The Wealth Strategy That BlackRock, Vanguard, and Your 401k Provider Don't Want You to Understand

0:00Everyone else that has upside potential is then putting their money in things they know nothing about. People that are great at real estate are being sold crypto. People that are that are great at business are being sold stock.
At your level, right? You've done so much from an author to crazy entrepreneur and successful to a comedy special.
There's a permanent penalty for not having financial intelligence skill. Dave Ramsey says if you save $100 for 40 years and you get 12% you can become a millionaire. True, 1.1 million. But what happens if there's inflation? We are live with the Be Wealthy podcast and I have to tell you that I am so so excited for today's guest. Uh I don't want to jump right in yet, but I I will tell you I met this gentleman about 7-8 years ago. I actually flew out to his event and it was mind-shattering. He's wrote a number of best-selling books and I will tell you we share the same mission that we want to empower entrepreneurs to get free. So it's my absolute pleasure to welcome Mr. Garrett Gunderson to the Be Wealthy podcast. Garrett, it's awesome to have you here, man.

1:03Dude, I I remember writing my first book like so scared to write first off and there wasn't nearly as many books back then. You know, I started writing that thing in like 2005 and so you didn't have all the self-publishing mechanisms that there are today and when I met an author I was like, "Wow, you wrote a book." But I was so scared to write that book because I'm like, "I'm probably not a good writer." You know, so I like hired a ghostwriter and I relied so much on them and it was his first book and it's amazing to now see that this has been out since 2006 was a self-published version early 2007 and then the actual when it hit New York Times was 2008 and then I rewrote the whole thing recently and it's still in, you know, top categories of Amazon and people are still buying it. So it's like it's pretty cool to be an author. Like I I just when you said it it kind of struck me and I'm like, "Yeah, I'm an author." And I would call myself an author now which I didn't early on because I didn't sit down and but I I wrote I wrote for a couple hours this morning. As a matter of fact, you know, I just get up early before everybody's up and do some writing and helps me really think

2:05through things and challenge thoughts and get deeper with stuff and what's really cool about it is like I just meet people that read the books and it impacts them and it's like, "How cool that I feel connected to this person and they feel connected to me from taking some time to write." And like you said, you used the word mind-shattering and it's like, "Yeah, that's it's crazy." Like what I was writing today, I think it's kind of mind-shattering. I was writing about how billionaires give bad advice because it's not what they do, it's what they think the rest of the world should do and it usually like helps their agenda, not the individual. And we keep treating people like babies and then they become economic toddlers. Or or the billionaires are talking about the things they're doing right now, not how they became the billionaire, right? It's cool to have these weird eclectic behaviors, but I love that you're doing the cold plunge. I have one, I'm into the sauna, I'm into all the weird stuff, but I only did it once I got my money right. I didn't do it when I was on my way up, right? I was doing radically different activities and I I think they lose that connectivity to where they once were. And you know, one of the things I'm really challenging myself with right now

3:07is just like when I wrote a book, I got into something that was going to be completely different than what I did before and I wasn't good at it. And I think that with my last business I got really comfortable. Like I just had built a system, but I also got disconnected because I was so comfortable that I wasn't challenging myself. And so now I'm like, "What are the skill sets that are going to create the highest impact and the most leverage to serve the most people?" And I'm getting good at things that I'm not good at yet. So I'm in that uncomfortable phase of like, you've seen me on stage, I've worked hard, I've had a lot of coaches. I feel like I'm pretty good. You know, I feel like writing I've gotten really good. I've had some amazing editors, some great coaches. But on video I think I'm pretty okay. I'm not great on video yet and it's cuz you have to slow down. Like I don't know if you've ever read an audiobook, but man, that was one of the hardest things I've ever done because I talk too fast and I don't read very well compared to speaking. And so then I'm like, "What's it going to take to get the message out to millions, not just thousands?" Because on stage, even if there's thousands of people there, it's only a

4:09few thousand people. One video can reach a million people and completely change their mindset. Like I just had my first Instagram video this last 2 days hit a couple million and it was actually me and Michael Bernoff him interviewing me on taxes. And dude, people are losing their mind about thinking these tax things are so aggressive. I'm like, "These are in the code. You're not going to get audited." It's so simple, but people are so afraid that I feel like it's important to get the message out there. Totally. Well, I I just love I didn't know that's where you were going to go, but I love that at your level, right? You've done so much from an author to crazy entrepreneur successful to a comedy special which I think is just really cool. Um but you've done all that in the in you're still asking the question, "What are the skills that matter right now that I need to grow and develop to go to the next level?" And I think a lot of our audience is struggling with that. I don't think they're asking that question. I mean, that's the question I'm asking myself and I know you are. So when you look at that and you're ready to go to the next level and speaking to our audience, what do you think the skills are right now that they need to be thinking about?

5:12Well, I mean, if they haven't gotten good at sales, sales is the fundamental skill. Uh my son just turned 18. I'm like, "All right, man, quit your job and get a sales job." And so he started it at Cutco and he just made the first incentive trip. He got to go to Cancun. He got to be around other people that are better at sales than he is and I went to a 7-hour like it was violating my It was like felt like a violation. 7-hour banquet, but

every single person that got up were these young kids that spoke articulately. So they were just so clear, they weren't nervous. I'm like, "That's a skill." Communication especially with the emphasis on sales. Now last Thursday I spent 12, maybe 13 hours sitting down with my creative director just on how AI can help me become more effective. So we were learning about We downloaded anti-gravity which I didn't have on my computer. We brought in Claude code and Gemini and then we used GitHub. Like it was like a foreign language to me, right? But I've spent hours and hours every day training that system so that

6:16it can give me better education. So I can say, "All right, what are the things I'm missing in what I'm doing in in video?" And it can critique it. Like I did one this morning. It scored 89 out of 125. I've been working on this script for hours and hours and days and I'm like, "Well, what is it going to take to get it to a 125?" And then see and I'm next scripts will probably get more efficient, but these ones are taking a long time because I'm in this new skill set, but I'm leveraging AI so that I don't have to hire a researcher. I don't have to take hours watching videos. I can have it working in the background so that it can spit out, "Here's the things that are working. Here's the things that you're missing." I said, "Hey, what are the hooks?" It said it took about 20 minutes. It goes, "Here's the 21 main hooks on videos." I'm like, "Am I using this?" They're like, "You're using three." I'm like, "Well, let's add these other ones in so that we could test them out." That's the game-changer. If people aren't adopting using AI to become more productive, they're just getting left behind. And in the last 2 weeks I feel like it made a couple years jump in what it can do, you know, with some of these upgrades. So

7:18with Anthropic and going to 4.6 and with I I haven't even started messing with like Multibot and, you know, Claude Claude code and all that. It was like that stuff things like crazy. And if you haven't heard of it, I'm just it's all over my feed right now, but if you don't know AI, you don't know sales, you don't know how to communicate and financial intelligence. There's a permanent penalty for not having financial intelligence skill. You lose money, you make mistakes, you get swayed into dumb ideas that sounded good at the time, you chase risk and ultimately overpay interest and tax and everything else. So those skills right there, if people had those skills, those foundational pieces will take them so far. That is sales skills, figuring out how to make AI I think to your point make it more productive, not to replace you, but more productive. And thirdly, financial skills. So I want to go there and you and I agreed that the traditional financial system, it's all around scarcity and fear, right? It's the story they kind of, you know, you know, just try to embed in you. So what do you think the most dangerous money myth is that successful people still believe

8:20that they're holding on to? Like it's holding them back. What do you think that myth is? That they're that they get anchored into them. I've never said this before, but I'm I'm I've been studying a lot on this lately. So this is going to shock people and it'll probably have some people just not want to listen to me because it's going to be very near to their heart. They're going to have believed this for far too long. Compounding interest is the greatest myth that's ever been sold to the public. Now, hear me out, okay? So first off, if you're a if you're an institution, what do you want from people? If you're a bank, you're a mutual fund, any of that. Yeah, they want they want capital. They want capital so they can go compound. Yeah. How often do they How often do they want it? They want it all the time as fast as they can get it all the time. How long do they want to hold on to it for? As long as they possibly can. And how much do they want to give back to people if they want to take it out?
None. They want to And if you ever especially if you want to get a withdrawal, we're going to make it hard, we're going to make it difficult. We got to lock it away. We got to make it a 4-day transfer or longer.
So that's the four rules. They want money all the time, hold on to it for as

9:22long as possible, give back the least possible which falls into the trap of compounding interest. So compounding knowledge is infinitely more valuable than compounding interest because compounding interest takes 30 years to work out and we don't have a 30-year runway in today's world. So when I give money my money to the bank, the bank doesn't wait on it, they turn it into cash flow immediately. They go, "We'll pay you $3 and we're going to sell that same thing for $6." That's a 100% markup. They're telling everyone else try to earn 10% in traditional investments, buy the index. And then And get people that argue and go, "Warren Buffett, Warren Buffett made all of his money compounding. All right, like I I'm just going to have to look to the side here for 1 second because I decided to do this research. I was like, did he really Is that true? Did he truly make his money compounding? And I and I knew that wasn't the answer, but let me just let me kind of read a few of these pieces to you. All right? First off Warren Buffett made 5.5 million percent returns over 60 years. 5.5 million percent over 60 years.

10:25The S&P 500 made 39,000% over the same 60 years. It's because he used a completely different strategy. He didn't buy index funds. He bought companies. He didn't diversify. He focused. He didn't wait for compound interest. He deployed cash flow. So, why is everyone telling you to do the exact opposite of one of the greatest investors in history? Well, let's look at it. Like, what did he do? So, he basically um he didn't buy shares of index funds. He bought See's Candies. He bought See's Candies for 25 million in 1972. That was a $2 billion return. That's an 8,000 return on one single focus bet. He bought GEICO. He didn't buy GEICO stock. He bought out full ownership and majority ownership of GEICO for 2.3 billion. It's now one of the largest auto insurers in America. He bought Precision Castparts for 32 billion, the biggest acquisition Berkshire ever made. Dairy Queen, Duracell, Fruit of the Loom, Nebraska Furniture Mart, all owned outright. Berkshire Hathaway owns more than 60 companies. It's not a stock portfolio. It's a business empire. And

11:28this is what he said when asked if there's only one word that you could write down that represents success. What's the one word? And he said, "Focus." So, it wasn't diversification. It wasn't compound interest. It wasn't patience. It was focus. He said this, "I can improve your your ultimate financial welfare by giving you a ticket with only 20 slots in it representing all the investments you can make in a lifetime. Under those rules, you think a lot more carefully about what you did and you'd be forced to load up on what you really think about. And so, this is the thing." He says, "I'm a better investor because I'm a businessman, not a better businessman because I'm an investor." He doesn't separate the two. Everyone else that's an entrepreneur, everyone else that has upside potential is then putting their money in things they know nothing about. People that are great at real estate are being sold crypto. People that are that are great at business are being sold stocks. And so, they're they're fragmenting themselves. And this is the thing. You compound your knowledge and you can get a 1,000% return. You compound your interest and you'd be lucky to get 12. Well, I I love that you broke down how

12:32Warren Buffett got rich in our last mastermind. I talked about it. I'm like, it and it was what you were talking about earlier where the billionaires aren't doing the advice they say. What does he tell everyone to do today? Just put your The average person should put their money in the S&P 500 and set it and forget it. Yet
Don't be average. That's my message. Don't be average. Our buddy Michael Bernoff, average sucks, right? Average sucks, right? But that's not what he did, right? He's telling you what you should do, not what he did. He did it by making highly concentrated bets in in you know, in whether it's Coke or you know, Coke a partial one, but GEICO he made highly concentrated bets. And then the the second part of the GEICO story, right, is the float. He wanted that business so he had access to tons of capital at a very low cost of capital. Like, that was that play. Right. So, here's here's a story. So, my uncle was a VP and an executive for a power company, right?
Okay. And originally um you know, it was owned by different companies. Scottish Power eventually bought it, but then Warren Buffett bought the company. And then my uncle retired within a year because when Warren Buffett bought it,

13:34who seems like this jovial, happy person, he deployed a methodology to raise the stock value, which was ask people to do more and pay them less and fire people to actually have more people, you know, take on to have fewer people take on more work. So, my uncle was just tired of firing people and asking others to increase their workload without getting an increase in pay. So, what what happens is there's this fiduciary responsibility when you're a public company. You have one responsibility. It's to the shareholder. It's not to the executives. It's not to the employees. It's not to the customers. It's to the shareholder. And so, he had a ruthless deployment of a philosophy that had nothing to do with diversifying in index funds. It had to do with he had controlling interest in the company and he changed the entire nature of how it operated to make more money. I had another guy that worked for that company that now works with me and my firm. He goes, "Dude, it was a train wreck at how much work we had to do. It

14:36was not humanly possible." He said, "I wasn't going to stay for some pension or retirement benefit. I decided to move on." And he came to work with me. So, like that's the story that we don't hear in the news quite often. And the thing is controlling interest is different than owning one share of something that's got millions of shares out there. Com- completely. All right. If you've been listening to the show for any period of time, you know I run a a high-end mastermind for entrepreneurs that are looking to create a different outcome and create more freedom in their life as it relates to their wealth and their money. And that's what I want to offer you a risk-free opportunity to come check it out. We have two seats available at our upcoming mastermind. You can book a call with my team over at bewealthy.com, navigate to the mastermind section and book a call. We would love to have you at the event and check it out and see what it's all about. I want to go to your book Killing Sacred Cows and you talk about the widely accepted truths, right? Kind of the truths in air quotes. Which of those sacred cows do you think are the most damaging today that are still like right now when we you know, cuz that book's been out like almost Is

15:39it like the official it's a 20-year Are we on the 20-year anniversary of that book? Yeah. Which by the way, isn't that That's going to be That's That's going to feel kind of cool, right? It's wild, man. I mean, you got to be kidding me. I still think of myself as the young guy, but my kids remind me I'm not, you know. So, I make sure I can always beat them in the gym no matter what with them being 18 and 20. But so, there's four major pieces to that book. The very first chapter starts out with the mindset. People believe in the finite pie. They think there's only so much to go around. That's the scarcity belief. And no amount of luck or no saving or no discipline or rate of return will save someone in the scarcity mindset. They will destroy wealth. The belief of scarcity is hold on to what you can. You know, it's a set it and forget it. It's a It's a hold on because there might not be enough. And it gets to people that think in reductionist thought processes. So, they overly emphasize budgeting at the expense of value. And so, the finite pie is not true because look, there's not a finite amount of food because animals

16:42reproduce. Plants grow again. So, even if there's a finite amount of money, there's an infinite number of times it can exchange hands. So, we have much wealthier people today in the middle class than some of the wealthiest people hundreds of years ago because of we've created refrigeration and air conditioning. And you know, you've got a variety of food and you can fly anywhere in the world. Like, there's so much more wealth today than there used to be simply because the finite pie is not true. But if people believe in the finite pie, they typically become communists because then they go, "Oh, it's unfair." Or they don't think in value creation and they feel stuck. And so, when people are in the finite pie, they believe that scarcity is real. Fear, doubt, and worry is their mantra. They think profit is evidence of deception and coercion. That's why they hate billionaires and blame their life on it. But we know the truth of the matter is abundance. It's that we produce more than we consume and then we continue to grow upon that. So, like when someone builds an architectural blueprint, all of a sudden houses get nicer over time than what they used to be without that kind of a blueprint, right? They learn how to make them

17:43better structure. We learn how to you know, produce things a lot more efficiently. So, ultimately um in abundance, it's that it's it's really about faith. It's about innovation and ingenuity. In abundance, profit is evidence of value creation and dollars follow value. It's not about accumulation. It's about velocity, which this is the second major point in the book. Accumulation is a belief in three things. It takes money to make money. It doesn't take money to make money. I mean, sure you can make money on your money, but it takes relationships and ideas. It takes value and exchange. Second, high risk equals high return. You know, you and I know people that are really savvy in certain areas that they can mitigate and reduce risk because it's part of their investor DNA. The third thing is you're in it for the long haul. That's again back to that accumulation philosophy of compound interest. Put away money, take a bunch of risk with it by investing in things you know nothing about, and then wait for 30 years and hope it works out. That is the accumulation mindset. I'm in the velocity mindset. Velocity is what is your output divided by your input? And how do we increase output without increasing in without, you know, increasing input or or reducing input?

18:45Well, through efficiency, either by saving by not paying overpaying on taxes, which most entrepreneurs do, not overpaying on interest because you have a good credit score, a good cash flow report, have the right connections, and even maybe the best collateral. And then third, how do we reduce drag with investments so that you're not having hundreds of thousands of dollars of loss over time because you are overpaying fees. And fourth, insurance. A lot of people have duplicate coverages or improper structure. So, we become efficient with four eyes: IRS, interest, investments, and insurance. And then the game changer is productive. You actually expand your means. So, how do we increase output? It's through scalability and it's through leverage and it's through adding more value and serving more people. It's about solving bigger problems. It's really the merits of business. So, so that's the notion is velocity. And that's how the economy works, by the way. It's just the GDP divided by the money supply. And the more times money exchanges hands because of goods, services, and experiences, the more output. So, we want velocity, which means we want cash flow, which means we want our dollar to do more than one thing, which means we want to be as efficient as possible so it doesn't have loss to all these other

19:47factors like IRS, interest, investments, and insurance. So, so So, really the second You asked for, you know, one of the things that's two of the four. I'll I'll take a second to breathe and take a drink of water. It It's just so It's so great to hear you talk about abundance cuz I think in today the the moment we're in right now, you know, as we're filming this it almost feels like there the overwhelming mindset of the average person out there or they just, you know, society in general is lacking abundance in this moment, right? There's a little There's a kind of fear I don't want to use negativity, but maybe you scroll through your social media feed. It's It's It's tough. You're using social media, it's not reality. We have so much more abundance now than before and I've heard economists say we've never been in a place better than today. Yet, we can go back and you got to realize most news and media predicts 10 of every one recession. You know, it's always

negative. It's always bad. It's always whatever because you got one party in politics saying the other party's not doing well and then the other party saying they are. And then when it flips

20:50the uh the opposite happens. So, it's always a blame game. Like we're not on the same team. It's my team versus your team, but it's, you know, it's all of us. And so, it's really easy to manipulate people's mindset because of everything that they see with legacy media or social media is that things are bad when the opposite is true. We're having this massive breakthrough in productivity just like when the printing press came out it democratized like education and knowledge. We have that where, you know, I just saw that Gemini like my son just took the ACT and now Gemini has an entire study course. paying $600 a month for his education towards his ACT. Now it's pretty much 20 bucks a month and way more effective. You know, I mean How is How is that It's only scary because people don't know what to do next. People are afraid that what work they're doing is going to become irrelevant and we find so much of our self-worth in our work because it's been culturally indoctrinated into us. So, what we're going to have to start finding is how do we become more connected to people? How do we build communities? And how do we become more efficient the work we do by adopting AI

21:53instead of talking bad about I can't believe how many people are not adopting it. My kids aren't adopting it enough. I've told them over and over. I send them videos every single day, but we're in a world of abundance and people are are preaching to to present scarcity. It's not true. It is It's just a totally different time. I want to I love your All of your books are amazing. What would the Rockefellers do to me is It's just one of my favorites and I It's because I have this belief and I think passion that you do around life insurance, which I believe is the most misunderstood tool. I don't think there's any product more misunderstood than life insurance. And when I talk life insurance, I mean I'm talking whole life, the same thing that you believe in, not some random, you know, I'm talking In In So, in that book, right? It reframes it and how you think about it, right? How How the Rockefellers, you know, how they engineered everything. Why do you think it's so misunderstood? Why do you think the people just can't get the abundance side of insurance? Life insurance. Because most insurance companies don't

22:55have great policies. So, it it takes way too long to break even. Because most insurance agents can feel pushy and salesy instead of understanding the person and they focus more on commission than cash value. And because ultimately these insurance companies are so old and antiquated in how they They don't even unders- They don't even know how to present the value of what they have. Cuz they're so afraid of their own shadow that compliance governs every conversation they have and Wall Street intentionally went and said "Hey, we've got something much much sexier. Why would you want to do this slow, tedious thing called life insurance?" So, couple things. One, you have to be patient because it does take a minute for life insurance to break even. And some people just like to see numbers show up day one even if that lags in 5 years or 10 years or if it's really lagging in 20 or 30 years, they can be short-sided. Number two, you've got these financial gurus that believe in one thing, reductionist thinking. That all that life is about how you can save

23:57more and how you can just be more disciplined and they think that willpower and budgeting is the way to wealth and what they believe is that people just aren't smart enough to do the right things. So, they reduce it to the lowest common denominator of how do we reduce expenses and they look at anything that's not a mutual fund or an index fund as an expense. So, if insurance is $1,000 versus $100, they don't go with $1,000 has $1,000 of cash and $100 has no cash. So, maybe the one with cash is a little bit better. They go, "No, that's 10 times more expensive." Not They ignore the benefits because they're so myopic in their mindset and they really don't believe that people will stay with the policy long enough to benefit from it. And so, what they go is, "Hey, you know what? These people just aren't smart enough." And they treat them stupidly, which keeps them economic toddlers. And ultimately, here's the nefarious part of it. BlackRock has 20 BlackRock, Vanguard, you know, those companies have 22 trillion dollars under their helm between, you know, just people putting money in index funds. And they created this amazing system

25:01that's all a lie. So, they tell you you want a fiduciary and it's true. When you have a legal document and you you want an executor, you want a fiduciary. When you have a trust, you want a fiduciary. You want someone where they have to be best interest first, but here's the deal. They are brilliant marketers and they said, "What if we tell them these asset gatherers that we'll say our financial advisors are fiduciaries?" Well, they're not because a fiduciary has to put your best interest first. And here's the data. If you put 100 grand into an index fund and you can actually get 10% that 10% would take you to 1.74 million dollars. But what if you have a cheap fiduciary, meaning they charge you less than 1%? The average is like 1.25, but it's usually one. What if they just charge you .8? So, like, you know, 4/5 of a percent. You don't get 1.74 million, you get 1.4 million. It's $340,000 of cost for them to do something that's

26:04even worse. 92% of index funds outperform managed funds after 20 years. 92%. That's before fees. So, you add the fee, you have a 22% reduction in your overall performance and they're saying that's a fiduciary? It's not. And here's the issue. If I am a asset gatherer, which I never I was for 1998, 1999 and I got out of that game, I might get paid 1% and like, "Well, 1% is better than 100% of what people pay on commission for the first year of life insurance." What they're not accounting for is you can sell your book of business for 12 to 15 times EBITDA as an asset gatherer. So, if you have a billion dollar book of business and that's bringing in uh you know, that's bringing in a million dollars every single year or maybe it's bringing in 10 million actually, right? 10 million dollars. And now you can sell that for 15 times that. So, you can sell that for 150

27:05million dollars because you gathered assets and handed them off so that BlackRock could buy out every subdivision and make housing the opposite of what you're doing. And because people are indoctrinated, they believe the fiduciary story. They believe that the market's going to outperform insurance and it will. Look, the market for 40 years did 12.7% um if you include reinvesting dividends. Over 30 years it's done 10.4%. Life insurance is probably going to get 5%, 6% after fees. But life insurance has beaten all fixed income, meaning bonds, meaning money markets, meaning CDs over any 30-year 30-year period of time if you're with one of the big seven mutual companies. Always beat it. So, for an asset allocation decision, but the difference is you now have access to the capital. It's protected from liability. It has no taxation on it. And what it lets you do is the buy, borrow, die strategy that I talk about in What the Rockefellers do. You have real estate,

28:06you could borrow against it. You pay zero tax on that. Right? And you can even when you die have a step up in basis so there's no tax on it to your heirs. And by the way, you can even donate the real estate if you've if you've you know, taken cost segregation to appreciate it to a charity paying zero tax on the sale of that real estate and when you die the charity keeps whatever is left over, but the life insurance comes back tax-free to your family using the Rockefeller method. So, you never have to pay tax if you do this intelligently. Sure, you pay property tax. Sure, we pay other taxes, but no income tax. And so, why would you hate life insurance if it gives you permission to do charitable things? If it gives you access to capital on the way, it's only because it's misunderstood and it's not sold properly. That's it. It I I love your I love the way you describe I mean, it it's I just I've watched I mean, so many of your videos and it's so great to hear the way you describe life insurance because to me it it is a wealth-building tool, right? And when you go look at the banks, right? Banks hold billions of dollars worth of this asset on their books. Like, why do banks do it? You

29:08know, my thought process always I think banks are some of the smartest businesses out there. Yeah, they don't own life insurance. They can put They put a third of their reserves in it cuz that's all they're allowed to do. They do They all max it out. Totally. And then the government My other thing is when the government restricts your ability to do something cuz you know those policies have the MEC in there, right? They can become a modified endowment contract. Which means you lose the tax benefit. Yeah. You lose the tax benefit. Yeah. Totally. But why would the government want to restrict me putting too much in there? Cuz why shouldn't I be able to put whatever I want? Cuz it could get too good, right? I mean, it just cuz you and I would shove more money into our policies. Do you know how that happened? How? I actually don't know how the MEC MEC happened. Yeah. So, it happened in 1978, EF Hutton, which was a brokerage, and if you remember like back in the '70s and early '80s, we had really high interest rates, right? You could put your money in a CD, get 13% or 15%. Um and so, they had these universal life policies where they'd say, "All right, let's just get a $30,000 policy, but let's stuff it with $3 million." Cuz you're not going to pay tax on those gains, and then, you know, ultimately, uh the interest rates are like 15%, so

30:12this is really good. Well, eventually, the government came and said, "Wait, this is a bit of abusive because you're just using this as a tax shelter, not as a death benefit." So, they created that corridor of death benefit versus cash value. Now, you can use things like paid-up additions that allow you to put more money in the policy, goes mostly to the cash value, but it pushes the death benefit up, but it will have a limit where you have a seven-pay test where you can't put more than the max over 7 years, and then it's kind of taken care of. Otherwise, you have a modified endowment contract, but that's when you get another policy or buy one on the spouse or put them on your kids using the Rockefeller method. So, it was basically like the government saying, "Hey, hey, hey, we don't want to have to have people die, and all of a sudden they become a burden to the system, you know, because there isn't uh value there um to to help them sustain life. So, this helps us out, but there's a certain or we're not doing it for the death benefit anymore. We want the death benefit to be part of it." So, they made those adjustments in the '80s. Interesting. Yeah, I never knew how they came to cap it. Uh so, you have this I mean, you talk a lot about the Wall Street firm. It was a Wall Street firm

31:13that saw the benefit in insurance. A Wall Street brokerage was the one that popularized and kind of created universal life because they wanted to have it where they could put more money in it. And that's why they invented universal life. Yeah. Oh, got okay. That makes sense. You you talk a lot about the family bank, right? How we can use, you know, an entrepreneur, I can do it individually. I can use life insurance as this family bank idea. What are What are some of the misconceptions that people miss when they try to understand that idea? One is there's the infinite banking crowd thinks of the cash value as the main purpose of the bank. It's a secondary purpose. When the bank takes off is when the first family member dies. So, think of it this way. I've got insurance on me, on my wife, on my kids. When we eventually, hopefully, have grandkids, we'll have insurance on them. And when anyone dies, that money goes into a trust, which is the family bank. So, it's not just the cash value, it's when the death benefit comes in. And that death benefit, like for my family, we have a family constitution in our

32:15trust that says, "Hey, anyone that wants to buy a home, they'd still have to have the requirements of what it would qualify for a home. So, you can't buy a home, you can't be making a hundred grand and get a $10 million home. That's not going to work. We have There's an underwriting process. But let's say that they could qualify for a million-dollar home." Well, we'll let the trust be the financier. So, the cash in the trust will finance the home, meaning no closing costs, uh you know, so no loan origination fees. And then, they'll pay an interest rate that's still an interest rate, but a preferred interest rate over what the bank would charge. There's certain IRS requirements, so we use whatever the low part of that corridor is, which means every payment they make is a payment towards their kids' house because now it's building the money in the family bank, not into the institution. Secondarily, there is cash value along the way. And I've used cash value to buy a business in 2014. I used it to buy a cabin on 3 and 1/2 acres in 2020. I used it to, you know, do a number of things. I've used it to buy real estate in the past. So, I do use it, and then I like to take the cash flow and pay it back.

33:18What I do is I don't rush to pay it back. I have it paid back in a normal course of business instead of choking out my cash flow because my money's still in the policy earning. They're charging an interest rate to give me their money, and the interest in the policies compounding while I'm paying it back is decreasing the compounding cost. So, you know, it doesn't interrupt the the compounding effect, and it doesn't and if I die, it just subtracts it from the death benefit. It doesn't go against my credit score, and I don't have to make payments if I choose not to. I've been building a new business, so I actually stopped making payments to my cash value in 2024. I just said I I made like one one like lump sum payment, but the rest of time, I'm not doing the the automatic every month cuz I can choose to do it or not because it's collateralized by my own cash. So, really cool story is I met this guy that's really big in finance. You know, I really respect him, and he said that he used to just do real estate. And the best real estate deal he ever found, he tried to buy and he didn't get the deal because the other person closed in 5 days. So, he was smart enough to go to the person who

34:20bought the real estate and say, "How did you close in 5 days?" He goes, "Well, my grandfather set up a family bank using life insurance, and so we have $40 million inside of there that we could use to buy real estate, and then we just refinance it later and put the money back in the bank, or we don't, we just use the cash flow from the real estate to eventually pay back the bank." So, it's like Imagine not having to be in the banking system, not having to go like I remember getting a loan for this house. You know, 20% down. It was actually so hard to wire the money because it was a big lump It was a big wire, and they had to get permission on the phone, and they had made me come into the bank. I ended up going to a private bank after that. But secondarily, like all the process to close on time cuz I only had 30 days, I had to check in every single day, make sure they had every single document. And then we had to go through, and we got a bad appraisal and had to debate that. You know what? If I just had had pulled the money from my cash value like I did when I bought my first cabin, which by the way, my first cabin, I paid $50,000 less than two other offers on the cabin cuz I closed in 9 days. I said I Well, I

35:22closed in 10. I said, "I can close in 9 days." There was one little miss out, but ultimately, I didn't even have to worry about getting an appraisal. I just bought the property. I paid it outright, and then I got a line of credit against it. So, I've been using this methodology for a long time, but I don't use it for like some people that do infinite banking, they pay for everything out of their cash value. I only use it if I know I'm going to get a really good return, and then I can, you know, that it's got high certainty. I wouldn't use it for like crypto, personally. I wouldn't use it for, you know, investments that like someone's startup or IPO or something like that. But I would use it to buy a business. I would use it to buy real estate I'm really intimately familiar with, and that kind of stuff. But, you know, some people overuse their cash. That's the main issue. I love your two things. I think people radically underestimate the deal they can get to your point when you can go pay cash. I've used mine, same deal, like, "Hey, it's a million-dollar deal and my kids so like, hey man, a million I can do it in whatever 60 or 90 days normal can financing terms, but I can close tomorrow or like, you know, as soon as title's ready, 3 days, and I can close for 850."

36:25And sometimes people like, "Dude, I'm in." And you're like, "Perfect. I mean, I'm just withdrawing from my So, like having that access I think And the other second part of that, I think people underestimate all the costs. You're like loan origination, but I don't think people fully understand all the transactional costs when you don't pay cash, right? You've got But even title, a cash policy versus a lender's required call radically different costs. 600 bucks in Arizona versus whatever it could be. You've got appraisal. You've got all the loan origination, you know, processing doc Like all those are massive fees to your point. You don't have those, and you get a better deal. What does that do to your rate of return on that investment? What Yeah, and what happens if you like
It's wild. What if it just takes longer than you expect and all the stress that comes with that? I mean, if you think about it, the only reason we go through this process is cuz the bank is protecting themselves. They want a down payment, otherwise they charge you PMI. It's to protect them. They want to see your credit score.
Totally. They want to see your seasoned money in your accounts, how much has been there for the last 3 months. They

37:26want to see your taxes. They want an appraisal, and then and all these other things, title fees, everything else. So, it's costing you a huge amount that there's an opportunity cost now over your lifetime that we can just eliminate that, right? And then when people are like, "Oh, well, there's so much cost in the front in the front end of the whole life policy." I'm like, uh you're going to make it up for that cost infinitely number of times by just the cash negotiation in the future and eliminating the other expenses when you're closing on things cuz I've Again, I bought businesses, I bought real estate, I've paid outright with my cash value, I've done down payments with my cash value, and then I have flexibility on the terms to pay it back. Hey, if you're getting value from the show, do me a favor. Take less than 10 seconds and hit subscribe, whether you're on YouTube, Apple podcast, Spotify, hit subscribe, leave us a review. It helps us immensely. Our goal is to help more people, and you are one of the keys to doing that. So, please do us a favor and leave us a review, and also subscribe. Well, that's the comment I hear all the time, Garrett, is that it's just so

38:27expensive. It's so overpriced. Right? Life insurance is so expensive. Like, what do you What do you say to that crowd? Cuz we were going to have listeners and viewers watching this right now go, "I get it, but this is so expensive." What What do you say to them? Well, first, I want people to understand that term insurance only pays out 1.1% of the time. So, that's a 99 or 98.9% chance that you pay for something and you don't get a a benefit from it because it's only paying out 1.1% of the time. If you keep your term insurance policy to life expectancy, you'll pay more in premiums than you'll have in death benefit because they phase you out in the later years by exponentially increasing the premium. So, you might have a 10-year level, 20-year level, maybe even a 30-year level, but the reality is they're just going to phase you out eventually because when you're most likely to die, they don't want to pay. So, that's the second thing. The third thing is and if you understand the death benefit has value to you while you're alive because one, when you have a death benefit, it can coordinate with other assets. Not saying this is the best way

39:29to do it, but this is the easiest illustration. There's people that end up paying off a mortgage, you know? And when the mortgage is paid off, that's a lazy asset. They get to live in it, but it doesn't create any cash flow for them unless they Airbnb it, which my wife would never do that with one of our homes, okay? So, we can we can actually use the death benefit as collateral, get a reverse mortgage, so that money comes out of the house tax-free, but never puts a home at risk because the collateral assigns to death benefit, it would pay back the full loan at death with no payments during your life. So, now you have tax-free money that's unlocked because of death benefit. So, here's what I think of. When I buy a death benefit, what's the payment I'm making to control that asset? If it's a $5 million death benefit and I'm spending $50,000 a year, that's $50,000 to have 5 million bucks in the future. How long does it take to create $5 million in assets that are free and clear? Now, most people think you have to die to benefit from it, but that's not true. The reverse mortgage is one illustration. You can read What Would Rockefellers Do, learn about

40:30charitable trust, learn about what's called a paydown strategy, where you start taking principal and interest to zero and then have the death benefit replenish what you spent, so you don't disinherit your family. It can give you 30% more cash flow. There's so many options of how you can benefit from your death benefit in your later years, and so you're controlling that asset with a small down payment. Now, the cash value, if you're going to be in this policy for 30 years, it's going to outperform bonds. If you're going to be in it for 2 years, it's not. It's just looks bad in the short term, but it's because you're controlling a huge death benefit that some people do die in those early years, so they have to have rules of how much is set aside for collateral accounts and for capitalization. So, is it expensive only if you don't know what you're doing with it? You know, is this is a savings account expensive? Is a money market expensive? Is a bond expensive? Absolutely. I mean, the problem with bonds is if you have a bond that's at 3% and bonds go up to 4%, your bond just lost value because everybody can go buy a new bond and get a higher interest rate, so you lose

41:31value. Once a dividend is paid in your policy, it's guaranteed and they can't take it back. So, why not have those guarantees and it's protected from liability in bankruptcy fully in 40-some states and partially in the others that it's not fully protected. And by the way, you just go sign it in the in the state that's fully protected to get the protections. So, if you live in California, sign in Nevada or Utah, you know, I mean, there's there's it's just I don't know. I I get the rudimentary thought process is people buy it and they cancel it. That does happen sometimes, and that's an expensive cost. But, buying term is the opposite. It's cheap up front, but expensive in the long term, and 98.9% of people cancel. Like, not 98.9% of people cancel whole life. It's the opposite. Only a few percentage cancel whole life. So, you have a much better odds stacked in your favor, but people just they think so myopically and so small because there's so many memes and clichés that enter the people's minds of I first time I heard about whole life, they told me it was a hole you throw your money into. Well, why would I want a hole I throw my money

42:32into?

It's a rudimentary thought process, right? Because again, maybe they're so stuck like yeah, the stock market's going to outperform the dividends. True, but it's but what happens is when you have three negative years in the stock market, which happens, like 2000 to 2002, 2008 to 2010, when you have those 3 years in your retirement years, if you can pull that money out of your cash value instead of another account that's going down, you can take 30% more from those other accounts because you've got distribution diversification. See, we can't just have all of our money paying off a mortgage and stuck in a retirement plan because people that are stuck in a retirement plan don't learn how to create cash flow over their lifetime, and now when they finally get to retirement, they're subject to whatever interest rates are told that they are. They can't change that. They're subject to whatever taxes are because everything's been delayed and deferred with taxes, now they just pay whatever the going rate is, and inflation robs their purchasing power. I was doing the numbers this morning. Dave Ramsey says if you save $100 for 40 years and you get 12%, you can become a millionaire. True, 1.1 million. But, what happens if

43:35there's inflation? And the inflation meant that it felt like you got 7% not 12%, and the reality is you're at $300,000 of actual purchasing power over 40 year 40 years by deferring $100 a month for 40 years. So, it's not nearly as good as people think, and unfortunately, it just seems easy to be like, oh, $100 a month for 40 years. 40 years is a long time. That's an awfully long time, and you could have compounded your knowledge, you could have built some skill sets, you could have built a business, you could have built other things, but you just deferred and delayed because you thought that it was willpower, savings, and luck. It is it was such there's so much education that's missed. I think the lack of education is what makes it expensive, right? You just gave a a master class answer on how to leverage. There's so many ways and that was just a portion of the things that you can do with it. So, I think the people have got to go out and get educated and you've got to go number one, they all going to need to read your book. So, stop what you're doing right now, go get What Would the Rockefellers Do. That's your entry into this space.
go Garrett B Gunderson on Instagram, DM Rockefellers, I'll give you the

44:37audiobook for free. DM Rockefellers on Instagram, Garrett B Gunderson, bam, we'll just hook you up. I love it. We'll drop that in the show notes. We'll make sure that's there, easy for you all to get. So, you touched on it briefly, but I want to go a little deeper on the wealth capture. So, you talk about life insurance where we can just capture some of this wealth. Can you just speak to that a little more and I just want to clarify that for the audience before we move on? So, when we look at can we save tax? Can we save on interest? Can we save on, you know, non-performing fees? Can we save on insurance costs? Like, even buying whole life means I can get rid of my term insurance, and that money can now go to my cash value. It might mean that I can have an accelerated benefit rider, so I don't need long-term care because my death benefit will be my long-term care, and now I can save that money. So, I'm looking for like anytime I'm saving tax or interest, I want to put that in the policy because if you don't, then it just gets gobbled up by lifestyle. And then you feel like you're treading water. So, I do use this as a wealth capture mechanism, and then I can use that cash in the future to deliberately invest. So, automatically save, deliberately invest. Use your cash value

45:39when you deliberately invest, automatically capture all this efficiency as you go through and plug leaks to build the policy. Some people are like, well, it's expensive. I'm like, well, what if I found all the money for it? What if I just found out you're overpaying the government by 10 grand a year? What if I found that your interest rates could be restructured, renegotiated, or re you reallocate underperforming assets to free up cash flow, and it went into your policy? And what if we can make it where there's 70% cash value year one instead of zero like most policies? I mean, we can make it so much better, right? That's that's the thing. And then when the wealth is captured, now when there's cash there and the right opportunity comes, you have the opportunity to jump on it. I mean, there was this article I read in The New Yorker years ago written by Malcolm Gladwell, and he talked about predatory investing. I didn't like the name predatory investing because he was using like Ted Turner as one of the examples that Ted Turner would sit on heavy amounts of cash, and then when the market turned and there were people in distress, he'd buy the companies when they were struggling with cash flow. So, he even bought back some of the companies he had sold. He bought, you know, and then he bought land during times when land values went down, where

46:41everybody else is told to dollar cost average and just set money aside no matter what, he's going, no, I'm going to wait, and then I'm pouncing when the opportunity's right. And the same thing happens with big companies. Big companies don't go Apple doesn't say, you know, we're sitting on too much cash and cash is losing value, so let's diversify into Microsoft and index fund. They don't do that. They buy companies. They buy capabilities. They don't deploy capital on things they don't understand, and they don't diversify into things that aren't right for them. So, that's the key. I It is it's just again, it's it's so misunderstood. I love the way that you said like every time I save something, I save some on tax, I don't need long-term care. I'm trying to wrap all that and put it back in because to your point, like all of this it's very easy to have lifestyle creep. It's a very real thing. And now you've got it so that it's going to go I The other last part I want to say on life insurance is it never goes I think people miss the fact that it never goes backward, right? So, once your policy go it can't it cannot go backwards, right? You're never going, oh, what happened to my policy? It lost 35% over 2 years. Unless you do variable universal life or

47:45you do index universal life, then yes, it could go backwards because they can raise the fees. Whole life fixes your fees, gives you a minimum guaranteed interest rate, it guarantees your death benefit, and your premiums can never go up. And once a dividend, which is not guaranteed, a dividend is not guaranteed, but once it's paid, it becomes guaranteed. So, there's six companies that have always paid a dividend for 150 years. Doesn't mean they'll pay it in the future, but they paid during civil wars, world wars, they paid during the Great Depression, they paid they paid during the Great Recession. I like that track record because if they're not paying a dividend, there's probably a lot of other things already going much, much worse and much more wrong. And your point is it has been happening for 150 years. So, I mean, we got to we do have a very good track record there. Uh you talk you talk about budgeting as a form of scarcity, and I I've always I think budgeting sucks because to your point, it takes you to a place where I'm I'm cutting out Netflix, I'm cutting out something that it probably's not going to really move the needle. So, I have a different way I do it, but I want to hear yours. When you talk to, you know, an entrepreneur, how should they think

48:48about their budget and their spending? How should they be thinking about it? Automate an amount off the top. My my preference is when you pay yourself, take 18% and set up in two different accounts. One is your wealth capture account, which eventually will go to life insurance if you're me. People can look for other alternatives. And then a living wealthy account. So, I choose 18% because inflation is at least 3%, technological change is at least 3%, tax hikes is at least 3%, a luxury once enjoyed becomes a necessity, so I want to be able to have a better life in the future, and 3% for things that break down and have to be replaced. So, that's 15%. It used to be 10% in The Richest Man in Babylon days, but that's before we had the creature from Jekyll Island and finding out about the Fred Fed and then banks lending out money more than once, and you know, you can go down that rabbit hole, but if essentially inflation existed now, so we have to, you know, go 15%. But, I'm not telling people cut back and reduce. I'm saying automate off the top by saving on interest, on and the IRS, saving on non-performing fees with investments, and then ultimately saving on insurance,

49:51right? Because a lot of people just have duplicate coverage or improper structure. So, that helps you get there. And then the last 3% is a living wealthy amount. Just money that goes through an account that you get guilt-free spending. You just go, you know what? I like these finer things in life. And I I even like the book Unreasonable Hospitality, which I love that book. For people that have read it, you know, he talks about they had like this 3% that they would just go wild with to create great customer experience. So, they could be really responsible with everything else with their restaurant, but that 3% was just like dream making, right? And so, it's like, yeah, I like that 3% to enjoy life along the way because finance tries to teach you to only live a good life 30 years from today or when you're too old to enjoy it. I'm saying that wealth is your ability to have quality of life along the way while still being prepared for the future. So, you know, it's more about automation. And I feel like the wealthiest people create a command center. And that command center is how do they utilize capital? It's not about budgeting, it's about growth. Budgeting is about restriction and reduction. Production is the game. No one shrinks their way to wealth. So, yes, if you're a train wreck that's not on track, budgeting is step one just to get on

50:53track. But, budgeting is not step two cuz budgeting will create restraint and and top out. You know, my wife is the one that really kind of brought this to my attention. And she's a she's a planner. She's a she's very detail-oriented. She makes sure to think things through. I'm kind of like the quick start, like let's get rolling. Let's make this happen. But, earlier in my life, I was a miser. My family just taught me like, you don't know when you if you're going to have enough money, so hold on to what you've got. And one day she's like, all right, well, let's do an exercise. Let's just go through our budget cuz I was so big on budget. We fought about it all the time. She's like, let's just see what we could cut out. We cut out $170. It was kind of miserable to cut out cuz it was like back in the day of having a Massage Envy, you know, thing that I paid 40 bucks a month for to get a massage once a month. It was cable back in the day. We got rid of cable, which meant we had three channels that were, you know, coming in from an antenna. It was just like we didn't we were living pretty frugally. She's like, all right, day two. Like, what can we do to add more value? Like, what could you do to make more money? And To make $170.

51:57Yeah. So, I was young and I was making a lot of money. And the thing about being young and making a lot of money in the financial space is other financial people are like, how are you making more than me and you're only a few years in the business? I don't get it. And I said, well, look, why don't I just start doing a conference call twice a month? I'll charge $179 for this conference call. Every quarter we'll get in-person events that you can fly in. And then I'll give you once a year where you can come watch me with the client. You can just come spend a day with me. I charge $179 a month, and within 18 months we had 100 people in that program. So, we were 100 times better off than cutting the expenses. It's such a great story. Well, it didn't just you get 179, you got, like you said, 100x that amount. But, I I love your point that you cut out everything that was kind of like the the stuff that was making it all good, right? It was the massage, it was the the little bit extra. You're You can only cut so much, yet your upside is infinite, right? Your upside could be any number. You can only cut so far, and you're like your point, you're just cutting out the luck the stuff that made it more pleasant. Yeah. I know some people watching this

53:00and hate us because they think, oh yeah, you guys are privileged and you guys are wealthy. I came from a coal mining town. I My great-grandfather's a coal miner, my grandfathers were coal miners, my dad was a coal miner. I I started by mowing lawns and babysitting. I've had a car detailing business where I scrubbed bugs and tar off of cars and took repossessed vehicles that were trashed and tried to make them cleaner so that the credit union could sell them for more. I put in some real manual labor. And I just made a choice. I was like, this isn't what I want to do. And I got into finance when I was 19. I started buying real estate when I was 19 years old, you know? And and I made some mistakes and I lost some money, but I didn't want to just be stuck in just reducing my life and trying to be so disciplined by getting a time for money type of job that was had very limited upside. And so, anyone could be an intrapreneur working in an organization that when you improve the bottom line or you increase the top line, you get a percentage of that. Sales is one of the perfect examples of that. Or, you're an entrepreneur where you're creating it. Where you go out

54:02there and you create it. It's extra work. My wife's like, the thing about being an entrepreneur, there's only one rule. You have to be responsible. Because there's no one that gets to say it was someone else's fault because it ends up in your in your pocket and costing you. So, I'm I mean, like it it wasn't easy. This isn't an easy path. It doesn't mean that I didn't have mistakes and, you know, I had business partners that died in plane crash. I had a big real estate portfolio that I was over-leveraged in 2008 and was exposed. I, you know, I sold a business prematurely and had to restart a new business. Like, I've been through it to get there, but it's so much better than feeling like in a dead-end job that I'm just trading time for money, I'm putting it into a 401k, and trying to pay off my mortgage, and then thinking one day when I'm too old I'll finally enjoy life. I rail against that. I want to help people create a life they don't ever want to retire from even though they could. I want people like to not be so blue collar that they wear down their body and realize when the time we're no longer in the industrial age, we're in the AI age. And anyone that's willing to do the work can start getting skill sets that were impossible before. We're building a firm right now where we can

55:05analyze someone's estate plan and their legacy plan and their taxes in minutes instead of in hours. And we're getting CPAs and attorneys to partner with us so that we can actually implement that with their oversight, and they never have to meet with the client and charge $600 an hour. So, we're providing services that used to cost $9,000 a month at $1,500 a month. It is bananas to me. And it's exciting as hell, right? Like, that's the world we're in. But, if you fear it and you don't deal with it and you just like, here's what too many people do. They play the victim. If this wouldn't have happened, they'd be better off. And if this person didn't screw them. Look, you've been in business, I've been in business. I There's been bad situations, you know? I I've had to mediate. I've had I've been But, the bottom line was like, as soon as I still created a more exciting future than just being a victim of the circumstance, life gets better. So, where anyone is feeling like they've been a victim of something, you've got to let go that story, you've got to forgive it, and you've got to start moving forward. You've got to start creating a brighter future. You've got to start developing those skill sets. You've got to learn about money. These

56:07are the things that we're talking about here. Because it's I don't want to debate about whether whole life's good or not. I want people to whether they buy whole life or not, they've got to invest in themselves. They've got to make more money. They've got to get better at keeping more of the money they make. Whole life is one pretty extraordinary tool for a lot of people, but it's really if it's not for you, move on from it. Don't listen to that part of the conversation. I Even when I write about whole life now, I'm like, whole life or an alternative. I If there's an alternative that they can get, like maybe they get a brokerage account and a line of credit against it. There's still some tax issues and there's still some volatility there, but that's better than nothing. Like, maybe they're going to do it with a CD and a line of credit against that. I don't know. Find a better method. And then show me the better method, too. I'm open to that. I've already agreed that the market's probably going to outperform it, but it doesn't resolve the the liability issues. It doesn't resolve the stability issues. It doesn't resolve the the access to capital. So, it's it's a different animal. It has its own place. To com- com- completely. And it it kind of segues to where I want to go next, which is you talk so much about that

57:09cash flow is so much more important than net worth. And you know, when when I talk on a stage, I always I give an analogy. I got two buddies that are both worth about the same amount. And this is like 5 years ago. They're both both worth about $50 million. One guy has his entire net worth totally cash flowing assets, right? Real estate, some private credits and debt, but it's just all cash flow. And he lives, you know, like you would think he would, right? He lives like a he lives really really good life. I got another buddy, it's all in land. Right? And he's kind of like Yellowstone, just not as cool. And every year's a struggle. Same net worth, radically different lives. So, I want to get your take on, why is cash flow so much more important than net worth? Cash flow is like blood flow, and net worth is like muscle. It's not like you don't want net worth. It's just that you can't take net worth to a a store, but you can take cash to a store. You can't buy anything with net worth. You might be able to collateralize it to get access to capital, but now you have a loan against it. So, I like three-dimensional investments. Three-dimensional investments look like this. One, the more cash flow that comes in

58:11without my involvement, the more enterprise value. The more enterprise value and cash flow that comes in with my involvement, the more fulfillment I have. So, I want to feel connected to it. I want it to build enterprise value, and I want it to create cash flow. And again, if that cash flow happens where I'm not involved in the sales team at all on my team, hey, that's that's more automation. I've got, you know, I've got a marketer, and I've got a copywriter that and I've got an AI guy that are building certain systems that make it where I don't have to be there for certain things that I used to have to be there for because it's taking my brain and capturing it so that we can be more effective. Like, that means more enterprise value. That means more freedom for me. But, then I'm still going, what are the things I like to do in business? I like getting this conversation with you today. It's super fun, Brett. Like, I love it. So, like, I want to keep doing this stuff. I love to write, so I want to keep doing that. I love building new relationships, so I want to keep doing that. I love anything that has to do with content creation, whether that's video or on stage or whatever it is. So, like, I want to keep in that, but I want my team to be able to leverage that in a much more effective way. So, that's three-dimensional. Real estate for people is three-dimensional. If you have

59:13tenants that are cash flowing, that it can im- improve your equity over time, right? Especially in commercial, the more cash flow, the higher the cap rate typically. So, and then you also get all the tax benefits. You get all the tax benefits for it. Or, you're doing the stuff you're doing, making it affordable housing for people. You get the feeling of like helping people get into a home that wouldn't get into a home otherwise. So, you're fulfilled by that, but you get the equity that grows over time, you know, uh on the properties you do keep. On the properties you sell, you just cash that out and then you turn it into the next one to create more cash flow, but too many people are one-dimensional. Pay off a loan, that's one-dimensional. Uh one-dimensional, put money in a retirement plan, one-dimensional. It's just growing, but it's not creating cash flow and it's not It's a false tax benefit. Deferring like if I have deferred tax in real estate, I can roll it over to another piece of real estate. I could borrow against it not pay tax. I could actually do a charitable trust. I have so many options. If I have a 401k or an IRA or an RRSP, if you're in Canada, I've deferred the tax, I have to pay the tax when I pull it out. That's my option.

1:00:14That's a problem. It's deferral, not savings. And plus real estate's a capital gain, it's ordinary income inside of a a retirement plan. That's, you know, I'm sure people are going to say, "Well, what about a Roth?" Okay, great. There's still no cash flow from a Roth. You know? Still a government plan. Still a government plan, they can still change the laws on you. I mean, so are they tools? Yes, they're just not my preferred tools. I love that. All right, if you've been listening to a show for a bit, you've likely heard that I run a wealth-building mastermind largely around some of the same concepts and content that we talk about here on the podcast. We have an upcoming mastermind. We've got two seats left for it. If you want to come shadow our mastermind, take a look at what it's like, get an actual feel for what it feels like to be with a tribe of people that are on the same journey as you. We've got a completely risk-free way to do so. Just go to bewealthy.com, navigate over to our mastermind and book a call with one of my team members to learn more about our mastermind and you can how you can come completely risk-free and check it out.

1:01:17So, Garrett, as we're wrapping up here, I want to ask you some just random questions here. You know, what's a question about money that you wish people would ask you, but they you maybe you haven't got it or they rarely do?

Why do we think money's so important? Ooh. What's your answer to that? When I'm in pain about money, it's because I think it's a scorecard. I think it's like it's my it's my worth. And it lets me know whether I'm doing something effective or not. Or I'm comparing to someone else. Or I think that I can buy that happiness. I think money rents happiness. It's damn good at renting happiness. Like someone could buy a new car and be super happy for a while, but if you're not a car guy, it's not going to last. You know, I I just read an article blew my mind. It said the bigger the house someone has, the less happiness they have. And you know, we have this big-ass house and I'm like, it's because there's a lot to manage. It's because there's a lot that is going on. You know, like we doubled the size of our house and it's been double the work for my wife.

1:02:19So, yes, there's some amazing things when we hosted the Super Bowl party here and stuff, but like a lot of it is we just are so confused about money because we think that with every rapper, with every Hollywood person, it's shown as the glamour that creates the the gold, but Coco Chanel said, "The best things in life are free. The second best things are really, really expensive." And when we put money in the first category instead of the second, it damages. When we put it in the second category instead of the first, it frees us. And that's the thing. That is um it's so interesting that you had so much good there. I love that the best things I always say the best things in life are go to the beach, go to whatever, right? And then the second best things turns out are are really, really expensive. But money, yeah, it is the love that I have with my kids, like it it's not about money. The relationship, you know, sure there's memories that have been enhanced by money, but my wife and I wrote down in in COVID, we sat down and we're like, "What are our best five days of our life?" Ooh, great question. five days of our life.

1:03:21And one day was we just were at the cabin, so yeah, we could have rented the cabin for the day, but we, you know, the only thing that we really did that day that cost money is we went for a Can-Am ride. I mean, it's expensive to buy a Can-Am, but again, we could have just rented it. We took a walk along the river. We had a latte to start the day. We made a lunch together. We made dinner together. We watched a movie. We built a fire outside when we watched the second movie. Uh you know, cuz the first one I think we watched like an episode, but then we watched outside. We blew up this this thing that didn't cost a lot of money, put a projector on it. And then we did some fly fishing. It was like an amazing day. Most of those things didn't cost money. If we took out the Can-Am ride, it didn't change whether it was the best day or not. Like you know, we could have just easily And then the other one was like the birth of our kids. Well, yeah, I mean, there's definitely kids cost money afterwards, but the reality was in the moment it had nothing to do with our net worth. Like the emotion I felt when I saw them for the first time and the love that they had for me when they were young had nothing to do with the life I was providing for them. It was the being

1:04:23present. We undervalue being present. We overvalue buying presents. That's the deal. We undervalue being present. We overvalue net worth. And I am guilty of this myself. There's times, you know, I had a a pretty sizable business. You know, we did eight figures and then I sold it and then I was like, "What am I doing next?" And I was like confused about it after I finished comedy. And I was like in 2023 being like, "I'm kind of a loot Am I losing it?" Like I just was so harsh on myself because I had tied too much of my my value to money. Yet when I'm with someone, they don't know the size of my house. They mostly don't know the cars I drive. Most of the best relationships I have, they just know the connection we have when we're together. They don't go, "What's Garrett's net worth?" They probably overvalue it. I had someone come up with an event and go, like, "Are you a billionaire?" I'm like, "Damn, how am I putting out that I'm a billionaire?" That's I'm definitely not. They're like, "Well, I read things that your cabin was great." I'm like, "Yeah, I'm I'm only making a few bucks per book that I sell, so I mean, I'm I'm a ways away from it, but like all of that doesn't matter as much as like can you see someone? Can you hear someone? Can you love someone? Can you can you be with someone? Can you laugh together?"

1:05:24Like all those things, those are the those are the first principles. The second principles are it's nice if you can get there in style. It's nice if you can have the luxuries. It's nice if it's nice if you can upgrade some of the conveniences, right? Those second things matter, but if you have the second things without the first things, you are going to be miserable. That's the thing. It is um I I filmed an episode This guy Ali Nasser wrote a book called The Business Owner's Dilemma. Just great dude. And he's got this line where he's like the greatest gift you can give anybody is just the gift of your presence. Just actually sitting, being present. Cuz you know, you go out to dinner, right? Everybody's on their If you look around, everyone's on their phone. And he's got this thing like you got to set your phone and stack them. Um I got I got I had a question for you.
so I was slightly distracted there for No, no, you weren't. You're What are you doing? We're almost I'm like, "No, I got to turn on my sauna, you know?" By the way, I'm a huge I I don't know if there's any health benefits to the sauna. Like I'm That's a joke. But I'm going to say it's my soundproof booth where I go to just think and have a minute, right? It's like it's the 20-30 minutes. Maybe it doesn't do what it's supposed to do and I'm like, even if it doesn't, where can you go for 30 minutes

1:06:26and just be present with yourself and just sit and think? So, I I do it every day and
That's fine if it doesn't, you know, reduce all-cause mortality and dementia and all that kind of stuff. But how pissed are you going to be if you find out the cold plunge is bad for you? Cuz I hate the cold plunge. I do not like it.
I would I like the sauna. The sauna the sauna if it said it ultimately ends my life a week early, I would still do it every day cuz I get so much value me personally. The cold plunge, I'd be super pissed cuz I do not love it. I question it every day. And you know, it's the one thing it never gets easier. You think it's going to? It it I honestly feel like it gets worse. It it's like you still you try to I got so lean that I I used to do 41° in the cold plunge and I decided I want to get as I want to see if I can get like just lean as possible, which my wife called me skinny, but I got to 7.6% body fat. And when I would get in the sauna and when I would get in the cold plunge at 41°, it burned. Where I used to be at like I went from 220 to 187. At 220, I was fine. So, I was like, "That it's a different ball game when you have

1:07:28less fat, you know?" I was like, "So, I just started turning it up to like 48, 49." I was like, "This is a little bit more manageable." And right now, my uh nutritionist only wants me to dunk my head in it. So, not my body anymore because it does stress out kidneys and I have already have kidney stress. So, so I'm in the place I only have to dunk my head in it now, um which I I I Maybe I that's a fib. I'm taking it. I'm taking it like it's truth cuz I'm I'm I'm just saunaing now after the workout. All right. I I love I want You know, there's so many people that watch this, Garrett, I know you talk to them, right? They're making six or seven figures, but they still feel broke, right right now. Like they've got the income. You know, what's the first thing, right? They're going to leave here today. What's the first thing they should think about doing? Improving their quality of life. The reason they feel broke is that they're deferring too much. So, I would literally be like, "What is worth going all in on? What makes you feel wealthy?" You know, if you don't feel wealthy, uh only 32% of millionaires feel wealthy

1:08:31according to Northwestern Mutual study. 32%. Why? Because well, it's not like it's enhancing their lifestyle cuz it's too net worth based, not cash flow not based. And usually people are getting there through discipline, but I look at it like three layers. Layer one, how do I improve quality of life? Layer two, how do I um create cash flow with my investments, right? So, like if I save money, I'm like, is there some for quality of life? Is there some to increase cash flow investments? And then layer three is where could I increase my skill set? So, I'm really like in layer three right now, where I've actually reduced some of like we usually take a trip to Europe. We're going to go to Hawaii instead. I know, I'm like, "Poor us," right? But like we're just going to because I'm like, "I'd rather invest more in the skill set this year cuz I want to get really good at social media, where I've been mediocre. And going to Europe is not going to be good for that plan, where I can get up early at in Hawaii, work on it, and then still have the time with my family. And I'm going to save half the cost going to Hawaii versus Europe, and I can take that money and just plow it into my team and back into my skill set. So, it's either quality of life, skill sets, or cash flow. Think of your money in those three categories, not just in one category,

1:09:33which is pay off loans or put in a retirement plan. That might be one That might be the improved cash flow category, but like what about improved skill set or what about improved quality of life? You probably aren't improving your quality of life enough because you feel guilty or shameful about using your money. That's so good. Quality of life, cash flow, skill sets. I love it. All right, Garrett, I ask the the lightning round you ask every guest the same three questions. What? Top three books that most impacted your life. Can't be your own, sadly, which we're going to get links to all your books. Top three books that most
you know?

What's the last time a big author they're like, "Dude, this is my three." I'm like, "I love that." And we're going to link to all those, but what are the three that impacted you the most when you were becoming Garrett? Uh The War of Art from Steven Pressfield. I listen to that once a year. Read it a few times. The Creative Act by Rick Rubin. Uh I've I've listened to that more than once, read it once. Uh probably read it again. Um and then The Married Man's Sex Life Primer 2011

1:10:35by Athol Kay. That That book changed my marriage. Wow. Okay. I like I You had three that no guest has said. I mean, uh War of Art more popular. I've heard, you know, in rooms. I have not I have not read the other two, which I will add to my list. Uh all right, next one is best purchase under 200 bucks that's the most improved your life in last 12 months.

Best purchase under 200 bucks that most improved my life.
Okay. Um I'll give you my goofy example while you're thinking. Mine was this Eight Sleep pillow. I'm a sleep nut. I got the you know, the cooling sleep the sleep I got a whole sleep system. The Eight Sleep pillow I did I spent a year going after like, "I'm going to get the ultimate pillow." And I went through like 40 pillows. It's the Eight Sleep pillow. Like it's a it's a $200 pillow, which doesn't make sense, but it's it's absolutely worth it. It's awesome. Yeah. Um Dude, you know, the the honest the honest thing is I bought Founder's Fuel. I bought two boxes of it. It's uh by my buddy Charles

1:11:40Gaudet and Reagan Archibold. And it's so good right before I go on a video or go up to do comedy that I am not drinking alcohol cuz I don't really drink alcohol anymore, but it gives me that feeling of like appreciation and energy at the same time and just feeling in flow. So, that you know, those two boxes were only like uh I bought them on discount because it was when they launched, so I think that that equaled 200 bucks. Founder's Fuel. I love it. Last thing is you get 60 seconds up to to talk to your 18-year-old self. You're talking to 18-year-old Garrett. What do you say to him? Stop worrying about being abandoned. People love you. Like you don't have all this to prove in order to Love is something you you don't have to earn. It's just something that is a gift. Enjoy the grace of that love from the your parents, your siblings, your wife, the your kids that you're going to have. Like stop hustling to earn and just be present, you dick. Stop being a dick.

1:12:45Give your love. Dude, that's that's incredibly beautiful. That's amazing. Well, where should we Everyone's going to want more Garrett when they when they watch or listen to this. Where should we send them to that they can interact with you or get more information about what you do today? You youtube.com/garrettgundersontv. Garrett B. Gunderson on Instagram. I'm dropping daily nuggets, usually two or more on Instagram every day. I'm doing a long form every week on YouTube. And they're just getting better. The one I just finished writing I probably I spent hours and hours, and I'm going to film it tonight in front of a live audience, and then we're going to do it as a as a live on YouTube. And then we're going to clip up some of the best moments, put it on Instagram. So, if you want to like take control your money, if you want to make more money, keep your money, grow your money, and and focus on legacy, like those are the two very best places. You go to garrettgunderson.com, I'd grab my newsletter. My newsletter's weekly. You know, it's it's content content content, and maybe we'll talk about a master class that you could buy into. Um it's you know, it's here's the top

1:13:47performing video that I think will impact you. I write my blog every week. I sit down and do the actual writing. I do most of it without any AI. AI sometimes will do research for me and grab me data and stats, but I'm telling heartfelt stories I think it could be impactful. So, those are the three best places. I love it, man. Well, thank you so much for being here. It was insightful as always. As a fan of yours, I'm so grateful Michael connected us again. So, thank you for being here. say that was you're so you were so prepared. You know which questions to ask. I've never felt like such a windup doll that like you would just get me going, dude, cuz like you would you would ask the questions that were the ones that like I was like so excited to talk about. You not only matched my energy, you brought that kind of energy, which I can be super intense. And we both are just have the sexiest gray hair and beard. Come on. You know what I'm saying?
it is Hey, listen, this is this is I dye this. I mean, I don't know about you. This is all dye This is all strategic. I've got I'm kidding. This was jet black, and then it would just went it

1:14:48just started giving out. I got a white chunk up here, you know? It just it stays, it can be this color all at once. Do you know what I'm saying? 100% man. Thank you so much. That's Garrett Gunderson. I'm Brett Tanner. This is the Be Wealthy podcast. We'll see you all here next week.