Building Your Money Machine

Buy THIS To Become Rich in Your 20s (and beyond)

• Mel H Abraham, CPA, CVA, ASA • Episode 241

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Want to know the secrets to becoming rich in your 20s and beyond? It's not just about working hard; it's about making smart investments and life choices that set you up for financial liberation.

In today’s episode, I dive deep into the eight critical investments I would make if I could go back to my twenties. From maximizing your 401K match to the power of mentorship, I share strategies that can multiply your money and build wealth. I discuss the importance of investing early, living within your means, and creating memories over accumulating stuff. Whether you’re in your twenties or sixties, these insights are designed to help you achieve a richer, more fulfilling lifestyle.

Ready to accelerate your path to financial freedom and live a richer life? Tune in to the full episode now!


IN TODAY’S EPISODE, I DISCUSS: 

- Maximizing your 401K match to leverage free money and compounding growth

- The importance of mentorship and networking for personal and professional growth

-Why investing in experiences and wellness can lead to a more fulfilling life


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ORDER MY NEW BOOK:

Building Your Money Machine: How to Get Your Money to Work Harder For You Than You Did For It! 

The key to building the life you desire and deserve is to build your Money Machine—a powerful system designed to generate income that’s no longer tied to your work or efforts. This step-by-step guide goes beyond the general idea of personal finance and wealth creation and reveals the holistic approach to transforming your relationship with money to allow you to enjoy financial freedom and peace of mind.

Part money philosophy, part money mindset, part strategy, and part tactical action, these powerful frameworks will show you how to build your money machine.


TAKE THE FINANCIAL FREEDOM QUIZ:

Take this free quiz to see where you are on the path to financial freedom and what your next steps are to move you to a new financial destiny at http://www.YourFinancialFreedomQuiz.com 

This is the affluent entrepreneur show for entrepreneurs that want to operate at a high level and achieve financial liberation. I'm your host, Mel Abraham, and I'll be sharing with you what it takes to create success beyond wealth so you can have a richer, more fulfilling lifestyle. In this show, you'll learn how business and money intersect so you can scale your business, scale your money, and scale your life while creating a deeper impact and living with complete freedom. Because that's what it really means to be an affluent entrepreneur. If I had a chance to go back in time to my twenties, what would I buy? What would I invest in? What would I have done that would have set me up to be rich or earlier in my life, longer in my life and easier in my life? I don't know. You know, here's the thing. I actually honestly have no regrets. I'm not saying that I made all the right decisions, all the right choices with my money or with my life. Certainly I didn't. I have won. I have lost. And as some of you have heard me say before, I have been fortunate enough to do enough things right to be successful. But y'all have been fortunate enough that I've done enough things wrong to be educational. And so that's kind of where I'm coming from. But none of this is because I regret something that I didn't do. It was actually because I probably didn't understand, I wasn't sure, or I allowed the 20 year old kind of ego to take me away. The, well, how does it look to the outside? Kind of take me away. So what are the things that I would have invested in? I'm going to break it down for you. I've got eight of them that I would say are important. Now, some of them might surprise you. Some of them, you might go, I get it. All right, let's just start off with a thing that seems so obvious. And the first one is, I would max out the match. I went to work for one of the big consulting firms in downtown Los Angeles. Okay? Now I'm coming out of college. I didn't know these things. Even though I was trained as a CPA, y'all, CPA financial guy. It didn't teach me to be wealthy. It didn't teach me to be rich. It didn't teach me about money. It taught me to be broke and work a nine to five by trading hours for dollars. I mean, that's the reality of it. But it did give me a skill set that I could build on. It gave me a foundational skill set understanding of business, understanding of business mechanics, business models, marketing, all those things that when I put them together, would make a big difference. But as I was coming out of college or some of you might be in that situation, and even if you're not in your twenties, if you're not doing some of these things, I want you to reconsider it because it will accelerate your results, it would accelerate your result, your pathway to financial freedom. But I didn't know really what a 401K was. I didn't know the importance of it, because I didn't understand the math behind wealth creation. I didn't understand things like what I talk about in my book, the wealth creation curve, which is in building your money machine, and that there's this concept of a flat line that comes into play. And the only way we get through that flatline is to make sure that, that we get in there early and stay in long. It's time. And so one of the first things I would do is make sure that investing is a priority. And I would put as much into my four hundred one k to make sure that I am getting 100% of the match from the employer. Okay? Because that's free money, y'all. If I come into your house and I give you$100, you gonna take it? Of course you are. If I come into your house and I say, all right, I got 100 here, I'm gonna give it to you, but you gotta give me 100, and I'm gonna give you both that one and another one back. So you give me 100, I give you 200, and they go, okay, that's what your 401K matches, they say, put $100 in, we'll match it with another hundred. They double your money up to a percentage. I didn't understand that, because I didn't understand the magic of compounding and investing in the wealth creation curve and all of this stuff. And I was back then, I was sitting there going, I'm in my twenties. I got plenty of time, y'all. In your twenties is the most important time to invest because it's the most valuable dollars. It's the most powerful dollars. At 20 years old, your money's going to multiply 80 plus times. If I wait just five years to 25, it cuts it in half to 40 plus times. So I want to get in the game now. You might say, Mel, I'm not in my twenties. That's fine. Whatever age you're at. Are you in a company that has a match? If you're in a company that has a match, make sure that you're contributing enough to at least get the match. Follow the wealth priority ladder. In chapter twelve, it tells you specifically what to do. And if you're sitting back saying, hey, but Mel, I don't have, I don't have the kind of income to be able to do that and pay my expenses. Some tough love right here. I want you to look back at your expenses. I'm not going to tell you to stop them, but I am going to tell you and ask you and invite you to explore them, to examine them, to look at the needs and the wants, and be really clear that needs are only for survival wants or something else, and then decide, am I still getting, am I getting sustainable joy from it? Or is there some little leak there that I can take and put it towards this? So I would max the match. And here's the other piece of this. I would not touch it. Okay? Couple mistakes I made. I did not max the match. And then the other thing that I did, these certificates on the wall are from my sensei in Japan. Because I went and lived in Japan, training the martial arts. And when I left that company back in the late eighties, and I left that company, in order to pay for my way to Japan, I took everything out of the withdrew it, which meant that I had to pay taxes and I had to pay penalties. I literally lost 50% of whatever was in there to taxes and penalties. But I didn't understand the power of time. I didn't understand, had I left it in there, there would have been at least$800,000 available to me today instead. Okay, I'm not going to complain. It was a fun time in Japan for the time that I lived there. But the fact of the matter is, is that I want you. That's one of the first things I would do. Get in there, stay in there, leave it alone, allow it to grow. Let time do the work. Okay, the number two thing that I would do, okay, the number two thing, and this is hard when you're younger. And even now, given the social media, is that I would forget. This may not come across the right way, but external image. Here's what I mean. I don't want you to worry about trying to look wealthy. The cool car, the expensive travel, all this. It doesn't. Here's the thing. There's a difference between looking wealthy and being wealthy. I want you to be wealthy. I want you to be that quiet millionaire. I want you to. I don't necessarily, because I see people. Look, where I live, there are homes right in this community there. There are 2020 $5 million homes. But when you see a lot, a number of the people, we call them billionaires in board shorts because we're by the beach and you would never know they had money. But then there's a group of them that they parade it in the streets. But here's the challenge. What you see on the outside may not be the reality on the inside because you have no idea how much debt they have. Because it's really easy to put a facade of life together on a payment plan and then parade it on TikTok and Instagram and things like that. Getting off of private jets, y'all. Did you know that there's a guy out there that is, he has a fuselage of a private jethe it doesn't even leave the ground. And he rents it to influencers to get on and off the jet and on the inside and take videos and pictures and this net as if it's theirs or that's the way they travel. Come on. We don't need to play those games. I mean, they can play those games, but I have no desire, and you should have no desire to impress a bunch of people you don't even know by parading something or putting yourself in debt or putting stress or strain on yourself to look a certain way. I'd rather you live a better way. Okay. Now, look, I am not exempt from this because I did that. I bought cars, I did things because I wanted to look cool. I got my job, I got this, I got that. I did it. But I think back on did it really give me a meaningful experience? The answer is no. Did it cost me a lot in the potential wealth? Yes. Now, so I'm not going to allow the external image to impress people I don't know to drive my decisions. That's number two. Okay, number three. Number three is an interesting one. I would actually get a coach or a mentor sooner. Okay, now this might be, this might be a paid one. This might be unpaid one. When I worked for this consulting firm, one of the cool things that they did there is they took a partner and a manager in that firm, and you got, and they got assigned to you as youre. As your consulting, as your coaching partner and manager. So your career moves, you could go to them and you had, you had coaching. The challenge is, when I told them I was leaving, the coaching stopped. Okay? But what I'm talking about is, are there people that are actually in the rooms living the living, truly living the experience you want, doing the things that you, you love that you can get into proximity with and conversations with to understand not what they did, but how they thought that made them do what they did. Because when I can get behind their thinking, when I can get a coach that or a mentor is going to give me their thinking, that I can duplicate their results, it's one of the things I try to do with my couple of elite clients, and when I do my coaching is to be that kind of a mentor and say, here's how I think about it. Here's what I do. Because now I'm equipping you to think for yourself versus mechanically memorizing it. But having a coach and a mentor, and I still have them today, that will challenge you when they see that you're being less than you are all cracked up to be, that will support you in a journey, that will celebrate you in the good, the bad, and all the stuff that's going on. And that will also allow you to start to look at things from a different perspective, to give you a different perspective. Okay. So this is the thing that I would do, and I'd get it early and I would stay with them. Now, maybe not the same coach or mentor for a long time. I have transitioned from different coaches mentors because I needed certain things at certain times, but I would have started it earlier. And no matter what your age or stage is going to always use additional perspective, additional support, additional direction, additional thoughts. Okay, number four is I would actually go along with. With the coach is I would look really critically at my network. Who am I associating with? Am I still with the fraternity sorority sisters and going out drinking, partying, this and that? Not, you know, yeah, it's fun, but are we taking life seriously? Are we building a life that's gonna provide a rich life? Are we still trying to hold on to the past? Are we networking with the people that are in the space or the place that we wanna go? Are we networking with the people that can introduce us to the things that we wanna wanna get to? Because here's what I know. When you're in the right rooms, okay? Masterminds. Networking events, conferences, events, that kind of thing. When you're in the right room, you are one person or one introduction away from the thing, the person, the resource that can change everything for you. Okay? So what I would do is be very specific in curating who I am networking with, who I'm spending time with on an ongoing basis. Now, I am not telling you to exclude the people that are in your life. I am simply saying you have I think of my, the people in my life in concentric circles. I have that inner circle. I have a, I have a couple of different circles, you know, acquaintances, colleagues, you know. And believe it or not, some of the, some of your family may not be in the inner circle. That's okay. That's okay. But you want to do that because this then defines how much time, effort, and everything I put into it. Not because it's transactional, but truly because the relationship is deeper, the trust is more, and when you do it from that perspective, it's a whole different ballgame. So networking is number four, number five, books and education. Whether you got a college degree or you don't, the degree process is just that. It is a process to get a degree. Your true education is when you're out in the world. I got my accounting degree. I got my CPA license. I got all of that. I got designations. The true education, the true self growth, the true growth. To do what I do to be able to, was that I was on a constant pursuit of growth and education, whether it was technical education, understanding more about investing in taxes and structures and what works, what doesn't work, okay, it was personal development. Ability to communicate, ability to speak, setting goals, setting those kinds of things, or, or licensing, education, getting designations and certifications. But the point is, is that every year, every year I have goals. But some of those goals are development goals, growth goals. How do I. What do I want to learn? What, what skills do I want to nurture? What things do I want to have? What you know and know that I am growing. So I am going to be more reader podcasts, YouTube, education programs. And I pick and choose based on what I need or what I want in that year. But I would have started that earlier. Now we have much more access to it today than we did back then. Okay? So there's really no excuse to not continually develop. And here's the beautiful thing. When you talk about building, building wealth, one of the four wealth drivers that I talk about in the book is income. Now, it's not the most important, although some people think it is. The one thing with income is this, the bigger the shovel, the faster you can get there. The bigger the shovel of income you have to throw at building wealth, the faster you can get there if you do the right things with it. And the way to increase the size of the shovel is to increase your skillset and your value to the people you serve, whether it's your employer, whether it's your customers or clients or marketplace. So the more use you grow personally, professionally, from a skill set, knowledge set, all of that. It makes you more valuable in the marketplace, gets you paid more, and now you have a bigger shovel to put towards your. Your wealth building. All right, that leads me to number six. Oh, this one. Oh, my gosh. Your wellness. I would have spent more time thinking about my wellness now. I was very healthy, I think, you know, I took care of myself. I worked out all the time. I wasn't a drinker. I wasn't a smoker. I did a lot of the right things, but did I check things? No. You know, the martial art I was in was a very. It was. I did a lot of throwing. Okay? So I ended up hitting the ground a lot. And now today, I can tell you that I feel it in my joints. Now, mind you, I'm 40 plus years in the martial arts, so body's taking a beating. But the question I got is, are you? Just like we'd say, hey, check. Check your money. So I want you to have a review rhythm for your I for your finances, for your investments, whether it's monthly, at least quarterly, but I think you need to do it monthly. You should be looking at your cash flow on a weekly basis. You look at your investments, you look at your plan, your overall financial plan, at least annually. So you have this review rhythm for your finances, where you're checking to make sure that your money is okay. We ought to be doing that also in our wellness, in our health, y'all. I got diagnosed with. With. With cancer. They found what ended up being a seven and a half centimeter tumor in my bladder. Seven and a half centimeters. They were freaked out, saying, how are you not in pain? I don't know. I don't know. I wasn't in pain. And one of the things that I realized is that seven years prior, I moved down here to the beach. And when I moved, I left all my doctors. I moved 100 miles south down towards the beach. And because I felt okay, because I was doing what I thought I was supposed to be doing and taking care of things, I didn't go and see a doctor. I did not see a doctor for seven years. Now, had I seen a doctor, would it have changed the cancer? Probably not. But what it would have changed is the tumor would have never got to seven and a half centimeters. Because of that size, I was in tremendous jeopardy. My prostate was risk of being removed. I was at risk of having a tube and a bag in for the kidney. I was at risk of losing the bladder and my life. But had I gone to the doctor and got checked and they caught it way earlier when it was smaller, none of that would have happened. We need to make sure that we are taking care of our health, of our wellness, of our well being, our physical state, our mental state, our whole, whole thing. I would put that high up there. Okay. Now that then leads me to number seven. And this is going to sound weird, but who are you partnering with? Okay, who is your partner in life? Who's your partner in life? And be, I want lack of a better term, be discerning. You deserve the best. Now, you got to ask yourself, when you sit back and say, this is what I want in a partner, there's two sides to that equation. You can demand what you want, all you want. The question you got to ask yourself is, who do you have to be as a person to attract that? So you can define what you want in a partner. And I think you should. The musts, and more importantly, the must nots, the things that you will not tolerate so you're not compromising your values. But because I will tell you this, then you sit back and say, who do I need to be to attract that and do the work in your self education, your self development, to become that and then be discerning? Stephanie and I. I didn't get married until 50 to Stephanie. I will tell you the day I met that woman, well, not the day, because she wanted nothing to do with me the first day, okay? But shortly after I met that woman, my life was transformed. Much richer, much deeper, much more meaningful. I will tell you what, whatever the nightmare stories are, with the right partner, your life will feel richer, your life will be more meaningful. Okay? And I know that this is typically we talk about money, but my job is to really get you to live a rich life. That's how we experience it, that's how we feel about it. The money is the fuel, the tool, the utility that's going to allow you to make the choices to live that rich life. That's why in building your money machine, the first thing that we do is define what your rich life looks like. Because if we don't know what it looks like, then how do we know what the destination is? But that rich life isn't about a bank account. The rich life is about life. Health, relationships, professional, all of that. We define all the domains of life, and then we put a price tag on it and we put it together. And that leads me to number eight and the final one. I think it really starts to accentuate everything and I think that I would invest more in experiences and memories versus stuff. Okay, versus stuff. Because stuff is fleeting. Stuff goes away. I can't even tell you the cars that I drove back then. I can think of one. A Mitsubishi star. Ian, I can remember that one. I don't remember the. I did drive a Lexus, okay? But that's it. And other stuff that I bought that's like, gone. At the time it felt like there was something that was really meaningful. But the fact is, the experiences, the memories, those stay with me. Those stay with you. Create, sit back and say, how do I create experiences? Things that you look back on decades on and laugh about and reminisce about and enjoy again, all of it. Like, this is one of the reasons that. One of the joy points and why we talk about when you build your plan, you put your top two, three joy points into the plan. The things that are sustainable, that bring that to life into the plan. I want you to have joy on the journey to financial freedom. If you've got to restrict or restrain certain expenditures, well, let's not do it on the joy points. As long as it's done responsibly. Let's do it on the momentary pleasures that are going to be fleeting and gone. My wife and I love to travel. And when we travel, we create memories. We look at the images, we look at the pictures, we talk about it. This is what has brought us closer and closer. Richness. And why I say we want a richer lifestyle is because I want you to experience life fully. Because richness comes from feelings, it comes from experiences. It doesn't come from the bank account. Now the bank account supports it. But if your whole focus is bank account, bank account, bank account. I want to build a wealthy bank account. You can build it. You can build a wealthy, wealthy bank account. I know a lot of people that have that, and unfortunately they have bankrupt lives because they're not experiencing life. They're not enjoying life and they're not living life. That's not what I want for you. So whether you're in your twenties, whether you're in your thirties, forties, fifties or sixties, I hope that you look through this and say, which one of these can I put into my life and keep into my life? The earlier you put it in, the better off you'll be. But if I had to go back to my twenties, these are the eight things that I would focus on, that I would invest in, that I would buy to set me up for a richer life, a wealthier life for my twenties. And beyond. I hope that this helps. I hope that this serves you on your journey and your path to financial freedom. You know that I'm on a crusade. I want to light the path to financial freedom for a million families, and I want one of them to be you. But I also know that I can't do it alone. That means that I also want to recruit you. I want you side by side, locked arms with me so we can march and shine a beacon of hope to the people that haven't got there yet. Let's make it happen, and let's do it together. All right? Until I get a chance to see you in another episode or on the road or at one of my speaking gigs. Always, always strive live a life that outlives you. Cheers. Thank you for listening to the affluent entrepreneurship with me, your host, Mel Abraham. If you want to achieve financial liberation to create an affluent lifestyle, join me in the affluent entrepreneur Facebook group now by going to melabraham.com group, and I'll see you there.

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