Wealth Formula Podcast

Buck talks about the impact of uncertainty, particularly during presidential election cycles, on decision-making and offers advice on how to navigate through uncertain times.

This week, Buck and Zulfe discuss various topics related to wealth and finance. They start by talking about the mindset of the wealthy and the common denominators among successful people. They also discuss recent political events and their potential impact on the market. They then delve into the current state of interest rates and how it affects real estate investing. Finally, they introduce Ryan Haley and Jonathan Wield, partners at Velerity Wealth, and discuss the comprehensive financial advisory services offered by a family office.

The idea that individuals gravitate towards their perceived financial worth can be observed in various real-world scenarios. Consider the case of lottery winners. Research has shown that a significant percentage of lottery winners eventually revert to their pre-lottery financial status within a few years. Despite the sudden influx of wealth, these individuals often lack the internal belief system necessary to sustain and grow their newfound riches. Their wealth thermostat, set at a lower level, pulls them back to where they began. A study by the National Endowment for Financial Education found that approximately 70% of lottery winners end up broke within a few years, underscoring the powerful influence of their internal wealth thermostat. On the flip side, stories of ultra-wealthy individuals who have faced financial ruin but managed to rebuild their fortunes provide compelling evidence of a high wealth thermostat. Consider the case of Donald Trump. Despite facing bankruptcy multiple times, Trump managed to rebuild his empire each time, driven by an unshakable belief in his ability to generate wealth. His wealth thermostat is set high, and he naturally gravitates back to that level of financial success, demonstrating resilience and unwavering confidence. Another example can be found in the world of professional athletes. Many professional athletes earn substantial incomes during their careers but often face financial difficulties after retirement. This phenomenon can be attributed to a wealth thermostat set at a lower level, where they lack the financial literacy and belief system necessary to sustain their wealth long-term. These athletes, much like lottery winners, revert to their previous financial state despite their temporary wealth. Napoleon Hill, in his seminal work "Think and Grow Rich," explores the principles behind the wealth thermostat. Hill emphasizes the power of thought and belief in shaping one's financial destiny. He asserts that success begins with a clear and unwavering belief in one's ability to achieve wealth. Hill's concept of the "Definite Major Purpose" underscores the importance of having a concrete and compelling vision of financial success. This vision, when internalized, becomes a self-fulfilling prophecy. Hill also discusses the role of the subconscious mind in regulating our actions and outcomes. The subconscious mind, influenced by our beliefs and self-image, acts as a powerful force in determining our financial reality. To reset the wealth thermostat, Hill advocates for techniques such as positive affirmations, visualization, and surrounding oneself with influences that reinforce a wealth-oriented mindset. Resetting the Wealth Thermostat To reset the wealth thermostat and elevate one's financial status, several strategies can be employed: Belief System Overhaul: Begin by identifying and challenging limiting beliefs about money. Replace these with empowering beliefs that reflect a higher financial worth. Affirmations and positive self-talk can reinforce these new beliefs. Visualization: Create a vivid mental image of the desired financial state. Visualization helps to program the subconscious mind to align actions and decisions with the goal of higher wealth. Education and Mentorship: Invest in financial education and seek out mentors who exemplify the level of wealth you aspire to achieve. Learning from those who have successfully navigated the path to wealth can provide valuable insights and inspiration. Environment and Associations: Surround yourself with individuals who have a positive relationship with money and who support your financial goals. The environment and social circles play a crucial role in shaping one's mindset and behaviors. Action and Persistence: Consistent and purposeful action towards financial goals is essential. Embrace setbacks as learning opportunities and maintain persistence in the pursuit of higher financial worth. My guest on this week's episode of Wealth Formula Podcast has taken a strong interest in the psychology of the rich and is writing a book from his observations of wealthy individuals. 08:06 What Makes Rich People Rich? 09:53 Feel Like You Are Worthy of Wealth 13:29 The Habit of Never-Ending Learning 15:35 The Value of "Networthing"

Buck recounts the time he met his hero through manifestation.

This week's episode explores the world of artificial intelligence as it relates to stock trading. While I'm not a stock trader, I find the use of AI in various aspects of finance fascinating. But before we do that, let's take a step back for a moment and realize that sometimes you don't need artificial intelligence to guide you. Sometimes you just need common sense and some guts. If you've got those qualities, you should be chomping at the bit right now. As Warren Buffett famously said, "Be fearful when others are greedy, and greedy when others are fearful." This contrarian approach has proven successful for many investors who have had the courage to act when others hesitate. Historical examples demonstrate the potential rewards of this approach. Following the 2008 financial crisis, investors like John Paulson and Sam Zell capitalized on depressed real estate markets. Paulson's hedge fund reportedly made billions by purchasing distressed properties and securities, while Zell's Equity Residential acquired thousands of apartments at steep discounts. The current multifamily real estate market provides another opportunity for people to make extraordinary profits. We are just at the beginning of a new cycle. Unprecedented interest rate increases have decimated property values, creating a unique opportunity for investors. The key to success in these situations is to identify markets that are temporarily depressed due to external factors rather than fundamental flaws. In the case of multifamily real estate today, the current downturn is driven by interest rates, not a lack of housing demand or oversupply. When investors purchase already discounted properties in high-interest rate environments, they position themselves for further potential windfall gains as rates normalize. As interest rates decline, property values typically increase. The moral of the story is this, while fear may dominate current market sentiment, history shows that those who invest wisely during downturns often reap substantial rewards. As Buffett noted, "Opportunities come infrequently. When it rains gold, put out the bucket, not the thimble." The current multifamily real estate market may well be one such golden opportunity for investors with the vision and courage to act. All you need is some common sense and some guts. But in this week's Wealth Formula Podcast, we are going to talk about more nuanced things that might require something extra like artificial intelligence. 05:50 Using AI for Stock Trading 07:30 Do You Use AI for Daytrading or Long Term Trading 11:31 Is AI Closing the Gap Between Institutions and Everyday People? 19:16 How to Get Started with Using AI for Daytrading?

How do you measure your professional success?

Buck and Zulfe discuss the importance of teaching personal finance to children and share their experiences with their own kids. They emphasize the need to go beyond basic financial literacy and teach kids about debt, investing, and building wealth. They also discuss the power of compounding and the different ways to compound wealth. The conversation then shifts to the market update, with Zulfe highlighting the record highs in the equity markets and the decreasing bond yields. They also discuss the possibility of the Fed cutting rates and the potential impact on the economy. The conversation discusses the potential fall in interest rates and its impact on various asset classes. It emphasizes the opportunity to buy assets at discounted prices before rates decrease. The discussion also touches on the performance of gold, Bitcoin, and other speculative assets. The potential benefits of lower rates on equity markets, bond markets, and real estate are explored.

My dad is a wise man. Like many teenagers, I didn't always think he was. Growing up, he didn't say much. He wasn't the kind of dad who was keen to talk to me much about life. But when he did, I realized decades later, that he was usually right. I remember my dad buying a lot of real estate when I was a kid. Most of the houses and small multifamily units he bought looked pretty ugly to me. So I asked him how he chose his buildings. "Cash flow", he told me. I didn't know what he was talking about and didn't really care but years later the words "cash flow" became serious buzzwords as Robert Kiyosaki released Rich Dad Poor Dad. And, as it turns out, cash flow is indeed the most important element when it comes to buying real estate. Another time, I remember him asking me why I wanted to go to medical school. He said if I wanted to make money I should be doing real estate, not medicine. I was appalled that he would dissuade his own son from becoming a doctor. But in hindsight, I would also probably warn my kids against medical school as a path to financial prosperity in the future. Finally, I remember during the late 90s, when I was in medical school in Chicago, Alan Greenspan raised interest rates rapidly. My dad had a lot of floating debt and ended up losing a lot of money. He told me to beware of floating debt. And of course, he couldn't be more right about that one considering what has happened to the real estate markets throughout the country over the past two years. Looking back, I wish he had taught me more. But those were different times and parental relationships in immigrant families were quite different than the kind of relationship I have with my children today. However, I think that it is still the case that most parents undervalue teaching their children about personal finance. Perhaps it's because they don't know much about it themselves. Maybe it's just not that much fun to talk about. Nevertheless, it is something that I think all of us parents should take a step back and consider what kind of financial education our children are getting at home and what we can do to help them be better equipped for the future. My guest today took that message seriously enough that he wrote a book on personal finance with his own daughters. Make sure to tune in to this week's Wealth Formula Podcast as Alpesh Parmar takes us down his own journey of educating his own children on money matters.

The first step to stop trading time for money and start building wealth is to figure out how to pay less taxes. Here are two real estate strategies to save on taxes for W-2 employees.

What do you do when you're not happy with the way things are? That's a question I have been asking myself a lot lately. In my case, I'm talking about life outside of business and real estate. You see, I've been divorced for a few years now and I have still not really rebuilt my life since then. When I have my kids, it all makes sense. It's about being with them. Last weekend we played four square, badminton and threw around a baseball. I'm pretty sure I had more fun than they did. But when I'm not with them, I sometimes feel like I live in a 7500-square-foot luxury jail. You see, I work from home and really don't have any reason to leave the house. Every morning I work out. Maybe I go on a hike or I lift weights secretly hoping that bigger muscles will solve my social problems. Sure I have some friends but most of them are married and busy with their own families. The dating scene in Santa Barbara has been remarkably bad and so… I'm still single. The bottom line is that my social life needs a facelift. I've been thinking about this a lot lately. I don't know about you, but I spent so much of my life engineering a successful career and virtually no time working on my life outside of it. A lot of guys get away with that and let their wives handle the social stuff. Well, I don't have one of those so I have to fix the problem myself. Somehow. But how? It occurred to me the other day that I should start looking at my social life the same way I look at business. What did I do to become successful in my professional life? Thinking back, I kept seeing a similar pattern. I would decide what I want to do and somehow make it happen by physical movement—even if it didn't make sense. Somehow, that movement itself seemed to make it happen. Let me tell you a story to illustrate. As you know, I was a neurosurgery resident for about a year and a half at the University of Michigan before I decided I was done with that kind of lifestyle and quit the program. It was the dead of winter in Ann Arbor and I suddenly found myself without direction. I decided to do some rotations on some of the other surgical specialty teams at the hospital and ultimately decided to move from Neurosurgery to a specialty called Otolaryngology-Head and Neck surgery—basically head and neck surgery of everything except the brain and spinal cord. To be clear, I wasn't passionate about this new speciality. I decided to do it because the hours just seemed better and it seemed like most of the professors had pretty good lifestyles. Now, I just had to figure out how I was going to get myself a residency position. This was a difficult task. I was looking for a second-year position in a program somewhere in the country where someone had, for whatever reason, left a vacancy for me. Most programs only had 2-3 residents per year to begin with. It's a small specialty. I didn't have a clear place to start, so I decided just to put myself out there and see what would happen. I chose the top 10 programs in the country and wrote letters (not emails) to their chairmen. One of those programs was the University of California, San Francisco (UCSF). In case you don't know, UCSF is one of the top hospitals in the world. For me, getting a spot at UCSF would be like hitting the lottery. Beyond the reputation of the hospital, my sister lived in San Francisco and I really loved the idea of moving there. I had had enough of being in a small college town in the Midwest. So I sent those letters out. A week later, I was sitting in the hospital library looking at programs on the internet when it occurred to me that I had no reason to be in Michigan anymore. I had an impulse to drop everything and fly to San Francisco. So I turned my internet search over to orbitz.com and looked up the next flight to San Francisco. It was leaving in 3 hours from Columbus—just enough time for me to drive there. So I went home, grabbed my stuff and headed to the airport. I landed in San Francisco just a few hours later. And, when the plane was taxiing, I turned on my phone and was shocked to see a text message from Dr.David Eisele, then Chairman of the Head and Neck Surgery Department at UCSF. In response to my letter, he was inviting me to interview for an unexpected vacancy in his program. I went to see him the next day and he offered me the job. Now you can call that coincidence, but the chances of all this happening randomly seem ridiculously small to me. I felt like somehow, I had willed this to happen by putting those letters in the mail and by physically moving myself to San Francisco. And if this story sounds crazy to you, I've got a lot more where that came from. Ask me about them next time you see me. I don't know how to explain these stories, but I've got a lot of them. So my challenge now is trying to use this same kind of energy to give myself a social life! It's a lot harder than professional stuff but maybe it will work. I'll let you know how it goes lol. In the meantime, the reason I brought up this stuff is because the first time I met Lane Kawaoka was at a meeting that I went to that ultimately led me to podcast. That was almost a decade ago. Since then, Lane launched his own successful podcast. I mentored him when he was younger and I've learned quite a bit from him as well. On this week's Wealth Formula Podcast, Lane and I reminisce on the old days and talk about the current state of the investment world. I hope you enjoy the discussion. 12:38 Lessons from the Years 23:15 Investing Outside of Multifamily 29:59 The Construction Space 35:31 The Wealth Elevator