Speaker 1: Welcome The Money in Wealth with John O'Briant, a production
Speaker 1: of the Black Effect Podcast Network and iHeartRadio. Hey, Hey,
Speaker 1: this is John O'Briant. This is the Money in Wealth
Speaker 1: podcast series on Black Effect Network on iHeart By the way,
Speaker 1: we're honored to be associated with these brands and my
Speaker 1: brother Charlemagne where I serve on the board of Black
Speaker 1: Effect also and bring you this content every week and
Speaker 1: an attempt to change your life for the better. This
Speaker 1: is gonna be a very impactful episode, I believe, because
Speaker 1: I'm gonna break down something that no one really talks about.
Speaker 1: I'm gonna break down everything from fake riches to real wealth,
Speaker 1: real generational wealth, and I'm gonna do it in one episode.
Speaker 1: So let's get into this. There are six layers from
Speaker 1: fake rich to real wealth. Six layers. Now, there are
Speaker 1: subcategories in each of these areas, without question, but if
Speaker 1: you understand these six layers, you understand the basic game
Speaker 1: and how it's played. So let's get into the first one.
Speaker 1: The first layer is influencer and bling rich, which ultimately
Speaker 1: means you're broke, but in the short term, it is
Speaker 1: a form in the current definitions of how people define rich.
Speaker 1: It is in the pathyon. In fact, it is probably
Speaker 1: the overwhelming definition in most people's minds of what rich
Speaker 1: really is. And it is something I want to break
Speaker 1: down because I have a problem with people who miss
Speaker 1: represent themselves to be something they're not to have, something
Speaker 1: they're not to take from somebody who has not, and
Speaker 1: then as a result of that, has less. And you know,
Speaker 1: I can almost respect the Ponzi scheme a little bit
Speaker 1: more because at least there is some actual legitimate business
Speaker 1: activity on the way to illegitimate business activity. But this
Speaker 1: is just straight up hustling, particularly some of these financial influencers.
Speaker 1: But I'm not going to get into picking on one
Speaker 1: group or another. I'm not picking on anybody. I'm explaining
Speaker 1: what this is. Now. By the way, there are legitimate influencers,
Speaker 1: and they're the legitimate financial influencers. Ash Cash is someone
Speaker 1: who I respect who's trying to educate people. He's not
Speaker 1: saying something he's not. He does promote a certain lifestyle
Speaker 1: which is aligned with success, but he's very transparent about
Speaker 1: what he's trying to do, is best I can tell.
Speaker 1: So he's really positioned himself as an educator. There are
Speaker 1: other folks who's just straight up line. So a lot
Speaker 1: of these influencers are just straight up faking it. They
Speaker 1: are in a jet that's really a movie set. It's
Speaker 1: not even a movie set, it's a room in Hollywood.
Speaker 1: There may be other cities. I know in Hollywood you
Speaker 1: can rent a room for I think it's seventy five
Speaker 1: dollars an hour that is set up as the interior
Speaker 1: of a private jet. You can rent lambos for seventy
Speaker 1: five dollars an hour. Lamborghini's sorry, you can rent. There
Speaker 1: is a one hundred million dollar mansion in Hollywood that
Speaker 1: is well known. This is not something that is well
Speaker 1: in the influencer community that once a week you can
Speaker 1: rent this place. I think it's one hundred dollars an hour.
Speaker 1: I'm probably wrong about that. I'm doing it by memory,
Speaker 1: and you can show up and report record your weekly
Speaker 1: content in this mansion that you don't own. The shopping sprees,
Speaker 1: folks are going online and buying shopping bags. I'm not kidding.
Speaker 1: They're buying Louis Vuitton and Hermes and other shopping bags
Speaker 1: and then getting a shot as if they're walking out
Speaker 1: of not as if they're walking out of the store.
Speaker 1: Carrying the bags filled with merchandise, but really it's filled
Speaker 1: with stuff, stuffing, and the only thing real is the
Speaker 1: bag which they bought online. There are companies in Los
Speaker 1: Angeles because, in all fairness, if you're in Hollywood to
Speaker 1: day companies won't I'm told, represent you if you want
Speaker 1: to be an actor or creative unless you have a
Speaker 1: following on social media. That's the first thing that they
Speaker 1: go and check it appears. And so I understand the
Speaker 1: quandary of people then going and buying bots and buying
Speaker 1: followers and all this stuff, or doing what it takes
Speaker 1: to try to look successful so they can then get
Speaker 1: the following. Uh, I guess I can understand the hustle
Speaker 1: in that regard. And as long as you're not hurting
Speaker 1: anybody else. By the way, as long as you're not
Speaker 1: asking somebody for money, you're not playing with anybody, you're
Speaker 1: not defrauding anybody. All this is fine. I'm saying is
Speaker 1: not healthy and it's not sustainable. But if that's what
Speaker 1: you want to do, then then then all good. I mean,
Speaker 1: I've I've I've faked it until I made it. Growing up,
Speaker 1: I walked around with fake jurry on when I was
Speaker 1: in my twenties. I had a cell phone wire in
Speaker 1: my Mustang nineteen st seven Mustang. I had a cell
Speaker 1: phone cord connected to a cell phone handle that led
Speaker 1: to nowhere, back when you had phones in the car
Speaker 1: phone handles in the car. I actually went to radio
Speaker 1: shack and bought the phone cord in the phone handle
Speaker 1: and cradle, and then a antenna back when they had antennas,
Speaker 1: and put the and stuck the antenna on the car.
Speaker 1: Because I was trying to look good for the girls,
Speaker 1: I was trying to be somebody that wasn't I understand
Speaker 1: the game, but at some point you've got to grow
Speaker 1: up and move beyond it. And I wasn't trying to
Speaker 1: hurt anybody else. I wasn't trying to separate anybody from
Speaker 1: their wallet. I just was insecure and didn't understand success
Speaker 1: and what real success really looked like. And I didn't
Speaker 1: have anybody telling me, as I'm trying to tell you now,
Speaker 1: how this game is really played. Right, So a lot
Speaker 1: of folks are trying to impress people with money. They
Speaker 1: don't have to impress people they don't know, to live
Speaker 1: in places they can afford, to be something they're not
Speaker 1: to achieve something that's not real with folks who don't
Speaker 1: care about you. So how are influencers that fake these lifestyles?
Speaker 1: How are they doing it where it's actually producing something.
Speaker 1: Here's a quick summary. The ones that are really smart
Speaker 1: have sponsorship in brand deal. Now, the short answer in
Speaker 1: this is views. By the way, a lot of folks
Speaker 1: are trying to make money on getting paid on views,
Speaker 1: which is why you increasingly will see on credible platforms
Speaker 1: like YouTube, you'll see you'll see these clickbait titles where
Speaker 1: a title will bring you into a video, but you
Speaker 1: go to see the video it has nothing to do
Speaker 1: with the title, or it is an outright lie and
Speaker 1: the person that they're saying said something didn't say anything
Speaker 1: of the sort. They're just trying to get you to
Speaker 1: watch it long enough to record as a view so
Speaker 1: they can get paid. The legitimate approach to this sponsorship
Speaker 1: and brand deals, where brands might pay them to promote
Speaker 1: their product to their following, and then they can create
Speaker 1: content that I aligned with those those brands, typically luxury
Speaker 1: brands or products. Influences can then attract paid partnerships making
Speaker 1: it seem like they live in a fluent lifestyle. And
Speaker 1: earning money from the deals at the same time. Affiliate marketing.
Speaker 1: Influencers can make money through affiliate marketing, where they promote
Speaker 1: products or services and earn a commission for sales generated
Speaker 1: through their unique referral links that are tied to them
Speaker 1: and their name. You'll see that on many influencers pages.
Speaker 1: This can include everything from fashion and beauty products to
Speaker 1: high ticket items that fit the luxury image they project.
Speaker 1: Nothing wrong with this either. By the way, you won't
Speaker 1: see that on any of my pages. Just to be clear,
Speaker 1: you know, I don't have to talk about stuff because
Speaker 1: I'm doing stuff. I don't have to profile or floss
Speaker 1: because I've built businesses, grown businesses, run businesses, and run
Speaker 1: them today, have a payroll at seven figures every two
Speaker 1: weeks and four hundred employees. So when I tell you something,
Speaker 1: I'm telling you from experience, and you need more and
Speaker 1: more people who are who are successes in their areas
Speaker 1: that you can then model them as an influencer, because well,
Speaker 1: they influence you with their influence. They impress you because
Speaker 1: they're you want to follow people who are the leaders
Speaker 1: in whatever industry they position themselves in. They're there, they're
Speaker 1: the best in Class and the Michael Jordan of their Space.
Speaker 1: Sponsorship content and ads. Platforms like Instagram, YouTube, and TikTok
Speaker 1: offer monetization options for creators who with significant followers influencers
Speaker 1: learn through ad shown on their content, especially on YouTube.
Speaker 1: It's like advertising agencies. You know, you're getting paid to
Speaker 1: bring in an audience, and that then allows advertisers to
Speaker 1: put themselves in front of that audience. And as a creator,
Speaker 1: this is completely legitimate, you get a portion of that.
Speaker 1: So this is again an example of how a legitimate
Speaker 1: example of how creators can get can get paid. Fake
Speaker 1: itty you make it already talked about about that, courses, ebooks,
Speaker 1: and merchandise. I don't have a problem with that at all,
Speaker 1: as long as you fess up that that's what you're doing,
Speaker 1: Be legitimate about it, be straight up about it. Tell
Speaker 1: people that you're making. You know, you're an educator, you know,
Speaker 1: don't profess an act like you're something you're not. If
Speaker 1: you never You can't talk about real estate unless you've
Speaker 1: been in real estate. If you're going to do that,
Speaker 1: say you're a professor, Say you're an educators, you know,
Speaker 1: say you're going to educate people in real estate. You
Speaker 1: can do that, but you're not the professional in real estate.
Speaker 1: You can educate people on technology, but don't say that
Speaker 1: you've done in our venture capital. Don't say you've built
Speaker 1: businesses or it's tweasy to check stuff out these days,
Speaker 1: you're going to be found out right, you can. You
Speaker 1: can confirm whether somebody is who they say they exactly are.
Speaker 1: You can find that out in twenty eight seconds these days,
Speaker 1: So don't lie about it. Just there's nothing wrong with
Speaker 1: being an educator, an inspire or a motivator. In fact,
Speaker 1: it's something very credible about that. Just say who you are.
Speaker 1: So courses, ebooks, and merchandise, crowdfunding and donations. Some influencers
Speaker 1: ask their followers for donations or use platforms like Patreon
Speaker 1: to generate monthly and from their most loyal fans. They
Speaker 1: might offer exclusive content or perks and change for financial support. Again,
Speaker 1: full transparency. Nothing wrong with the leverage. Uh, they're leveraging
Speaker 1: credit and loans. I think this is crazy, but they're
Speaker 1: getting lines of credit and loans to try to look
Speaker 1: the part that's going to really blow up in their face. Okay,
Speaker 1: now let's we're gonna run through the rest of these quicker.
Speaker 1: I'm not going to go in the deep dial dive
Speaker 1: I did on on the influencer in Bling Rich Peace,
Speaker 1: but I thought it was really important to break that
Speaker 1: down and get into detail. If you're gonna do that,
Speaker 1: do it. You know, for most people, this is just
Speaker 1: a short term. This is just this is what you're
Speaker 1: doing right now. This is this. I'm gonna do a
Speaker 1: whole thing about why this is such a rage, such
Speaker 1: a craze, Why do people Why what happens when people
Speaker 1: turn on the camera, They just they just change. Most people,
Speaker 1: most people just completely change as a human being. And
Speaker 1: I'm gonna do a separate podcast and some straight talk
Speaker 1: live just on that, but that's not for today. But
Speaker 1: I really wanted to get into this because this first
Speaker 1: layer of rich is fake rich, straight up fake rich,
Speaker 1: and ultimately, unless you use that to transition into something else,
Speaker 1: you're going to be broke, which then leads to my
Speaker 1: second level of rich, which is transactional rich. This is luck.
Speaker 1: Something you're doing with influencer. Influencer in the bling bling situation,
Speaker 1: put you in the right place at the right time.
Speaker 1: You influence somebody, You press somebody the right place, right time.
Speaker 1: I've been right place, right time. I got lucky, and
Speaker 1: now I put myself in that place. You can read
Speaker 1: that in my book Up from Nothing, or my book
Speaker 1: to Memo. How I went to you know, Malibu, California,
Speaker 1: and worked as a waiter, not a very good one
Speaker 1: at Jeoffrey's restaurant, and put myself in position to be
Speaker 1: to meet somebody would be a billionaire today. But he
Speaker 1: was worked two undred million dollars back then Harvey Baskin,
Speaker 1: and he hired me as his personal assistant. And you know,
Speaker 1: I was rich in spirit at rich in knowledge, rich
Speaker 1: in insight because I had access to him. But anyway,
Speaker 1: you can be actional rich because you luck up right,
Speaker 1: you get a deal, you get a hookup, you won
Speaker 1: the lottery. Here's a great example. You won the lottery.
Speaker 1: Now people are gonna say, all right, John, well how
Speaker 1: is this transactional rich? Because I'm saying this is a
Speaker 1: broken time. First one is broke, broke period, broke in
Speaker 1: real time. This has broke in time. Now somebody's gonna say, well,
Speaker 1: wait a minute, I won the lottery. How can you
Speaker 1: say I want to be broken time? Isn't that presumptuous?
Speaker 1: John seventy percent give or take of those who win
Speaker 1: the lottery are broke within five years. Because it's not
Speaker 1: about the money. Somebody wants to ask me, like John,
Speaker 1: why don't we just why are you teaching all the
Speaker 1: financial literacy stuff. Just take everybody's money, all the rich
Speaker 1: people's money, redistributed equally to everybody in the world, and
Speaker 1: that's it. Well, I'll tell you if you do that
Speaker 1: in three to five years, the top three percent, which
Speaker 1: include me, that you took the money from to distribute
Speaker 1: to everybody else, we'll all have it back. Because financial
Speaker 1: literacy is real, because it's not about the cash. Is
Speaker 1: just simply a means of transferring value. It's it's the insight,
Speaker 1: it's a knowledge, it's it's it's how to build that
Speaker 1: that's really important. That's when that's what I'm trying to
Speaker 1: teach you in this Money in Wealth series. You just
Speaker 1: be broke in time, which then leads to my third
Speaker 1: level of riches. Now you started getting into again, mind
Speaker 1: mind you, I note a difference between rich and wealthy. Okay, rich,
Speaker 1: it's a contract, it's a it's a it's a thing.
Speaker 1: It's an upgrade on making a living right. But you're
Speaker 1: not necessarily making a life. You build wealth in your sleep,
Speaker 1: please write that down. You make money during the day,
Speaker 1: you build wealth in your sleep. It's compounding, right, it stocks, bonds, investment, business,
Speaker 1: real estate, any other other forms of assets. Music publishing
Speaker 1: is isn't is an example of those who love the
Speaker 1: music business. But doing the entire podcast just on the
Speaker 1: future of the music business, particularly the black music business.
Speaker 1: To watch out for that one. But contract riches is
Speaker 1: the first real entry to the big game. What's an
Speaker 1: example of contract riches? An NFL contract, National Football League,
Speaker 1: an NBA contract, National Basketball Association, baseball, hockey, soccer, NASCAR.
Speaker 1: These professional sports areas, they find the best of the
Speaker 1: best talent and then they give them these incredible contracts.
Speaker 1: And these players often have never seen this kind of
Speaker 1: money before in their lives. And in most cases, particularly
Speaker 1: the those who come from underserved neighborhoods like where I
Speaker 1: came from, the first year I have received of that
Speaker 1: contract is rather predictable. The money's gone. They just spend
Speaker 1: the money. By the way, I did a podcast on
Speaker 1: professional athletes, I specifically drilled down on that. Go back
Speaker 1: and listen to that podcast. For those who aspire to
Speaker 1: be a professional athlete out of high school, college, or
Speaker 1: you know you or you have a child that you
Speaker 1: want to be a professional athlete. You need to really
Speaker 1: take time and listen to that. I want this entire
Speaker 1: podcast series to be something that as a as a whole,
Speaker 1: you know, network of episodes, fifty plus episodes. You can
Speaker 1: take this and give it to your child right as
Speaker 1: they go off to college or whatever. Give it to
Speaker 1: somebody who just got married, Give it somebody who just
Speaker 1: standing off in life, somebody who's resetting their life. You
Speaker 1: listen to these while you're working out, while you're going
Speaker 1: to work or going home whatever. Listening to you know,
Speaker 1: as a series or persodically meaning the ones that interest
Speaker 1: you at that moment, and they can transform your life.
Speaker 1: So contract Riches is not wealth. My friend Tony Wrestler
Speaker 1: owns the Atlanta Hawks. He's a principal owner. He has
Speaker 1: other investors in the Atlanta Hawks basketball team, Tonysworth, you
Speaker 1: know a lot. I won't get into his business, but
Speaker 1: it's public information. And that's my brother from another mother.
Speaker 1: I love Tony. Tony dresses in jeans and Polo showed
Speaker 1: her something. His beautiful wife, Jamie Gertz is I think
Speaker 1: to this day the wealthiest woman in Hollywood. She's an
Speaker 1: actress and producer, etc. They just dressed normally. You would
Speaker 1: never know. They drive normal cars. Relatively speaking, they're not
Speaker 1: blinged out. But when you pull in the Atlanta Hawks
Speaker 1: are any by the way, professional team parking area for
Speaker 1: the players, it looks like an exotic car lot. And
Speaker 1: I mean I mean blinging, slinging, slanging, you know, gloss
Speaker 1: and floss. And then when they get out what they
Speaker 1: got on it makes the car look shame to shame
Speaker 1: because now they just draped, right, and the girl is draped,
Speaker 1: and of course everybody's got to be on the front
Speaker 1: row so that I guess they can be seen. That's
Speaker 1: the presumption I'm going to make. I sit with Tony
Speaker 1: and Jamie, my wife Shatra and I when we're go
Speaker 1: as guests and we're up at the I don't know,
Speaker 1: we're not on the floor. So we're going back. We're
Speaker 1: in that first row, probably six or eight rows back,
Speaker 1: so you know, we're fifteen eighteen rows back from the court,
Speaker 1: and nobody knows who Tony is. Doesn't say owner's box
Speaker 1: or owner's seat. He just sits down and he buys
Speaker 1: a hot lock up dollar everybody else, but he's paying
Speaker 1: those players who are profiling with his petty cash. He's
Speaker 1: writing the check, they're cashing it. I did a piece
Speaker 1: on one of my social media accounts about an NFL
Speaker 1: player whose father and financial advisor said, you're gonna you're
Speaker 1: gonna be an LLC, a limited liability corporation, not a person,
Speaker 1: and you're going to contract with the NFL. This I
Speaker 1: think was one hundred million dollars contract. And they're going
Speaker 1: to pay your LLC corporation, not you as a person,
Speaker 1: because they're providing you're providing your professional services, and they're gonna,
Speaker 1: you know, basically gonna be their partner and the team.
Speaker 1: You know, they didn't want to upset the guy. He
Speaker 1: was a first draft, first round, you know pick. But
Speaker 1: the work came back and they sent it up to
Speaker 1: the NFL so they could blame it on them, but
Speaker 1: everybody knew the answer was their work came back. Blah
Speaker 1: blah blah blah blah. No, no, we can't do that.
Speaker 1: You are listening to me, now, this is contract riches.
Speaker 1: You are an employee. The NFL provides your training facilities.
Speaker 1: The NFL provides your uniforms. The NFL gave you an
Speaker 1: advance on your signing, on your contract. And by the way,
Speaker 1: in the NFL, you only you may have one hundred
Speaker 1: million dollars contract or fifty million dollars contract, but really
Speaker 1: owning you really own in the NFL is that signing bonus?
Speaker 1: And how many games you play before you know? Hopefully
Speaker 1: you never get hurt. But the NFL is unique in
Speaker 1: that they you can sign a fifty million dollars contract.
Speaker 1: It doesn't mean they're going to pay you fifty million
Speaker 1: dollars unless that's what you negotiate in advance. That's a
Speaker 1: whole again, go and listen to my specific podcast I
Speaker 1: did on professional sports. Back to this topic, and by
Speaker 1: the way, all this is fair exchange is no robbery,
Speaker 1: like capitalism is a gladiator sport like there's nothing wrong
Speaker 1: with this. This is a fair exchange is no robbery,
Speaker 1: and everybody's winning here. I just want to need. I
Speaker 1: need the person cashing check to be able to win
Speaker 1: and not just a person writing the check who knows
Speaker 1: how to win already. It's why they're writing the check.
Speaker 1: So this guy wanted to be treated as a partner,
Speaker 1: but the team had to remind them the training equipment,
Speaker 1: the training staff, the coaches, the facilities, the infrastructure, the transportation,
Speaker 1: the health care plan, the pension plan. What does that
Speaker 1: sound like, everybody? That sounds like what you get when
Speaker 1: you work at a corporation, doesn't it a highly paid executive.
Speaker 1: That's right. You're an employee. So you can't be a
Speaker 1: partner taking risk and sharing the risk and being an
Speaker 1: employee at the same Well you can if you're the
Speaker 1: owner of the company, but you cannot have it both ways, right,
Speaker 1: So this guy wanted it was financial literacy people. And
Speaker 1: by the way, he was doing this because he was
Speaker 1: trying to avoid taxes. This is a whole other conversation.
Speaker 1: You want to get deeper in that, going to my
Speaker 1: social media account. I think you can find it easier
Speaker 1: on my Instagram account at John O'Brien everywhere, and watch
Speaker 1: that episode. You'll see it because that the operational logos
Speaker 1: in the in the background, so you can find it
Speaker 1: very easily. It's very popular conversation. But the guy was
Speaker 1: trying to avoid taxes, or his father was, or his
Speaker 1: agent was, whatever, And I'm glad that it didn't work
Speaker 1: out because he would have gotten arrested and gone to
Speaker 1: jail because that's a felony. So contract riches last three
Speaker 1: to five years in professional sports on average, right, and
Speaker 1: most people aren't making tens and tens one hundreds of
Speaker 1: million dollars. They're making, you know, high six figures if
Speaker 1: they're lucky, low seven figures most players. And you're going
Speaker 1: to play three to five years on average, and you'll
Speaker 1: get you know, injured, or you're not top of the
Speaker 1: game anymore, you know, and they trade you or they
Speaker 1: buy out your contract or whatever. But on average, the
Speaker 1: contracts are not very long. The careers are not very long.
Speaker 1: If you have a ten year career in professional sports,
Speaker 1: you're doing amazing. But life is long. If you lived
Speaker 1: at eighty years old on average, and you went into
Speaker 1: the professional sports at twenty years of age, eighteen years
Speaker 1: of age, you do the math. By twenty five, twenty eight,
Speaker 1: you're done. You're retired. But what happened to the money.
Speaker 1: Your bills now have stacked up to a level, but
Speaker 1: your revenue has just dropped. So now you've got Bentley's
Speaker 1: on lease and Ferrari's on lease and houses in two
Speaker 1: or three places, and you got a lifestyle you and
Speaker 1: your family has gotten a ground accustomed to and private
Speaker 1: jets and all that kind of stuff. By the way,
Speaker 1: I'll do a whole piece on private jets. The people
Speaker 1: who actually own these jets don't pay for him personally. Hello, Hello, Hello,
Speaker 1: the mansions, the jets, all this stuff is. It's a system,
Speaker 1: and I'll explain to you how that works in another episode.
Speaker 1: I hope you guys like how I stay focused on
Speaker 1: the topic at hand, so I can give you the
Speaker 1: lesson that I promised you, the sharing that I promised you.
Speaker 1: So in this example, you go broke in the end
Speaker 1: because seventy percent of all NFL players, and I believe
Speaker 1: NBA players about seventy percent sixty to seventy percent its majority,
Speaker 1: are bankrupt in five years and worse, divorced five years
Speaker 1: after retirement. The partner tends to find no interest or
Speaker 1: other interests, and whatever the answer is, they leave them,
Speaker 1: or they break up, or I don't know the circumstances.
Speaker 1: Of course, I'm not getting people's lies. I'm telling you
Speaker 1: that this is just not coincidental. So now let's get
Speaker 1: into real wealth. So we gone on the influencer and
Speaker 1: bling rich broke transactional. Rich broke in time, contract rich
Speaker 1: broke in the end. So now let's talk about the
Speaker 1: first stage your wealth. It's a liquidity event. So you've
Speaker 1: built a business, or you're a rapper, or you're a singer,
Speaker 1: and you have publishing rights that you own, or writing
Speaker 1: rights that you own. You are a professional athlete, and
Speaker 1: you have taken stock or share of ownership in a
Speaker 1: business or a brand that took off like a rocket.
Speaker 1: You were an influencer and you tripped over God's grace
Speaker 1: and you were humble and you were doing it right.
Speaker 1: And I'm gonna say that you're an influencer and you
Speaker 1: actually had a really good training program and that thing
Speaker 1: that took off like a rocket, it was incorporated and
Speaker 1: everybody's subscribing to it and they're benefiting from it. You've
Speaker 1: got now a YouTube channel that's generating all kinds of revenue.
Speaker 1: But really the thing that's beneficial is the company itself.
Speaker 1: And you sold the company. You sold the company, you
Speaker 1: liquidated the stock, you you sold the publishing rights. In
Speaker 1: my case, I sold, I built and sold a company.
Speaker 1: I've done this several times. But the example that I
Speaker 1: love to give is the promise homes company that I
Speaker 1: built over five years and sold it for over one
Speaker 1: hundred and twenty men or about one hundred and twenty
Speaker 1: one million dollars total transaction value over five years. And
Speaker 1: you have what's called in business and on Wall Street,
Speaker 1: they understand it to be a liquidity event. That's where
Speaker 1: the net worth that you have becomes liquid cash. As
Speaker 1: my friend Tony would say, the deal ain't done, Tony
Speaker 1: Wrestler until you see the wire transfer come into your account.
Speaker 1: So the first stage of real wealth, well, the first
Speaker 1: stage where you can see it experience it in a
Speaker 1: different way, is where you set it up and you
Speaker 1: paid it off. So you've bought some real estate. Now
Speaker 1: you're building wealth when you by real estate or you're
Speaker 1: building a business. So I'm I'm giving you the crib
Speaker 1: notes here because you don' want anybody get arguing about well, John,
Speaker 1: there was you know, asset value wealth creation before you
Speaker 1: the liquidity event. Yes, yes, yes, But the stage where
Speaker 1: you can breathe and sort of that inflection point on
Speaker 1: this fourth level between fake rich and real wealth, real
Speaker 1: generational wealth is this fourth level, which is the first
Speaker 1: age of real wealth. Again, you make money during the day,
Speaker 1: you build wealth and your sleep. So now you've set
Speaker 1: it up and you've paid it off. You built this business,
Speaker 1: and now somebody's bought that business from you, confirming that
Speaker 1: it had a value. Same thing with the publishing rights,
Speaker 1: whatever it is. You thought it was valuable, and somebody
Speaker 1: confirmed that it was valuable. The market did, and they
Speaker 1: paid you for it. And you take that money and
Speaker 1: you don't spend it. Now if you want to, say
Speaker 1: twenty thirty percent and go create lifestyle events for yourself
Speaker 1: or you know. I rewarded my Promise Home, my Promise
Speaker 1: my Operation Hope team. I took your Promise Homes team too,
Speaker 1: but my Operational Financial Literay mind, my Financial Literacy organization,
Speaker 1: the nonprofit. You can you can see the video online.
Speaker 1: I bought them all. I bought my senior management teams.
Speaker 1: I bought them all cars and gave them investment accounts.
Speaker 1: Because they don't have big bonuses and big salaries working
Speaker 1: for a nonprofit, they don't have stocks. They couldn't do
Speaker 1: that for themselves. So I wanted to reward them for
Speaker 1: all their years of hard work. At that point it
Speaker 1: would have been twenty five plus years, and so I
Speaker 1: used my liquidity event to guests which car each one
Speaker 1: of them would love, and I bought them each the
Speaker 1: car and surprise them again. It's a video you can
Speaker 1: you can watch it. You can search for it and
Speaker 1: watch it if you like. And the visual on their
Speaker 1: faces was prices. But I did that with my petty cash,
Speaker 1: just like Tony Resher pays salaries to his ball players
Speaker 1: with petty cash. I then make sure I paid my taxes,
Speaker 1: which was not paid cash. It was seven figures, but
Speaker 1: I was proud to pay my taxes. Always pay your
Speaker 1: taxes because that means you're making money. Don't be upset
Speaker 1: because you're paying your taxes. That is, you know, not
Speaker 1: only your obligation. You're right as as as somebody in
Speaker 1: the freener price system and capitalism. But it's it's it's
Speaker 1: confirmation that you made it and the government was your
Speaker 1: partner in your silent partner and your success because you're
Speaker 1: operating in the most valuable, most prominent economy in the world,
Speaker 1: in the United States of America. And now you feel
Speaker 1: real personal about those potholes. By the way, when you
Speaker 1: pay taxes, I paid, and you become a become an
Speaker 1: expert in taxes. But you know by the way they
Speaker 1: got al Capone, not on murder in Mayhem, the gangster.
Speaker 1: They got them on tax evasion. Is. One thing you
Speaker 1: don't mess with is the is the pub I'd say,
Speaker 1: the police is is the I R s. You just
Speaker 1: do not mess with the I R s. Never, never, never.
Speaker 1: So I did this thing for my team. Uh. I
Speaker 1: took care of my family this, you know this, this
Speaker 1: these normal situations, right of course, take cook you know,
Speaker 1: made sure I celebrated my wife and my mom, my
Speaker 1: sister and brother, you know, auntiets, et cetera. Took care
Speaker 1: of my team, took care the irs, and made some
Speaker 1: investments that would build wealth over time. What investments none
Speaker 1: of your business. But uh, some it's predictable generally speaking.
Speaker 1: It was the stock market and no, it was not
Speaker 1: cryptocurrency and all that kind of stuff. It was solid,
Speaker 1: traditional stuff that's not going that it's not going to
Speaker 1: implode tomorrow. I you know you want to put you
Speaker 1: want to this is your nest egg, Like you won't
Speaker 1: get another one of these liquidity events. This may be it.
Speaker 1: So you want to put that in something that you
Speaker 1: know is going to be there. And you really just
Speaker 1: want to if you're want to play with anything, play
Speaker 1: with the interest on those investments. But you don't want
Speaker 1: to take the principle from those investment. So there's money
Speaker 1: that's set aside that you don't touch from that liquidity event,
Speaker 1: and that's going to build moral wealth. So you built
Speaker 1: wealth the first time that was an illiquid investment in
Speaker 1: liquid investment. You then had a liquidity event you sold whatever.
Speaker 1: By the way, the purpose of the company is the
Speaker 1: is the build it, grow value, build value, you know,
Speaker 1: build a customer base whatever, and sell it right to
Speaker 1: monetize it, shall I say, you have different ways to
Speaker 1: monetize it, but that is the purpose of growing a
Speaker 1: company like this. Don't get emotional about it, and then
Speaker 1: you can you know, you can build another company, by
Speaker 1: the way, or buy that one back. People have bought
Speaker 1: their own companies back over time. But you got to
Speaker 1: find a way to to to pull the register, to
Speaker 1: pull the cash register, to pull the you know, the
Speaker 1: I made it stick, right, they call it clip clipping
Speaker 1: a coupon on a wall street. Don't get emotional about it. Right.
Speaker 1: Whenever you make a bad decision, it's an emotional decision
Speaker 1: in business. Do not be become emotional in business. It's
Speaker 1: just business, right. So, uh, I made some investments which
Speaker 1: I can confirm already have done with their job. So
Speaker 1: you know, one piece of real estate I invested in
Speaker 1: is almost doubled in value. That's and that's building that
Speaker 1: that's happening without me. It is growing in my sleep. Right.
Speaker 1: So you when I say about wealth, you build wealth
Speaker 1: in your sleep. Now this, I've built fifty businesses, right,
Speaker 1: fifty business and fifty enterprises. I'm just telling you about
Speaker 1: one that's public information. Uh, it's you know, it's searchable,
Speaker 1: it's on the internet. I got. I signed a two
Speaker 1: hunred millon dollar credit facility. Me and my partners on
Speaker 1: the new company. I'm still an owner of shareholder in
Speaker 1: the new company. Even though I sold the company. I
Speaker 1: was an officer of the company for a bit and
Speaker 1: chairman by resigned from all that because you got to
Speaker 1: know when to walk away. You got to know when
Speaker 1: you know you've done your job right. And I had fluence,
Speaker 1: but not control. You know, it didn't have any power.
Speaker 1: So it's fine. I sold the company. The person who
Speaker 1: who bought the company again not emotional. They've got the power. Now,
Speaker 1: all good, I'm gonna do something else. But way, that's searchable.
Speaker 1: Twenty million dollar credit facility, another one hundred millillar credit
Speaker 1: facility recently on that non recourse debt, which means sign
Speaker 1: personal guarantees. But anyway, so that's the first, the first one,
Speaker 1: then the number five. The second stage of wealth is
Speaker 1: where you're not living on your principle. Now, this is
Speaker 1: a mistake that people who get that contract rich. This
Speaker 1: is why they go broke in time is they they
Speaker 1: didn't they thought they did. They forgot that money has velocity,
Speaker 1: and they thought that money's gonna be there forever. They
Speaker 1: figured they got a million or five million or ten million,
Speaker 1: and twenty million, thirty million, forty million, fifty million, asked
Speaker 1: him c Hammer. They thought that money's gonna last forever. No,
Speaker 1: it will go. Money has velocity. You can spend it.
Speaker 1: I've known I don't know him personally, but I know
Speaker 1: of billionaires who went broke. There's a famous boxer will
Speaker 1: mention his name. But the way he's spending uh planes
Speaker 1: for all of his friends, for him in one private plane,
Speaker 1: and his boys in the second private plane, his family
Speaker 1: in the third private plane, he's gonna go broke. I mean,
Speaker 1: you know he would buy wear one pair of shoes,
Speaker 1: won't wear it again. People who got real wealth and
Speaker 1: real money don't do craps do stuff like this is
Speaker 1: nuts Anyway, I'm jumping around here, but I'm trying to
Speaker 1: give you context. So people who have contract riches number three,
Speaker 1: they think that they're in number five. So number five
Speaker 1: is you're still spending according to your lifestyle you've become
Speaker 1: accustomed to. Right. The difference is when you lock in
Speaker 1: on number five, the second stage of wealth, you're spending
Speaker 1: money that's new money is not tied to the liquidity event.
Speaker 1: It's not tied to that contract you had. Okay, contract's gone,
Speaker 1: but you keep spending like you still have a contract.
Speaker 1: You're going to go broke when you're outfloaks, you're inflowed
Speaker 1: and your overhead or be your downfall. But if you
Speaker 1: are lucky enough to build a business and sell it,
Speaker 1: but now you have a reputation in that industry and
Speaker 1: now you can go get a contract. So now you've
Speaker 1: sold the company and you put that money aside. If
Speaker 1: you're a couple listening to this and you're saying, what,
Speaker 1: I don't have all that fancy stuff, John, what can
Speaker 1: we do on both people are working. One person makes
Speaker 1: the money and they use that to pay their bills.
Speaker 1: The second person makes the money and they use that
Speaker 1: to invest. Okay, do you hear me. One person's doing
Speaker 1: contract riches, contract aspiration, and the other person's doing a
Speaker 1: version of wealth creation. Okay, So person number one is
Speaker 1: paying for the is making a living. The other, the
Speaker 1: second person, is helping to build a life. Please, if
Speaker 1: you don't listen to anything else, tell your friends to
Speaker 1: go to number to minute thirty six or thirty seven
Speaker 1: on this podcast and listen to this. One person making
Speaker 1: a living, one person building a life. One person's paying
Speaker 1: the bills and you're living within the means, and that
Speaker 1: one person the second person. My friend Bernard Kinsey and
Speaker 1: La did this with his wife and they have a
Speaker 1: beautiful mansion overlooking the ocean in the bever Hills and
Speaker 1: player deray Yas I think it's playa Delray in southern California,
Speaker 1: and he worked at IBM as a corporate executive. But
Speaker 1: they have a huge art collection. They just did it right.
Speaker 1: They lived on his salary or maybe her salary, and
Speaker 1: then his salary was used for investments, and they got
Speaker 1: really smart on the investments they made, they really paid
Speaker 1: off well for them. So you got an expertise now
Speaker 1: in something because you built this company and you sold it,
Speaker 1: and other people are now willing to pay you based
Speaker 1: on that expertise. And you take that income and that's
Speaker 1: what you live on. That's your lifestyle money. You're not
Speaker 1: touching the principle. Please tell me you understand what I'm saying. Again,
Speaker 1: you sew that company, or you took that contract income
Speaker 1: and you put it aside, didn't You lived on a
Speaker 1: fraction of it. Now you're no longer in the NBA,
Speaker 1: NFL whatever, or you're no longer running the business running
Speaker 1: running the shoe shop or the Neil salon or the
Speaker 1: tech company or whatever it is you built. Okay, but
Speaker 1: you have an expertise and a brand and a reputation
Speaker 1: that people value, and now other people will hire you
Speaker 1: as a board member, an advisor or consultant or maybe
Speaker 1: even a joint venture partner on a new enterprise that
Speaker 1: gives you cash flow that pays for your lifestyle. And
Speaker 1: you're going to listen to me, now live on that
Speaker 1: cash flow. You're not going to touch the principle unless
Speaker 1: you're going to make an investment another investment with that principle,
Speaker 1: or you have some shock event that happens your life,
Speaker 1: like a tax bill that shows up that you can't
Speaker 1: absorb in your cash flow, Or there's some capital expense.
Speaker 1: Capital expense is using capital to again for pay taxes
Speaker 1: or make an investment or something, but you're pulling from
Speaker 1: the capital. When you pull in the capital, that stack
Speaker 1: of money you have gets smaller, and it's not going
Speaker 1: to replenish itself, at least not on the level that
Speaker 1: you're taking from it. That's why people make a lot
Speaker 1: of money go broke. They think the cash flow is
Speaker 1: capital and capital will always be there. Know, your cash
Speaker 1: flow created a stack of money, and the second money
Speaker 1: is going to go away unless you replace it or
Speaker 1: you or you live a lower standard of living, either
Speaker 1: in the real time or when you get beyond your
Speaker 1: professional career as an athlete. In this example, you got
Speaker 1: to step down significantly your expenses. The sixth stage of wealth,
Speaker 1: which is where you enter generational wealth. And by the way,
Speaker 1: there's a joke amongst the wealthy. The first generation makes it,
Speaker 1: the second generation spins it, the third generation loses it.
Speaker 1: You can make enough money where it's hard for people
Speaker 1: to screw it up. But we're talking I think that
Speaker 1: I think you're talking about several hundred hundreds of millions
Speaker 1: of dollars and really safely billionaire status still easier to
Speaker 1: screw it up if you work hard enough at it.
Speaker 1: But if you just reasonably saying billions of billion dollars
Speaker 1: will last generations and generations generation. In fact, billion dollars
Speaker 1: will make one hundred million dollars if you invest intelligently
Speaker 1: and think about this now, if you have billion dollars
Speaker 1: in cash or investments, earning ten percent, you'll make one
Speaker 1: hundred million. If you have one hundred million of investible assets,
Speaker 1: you'll make ten million dollars a year, eight to ten
Speaker 1: million dollars a year on a mix of investments with
Speaker 1: smart investment advisors who are proven, by the way, and
Speaker 1: you'll never touch the principle. Please listen to what I
Speaker 1: just said again. You don't want to touch the principle.
Speaker 1: So on every stage before this, on some level, please
Speaker 1: listen to me. Now, slow this down and listen again.
Speaker 1: On some level, and on these first five stages, labor
Speaker 1: was king. Okay, labor was king your hands, your mind,
Speaker 1: your heart, your brain, your thought, your looks, your your
Speaker 1: your you know something, your your hustle, your heart, work,
Speaker 1: your genius, something about labor generated income and wealth and
Speaker 1: opportunity for you, and you got paid. But the baller
Speaker 1: alert here, the drop the mic, the big baller shot
Speaker 1: call a statement of it on this podcast as we
Speaker 1: wrap up, is the third stage of wealth. Number six.
Speaker 1: This is real wealth. This is generational wealth. This is
Speaker 1: where your money makes you money. Wooh, I love making
Speaker 1: smart sexy. We've been making dumb sexy for way too long.
Speaker 1: We've dumbed down and celebrated. Its time to make smart
Speaker 1: sexy again. I love making smart sexy. And I know
Speaker 1: that you're smart, and I know that when when when
Speaker 1: you get it, the light comes on you go, oh
Speaker 1: yeah that. So, up until this point, labor made your money.
Speaker 1: But for true wealth, money makes more money than anything
Speaker 1: else can. So now you've got X dollars set aside,
Speaker 1: and those that money is invested in all the right places,
Speaker 1: and the return that it gets on the money that
Speaker 1: you have sitting there is unmatched. And maybe if you
Speaker 1: want me to go into this and give examples, I
Speaker 1: mean private equity is an example of this. Venture capital
Speaker 1: as an example of this joint ventures. You know where
Speaker 1: your money is making you more money than your labor
Speaker 1: ever could. Now you're building wealth and making money in
Speaker 1: your sleep. I have friends who have and this is
Speaker 1: where you start a family office. Actually, you can start
Speaker 1: a family office after the level four, after that first
Speaker 1: stage of wealth, a liquidity event. Okay, And if you
Speaker 1: don't know what a family office is, look that up.
Speaker 1: But it's basically an office dedicated to managing your family's
Speaker 1: wealth and opportunity. It manages the trust, it manages the wheels,
Speaker 1: It helps the kids to plan financially, financial planning, credit
Speaker 1: lines of credit, and loans, and it manages the stocks
Speaker 1: that it is. It's staffed, and these folks make sure
Speaker 1: that you don't go broke, and that you actually be
Speaker 1: on going broke. They make sure that you you're building
Speaker 1: in accordance with your mission statement, your plan. Family office.
Speaker 1: Do you know what that was? I want at some
Speaker 1: point I'd love to create a coalition of wealthy people
Speaker 1: of color to create a family office. I have a
Speaker 1: family office Rockefeller Capital Management, the Rockefeller family out of
Speaker 1: New York. But so you have this family office and
Speaker 1: it's managing your generational wealth and Uh, I guess his story.
Speaker 1: I was gonna tell was I have a friend of
Speaker 1: mine who I can't tell how much money he's worth,
Speaker 1: but it's billions. And he's got a family office, a
Speaker 1: manager of his family office who's got to find a
Speaker 1: place to shove one hundred million dollar dollars one hundred
Speaker 1: and forty million dollars a year. And uh, I'm gonna
Speaker 1: do a separate podcast, and that's passive income he doesn't
Speaker 1: have to make. He actually told me one day he
Speaker 1: end upset with me and said, uh, this friend of mine,
Speaker 1: he upset with me. He's like, so I brought him
Speaker 1: a business deal, not something I wanted to invest in,
Speaker 1: but I thought something that he would be good for him.
Speaker 1: He cursed me out, John, I don't bring me any
Speaker 1: more business deals. I don't want to make any more money.
Speaker 1: It's a headache. He just you know, if you want
Speaker 1: me to meet somebody to do something, let's do it,
Speaker 1: because I like you, I don't need to make any
Speaker 1: more money. And that you should be scratching your head
Speaker 1: right now, like what what did you just say? Because
Speaker 1: if he makes money, if he earns money, traditionally he's
Speaker 1: going to be taxed at the highest rate possible. As
Speaker 1: an example, First of all, it's a hasshole. It's got
Speaker 1: to he's got to organize the business, going to manage
Speaker 1: the business. He doesn't want to do all that stuff.
Speaker 1: He's through that days of his life. But he's also
Speaker 1: gonna be paying the highest tax rate possible, Whereas if
Speaker 1: you keep your money in passive investments, wealth creation, in vehicles,
Speaker 1: you're going to pay capital gains tax, which is twenty
Speaker 1: twenty one percent versus thirty eight percent or higher, thirty
Speaker 1: eight thirty five percent or higher. And if you maybe
Speaker 1: I'm going to do a whole piece on taxes, but
Speaker 1: you know, people just don't understand the tax structure. Like
Speaker 1: I think, I'll drop the mic, leave it here. Warren Buffett,
Speaker 1: who I've been blessed to meet, actually stayed next to
Speaker 1: him at a conference where I made sure that was
Speaker 1: always in the elevator when he's in the elevator by
Speaker 1: the way, listening to him talking to him. Nice guy.
Speaker 1: Warren Buffett is famous for saying that his secretary pays
Speaker 1: more taxes than him and that's not fair. And he
Speaker 1: I believe I'm not in his head, but I believe
Speaker 1: he was just trying to make a point because he
Speaker 1: understood why he wasn't paying taxes. It's not like he's
Speaker 1: a bum or the taxes is just so screwed up
Speaker 1: where he's not paying his fair share. In fact, the fact,
Speaker 1: the reacting. The reality is that most taxes this country
Speaker 1: you are paid for by the wealthy. I think it's
Speaker 1: seventy percent of the of all taxes the country paid
Speaker 1: for by those who are quote well to do the
Speaker 1: top ten percent. Check it out for yourself, Which doesn't
Speaker 1: mean they shouldn't be paying more in certain in situations,
Speaker 1: by the way, but that's the reality. Seventy percent of
Speaker 1: all taxes to paid by the wealthy. Anyway, Warren Buffett
Speaker 1: is not paying more taxes than its secretary because its
Speaker 1: secretary is paying taxes on income. She's paying an income tax.
Speaker 1: He wasn't talking about more taxes in a literal dollar sense.
Speaker 1: He's talking about a percentage of taxes. So a percentage
Speaker 1: of her income thirty five, thirty eight percent, whatever it is.
Speaker 1: I don't or a tax bracket, but whatever it is
Speaker 1: was more than twenty percent. She was because she's a
Speaker 1: W two employee, a W two employee, and I mentioned
Speaker 1: this with the contract, which riches the professional athletes. They
Speaker 1: are W two employees, right, somebody else is taking the risk,
Speaker 1: but they're paying you a salary to do a job.
Speaker 1: Somebody else taking the entrepreneurial risk, and so they get
Speaker 1: the entrepreneurial rewards. So this person comes in nine, leaves
Speaker 1: it five, you know, gets health insurance, all that stuff.
Speaker 1: She's she's a W two employee, and she gets tax
Speaker 1: at X rate. And he was saying that, you know,
Speaker 1: why does he only get taxed at a much lower rate?
Speaker 1: Something wrong with that system. Well, he's paying a crap
Speaker 1: loan more in taxes than anybody in his town, so
Speaker 1: let's start there. But he was trying to make a
Speaker 1: compassionate point that those who were wealthy need to pay
Speaker 1: a little bit more for the greatest country in the
Speaker 1: world in spite of our problems and challenges. My second
Speaker 1: great grandfather was George Young. He was a slave and
Speaker 1: he fought in the Union Army and amongst the black
Speaker 1: troops in Tennessee. And my second my grandfather was RB Smith,
Speaker 1: who was a sharecropper. So I my mother's mother, my
Speaker 1: mother's mother was God rest her. So both of my
Speaker 1: mother and her mother at Wadia Smith and her mother,
Speaker 1: Missus Murray. My mother's mother was a slave. My mother's
Speaker 1: my mother's mother, and you know my mother's mother's mother
Speaker 1: and my mother's mother on the shotgun shock. So literally
Speaker 1: came from nothing and built some thing. So it's just
Speaker 1: compassion for those who work really hard, who have too
Speaker 1: much month within their money, and those who have done
Speaker 1: really well in this light on the hill called America
Speaker 1: should be happy to give back where they can, whether
Speaker 1: it's through philanthropy or through smart investing in taxes where
Speaker 1: we know is going for good causes and so on
Speaker 1: and so forth. But that's another conversation another day. But
Speaker 1: I hope this has been helpful. This is six layers
Speaker 1: from fake rich to real wealth to even generational wealth
Speaker 1: and even get your little bonus on the tax system. Okay,
Speaker 1: is John O'Brien tell all your friends to this is
Speaker 1: my ministry of finance. Every Thursday is downloading new episodes
Speaker 1: to help them to subscribe to Money and Wealth with
Speaker 1: John O'Brien on iHeart Radio and the Black Effect Network
Speaker 1: and you'll get your podcast downloaded automatically every Thursday and
Speaker 1: follow me on all social media platforms at John O'Bryant,
Speaker 1: where I do my Straight Talks Live series and get
Speaker 1: my book financially was he for alls number one in
Speaker 1: business and finance. My major platforms USA Today, Publishers, Weekly, Amazon,
Speaker 1: et cetera. Soon be featured at Walmart EA. The CEO
Speaker 1: Walmart did the cover. And most importantly, we scholarshiped you
Speaker 1: into financial coaching through all my partners who've funded the
Speaker 1: budgeted Operation Hope, so we can get financial coaching for
Speaker 1: you for free at Operation Hope. Download the Hope and
Speaker 1: handapp and get your appointment today. This is John O'Brien
Speaker 1: is Money and Wealth, and this is a silver rights movement.
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