Dude, check it out. I set money aside in my company and they match it and then it
grows and it's this thing called a 401k. And then my buddy was telling about this
crazy thing called real estate investing. There's no real program for that. You
have to take risk do it all on your own. Friends, today we're going to take 401ks,
IRA's. We're going to put them up neck-and-neck talk about the pros and
cons of each. And see ultimately, if we can help you come up with the better
strategy for your financial future.
Have you watched that movie Dumb and Dumber? I kind of wonder if in hindsight
in this video is going to feel like that. Because there's this movie where like I
can't remember who was but one of the dumb guys turns to the pretty chick and
they were at the like the gasoline Phillip thing and like the dog was
lifting its leg and he was putting gas in it. And he turns to the the hot girl
and he says, "Hey." She's like, "Hey, okay." He's like, "Those are skis?"
She's like, "Yes." And then he says, "Both of them?" It's like the funniest line in the
world for me. And I kind of feel like even talking about 401k's compared to
real estate is like Dumb and Dumber speak. Listen, I want to be fair here. Like
honestly, a 401k is a really smart thing to do if you don't have a plan like. If
you don't know how you're going to get where you want to go, a 401 K does a
couple of really great things for you. Number 1 it's like a for savings
account. It actually gets you putting money aside because heaven knows most
people are just not doing that. And number 2, it does earn something, right?
It earns 4 or 5 percent which again is better than nothing.
So, I look at it kind of like a worst-case scenario that says, "You
clearly haven't read financial books. You're clearly not taking your own
financial future in your own hands. And you're leaving it up to Society." And if
you're going to do that, then a 401k is probably a good move. But if we
fast-forward 30 years, your 401k will likely be enough money to live off of
for 2 or 3 years at the point of retirement. What's the point we're tyring
after 30 or 40 years if 3 years later, you have to go back in the
workforce? Now, some of you like, "What are you talking about Kris?" Let me tell you what
I'm talking about. Let's say that your custom to living off of 70 grand a year.
And let's say that you put $200,000 away in a 401 K after
all those years. 200 grand it's going to last you not even 3 years
before it's all eaten up. So again, what's the point of working for 40 years to
retire for 3 years and then go have to get a job? Doesn't really make sense,
right? So, that's why we actually have this whole conversation of comparison.
Because even though some of you are like, "No, Kris. The match is awesome. The
company gives me free money. You're right. But can you invest it? Well, no. Does it
produce a return for you? No. Okay, good. Then is it doing you any good?
If it's your plan and it's how you get to 200 grand and you want to retire for
3 years, great. You're covered but if you're starting to do the math
and say, "Wait a second. I've got problems like I don't know if this is actually
going to work out the way that I want." Then you shouldn't
put money into something that you know can't get you where you want to go. It's
not even a tool of diversification, I want to be clear. Locking up your money
in 3, 4, 5, 6 percent returns that can accumulate to what you need.
It's it's broken and it's not enough. So, it can't really get you where you want
to go. The alternative is to find a different choice that's going to do better
for you. Now, many of you know that I do the game of real estate. We could talk
about the risks of real estate. We could talk about what kind of strategy, buy and
holds, flips. And you know, tax liens and stuff like that. But at the end of the
day, real estate comes down to one thing. When I get at a complicated pro forma
with like hundreds of numbers summing up an entire property that I'm thinking
about doing. I only look at one number to know whether I'm going to do it or not. And
that's the ROI. And on average those ROI is are over 25%. So when I say,
"This is perusing 4 or 5 percent, this is producing 25%.
Hmm, it's 5 times bigger than that." Now, 5 times bigger doesn't make it better
alone. It's 5 times bigger than I can put into real estate that will give me a
5x leverage point. Meaning, a hundred grand will buy me 500 thousand
dollars of real estate. So, wrap your mind around this. Not only am I making 5
times more money but real estate gives me extreme leverage. If you take that
money and you compound it, you can find out that inside a decade or 2. if you
buy enough properties, you can retire. 401ks or... You know let's talk about
401k's. Just say it's any kind of investment pretty soon 4 or 5
percent. Let it compound and in 40 years it's not going to be anywhere near what
you need. So today's conversation guys is really not about is a 401 K good or bad
as real estate good or bad? It's just are you doing the math and are you figuring
out what will get you where you want to go and what won't get you where you want
to go. Because ultimately if you do the math, that's what should motivate you to ask.
Now by the way, when should you be taking action? The younger, the better. Put time
on your side. No matter what age you are, you need to get your money working for
you at 25% rates or 20% rates or even 15. Maybe even just 10%. Because 10%%
compounding is way huger than 5% compounding. So, at the end of the day,
those are your options between 401ks and real estate. If you want the real guide
on the hoax of the 401k and what real estate can really do for you, it's all
found in my book. This is The Straight Path To Real Estate Wealth. It's updated
for today's economy and the upcoming crash which gives me excited. And we sold
over 50,000 copies of it. This book has created millionaires. In fact, they just
you know decided to miss a call from sterling one of my buddies who was
calling me about his next multi-million dollar deal I'm going to be doing with
them. I'll started from principals right here in this book. Now, the cost of this
book is normally 20 bucks and to you today is free. Cover the shipping. My team
will put it in the mail. Technically my 13 year old daughter will do that
because I'm teaching a principal entrepreneurship. And this book possesses the
knowledge that can financially transform your life. So, get yourself a copy of this.
Make sure your subscriber and I will see you on tomorrow's video.