3 Steps to Creating Wealth: What I learned from Grant Cardone

 In Habits, Money, Money Mindset, Saving + Investing, The Hustle

What I learned from Grant Cardone About Creating Wealth

Photo & Media Credit: All photos and videos of Grant Cardone is used with permission from Grant Cardone.

 

If you’re an entrepreneur or in sales, you’ve probably heard of Grant Cardone. He talks a lot about creating wealth. Grant is a professional sales trainer who built a $566 million dollar real estate portfolio from nothing. He’s also a seven times bestselling author, with my favorite books being:

3 Steps to Creating Wealth — What I learned from Grant Cardone

 

While his audience tends to consist of entrepreneurs and people in sales and creating wealth, he shares some thought-provoking ideas around how the wealthy view money. Although his ideas are rough around the edges, they’re actually pretty good.

What I really like about those ideas, while not directly financial, is that they’re real. They’re raw. They’re “tough love” in nature and empower people to make bold and courageous moves to create the life they’ve once only imagined.

Unlike financial entertainers like Suze Orman or Dave Ramsey, he doesn’t focus on the past. He doesn’t blame people or make them feel bad about the decisions they’ve made. He doesn’t deny people what they want in life; he encourages people, and tells them to go find the money.

But, like Gary Vaynerchuck or anybody that’s raw and keeps it real, Grant Cardone is an acquired taste.

With the exception of his book, A Closer’s Survival Guide (I don’t have problems closing deals), I have read all of his books, and I wanted to share some of his ideas that resonate with me. Chances are what you’ve been taught about money is wrong.

Getting money shouldn’t be taboo. It should be your battle cry. Getting money isn’t only possible, it’s vital to your survival and your ability to help others.

We live on an economic planet. Every day we are confronted with money, money requirements and limitations. From shopping at the grocery store, taking care of your family, funding yourself through old age, to taking care of unexpected setbacks, having enough money is a necessity.

The entire subject of money is greatly misunderstood.

Hopefully these essential lessons Grant Cardone will inspire to you get the money you deserve, keep it, and multiply it.

 

 

1. Creating wealth by increasing your income

In order for us to live comfortably in today’s world, we need to find creative ways to earn extra money to offset expenses like student debt. If you want to be that person that helps their church, parents, community, or a charitable cause, you need more money.

There are so many ways to increase your income today. From internet sales, writing blogs, editing for authors, releasing a podcast, creating affiliate programs, and so on. You can also get a job waiting tables, bartending, babysitting, pet sitting, teaching a language, or driving for Uber. You can some more good ideas from this Forbes post.

If you have a useful skill, you don’t even need to work for someone else to make money. You just have to connect with those who already have it.

Make a list of people you know that have money and might be in need of some help. Exchange with them your skills and knowledge so that they share with you the money they have and you can help them out. Invest all your time serving those who need what you have. What is your skill?  How can you profit from it?

 

I started my first company when I was 24. Even then, I knew I had to spend all my time, 60 to 70 hours a week, getting in front of those who could possibly benefit from my products and services, and benefit from them.

I spent almost none of my time with those could not, would not, weren’t able to, and didn’t have money. If you spend all your time with people who don’t have money, and don’t appreciate money, you’ll end up being someone who doesn’t have and appreciate money yourself.

This is just the cold, hard facts of building wealth. “Follow the money.”

 

“I don’t have time is an excuse. All you have is time.”

– Gary Vaynerchuk

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It’s amazing how so many people tell me that they don’t have the time to increase their income. That they have a demanding career and family. Yet, if you examine how they spend their time, they’re wasting a lot of their time being inactive. If you have time to sit on the couch and watch television, you have time to increase your income.

“I don’t have time”, is a lie people tell themselves to justify their current financial situation. We all have the same 24 hours available to us, and anyone can create income.

Want to create more income today?

Go through all your stuff in your house or apartment. Look for stuff you no longer want and put it up for sale. Don’t worry about how much to charge for it, just sell it. That’s income.

Whatever you can’t sell give away to charity and take a tax deduction. That’s reversed income. Instant tax credit is income in reverse.

When you have nothing left to sell go to your parents’ house and see what you can sell. Then go to your cousins’,  your uncles’, and your grandparents’ and take away all the things they longer want and value and sell them. Go on Facebook and Craigslist and find people giving away free stuff. Sell them. That’s income.

It’s a lie that you can’t create more income. You might not want to put in the #hustle, but don’t tell me that you don’t have the time. It’s needed in creating wealth.

I can understand how some people reading this will think that finding a #sidehustle is beneath them. They may think that selling a bunch of old crap is a bit much, or that there is no way are they going to wait tables.

Does a #sidehustle sound beneath you?

What’s beneath you is living paycheck to paycheck. What’s beneath you is not taking care of your spouse and children. What is beneath you is never having prosperity and creating a lifestyle you love.

No, money won’t make you happy. It won’t fulfill you or make you feel more satisfied. That doesn’t mean you shouldn’t work for it.

Money isn’t a problem unless you don’t have it.

 

2. Keep the money

Did you know that most people produce or come into contact with a million dollars in their lifetime? If you make $50,000 a year for the next twenty years, you will produce a million dollars.

The problem is most people don’t keep the money, they spend it. They’re creating wealth in reverse (debt).

Did you know that 78 percent of Americans live paycheck to paycheck? And of that, 10 percent are working Americans earning $100,000 or more? This came from a press release from a survey conducted by CareerBuilder.

Additionally, 50 percent of Americans don’t have enough money for retirement, and 47 percent don’t even have $400 for an emergency.

This is today’s middle-class America, and it’s a compromise. When you think about it, it’s selfish. The middle-class is for those that settle for just enough rather than striving for prosperity. When we compromise our finances, we become unable to help others. That’s because we’re struggling to take care of ourselves, let alone anyone else.

Instead of spending all of my money and constantly inflating my lifestyle, I took Grant’s advice. I’m not spending my money, I’m keeping my money and tucking it into accounts earmarked for future goals and investments. This is what funded my first, second, and third businesses. I’m creating multiple passive income streams that feed each other.

I’m also not giving my money to my kids. With the exception of special occasions, I’m not buying them toys and video games. They know if they want something, they have to get the money. I explain all this in my #AskTommy episode, “How do I teach my children how to save?

What I’m doing is teaching my children that they can do anything they want in life, as long as they pay for it. And at nine and eleven years of age, I can confidently say that they are stacking their money for a future investment.

 

3. Invest the money

“Compound interest is the eighth wonder of the world. He who understands it, earns it … he who doesn’t … pays it.”

– Albert Einstein

The only reason to save money is to one day invest that money.

Like Grant, I have a policy of never having money sitting around. I live like I’m broke (not poor). With the exception of my emergency fund, I don’t have money sitting in my bank account. It’s not possible to multiply your money by having it sit in a bank. The average interest rate on savings accounts is about 0.1%. That’s not ten percent. It’s one-tenth of one percent.

Creating Wealth — The Rule of 7

In investments, there’s something called the Rule of 7. It states that if you can earn 7 percent of compounding interest, you will double your money in 10 years. If you earn 10 percent, you will double your money in 7 years.

If you’re only earning 0.1% on your money in a bank, it will take you 144 years for your money to double.

Also, keep in mind that the annual inflation rate is in between two and three percent annually. You’re losing money by keeping it in the bank. Even the banks don’t want money sitting in their vaults. That’s why they offer loans.

Unfortunately, with investing there is the chance that you can lose some money. Many people lost a lot of money in market downturns, whether their money was in equities, fixed income products like bonds, and even real estate. But the biggest problem that I see isn’t that people are taking on too much risk, it’s generally that they aren’t taking enough. Clearly, keeping your money sitting in cash equivalents is a guaranteed way to lose money.

To give you some ideas for investing your money and creating wealth, here are some quick ideas for investing your money.

    1. Buy investments yourself using online brokerage firms. This is pretty risky as most people that buy stocks themselves chase returns. This isn’t investing, it’s speculating. When building your own investment portfolio, pay attention to trading fees and internal expenses of mutual funds and ETFs.
    2. Invest with a virtual financial advisor. Modern financial advisors, like me, leverage financial technology to invest your money. We’ll make sure you’re investing within your risk appetite, and understand how your investments help you achieve your financial goals like buying a home, starting a business, traveling, or making a capital purchase like a rental home.
    3. Invest in yourself. The return on investing in yourself and your own earnings potential is much higher than that of the stock markets. It’s not even close. Discover who you need to become to achieve your greatest potential, and invest your money to become that person.
    4. Start a Blog. Investing your time and money into creating a blog that people value can produce huge returns. Top bloggers can produce revenue streams of up to $167,553.31 a month. That’s Pat Flynn’s reported monthly revenue of SmartPassiveIncome.com. Now that’s creating wealth! Even Alex of SingleMomsIncome.com reports a monthly income of $6,648.63. How does that work from home job compare to your income now?
    5. Invest in Peer-to-Peer Lending. Companies like Lending Club connect borrowers to lenders (you). They offer investors access to the consumer credit asset class which, until recently, has historically only been available to banks and large institutions.
    6. Pay down your debts. If I told you that I have an investment where you could get a guaranteed rate of return of anywhere between 6 and 29 percent, would you take me up on it? Well that’s your student loan and credit card debt.

Remember that the best investment for you is one that will help you achieve a financial goal. If all you require is a 5 percent return on your investment to achieve your goal, don’t go chasing something that boasts a 9 percent return.

Remember, your income is the only thing that can restricts how much you invest and save.

3 Steps to Creating Wealth — What I learned from Grant Cardone

Conclusion

Like I said earlier, Grant Cardone is an acquired taste. Some people find him offensive because he calls your bluffs. I love what he has to say because he mostly speaks to people like me: entrepreneurs and people in sales. He’s a proven investor at creating wealth. Yes, he’s tough, but he has a really interesting point of view on money.

One thing that I’ve learned from working with people and their finances, (and this goes in alignment with what Grant preaches), is that money gets bored. When we have extra money sitting around, we spend it. And that’s not creating wealth.

Because of that, I live like I’m broke (but I don’t mean poor).

I simply don’t trust myself to just have cash sitting around, so I direct one hundred percent of my extra money to special accounts earmarked for future financial goals or investment opportunities.

I have seen so many people gain success over their finances and then quit the habits that made them successful to begin with and then go backward, financially.

My best advice is to stay broke. Deprive yourself today for the possibility of financial freedom in the future. The reason why most people don’t get rich is because they never even considered it a possibility. They’re convinced by those close the them to simply be satisfied with their financial situation.

Most people aren’t equipped to take advantage of wealth-creating opportunities. They don’t have the money when an opportunity presents itself. If that’s you today, don’t let it hold you back. Commit to increasing your income by living like you’re broke. Keep that extra money you’re saving and invest it so that you can multiply your money. Maybe one day, you can retire early.

Find your hidden talent for creating wealth. You and your family deserve it! It’s the only way you can start helping others.

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