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March 29, 2022

Where To Put Your Money During Times of War, Inflation, and Expensive Real Estate w/ Fred Hubler

Where To Put Your Money During Times of War, Inflation, and Expensive Real Estate w/ Fred Hubler
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Russia/Ukraine. Inflation. Hedge Funds buying Homes. Stock market dropping. What the heck do we do with our money?

Fred Hubler has 25 years of  capital allocation experience in his wealth management firm "Creative Capital Wealth Management Group". He's the go-to investment guy for billionaires, NFL players,  high income earners.....and Gobundance. Today we talk about where the economy is at, what we can expect, and where we should park our money for the time being and the future.

The name of the game is "don't lose money" and also simultaneously find where to make more of it.

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-Defend against inflation
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All right, the man the myth, the Hubler How're you doing, buddy? I'm doing excellent. Thanks for having me. So to begin, I'm not even, I'm not even going to attempt to do your resume. I'm gonna let you introduce yourself. I'm not even gonna attempt it. I'm gonna let you you talk to the people, Fred, this is what you do. Alright, so I think the story I grew up in the 80s. And to me success was having a briefcase. And basically, when you grew up in the 80s, being a Gordon Gekko and being that was something to aspire to, it's a way of getting you out of I was middle class America, no one in my family went to college. No one in my family really made any serious money. You know, I just knew I wanted to be rich. But that was like, the intent of my dream is I want to be rich, as you get older, you know, like, why do I do that? So I went to school, got the MBA, I worked at a fortune 500 company. And I was in charge of y2k. So I'm dating myself a little bit, but you got to know the pressure that made the diamond that you see right now. So I was in charge of it. I was 27. And I thought it was hot. You know what, except for when it was over, it all worked. I was in charge in North America y2k For this fortune $500 and fortune 500 company. And when the dust settled, the raise and the promotion that I was promised, never happened. Someone towards the end of the campaign was going to take my success and make it theirs. And I didn't let that happen. But at the end, I was burned out. And I realized I had the ladder up the wrong wall. And the one gift I got was the big boss, who who I was side by side with said, listen, for the next six months, tell everybody you're working on a special project. But you don't have any work to do here. Relax. Re compreso I was playing Duke Nukem and doom and I was at the company. But I knew I wouldn't make the first layoffs. You got it? Like, you know, yeah, quality employee shit. Yeah. On the computer. Yeah. So for about a month and a half, I really did just do nothing. But I started to think what really do I want to do. And financial services came up, when my friends were changing my oil, I was doing their taxes, or I was buying stuff in E trade for them where I was telling them what to buy in the trade. And I always had, in my mind, in the back of my mind the feeling that the rich got richer, because they knew things the regular folk didn't know. And I've been doing this now for 18 years, it is not only absolutely true, it is a government program. And we'll talk about it on this podcast, because it's, it definitely is something I'm now living, my clients have private jets. And I'm in a position where I never thought I'd be and I'd have to have a lot more money for my wife to let me have a private jet. But we're not there. But I'm not there because she would need to have so much more for me to write off a $10 million jet. But long story short, the where I'm at now I spend my first day was 911. So again, you always see the picture of the iceberg. And we only see the top the success of I failed more than I've won. I've my days have been like oh my god type of days. And it seems like wherever something happened to its historical, I'm starting a financial services company, and 911 happened. So you couldn't have picked it. That was my first day. And so my license really didn't turn on for a week and a half, because the market was closed. And my dad had called and said, Hey, do you want to go back to the fortune 500 company because this might be the worst time to start a business. And I'm like, it can't be a better time because people are gonna be dropping out and I'm gonna be starting. And so we're what you see now this perfectly preserved torso, a lot of stress, a lot of risk. Wife number one Corvette number one, house number one all in my rear view mirror things didn't get divorced and 911 911 ended like a whole bunch of stuff. And I think the bet that anyone would have made I would have made a million dollar bet with you back in the day. If you bet me I'd get remarried. I was under No, under no circumstances were they going to let that slow me down. I was gonna date for the rest of my life. And if George Clooney can do it, I could do it. And then I fell in love. And now I have 10 year old twins, I wouldn't give him up for the world. Still married. And so the funny thing is my wife's a teacher was a second and fourth grade teacher. And she's risk averse. And every now and then I'm like, you don't know what it took to give me the risk I had to take to get here. And for a while my dog ate better than I did. You know, and for all the entrepreneurs that are out there. And you saw the picture of Elon Musk fixing his own BMW. Now my success story is nowhere Elon is now worth more individually than for BMW, which completely no good for him. And that blows my mind. Like he was fixing a BMW because he had money for, you know, a new car and now he's worth more than four times the company BMW. I'm a fanboy. I got a Tesla. I just love. I love the way things and I'm starting to realize, because I've been called a disrupter. And I didn't know what that meant. And I wasn't sure if that was a compliment. And then I'm starting to realize The people that really make a difference, disrupt, they do it right. And they do it well. And they always do it with the intention of helping the client helping the end user helping humanity in the Neilan case, I have nothing against humanity, but that's not my client. So I have to help who I can help. And hopefully, by doing that, they have more money to do what they want to do. So my short story is I was going to be an executive, I started my own business 18 years ago, worked for a brokerage company for two years, and then went out on my own. And I am literally in Valley Forge, and if you know Valley Forge as a place, the other company is Vanguard, so I am in Vanguards backyard, and I was never going to be bigger, never going to be cheaper. So 18 years ago, using my NBA spidey senses, I decided then to be different. And for me, and for investments different is when I found out about accredited investors, and that they have access to things called accredited investments, which we can talk about today, I realized that's going to be my niche, because that's not for everybody. And there is there is a litmus test of who can understand if anyone can understand but who can get into it and who can have access to it. That's been our claim to fame. And now with stocks of all time highs, bonds only going down. People are starting to say wait a minute, what, what else is out there? We've never been busier. I've doubled double the last two years in revenue and probably doubled the last few years and staff so much. So I need to go hire a director, a managing director, because I can't do the job I want to do, because I'm doing the job I don't want to do which is staff meetings. And being your manager. I'm a leader. But Steve Jobs had a Tim Cook, and I'm looking for a Tim Cook. So if anybody wants to if anybody wants to organize chaos, yeah, no, I'm glad. That analogy. Yeah, I'm glad to let you lead off there. Because yeah, there's no one that could quite describe me like you, my friend. And I'll try my best to try my best to follow it up from the outsider perspective. But for people listening, Fred is a member of abundance that we typically have on the show. And whenever we're in abundance, and we're looking up new investments, or have new investment opportunities presented to us or any kind of spotlights on funds, different vehicles to go towards Fred's kind of the guy. That's like the litmus test for everything coming in. And you're the one that always asking the best questions. You're basically the Bulldog, we send it you're like, alright, if it passes Fred's test, like we'll take a look at it. So that's why it's really cool for me to have you on here so that we can talk at a super high level, we could talk about what the accredited investors can do. And then maybe what like the average people on the street can do with all this wackiness is going on in the world right now. Because we got this Ukraine situation. And that's probably going to be one of the titles of today's show, is what the hell is going on. So it's like, what's the end game here, but at the end of the day, what you and I like we can donate to charities like Ukrainian charities, we can do all that, but we can't change what's happening, what we can do is proactively act on it. So this is gonna be a conversation for everyone buckle up, buckle your seatbelt, take another sip of the coffee because we're gonna get into economic policy. We're gonna it's gonna turn Fred on, are talking about economic policy, alternative investments, where to park your money for safety, how to avoid how to mitigate downside risk, how to have growth opportunities, basically, wherever you want to start my friend, the the show is your oyster. So the thing I like to start with is, if if your listeners Google best NFL financial advisor, I organically show up on the first page, and usually the first unpaid for thing, I've never paid for it. I like to say I'm like the rock, but I have more hair, and I'm half the size. I'm five, four, I think his right quad is five, four. But the reason I tell you that is if I can explain it to football players who are in the equivalent of a car accident every weekend. I can explain it to anybody. And I think that's something that so Ukraine, one absolutely horrible, I think the things that we have to look at the board how it is not how we want it to be. And we are in a world that's becoming almost impossible to do. What I mean by that is we are all building with technology, our own echo chamber, and and you hear what you want to hear because you're in the same everyone that you're in hates the same person you hate or loves the same person you love. And we know there is no news anymore. Their story. There's an algorithm, there's algorithms and then there's also a narrative, but sometimes life pushes through like the real facts push through. And although Greta won't like it, we can't move off of fossil fuel for the near and probably foreseeable future. And that is something that everyone's to my Tesla plugs into a nuclear plant. It's not green, I guess it's the until it's not clean until it's dirty, it's the cleanest of the dirty. Most energy, most cars are not very good take me at, I didn't buy it to save on gas. And it'll take me at four years the way I drive to save on gas. So for the Ukraine thing, I think there's a few themes that I think we can start to extrapolate. One is, oil and gas is not going away. And there is a real economic reason why we want to be at a country energy independent. Now keep politics out, which is really hard to do. But at one point, we were energy independent. Now we're not. And there's one thing that changed, and I'm not going to say what it was, but we all know what it is. So we need to go back to being energy independent, and we can do it clean. And we're not saying on bury all the Indian burial grounds, and we want to do it with respect. But at the end of the day, there's the more you pay in the gas, the less you have for other things. And that doesn't help anybody. So the Ukraine shock really isn't a shock. He had months. Putin that months of going in there, I'm going to guess we will not be getting into World War Three for Ukraine. I will hope that's true. I think all none of us expected. I think what will happen is Putin will lose from the inside, because his own people are they still have access to some version of Twitter. And you when you see what's going on, a lot of the Russian troops don't want to be there don't know why they are there. And frankly, Ukraine is as fighting with Canada, except for Canada used to be part of us if that in the exam used to be. Yeah. Tell who was who. Yeah. Other than lines on the map, there were the same people and the people level. So again, looking at the board how it is. I think Putin completely miscalculated everything about it. I think the the I don't think Russia is nearly as financially big as people, I think someone said the GDP of Russia is the same as New York. That's, that's crazy. That is crazy. And I don't know how true that is. I guess I could have Googled it. But I'm sure it's not nearly the size of us or China. So that's one thing. The second thing, which is a little bit interesting, is we've seen how quick people can turn off. If someone doesn't agree with you how quick the government can turn off your money. So right now we're living through a true world again, seeing the world as it is that cryptocurrency has real value that fiat money doesn't. Because I can take it off the exchange, put it on a thumb drive, and you can't take it away. I don't care who you are, and what happens to the liquidity of it. So I am seeing that were Coinbase and all these all these different parties. Obviously you can have on your own thing, because I used to have like a Ledger Nano. It's like your own hardware wallet is the word I'm thinking of. Because if you can't, I'm sure you can figure out some way through like a VPN but there now the exchanges like the intermediaries are blocking off. So yeah, so you just have such so the workaround would be you have it on your you know, hardware wallet, if America turns off Bitcoin, which would be a huge Yeah, I don't think that would ever happen. You can't turn off the blockchain. You can't turn off Bitcoin, you can restrict who gets in and off by but Software wise, but you just tell the VPN, you're calling in from Jamaica. There you go. So I'm not saying it's gonna be that Cavalier. But it definitely shows the value of digital currency, especially when we know every one of the truckers and they've taken their money of the truckers that we're riding in Canada. But we don't know any of the Jeffrey Epstein's clients, even though they're just a court and they had all those documents. Like there's some weird stuff going on right now that if it was in a movie, I wouldn't believe the plot. But we absolutely. The truth is these portrait destructors got all their money taken away, because we knew who they are. And pedophiles got away free because no one wanted the names out there because they were powerful. Yeah, it is a wow, the whole galane back. Right. Okay. Yeah, so that's fine. That's not like, again, there's no financial. What do we do with the information that's out there? Number one, understand the information is going to be cloudy, even what we think is happening in Ukraine is going to be cloudy. The Ukrainians want to have and want to say that they're standing up for themselves, and there's really no damage. Russia wants to make sure that they're stronger. If they're so strong, they wouldn't be there. 29 days later, whatever it is. So that's bogged down. But I think the end result is both at the European Union standpoint and the American standpoint, oil matters. And I'm sorry, but it does, because of all the other Reapered repercussions from that. And frankly, one of the investments we're seeing that we did before, before Ukraine was a oil play, because a lot of our clients have a lot of money in real estate, and they have a lot of money tied up and one of the things you want to do is make some decent money outside of the stock market and not tied up. And so for accredited investors and just the we're all in the same accredited, it starts at and it goes up but starts at a million dollars in net worth not counting your house. So this call is going to serve both those people there and those people not there because I want to make sure that everyone gets something out of the call. But just understand accreditation is on the table for you. If you have a million dollars not counting your house, and that's your 401k That's everything just not counting your house, is it worth a million bucks? Number two, that's that's the first litmus test. Number two, are you working with a firm that specializes in that world? I have clients that have $18 million, but they're at a firm that doesn't offer anything more than stocks and bonds. And so they're not yes, they are accredited, but it doesn't mean they have or bought? Or have their money exposed to accreditation accredited investments. So there's two parts of it, are you and then are your team are the people you're using. And being us being in Vanguards backyard? In Valley Forge? We were that was our that's our core competency. We've been doing it for 18 years. And now it's you were the I felt we were in left field. And it turns out, we were ahead of the pack. Because now we're like, hey, we want that. And one of the other questions I think most people need to again, see the board as it is, if financial advisors are allowed or wrong half the time, or if you're working with a financial advisor is not as rich as you are, how where's their information coming from? So when I went independent after the two years working, starting on 911, I, I'm a hard working lazy person. And so estimate, you see this with abundance guys, there's modeling, if you want to lose weight, you find out how someone who's close to your age, and how they do it. If you want to flip houses, how did it so there's whatever the concept is, those Yep. And financially when you model Okay, who are the best? What's the best portfolio, Harvard and Yale foundation by far always comes out as being the being the poster child for how money should be managed. So when I went independent, I just looked at the render, the annual reports are out there, everyone can see it. So I'm looking at the annual reports. And I was surprised that 70 to 80% of their money was not in stocks and bonds. Really, the rest of us are betting on, we're at the casino. And the smartest kids, you know, in the classroom aren't even in the building with us. They're completely different. And then I started to do some research. So I'll put you you're not on the spot, because this is your show. But I will ask you an audience participation question. Brian, if you had to guess how many tickers there are in all of the US market? Like we're talking the trillions and trillions of dollars? How from companies you think are out there? How many different independent tickers? Yeah, knowing that there's 1000s of mutual funds. How many companies do you think they're actually investing in mutual funds on imagine that they'd probably be cycling between only a handful but like individual tickers, like probably in the millions, like 10s of 1000s, hundreds of 1000s 3400. And that's it. When you 3400 When you factor in Facebook, Exxon, Mobil, Apple, the companies that actually people, there's less than 800 to 1200. doesn't notice own most of those. Yeah, yeah. So we think it's just gigantic ocean, it is a four inch wide lakes and the boats we see have no hope. They're just sitting right on top of a four inch lake. So when I'm looking at Harvard, and I'm looking at that these foundations, and we'll call it instead of just Insta foundations, let's talk about the institutions. They have very little money in stocks and bonds, all the rest of us were forced to put it in there, like our 401k. That's our only options. And today, it's going to be scary, because the markets overdue for a correction, which we blow and we know what's going to happen. But here's the bigger correction that most people don't recognize. And like you said, History leaves clues. History doesn't repeat itself, but it rhymes a lot. So from 71 to 81, the market was flat. You and I have had a recency bias, and every time the market goes down, but 911, it comes back up 2008 It goes down and then a year and a half, it's right back where it used to be COVID was down in march back up in May, and back to where it was in which kept on going artificially, that that recency bias makes us think that when it goes down, it'll go back up. So that number one is not normal. Number two, there are people older than us, let's say 60 year old people that have invested their whole life and have never lost money in bonds, because interest rates have been going down for the last 40 years. When interest rates start to go up and they already we none of us expected not to the price of bonds are going to go down. And then people are going to say hey, this is supposed to be my safe money. Now it's down they call and take it out. And so there have been there was a bond fund six years ago, the bond itself went down four bonds in the portfolio went down 4% The amount of distributions maybe we'll call Insane, I want to get redeemed out the amount of redemptions made the fund down 44%. So the underlying assets only went down four. But when everyone's calling saying, Get me the hell out of here, that's going to I think the bond bubble will be a bigger bubble than the market. Because the people in bonds are completely a little prepared for the risk of being in a bond fund when interest rates going up, and they're gonna call and I count on self preservation at a company level, like you, you wouldn't have me on your show unless you thought it was good for you and your show. So there's self preservation everywhere. And I think that's going to hurt the most vulnerable. So you're in a position where 99% of the world have the ability to put money in stocks and all time highs or money in bonds before interest rates go down, and bonds go up, interest rates go up, and bonds go down. And those in the bonds too, are in the stage of their life, then that season where they're starting to draw on that money anyways. So right, they need that money. Now, that's not gonna not only not have income, they're not have principal. Yeah. And then when they so it is, I'm very concerned for the well being of most of the population. So to answer your question, what do you do instead. And there's one thing that has changed in the last five or six years that everyone can benefit on. And it's a concept called crowdsourcing, really mobile is one, I have nothing to do with them, I'm just using them as an example. I have like maybe 20 grand over there just to see how it worked before I recommend it to my clients, kids, because we have people in our office that aren't accredited. And I'm never going to say, hey, I can tell you have money, I can't help you. They need my help more. And so any place that you can crowdsource, and, again, Google, crowdsource real estate, there's a bunch out there, basically, you're going to put small amounts of money into a fund that will be backed by big pieces of real estate. And so one of the things when you look at what happens during the recession, which we're overdue for, and we're probably already in one now, and we'll find out in six months, that we've already won. And inflation is obvious here is hard assets, cash flowing hard assets, can't be, you can't have enough of those, because the stocks are going to go down before they go back up. And they may not go back up for 10 years. And that's that's not necessarily going to be fun to run the bonds. Obviously, if you're in a bond fund, I'd rather you be in cash, because the bond fund has a huge amount of intrinsic risk in it as interest rates go up. So for non accredited investors, things like Realty mogul or anything like that you can put $1,000 in $2,000 in the crowdsourcing concept is get a website, get a fun that people can come into. And they don't necessarily have to be accredited. And so that's something that is already out there. Does their salary have to be accredited, returning, um, I think high single digits, I think I'm up nine or 10%. But it was two of them were multifamily. And you get to see what they are. So it's not a black fund, and you're buying one individual thing, which again, is good if it's a good thing, but the one I made one was a stabilized high income, I'm not going to make make much in growth to the Thai income. And then the other one is a little bit less than your income, but they're taking the income and they're adding, they're updating some of the units in the apartment. So the idea is that will not only bring up more income down the road, because now this apartment can be rented for more. But when you rent for the apartment for more the value of the Empire, the whole, the whole thing looks bigger. So how liquid is that? What are those is there, they're all different. I think it's definitely tied up. It's not as liquid as a mutual fund. And that's one of the things that is a benefit if something's not very liquid, it's also not very exposed to the stock market more stable. So I think they had different liquidity so I think it's every quarter you can request to have your money out but they're all different but I just I wanted to come with ideas that are not just the accredited on the accredited side. I can tell you what we're doing. They're not accredited, I think any platform that lets you crowdsource into something that's not stocks and bonds. Absolutely. Take a look at it, you small amounts. I also crypto using either blockchain or blockchain, I don't care what you use. The Crypto is an asymmetrical return. The motional lose is what you pay. But the emotional win may be way bigger than what you've ever thought. And it's really a function of not only with Ukraine and people being shut money down. It's also smart contracts like all those things are gonna roll out and we're almost like that frog being you know, boiled alive, we're not gonna see it until it's already here. So the things that the blockchain will help with down the road title insurance or liens against your property. You don't you really don't need the whole industry once it's all on a blockchain. Now they're going to fight it tooth and nail because obviously, it's an entire industry where people making a ton of money, but even things on the web where I have Eagles tickets, and you want to buy the tickets, but only Internet, we don't trust each other. There's surfaces there that StubHub and Ticketmaster and all those guys those, yeah. That's ready for the blockchain. Yeah, yeah. And so you add blockchain with smart contracts. I can say, hey Siri, let's buy tickets for $300 or more, you can say, hey Siri, are there any Eagles tickets for $300 or less. And as long as revalidated, it'll be automatic. So your non accredited investors can also do that. And I'm not saying we're gambling and the two I would recommend as being the safer of Kryptos Is it very volatile, but it would be Ethereum and Bitcoin. That's, that's my it's a me problem. But I also think it's probably good. So I've made I made a shit ton of money in crypto lost a shit ton of money in crypto. And then just so I was part of that 2016 While I was in college, because it was all made up money. And because I like started buying Litecoin when they hit right when it hit the coin base, and everything was new. And I had probably 10 to 12 Bitcoin worth and it was like a couple $100,000 I'm like, I'm gonna ride this to a million No problem. I'm just DJing at a college bar. I'm like, now just thinking whatever. But that's part of investing. It's you have to have a short you have to have a long memory but you have to have short emotional reaction to and then just Yeah, I don't I look at it. And to me, how do you avoid gambling with it? Because I had the Bitcoin everything and then all of a sudden you see this all coin? Just like, oh, I want to be in on that. But oh, no. Let me go back to Bitcoin. How do you control that? Just no. Human Design again, history. So the at one point, there were 300. Car manufacturers in America. Mm hmm. And it ended up being Ford, Chrysler. And now Tesla's worth more than every car micelle again, I keep saying Tesla. So Could one of those micro alt coins be the next Bitcoin? Yes. But he already has a Bitcoin. So for me, I'm just what's the single I want to be on the fairway, I'm not trying to hit a home run on my first drive. I don't have to rough I think Bitcoin for how long it's been around and how dispersed it is. It'll never the registry will never be corrupted at any point, because we even know where the computers are anymore. And Aetherium because that's what the smart contracts are using. And their entire companies are built on the Ethereum blockchain, because it's it. And I know and one of the things that's interesting is private equity right now, look at companies that have very large, reciprocal transaction, a third of your company, buy something from me and a third of my company buy something from you. Private Equity buys us both and puts in a private blockchain. Everyone that wears a white shirt and finance in your business and everyone that wears white shirt, finance my business, we just laid him off. And so that's happening now. But it's happening at the private blockchain level, because that's where they can control it and roll it out. And, and all that is the database isn't distributed on every computer in the world, it's distributed between the two. So again, crypto is one of those things that anyone can do, you have to be accredited. And looking back in 10 years, I don't think you're going to think you overpaid. If you paid 50 $60,000 per coin, a lot of people are never going to get to a coin, but they should get a piece of it. And eventually systems like to have if you if a system is left to itself, there's almost always things like 97% chance that it will end in a duopoly, Google and Apple, Pepsi and Coke, Republicans and Democrats like no matter what you are, most systems if you're left handed, largely and so I think Bitcoin and Aetherium will be maybe they'll be others not saying that the only two but they're the ones that matter. So let's I love where you're going here. I love what you started here. So let's put a pin in this really quick. And then let's sit here for a second. So let's sit here with the up and down the street. And then we can build a little bit up in this back half an interview, we can start here with up and down the street, build up to the intermediate and then end it with some really high level concepts. So right now, let's talk to two different people. So the people that I'm thinking of, I'm partly one of them, is people that are well go ahead to probably the most, the probably the best stereotype of everyone right now. And that's the person that's sitting on some cash, maybe they got 20 30,000 They wanted to buy a house, they can't afford a fucking house now, because they're getting priced out of the market. So they're sitting on this cash, they don't know what to do with the cash because they can't afford the house anymore and they're getting outbid cash by whoever the hell is still buying houses for cash and $50,000 over asking. And they're like I'm sitting on this cash now I'm losing my cash to inflation. And I can't my gas is 50% more my groceries are 50% More Where the hell do I put this cash? What's our answer to that person? Because I feel like that's all my neighbors right now. All the people that are asking me calling me they're like Dude, what do I do my cash I like to if there is intent was to own a house and they're there, maybe they're single, or they're just recently married, but they don't have a family, they don't kids, then you could house hack, which is a whole other thing. It's not, it gets you into a house that maybe you wouldn't be able to afford without the hacking, and you can rent the rooms again, eventually you'll move out. But once you buy it, there's not a good place for cash. And leaving it in cash is not a good place over a long term. But you need to have dried powder to take advantage of things. Some of that cash could, let's say, if you have 20,000, put two to 5000. In crypto, I don't think it's going to go to zero in the next couple of years. It'll maybe go from if you put 5000 down to three before it goes up. But it'll Yeah, I don't think we're at a frothy point of it's overpriced. It was at 63,000, less than 12 months ago. And now it's at 4343. Four, I have a little sign over there. And so that was the really depends on the time frame. So investing is matching the risk with the timeframe. And then looking in the environment and seeing the board as it is what math matches those two, I lost a client not lost, I did not get a football player as a client, because he went with a guy that guaranteed them 18% And this was maybe seven years ago. No, you can't guarantee that then you couldn't guarantee it. Now, I My question for him, because his only question was how much you're gonna make me and my question to him was how much you want to make, because whatever you want to make, you gotta be willing to risk that in the short term. So with cash that you need for potential downpayment for something else, because that's what you said. And that's if it's out there other people right now is if they're sitting, if they are sitting on cash, it's because of that it's because they're either trying to buy a house or they're sitting on the sidelines waiting for this imaginary house. Yeah. So I would say places like the old ing account, I think now it's Capital One, or if you're a credit union, interest rates are going to be going up even on the cash. Now, it won't be 7%. If inflation is seven, but it won't be the zero point nothing we have now. So short answer is if you're going to decide that it's going to be five years before you need that money for a down payment, then do you can do certain things with it. So I've seen some banks have special CD rates for six or nine months CD, so you got to shop around, you're going to still get single digit returns, if you're going to want it to be short, light, short, tied up, or not tied up at all. There's no 10% cash account anymore. The other place that I would think of is if you have permanent life insurance, and you have to check with your agent, because some of these aren't built for it. But sometimes you can add money in that life insurance and be able to borrow it back. But within the life insurance, it's making five 6% 10. So that's a short term. So as that's one of the strategies that as you get more money, people have less than the stock market more in real estate, and depending on their game plan might have more in this overfunded life insurance, you don't have to be an accredited investor for that. What you tend to do need to do is have a have a plan and have the policy built for it versus for life insurance. What are some good, what are some good pointers you can give to somebody that's maybe sitting on 30 to $80,000, called 50 to $100,000 of cash? And then they're like, Okay, cool. I don't know anything about life insurance. I've heard about it before, what would you what some different tips tricks you could give them to avoid being completely screwed? Yeah. So I think that the short answer is, if they go to affirm that this is all they do, then they're going to be experts, which is a good thing. But they're going to, there's going to be the hammer, and everything's gonna look like a nail. So looking going to affirm that this is one of the things they do and they do other things means they're less likely to just prescribe the only medicine they have to prescribe. Because they are seeing their view through that. I think the Superfund a life, that could be a whole other thing. And again, I have two policies like that. And I've seen really dogs out there, and I've seen people really get hurt by the idea is sound, the implementation sucked. And the agent made more money than the client ever would. That's, you know, so that it's a gray area there. I think if you had 50 to 100, and you have three years before you need, you've decided they're going to wait for things to cool off for two or three years. That's when you can tie it up. In the real estate that we talked about that was a syndication or that crowdfunding to get money out putting five or 10 into Bitcoin or into Ethereum or split, I would say split whatever we're going to put into crypto, split it evenly between the two, those things and there are going to be because they used to pay interest and then the government turned it off, but they're all going out with probably by the end of the year, you're going to be able to new people are going to be able to earn interest on their crypto. I'm grandfathered in because I was in it before the government said you can't do it. But as part of the settlement they also made it so you couldn't stop me from getting it. In that world, I was getting five or 6% a year just sitting on crypto. So that so that's going to be coming back. So I would say keep some powder dry for that everything I'm reading says it's probably going to come back before the end of the year. And just keep your eyes on the big guys coin base block phi that the ones that are out there, you don't want to use your Baba Joe, your best friend's app that he wrote, you want to have it a big company that has some backing from the institutions, I definitely would say for for regular folk. If you have money, there will be things on sale. And when the market does its thing, which is overdue, you can pick up your pride pick up apple and Tesla and all the other companies are all going when the market was down, they're all going to go down, you could then take advantage of it. The 60, the 70 to 80% that the Harvard and yells don't have in the market, I would not be surprised if that is more money in the market after things go on sale, because that's just the allocation now because it's over, they're making money off somewhere else. So I'd say keep some dry capital for some opportunities. See if you can house hack with either buying an investment property with someone else because you can't afford it by yourself. Or if you can live with renting out rooms and bootstrapping yourself. That's another house hack where you're buying it as a residential house. But you're renting out the rooms, you got to make sure that the the borough allows it or whatever. I'm not saying do anything illegal. But I've seen you only lose money in real estate if you sell it wrong. So yes, you're probably overpaying for it. And yes, it'll probably go down in value before it goes back up. But held long enough, it will go up. So if the idea is the the mortgage can be paid by renting out the rooms today, and it really doesn't matter what you paid for it, because you're going to be able to cover it. So again, maybe five years ago, you could have got it cheaper, but okay, you're not there. And you can't do it five years ago, there are bad times to buy real estate. I think we're getting to the frothy part of real estate now. But a lot of the real estate that I'm seeing is frothy is affordable housing, affordable houses, they're not building it anymore. So once they have it there for so that's when you have to write the love letter multifamily, there's a lot of multifamily coming online, because it's been under supplied for so long. And multifamily, the perfect would all call professional multifamily. It's where everyone does their zoom meetings from at work. And the new multifamily that's coming out is going to look like luxury vacation, I saw one, it's going to be a $50 million lagoon. So it's a gigantic pool. It's like it's they're just building, they're just building a class because they're going to get the same returns on a class that they wouldn't be anyways with have the cap rate. So look and see exactly, exactly. The one that we looked at, it's going to be in Texas, and the single family homes being built are going to be 400,000. Because that's their core market. Now it's you get one of three flat you get. It's not like a Toll Brothers, we can change everything. It's going to be pretty much cookie cutter, there's some upgrades. Again, this is not this is just what's being built in the market? The the short answer would be you want to be more strategic in your in your disbursements, I would say you don't want to follow the crowd. So the story when the market collapses, that 4 trillion shares were traded. And we all hear oh my god, 4 trillion people sold. But it's a market. And that nearly means 4 trillion people bought. And so you want to be disconnected from feelings when you feel like it was it's horrible to own stock, that's probably when you need to buy it. And so your listeners with cash, I think having cash on hand leading into a recession leading into a market correction, and we're probably gonna have both, that's going to be a good place to be now short term, yeah, you're maybe losing to inflation, but you need capital to deploy when things are a better value. So I it may be a buying opportunity and the next three to six months. And if you're sitting in cash for three or six months, I think the Buying Opportunity will pay for itself what you where you put that money will make up for the fact you made zero point nothing on the cash. Yeah, I agree with that. So like right now I'm building up my kind of powder reserves. And so we'll say by me also, I also have house hacks. So I don't have to worry about a mortgage like I'm early in the basement of one right now I've got multiple, so I'm just gonna be here. I'm just gonna be sitting here just reaping the both the best of both worlds. I'm capturing my inflation and both my properties. So that's the net worth while I'm also just now I will say this, I will say this, I have made a slight pivot and then we'll be brief on this so we can get into what the intermediate and advanced investors can do here. But like for me, I was trying to force bad deals down here in Atlanta, because I'm just like I buy assets and have bought an asset that Need to buy an asset. And it was just taking so much mental space, I'm about to go travel around the world for a bit. So I'm like, why would I buy something that's super heavy on the management side, I was like, That's stupid. So I'm like, somebody offered the advisor, like, hey, instead of buying the asset, build the asset. So now this podcast is brand, this is all going to become asset. So that's what I'm putting all my seven dry powder, building this into an asset. And there's a ton of people that can build a business that has very little cost, and can be self managed at some point. And there's entire books about it. As long as it's something you're interested in, it won't feel like work. And I think we're gonna see I think it's the next evolution of the gig economy is everyone has value to give the question is how do you capture it and monetize it? And how are you smart enough to do it, because everyone knows what needs to be done? I need more setups and eat less carbs. But how do you do it, you have to kind of know yourself. So congruent congratulate for you, you're hacking, and again, I'm talking about House hacking, you've done it more than I have. But that's also on the flip side of that it's, I'm sick of it. And now I'm just 767 figures of dry powder to drop into commercial. And I'm going to walk. So I think that and this goes, that's very similar to what we're seeing in other places. So getting back to the rich getting richer, and it being a business, qualified business and accredited event business. If you're selling real estate Hi, and you're exchanging and into another piece of real estate that you can afford, you're probably buying that one high, too. And it's a function of if other people can buy it. It's frothy, and so anything that mere mortals can buy, could I count that as not, not institutional real estate, we're probably overpaying for it at some level, because it's 15 people dividing it. And again, seeing the board as it is not how you think it shouldn't be or what's fair, quote unquote. By the time a lot of times you see a big development being built. Even if it's the same Amazon distribution center, by the time you see the sign or put on it, even if you had the 100 million dollars, and most normal regular people won't have that or want to put in one acid anyway. It's already been sold two years before, and then they build it and did a Sally's buyback. So what we've been seeing as a trend, and what we've been helping everyone do is if they either have cash to deploy, so this gets to your, if someone hasn't is worth a million dollars would not count in their house, but they only have 50 grand to play with. This is the beginning of that job. So these are not high minimums, you just have to be accredited to be to be have access to it. So you're everyone's probably familiar with a 1031 real estate, you sell it, you exchange it in the into something similar, and you have to pay taxes and attend 31. Yeah, my cow for your cow, but not my cow for your bowl. That's how that works. So what I'm saying as a side of that, as a mind blowing idea, that shell, you can get on that shell of you're putting money into something that's a bigger, so you're selling it a $400,000 property, and you're going into a piece of an Amazon or a grocery store, whatever what it is, by the way, it's static at that point, we found a way, and we're probably not the only ones have found the way but we have access to that people investors putting cash into that structure. So you're putting cash into the end of the day, it's called a DST, you put cash into the DST because you didn't have a property to sell. So you didn't do the 1031, you're putting cash into it. Two things are going on number one, this is the capital from the 1031. Both. So if you have a 1031, you can sell your property at the all time high, and then move into a DST of your choosing. And if you have a package, so let's say what the normal investor would do, like they would have 10 single family homes that sell single family homes to go into multifamily. And then so if for anyone that's unfamiliar with 1031 exchanges, it's going to be you have a time window that you have to buy the property. So you're saying that I didn't know this. So you can just take that those funds and put it into what this DST is. Yeah, so it's still 1031. So there's two ways to fund the DST, you're selling a property and you take the you get take the money from you got to use an intermediary. And that money rolls into a DST that you choose. And the DST right now we have storage. And they're all I don't make any of it. So they're all big names you've heard of. And we just were manager, the managers and we have access to it. So yes, people are selling the real estate doing a tax free roll into a DST, what I'm suggesting that a mind blowing thing is in addition to that way of funding a DST some of your listeners might say hey, I don't have real estate now. I still got the 100,000 I saved up to do it. But I don't want to overpay for you know the condo I might be able to buy with 100,000 or maybe a duplex for 100,000. What I'm suggesting is they look at potentially, they can put that 100,000 into multiple DSTS and have a fractional ownership of better real estate like you're gonna pay for a trust with two or four grocery stores or a dialysis center or an Amazon distribution center or a $300 million multifamily or storage, like we have mall is probably better than you buying one thing in your neighborhood. And so here's the cool thing, whether it's a 1031, and you rolled it into, or whether you took money out of your bank account and put 50 grand into the DST. From that moment forward, it's real estate status indication, it's not a partnership, it's not tax like an investment. It is real estate, which means when in five to seven years, every DST has a different life that usually five is on the multifamily and seven or eight might be for storage or mobile home, or might take that longer to monetize. Because you don't want to jack up everyone's price in the mobile home park, everyone's gonna leave, let's say five to seven years from now, when that DST comes back, you have three options, you can pay taxes, like it was a syndication or like it was an investment, you can roll into another DST. That's how my kids are going to be going to college, because that's really what we do. And we have enough money on the street to know what's coming back. And when it is, or because it's real estate, you can roll out of a DST back into an individual property in your name. So you're not stuck in my world and institutional world. But right now, with regular real estate, let's say sub $10 million, there's a chance it's profit, and there's a chance you're not the only one competing for that property. If you're getting into brand new bill, Amazon distribution centers, or you're getting into essential retail and someone has a contract with all the CVS is there's nuances to this that are very sponsor specific. And I don't want to, you know, get sued for telling people their secret recipe, but our job is to find out who has access to this and why and is it legal and ethical? And the answer is yes, because it's these are all FINRA regulated SEC regulated. But long story short, it allows regular people that are accredited, have access to institutional properties, and the technical term is swap into your drop. So let me use me as an example, put $100,000 into a DST and joint name me and my wife, every five to seven years, I roll into another DST that I choose again, I get to choose as the investor, at some point that 100,000 Let's say is worth $2 million dollars on me and my wife checkout, my kids get a data death step up to about $2 million. So the capital gains that I kept rolling, never get paid when I die and my wife dies, assuming let's say I die first. There's a date of that step up. And that's because that's real estate. Yeah. So it was a package is going to be safe moving forward. I know that there was some talk. It's always been on the table. I think, the amount. The thing that I think, again, seeing the board and I say this a lot because it's true. The things I do and the things we do for our clients, if everyone did them, no one could do them. And the fact that no one's doing them mean some people can do that is just the world. So everything we're doing is ethical and legal loopholes or eco Carter's that allow you to benefit from the code. The DST was created with the IRS, the company went to the IRS and said, Hey, how do we do this? And the one other thing that I like about the DST always has to be investment property. But you can roll a DSC from storage to multifamily to, you know, mobile home park, you're not stuck in the type of investment. You're not stuck at the asset class level. What is the really cool? What is the return look like on that? Is it like a capital event return? Is it a cash flow return or the income. So the investors have a choice, they can pick one that has no income that comes out. And that means you get passive losses to offset some passive gains, you have other places, it's making money, it's just not paying off to you. And most of the money it's making will pay down the debt. So then five or seven years, you have more equity to move into the next DST. The other one is DST that creates income and generates income. And all of these are built intended. And all we're doing is our monies, is replacing the sponsors equity. So we're not building a grocery store hoping that someone moves in, it's already there. They're already tentative. The income you get on the DST, because it's real estate, they can accelerate depreciation and amortization to cover the income and make the income tax free. So right now you're gonna have single digit tax free income again, these aren't crazy, these are saying, Oh, but that's like, that's a double, like single digit tax free income, and then the appreciation so if inflation is bad, that appreciation gonna be even bigger. That appreciation you don't see until they sell the property and when they sell the property, they give you 30 days to say do you want to cash out and pay taxes? Do you want to roll into another DST or do you want to roll into a property that you want to continue? Throw yourself. Everyone has those three, and everyone and unlike the old tenant in common, everyone can make a different decision. So you're not, I can't get everyone in my family to, to decide what to have for Thanksgiving dessert. So you these aren't the tenant and comments, the sponsor, for all of these have a job like a general partner, even though it's not a partnership, their job is to do what's right for the shareholder. So their job is to be managing the property. If it's retail, it's going to be essential retail grocery store, Pep Boys, dialysis center blood plasma centers, thing that were things that still opened in COVID, and still would be opened during a recession. I would put the state stores in those, but it doesn't have any no alcohol. But depending on who you are, that might have been mission critical to Dorian COVID. So the DST is something I would look at them to look for it, I'm not saying it's because what we use is we use it because it's something that's a game changer. And it stops you from selling high and buying high, you're selling high, hopefully, if you're selling or you're saying I want to be a landlord, I don't want any of the landlord headaches, and I want to own something that's safe for the median landlord in my town. And so these DSTS provide that ability of partial ownership of the real estate of a bigger policy, property, and almost always a better tenant. Like at the end of the day, I personally have a DST and an Amazon, I don't worry about the rent, and lease with Amazon is 20 years. But the life of these DSTS are five or seven, five to seven, because they want to get out and leave enough juice in it for the next guy to squeeze. So these aren't your singles and doubles. But the higher net worth I've seen, the less people have in the market, and the more they have in real estate. So that's so real estate. And that's one way to do it. The second thing to want to make sure the major themes come out in our conversation. If you remember Richard Gere and pretty woman, he did private equity. And private equity is one of the longest held asset classes of Harvard and Yale back when they when they started showing their annual reports, they still have it today. And again, for accredited investors, you can get into an access to private equity at the $25,000 minimum. So the the investments don't have the high minimum, it's just as an investor to see that part of the menu, you have to check off, you're worth a million bucks counting your house. So that's something that I would suggest they look at of exposing yourself to private equity for two reasons. It'll give usually will give the same upside as public stocks has a lot less risk than public stock, because it's private companies. And then more importantly, we all see the storm clouds, but we don't know what kind of storm is coming in. And we don't know where it's gonna land. And none of us all 2008. But now that we know there's a storm coming, and it might be multiple storms might be inflation might be recession, while there's a stock market correction and bonds go down. I think that's going to be probably likely, yeah, whatever the whatever one more of a trifecta is, that's what that's going to be a quad factor, whatever. Yeah, private equity will have a blessing moment for them, because they're going to be on a buying spree, they're going to buy the companies that that are now undervalued, they're going to buy them off the market, they're going to retool them, so you're gonna see a lot of m&a when things become less frothy in the stock market. So private equity would be an asset class, I not only would suggest people look at getting into, but also never getting out of, you can take money off the table. And if you have 100,000 in it becomes 150 Take that 50 new, but it should be especially if you want to mimic the Harvard nails you got to do its modeling, you got to do what they do. They have money in institutional real estate, they have money in private equity. I think the other thing that we've seen, and we've put a lot of money in for me personally, and also as the office is short term oil or gas plays. And those things are again, an accredited investment. So if you're working with a firm that this is what they do, they're going to have options for you. And if you're not working with a firm that has access, you need to find a firm that has access, because these things are and I met some good abundance guys that are other advisors, and like how are you doing what you're doing? If my clients knew what you did? They wouldn't be my clients. So I gave them the contacts I use the here's the company I use. Here's Tom Fred sencha. Because there's enough for everybody I'm not. And they both and they were two different guys are both the ones guys, they both call me back to Yeah, I can't do it. To me. It's like, they told me that they are selling out of their programs already with people like you, not just me. So I'm not that they don't want to open it up to other people, because then they're going to piss off the people that are already there. And so it dawned on me that there's a huge moat around the accredited investment strategy and the people that do it, because there's so few companies doing accredited investments. There's so much money trying to get into it that things sell out and using the deal Here's an example since it's not a REIT, or a mutual fund, you're buying a specific property, that property only has X amount of equity available. So if it's a, if it's $100 million property, and it's 50% leverage, there's only $50 million, and there won't be a penny more than $50 million allowed in. And a lot of these cases are $300 million, trying to get into something that's only worth 50. And we're seeing that there we're seeing things sell out and with a 1031 if you identify something, and that's not what you got into, there's, there's some real issues, there's liability for you as the investor, there's liability for me as the advisor that was getting you into it. So we're very fortunate to have the business coming in. It's very stressful and have as much as we have coming in and it is not a surprise this would have changed my life. 10 years ago, someone called Hey, I got $15 million I need to find a piece of it I need to find a DST that would have been my year like I would have been okay, I'll help you out. And it'll take me you know, a while it'll take me weeks to get navigate what you want and what's available and matchmake now that is almost on a weekly basis and it is blowing my mind it is blowing I have to you know move out of my office down get a bigger office so there's very even though the real estate might not be frothy value wise the amount of volume leaving individual real estate and going into these things and are people saying I have cash I want to be in real estate but I want to be in that real estate I want to be in smarter real estate in their opinion why one of the few games in town and that's I'm happy with that but it's also there's some gray nose hairs in here because of the amount of money coming in but I have to place or else they owe taxes and no one wants to owe taxes yeah good problem to have So as a summary so we got DSTS we got gas and oil plays we have all this for the accredited investors and then backing up for the up and down the street the marks in the Susan's salaries in the Joe's we're going to have sitting on some cash put a little bit of crypto put a little bit the crowdsourcing and then looking at that but it's always good to have a little bit of dry powder just in case the beans get a little bit frothy. Yeah, absolutely. There we go. Awesome. I love it brother man. That was awesome. That covers just about every base that I think that we could possibly cover for everyone listening to this where can people go if they are looking to work with you if they want to find you ask more questions Yeah, so our website CC W mg like cat William Mary Greg and for your listeners we put up a link to sos which stands for Second Opinion service completely complimentary. You click on it you have a scheduled meeting it may be with me depending on when you schedule but you will talk to one me or one of the other well strategist and we will just meet you where you are answer what questions you have. It is not is the way I give back. So I don't use it as a way of making clients we typically get our clients through referrals of hey, you helped me with my taxes. Can you help me not pay any taxes? Can you do it with my buddy? So I have I'm staffing up so we have people Operators are standing by these guys are licensed advisors, but they know that this is our part of our give. So it's called the SOS you'll see it on our website under the what we do. And you'll see a lot of profiles of the kind of people and the kinds of things that are out there. So our website has a lot of information. I think the best thing is CCW mg, click on SOS I opened it back up because I figured I wanted to give your people some place to go. And we'll help if we can and we'll be the first one. It's not a sales gimmick for us. Yeah, you've gotten a phone. Yeah that's why I call the people that are doing well enough where it's like I don't gotta sell anything. That's a good position to be in man. I appreciate it man you of course you came in knocked it out the park over delivered as always, thank you for having greatly appreciate your time your friendship, man. It's awesome to have you. And yeah, and I was about to say what the way that this all this is going we'll probably have multiple episodes down the pipe. Yeah, each of those could be and your listeners can if they play it back and half the speed. I'm actually a regular. I'm at my regular pace and half the speed. Okay, a lot of good out there. Alright, Fred, Fred, thanks for having started off with the action Academy. Take