bucks in savings. Not touched unless it’s for emergencies.

Now step two is, Managed Debt. Not pay off debt, manage it. Now this is where people will try to figure out what should we do? You know, she would pay off this or that or the other, right? Well, here’s the thing. First foremost, I’m not about trying to pay off all your debt. If you got mortgages, you usually won’t try to pay it off faster. You got car loans, which they’re low interest. You probably won’t pay those off faster, right? Credit cards. Sure. Maybe we’ll do that. And in some other types of loans. But for the most part, we’re just trying to manage it. Key thing is using the, why I refer to you as the cash flow index. If you guys remember my formula from last year, I did a podcast called what is the cash flow index? I think, Oh, no. Best way to pay off debt. But the cash flow index is a part of it.

I would go back to last fall and look up that episode. I don’t remember the exact number, but I would look that up for sure, because that cash flow index is key to help me decide which one I’m actually pay off first, if I would pay it off at all. But I would use that formula specifically to figure out what should I pay off. So yes, we want to manage it. Do we want to re finance loans and get them to a cheaper payments? You know, right now it could be a great time to refinance your mortgage and maybe even get some money out of it. You know, I have a client right now that just hired me, said, all right, Chris, I’m taking some of your advice from a few months back. I just refinanced my mortgage. They’ll save me 420 bucks a month. And now I’ve got my line of credit open. I’ve got 150,000 available to use an equity. Now what? Well good. Well that moves the step three.

Step three is, Buy Cash Flowing Assets. That is where it gets to be fun, right? This is where you sort of say, Hey, do we buy real estate? Do we get into syndications or funds? Or what do we do here? That’s exactly the kind of strategy you’ve got to figure out. Again. We want Cash Flowing Assets. Things that pay you on a consistent regular basis. That’s stable. That you can count on. That is the kind of investments I love. Right? This is where we don’t create more risk or somebody to say, well, this sounds like we’re doing some risky stuff. No, we’re actually trying to reduce your risk. Why? Because we want multiple streams of income. We don’t want you relying on your job. Or your business. And if that’s solely the money that’s coming in, you were at high risk for failure for financial failure.

And if you weren’t scared in the last few months, I don’t know what will scare you because the truth is, is that anything could happen at any time. I’ve had people in industry that say, I thought I was recession proof. You know, I have a client that, you know, he works with sports, you know, like NBA and things like that. He says, Chris, I thought I was recession proof because when people get laid off, they watch sports. You know, that’s the one thing that people will escape to during depressions or recessions. And he’s like, it affected me with this whole virus, you know? So you never know, that’s why we need multiple streams of income, especially regular stable cash flow coming in. And that’s where Cash Flowing Investments come in. Again, which ones we do and whatever that depends. We don’t want to ever sacrifice the emergency funds that you have.

I mean, often when I get clients, I’ll say, great, let’s preserve your emergency fund. We might even keep a good chunk of that emergency fund inside the life insurance. So at least it’s, tax-free protected from lawsuits and creditors and it’s earning much better than point nothing percent in the bank, right? So good. We’ve got those reserves in place. We’ve got debt managed. Now we can start Buying Cash Flowing Investments to start increase your income. Now when we get that money from the cash flow and those investments, the bulk of that money we’re taking and reinvesting in it, if not all of it. We’re taking our money and reinvesting it again to buy more creating what I call this income snowball, right? They were Dave, Ramsey’s get his debt snowball, right? We’ve got the income snowball. It’s like what I explained one of my clients, he were able to get his passive income about 35,000 to 40,000 a year.

I said, cool. At 35,000 40,000, we go and buy more investments the next year. It’s like, all right, well that bumps us up to about 40,000 to 45,000 next year. Great! Now we take the 40,000 to 45,000 and do it again. And now we’re up to 45,000 to 50,000. The next year. We do it again. Now we’re about 51,000 to 56,000 a year. And then it kind of compounds on itself, right? Again, just building on that income year, over year, getting it better and better. So that’s kind of the goal guys with step three is let’s buy these assets that are cash flowing that are creating some real safety for you, right? Again, we don’t want to do gambling and into crazy different investments of funds. And there’s a lot of, there’s a lot of scams out there even right now, right? I’m hoping a lot of these scams will die out with recession a little bit, but they’re always there. And then the effect of the recession, they still show up. So you gotta be careful, but there are lots of opportunities to create good stable cash flow. So that’s step three.

Step four. And this is actually one that I said, this is one that applies throughout the whole time. This one is, Protect Your Assets. Protect along the way, you know, cover your assets, right. That kind of thing. We always want to protect along the way. So this protection component will actually do throughout. But when you’re first starting your initial protection for the most part is basic insurances. And you know, your emergency savings. That’s your basic stuff. Now, as time goes on, right? Again, you start to build your assets. We’ve got to protect more and more. We’ve got to have corporations in place. If you go in and decide to buy it from step three, right?

You buy more assets, we’ve got to have things like LLCs and things in place to separate these assets from your personal assets. Right. We’ve got to make sure you have an estate plan in place and these kinds of things, right? All these things that are there to protect you. Yes. I mean, sure. Life insurance is part of it. But heck make sure you have disability, learn to compare, you know, like these kinds of things that are these types of things to protect, you need to be there. And the bigger the asset, the more you grow them, the more solid that these production strategies have to be. Here’s the key point with this. Is that there are a lot of people out there trying to sell you these massively complex plans for the vast majority of you. It’s not even applicable, right? When people start saying like, what do you think by doing all these series LLCs and stuff?

I’m like, well, how many, what’d you have for assets? Well, I’ve got some mutual funds here and I got one in rental property. I’m like, no, you don’t need that. I’m not an attorney, but I can tell you that is overkill. You know, most of those kinds of things are for when you have significant amount of assets, then great. You can do that kind of stuff. But for the most part, those things are overkill and just extra costs for little gain. At least, especially in the short term, you know, you can always build upon a plan as you go along, just like any good castle, right? You build the moat, the water moat that goes around it, but the bigger the castle, the bigger, the more it needs to be. And so you can widen that moat more and more and add more fortifications. The things protect you as time goes on.

But initially, most of the time you guys, you just need some basic stuff in place. Some things you almost check off a list and you’re good, right? So that’s what I mean about protect along the way it will build as time goes on, but you don’t have to have the Rolls-Royce of, of protection when you’re just starting out. Does that make sense? You know, even if you have a few, even if you have over a million dollars assets, you probably don’t need, most of these things are like the Rolls-Royce of asset protection. You’re talking more like if you’re at least five, 10 million of assets of net worth, now we might be talking about getting a little bit more complex. Makes sense?

All right, now, step five. The last one is, and this one I think is actually one of the most important ones. If you want to have wealth creation continue, is you want to Create a Legacy Along The Way. This legacy is more than just value. This is what I talk about the ripple effect, right? Especially if you talking about through your family and for those around you, you know, what kind of legacy are you creating within your own life? What kind of example are you living in your life? Are you doing more than just making money? What is your life really about? If money were no issue, no longer an issue in your life, what would you spend your time doing? That is something you guys should be focusing on today. If money were no issue, what would you be spending your time doing? Focus on that. You know, what, what kind of things do you want your family to learn? How do you teach them to be wise stewards?

How do you teach them to know the things that you know? Because just giving them money, does them no good. Right? We all heard people that are like trust fund babies that, you know, they ended up losing and blowing it all. Anyways. Why would you work so hard to build something so great, only to have it blown? You know, now you’re single. You’re like Chris, I’m not going to have a family. I don’t care. Great. Then don’t worry about it. Maybe you got a favorite charity. Whatever it is. Either way. What’s that legacy? What’s that next step? What can you create that creates a ripple effect, even beyond the grave? What is your life really going to be about? I’ll tell you for me, the asset, their true assets are actually more about us, right? Us, my family. That is the true asset. That is the asset that keeps on generating returns forever for eternity, right?

What am I doing to invest in that? What am I doing to create from there? You know, the money, the punny money part honestly, is not that hard. Once you get down some key principles and some strategies. But allowing that to perpetuate beyond you and to teach true principles to where your family become more than just spoiled jerks for lack of a better term. But they actually become something, someone of real value where they create their own mission. They can actually propel and build upon the wealth. You’ve already created to do something even greater than you did while you’re alive. And that takes generations guys to create something massive on a massive scale, you can do a lot with a little, even in this life with your, with what you can do, but that ripple effect depends upon what you teach. What you can create beyond that lasts beyond you.

This podcast for me is part, a big part of that. You know, even regardless of my family, I know I create a ripple effect that extends beyond these lives. I know that it can impact millions and millions of people. And you guys are part of that. That’s why it’s so important for you guys to do that. So recap of these five steps for creating wealth. For building wealth step by step.

One. Those emergency reserves, make sure you have that in place at least five to 10,000 to get started, but eventually at least six months of expenses.

Two. Manage your debt, make sure you refer back to that podcast where I refer to the cash flow index. Using that formula to help decide whether you pay them off or not, or to refinance and managing, get those expenses down.

Three. Buy cash flowing assets. You know, creating that passive income so that you’re not relying on just your active stream of income. You’ve got multiple streams coming in that protect you and lie to keep building wealth.

Four. Protect it along the way. All at every step. Even from step one on, you protect yourself and make sure that no one event can take away all your assets.

And then step five is create a legacy. Ensure that it perpetuates beyond the grave that you create a ripple effect that lasts beyond you.

Guys, this is the kind of life that I’m living. That I want to continue to live and make bigger and better. And I challenge you to do the same. I hope you make it a wonderful and prosperous week. And we’ll see you later.