The Finance Expert: Simple 6 Step WEALTH Formula ANYONE Can Use To Become a MILLIONAIRE! | Jaspreet Singh

Today, finance expert Jaspreet Singh dives into the world of financial responsibility, mindset shifts for wealth building, and the art of savvy investing. Lewis and Jaspreet unpack complex financial concepts using everyday language and relatable personal examples. From the importance of knowing the difference between active and passive investing to the power of digging deep into research before making financial moves, they keep it real and engaging. They explore the highs and lows of forging a different path and the importance of staying educated and aware. But it's not all serious talk! They also delve into practical tips for managing credit card debt, maximizing savings, and building a solid financial foundation. In this episode you will learnThe fundamental difference between active and passive investing and how each strategy can impact your financial future. Tips for managing credit card debt and leveraging credit card benefits to your advantage. The power of strategic savings and how to build a strong financial foundation for long-term success. Insights into the world of real estate investing, including the challenges, rewards, and potential future trends in interest and mortgage rates. The importance of mindset shifts for financial success and how cultivating a proactive attitude can transform your approach to wealth building. For more information go to www.lewishowes.com/1579For more Greatness text PODCAST to +1 (614) 350-3960More INVESTING episodes we think you’ll love:Alex Hormozi: https://link.chtbl.com/1522-podJaspreet Singh: https://link.chtbl.com/1411-podRory Vaden: https://link.chtbl.com/1148-pod Get more from Lewis! Get my New York Times Bestselling book, Make Money Easy! Get The Greatness Mindset audiobook on SpotifyText Lewis AIYouTubeInstagramWebsiteTiktokFacebookX

Speaker names marked ? are inferred from speaking time and the show’s known hosts — they are not voice-verified.

• 0:00Jaspreet Singh?

  Most of us, myself included, are never taught a thing about money. We're told, go to school, get a degree, get a job, and all you figure it out. And then what happens for the majority of people is you end up broke, you end up struggling financially, and you can never figure out why. So the first thing is.

• 0:17Lewis Howes?

  Welcome to the School of Greatness. My name is Lewis Howes, a former pro athlete turned lifestyle entrepreneur. And each week, we bring you an inspiring person or message to help you discover how to unlock your inner greatness. Thanks for spending some time with me today. Now let the class begin.

• 0:41Lewis Howes?

  Welcome to this special masterclass. We've brought some of the top experts in the world to help you unlock the power of your life through this specific theme today. It's going to be powerful, so let's go ahead and dive in.

• 0:59Jaspreet Singh?

  What is it that you want to achieve in your life financially? And then you have to go out and figure it out yourself because unfortunately, school will never teach you this stuff. I saw my parents work their butt off every single day. If my dad got a Saturday and a Sunday off, it was considered a long weekend. And so I didn't get to spend a lot of time with my parents growing up, and they would always tell me that you have to go out and become successful. And I completely agreed because I wanted to give back to my parents. I wanted to help support them. And I figured, okay, if I want to become successful, I should follow the steps that we're told to become successful. What are those steps? Go to school, get a good degree, get a good job. For me, in my case, it was become a doctor. And along that way, it was in college,

• 1:44Jaspreet Singh?

  I realized that something is wrong, something is not adding up. And it actually happened, I was studying to get into medical school. And as I was studying, I started reading other business books and financial books. And I remember this, I was in the library studying and I went on to Google. And I searched the richest people in America. And you see people like Steve Jobs, Warren Buffett, Bill Gates, Mark Zuckerberg. And I was like, huh, none of these people are doctors. None of these people went down that traditional route of, you know, getting a degree, doing a good job. Am I missing something? Because I thought that if you go to school, get a good degree, you can make a lot of money. And if you work harder in school, get better grades, you'll make even more money.

• 2:28Jaspreet Singh?

  So I thought it was just directly correlated, your grades, your income. And that's when I started questioning things and I realized, oh, maybe this isn't right. And as you start to go down deeper and deeper down the rabbit hole, you start to realize, oh, my God. Everything that I've been told is a lie. And so that that kind of pushed me into this whole painful, emotional journey of learning about money, learning about entrepreneurship, learning about what does it mean to become wealthy? And how do you actually do it? Right. So that was that was kind of the the initial phase for me. And then I had to go out and actually start learning. Yeah. And the first real experience of that for me was I had this event planning company that I started in college.

• 3:10Jaspreet Singh?

  And the reason why I started it was because when I was in high school, I worked at Indian weddings. So I got to know a lot of the DJs. Right. And when I was in high school, these DJs were like, hey, man, you know, a lot of people in high school. How about we host a teen party for your friends in high school? I was like, all right, that's fine, you know, why not? Started this little teen party, party business in high school and I go to college. Don't know what to expect because my parents didn't go to university here. I think everybody goes to college to study hard and and become this big thing in college. I get to college and everybody is partying. Yeah. They're blowing their money that they don't have on alcohol. They're drinking. I don't drink. I don't smoke. I'm not, I'm not into that party scene, but I need something to do on Friday nights.

• 3:52Jaspreet Singh?

  So I was like, why don't I just take this teen party business that I had in high school? Bring it to college. And that's what I did. My freshman year, I was seventeen years old, just had a knock in on the door of every club, venue, bar, restaurant, asking if I could host a party here. Some would say, yeah, it's gonna cost you ten thousand dollars. Someone would say, yeah, it's gonna cost you twenty grand. I don't have that money. Right. But then one or two said, you can do it here. We're not gonna charge you a penny. Just give us half of the cover charge, half of the money that you bring in. I said, okay, now I'm in business. So I started making a little bit of money doing this. And I had some cash saved up. And I'm starting to read these business books. And every business book said, wealthy people invest in real estate. I don't know what that means. I don't know any real estate investors. My parents aren't investors.

• 4:35Jaspreet Singh?

  And so I was like, okay, if wealthy people invest in real estate, maybe I should invest in real estate. And this was right after the two thousand eight crash, and I'm in Michigan, where real estate was extremely hard. So I was like, all right, you know, I would like to invest in real estate. I'm studying for my medical college admission test. I start going to Google, because I'm bored while I'm studying for this exam. I'm reading about the Forbes richest people. None of them are doctors. None of them are people that work the traditional path. And you know, I have this idea to start investing in real estate. So I started looking at real estate in between my study sessions. And on August twenty second, I took the medical college admission test, the MCAT. And August twenty third, I closed on my first real estate investment property. Wow, how old were you? I was nineteen. Holy cow. It was eight thousand dollars.

• 5:20Jaspreet Singh?

  What was the investment? Was the price of the condo. The condo was eight grand? Eight grand. How'd you get a condo for eight grand? This is right after the two thousand eight crash. Wow, you got out of foreclosure or what? I was out of foreclosure. That same condo was selling for about a hundred and fifty grand, just a few years prior. Come on. Yeah, and so I came in. It was actually listed on sale for eighty four hundred. I made an offer for four thousand. They came down to seven thousand dollars. And I was still trying to push them lower. But then they said they had another offer on the table. I didn't wanna lose it, so I said, I'll give you eight grand, right? So I bought it for eight grand, put in a few thousand dollars worth of work, and at least for six hundred dollars a month. And now, all of a sudden, my mind was blown because I kinda had this idea of what entrepreneurship was.

• 6:02Jaspreet Singh?

  I had never heard that term until I came to college, but I was running this event planning company. And I'm starting to learn about this thing called entrepreneurship. And now I have this condo that's generating me this like almost passive income. I say almost because I was making a lot of mistakes in the beginning. But now I'm like, wow, this investing thing is very unique because I never learned this in school. My teachers never taught me this, but why am I working so hard in school? I mean, I want to become a doctor so I can ultimately make money. Now I start having this, you know, I talked about an emotional dilemma. Why am I becoming a doctor? Okay, I want to make my parents happy. Check. I want to be successful. Check. Do I really want to be a doctor?

• 6:44Jaspreet Singh?

  Maybe. And now I'm starting to question my like my actual beliefs. Because if I become a doctor, how do you make money? You treat people. I kinda have this entrepreneurial mind. I want to become successful. How do you make more money? You treat more people. So it's like this kinda runs into a dilemma because if I'm trying to maximize my income as a doctor, I gotta maximize how many patients I see. Maybe that means I don't get to give the best value to each individual patient. But as a human, I want to provide the most value possible. So I started to kinda face this dilemma where maybe I'm becoming a doctor for the wrong reasons. Interesting. And then I run this idea by my parents. I don't want to be a doctor. And they're like? Absolutely not. My dad was angry. My mom was furious.

• 7:30Jaspreet Singh?

  It took my mom about a year and a half to believe that her son was not going to be a doctor. Oh, man. And I had, I mean, when I say it was, it was, it was tough, like my parents would tell all their friends. Joseph is not going to become a doctor. Oh, wow. You're not becoming one. I'm not going to become one. Now I'm getting calls from my family in India. I'm getting calls from my family across the states. What are you doing? You're a disgrace to your family. Exactly. Exactly. I heard that again and again and again. But I was like, ah, this is not for me. And I started to realize that there's more to this thing. So now I started to go down this financial education journey. And the more I I learned, the more I realized I was lied to. Like, we're taught to go to school, to get a degree, to get a job, so we can then get a job and climb the corporate ladder. Well, wealthy people don't do that.

• 8:14Jaspreet Singh?

  Wealthy people are not working to climb the corporate ladder. They're working to own the corporate ladder. I didn't even realize that you could do that. Now, you can climb the corporate ladder and work to own the corporate ladder at the same time, but it's a different mindset, right? Most of us are taught to get that degree so we can do one thing, climb the corporate ladder, get earn a bigger salary. But if you only rely on your salary, you're just one step away from being broke. Because if you lose your job, something happens to you, you can't work, or your company goes down. You lost your salary and now you have no income coming in, and now what? You're scrambling for a job. Maybe you have some savings to help take care of you.

• 8:50Lewis Howes?

  Or if you haven't been saving and you just spend on on things all the time and you have no savings, then you're really screwed.

• 8:55Jaspreet Singh?

  Yeah, you're going into credit card debt.

• 8:57Lewis Howes?

  Right.

• 8:58Jaspreet Singh?

  And now you're trying to figure out how do you make things work? And by then, it's too late. This is where you gotta be proactive. And now I'm just like, this is crazy. Why was I never taught this? I was never taught about wealth. I was never taught about investing. I was never taught about this sort of financial education. But why aren't we taught this? And that's when I realized it's very profitable to keep people financially uneducated. It's profitable to keep people poor.

• 9:23Lewis Howes?

  Interesting. What is that? What would you say is the main system that keeps people poor then?

• 9:30Jaspreet Singh?

  It goes down to so many different things. The banks profit when you're financially uneducated because they will keep you saving money in the bank. They'll keep you in consumer debt. If the banks lived by their own advice, which is save money, the banks would be losing money. When you go and deposit a thousand dollars in the bank, That cash that you deposited is a liability for the bank. An asset is something that puts money in your pocket. A liability is something that takes money away from your pocket. So when the bank has your cash, it's a liability for them. They want to get rid of it as fast as possible. And the way they do that is by lending it out because it's an investment for the bank. They don't want to hold on to cash, but they want you to save your money.

• 10:10Lewis Howes?

  You want you to give them cash.

• 10:13Jaspreet Singh?

  Right.

• 10:13Lewis Howes?

  And just leave it there.

• 10:14Jaspreet Singh?

  Leave it there. And what's happening to your cash while it's there? It's losing value to inflation each and every day. Every day that you keep your cash in the bank, you're becoming poorer each and every day. Now, it's funny, I made a video on this in 2016. It was my first video to go viral. It was called, "You're guaranteed to go broke if you do this." And I was talking about inflation at 2% to 3%. If you keep your cash in the bank, you're going broke every single day. Now, here we are.

• 10:39Lewis Howes?

  Eight and a half percent.

• 10:40Jaspreet Singh?

  Eight and a half percent. And now people are starting to realize, wow, this inflation is a real problem. And so now, when you keep your cash in the bank, the bank is paying you 0.01%. Maybe 0.5% if you're lucky. And they're turning around lending it for 5%, 6%. And so the bank does not want to keep the cash in savings because it's a liability for them. They want to keep you spending money on their credit card because now they'll get to earn 18% to 25% in interest every time you spend a dollar.

• 11:07Lewis Howes?

  Wow.

• 11:07Jaspreet Singh?

  Governments want you to be financially uneducated. Because when you're financially uneducated, guess what? You are an employee and you're a consumer. Who pays the highest taxes? Employees and consumers. Everybody knows that rich people don't pay taxes. It makes people angry. But a lot of times, we don't understand why.

• 11:26Lewis Howes?

  Right.

• 11:27Jaspreet Singh?

  And we get angry at the wrong things, at the wrong reasons.

• 11:31Lewis Howes?

  Yeah. But the more you make as a business owner, until you're like uber-rich, I feel like, you're spending a lot of taxes.

• 11:37Jaspreet Singh?

  You are. And you know what? And there's a lot of things that you can do.

• 11:41Lewis Howes?

  Right.

• 11:41Jaspreet Singh?

  Legally, to pay less money in taxes. And there's different ways that you can invest your money that pay less money in taxes. So I'll give you a couple of examples. Let's start with this. Tax avoidance and tax evading are two similar words with two very different outcomes. This is one of the first things that you learn in law school. Tax evading is illegal.

• 12:02Lewis Howes?

  Yes.

• 12:02Jaspreet Singh?

  You go to jail.

• 12:03Lewis Howes?

  Yes.

• 12:04Jaspreet Singh?

  Tax avoiding is legal.

• 12:07Jaspreet Singh?

  And then you get hated for doing that. But this is the way it works.

• 12:10Lewis Howes?

  But you're playing within the rules of the system.

• 12:13Jaspreet Singh?

  And if you learn the IRS code, it's a rulebook. And the people who understand the rulebook are the people who have the money to hire the good accountants and the good attorneys.

• 12:22Lewis Howes?

  But you're not an accountant, but have you studied the?

• 12:24Jaspreet Singh?

  I have studied a lot of tax law.

• 12:26Lewis Howes?

  Really?

• 12:27Jaspreet Singh?

  Yeah. And so what happens is wealthy people will understand how this works, play within that system, and pay little to no money in taxes.

• 12:37Lewis Howes?

  What are three things that people who are making half a million and above should be doing to avoid taxes better?

• 12:46Jaspreet Singh?

  So let's start with, I'm gonna assume that you have either some sort of your own income, you're a side hustler, or you are a business owner.

• 12:53Lewis Howes?

  Yes.

• 12:54Jaspreet Singh?

  So if you make half a million dollars, let's assume that's profit. You are taxed on income. So if you take out a salary, that's gonna be taxed. Now, the question is, what is a tax deduction? Or the better question is, how can you make something a tax deduction? Because anything can be a tax deduction if you know how to make it a deduction. So that's the question that you have to ask yourself, because if you don't have an income, you don't have any tax. So this is what wealthy people are doing. So I'll give you an example of it being done, then I'll show you how people can do it on a potentially smaller scale. Elon Musk, he is probably the biggest example of this. He never got paid a salary running and owning Tesla. He got paid in stock options. So these stock options were.

• 13:38Lewis Howes?

  Is this even before it was public?

• 13:40Jaspreet Singh?

  This is, I think it was around the time that it was public, or maybe a little bit before. But he's been getting stock options for a long time.

• 13:47Lewis Howes?

  Sure.

• 13:48Jaspreet Singh?

  But the stock options that he gets were originally got were at $6 a share. So when the stock went up to $1,000 a share, and he was given millions of these stock options. Now, he has on paper a lot of money, but that money isn't in his bank account. So what he does is, instead of selling it and having an income. He goes to the bank and says, hey, I have these stock options which are worth billions of dollars. How about you give me a loan at three, four, five percent interest? No bank is gonna say no to that because the value of this is so much, it's billions of dollars. I mean, you can make the number smaller, but no bank is gonna say no. He takes that loan, pays three to four to five percent interest on it.

• 14:30Jaspreet Singh?

  And if this company grows, its stock value grows by six percent. He just made a profit on that. He didn't have to take any money out, never took an income, doesn't pay any taxes, and is able to now spend his money, live free, buy whatever he wants, live rich, and not pay a penny in tax.

• 14:48Lewis Howes?

  So he didn't have to sell any of the stock because if he sold it, he'd pay an income tax wherever you sell it. Instead, you get a loan out from the bank. You don't have to pay tax on that loan.

• 14:58Jaspreet Singh?

  When you go and get a mortgage for your home.

• 15:00Lewis Howes?

  You're getting a debt.

• 15:00Jaspreet Singh?

  It's debt. It's not taxable. It's not income. If you go and refinance your home, it's not income. It's cash that you have in your pocket, but it's not income, your tax on income. So now, your job now as a business owner is strategically, how do you not have an income? Now, you might say, well, I need money to spend. Sure, of course you do. But how can you now strategically use your income to pay for your lifestyle? Now, again, it's gotta be within the rules, so talk to a tax advisor. But right now, after the pandemic, one of the things that the presidential administration wants to do is encourage people to eat out, eat at restaurants, because restaurants were hit so hard by the pandemic. So what did they do?

• 15:41Jaspreet Singh?

  They created a 100% deduction on food through 2022. So if you go out to eat with your team, it's a 100% deduction.

• 15:49Lewis Howes?

  It's a write-off.

• 15:49Jaspreet Singh?

  It's a write-off. I'm here in San Diego, well, we're in LA right now, but I'm here on a two-month business trip to San Diego with my business partner. I have to rent a car, I actually got a Ford Mustang because I always wanted a Ford Mustang when I was a kid. That was like my dream car, so I got one here with a convertible.

• 16:05Lewis Howes?

  Nice.

• 16:06Jaspreet Singh?

  And, you know, we have to go to business meetings, we have to go out and explore San Diego, do these things. My business partner is my wife. We're staying in Airbnb in beautiful San Diego. Guess what? These things are tax deductions against my business. I'm here working. When you're an entrepreneur, everything is work. Yeah. Now, the question is, how do you spend your money in a way that is going to give you a tax write-off? But you have to be smart here because you don't wanna just blow $500,000 so you don't have to pay 150 grand in taxes, right? Like, my accountant called me up last year and said, "Jaspreet, you need to go out and buy a G-Wagon." I said, "What? I don't wanna buy a G-Wagon. Why?" He said, "You know, there's this tax deduction going on saying if you go out and buy a heavy car, it's still going on right now.

• 16:50Jaspreet Singh?

  If you go out and buy a heavy car, you can deduct up to 100% of that value of that vehicle right now." Really? And because you're an influencer, you can potentially claim that as an influencer, you need a G-Wagon to help you support your lifestyle. The tax code allows this. And I was like, "Well, I don't wanna go out and spend 150 grand for a car that I don't necessarily need just so I can save, let's just say, 50 grand on those taxes." So you have to be smart here and know what's right for you and not just spend your money to, you know, spend a dollar to save 25 cents. Right. So, you know, you just need to know the right strategies that can work for you. And these things change over time, which is why the best thing that you can do is go out and hire a tax accountant, a tax advisor, somebody that isn't just gonna file your taxes,

• 17:34Jaspreet Singh?

  but someone that's gonna help guide you and say, "All right, you know, here are some things that you could potentially spend your money on. Here are where there are more benefits coming this year, next year, things that you wanna do. And so there's gonna be times where it's gonna be more beneficial for you to spend money. There's gonna be times where it's gonna be more beneficial for you to take in money. And, you know, it's all a game." Yeah. And this is what wealthy people understand. It's all a game. And a lot of people hate that, "Oh, this person's not paying taxes. That person's not paying taxes." But at the end of the day, what you have to remember is somebody else wrote the tax code. Yeah. All that people are doing is they're trying to learn, "Okay, this is what the tax code is. What do I do?" And you know, and then you kind of get into the other philosophical questions.

• 18:18Jaspreet Singh?

  Who's going to do better with a hundred grand, the government or me? If I have a hundred grand in my pocket, I can go hire an employee or two. The government's gonna, you know, spend that money wherever they spend it. And pennies will end up actually going to help people. I'm all for helping people. I think that's very important. As soon as we hit a million subscribers on YouTube, what we did was took my team. We went out to a teacher's store. And essentially I asked them, hey, can we buy everything in your store?

• 18:44Lewis Howes?

  Wow.

• 18:44Jaspreet Singh?

  Because you know, the, the whole, during the pandemic, people weren't going to class in person. And so a lot of these businesses were hurt. I said, can I buy everything? And she said, well, we need some of this stuff for our teachers. I said, what can we buy? So then we went out and bought a big chunk of the store.

• 19:01Lewis Howes?

  Mr. Beast style.

• 19:02Jaspreet Singh?

  Mr. Beast style. It was a fun video. Took the team out kind of as a celebration. We bought a big chunk, took it out to a school in Detroit, gave it to them for free. And then I asked the principal there, who's a friend of mine, I said, how many teachers do you have? Okay. And I gave every one of those teachers a $500 check to help them help support their students. Giving is important. But you know, it goes back to the tax question of who does a better job with their money?

• 19:28Lewis Howes?

  Right.

• 19:28Jaspreet Singh?

  Entrepreneurs who are working to create more jobs, who are working to produce more value, or the government, which, you know, may not be so good with their money.

• 19:36Lewis Howes?

  Absolutely, yeah. So you started doing the real estate thing early. Are you still a massive investor in real estate? And what's your approach on it now?

• 19:44Jaspreet Singh?

  Yeah, yeah, so this is an interesting question that you asked, especially right after the tax question. So real estate is one of the, the best tax games for investors. That's one of the reasons why wealthy people love investing in real estate, because not only can you get cash flow, but you also get tax benefits. I started investing in real estate when I was 19 on accident. I went through a lot of pain. I remember when I told my dad first, hey dad, I want to go invest in real estate. He was like, you're stupid, go study, go become a doctor. So I started investing in real estate then, and I continued to buy homes. And I remember, because remember, this is right after the 2008 crash. I was buying homes for like 30 grand in good areas. I remember home prices went up to fifty thousand dollars and I was like, that's a lot of money for a home. I didn't know anything else, right? That's all I saw.

• 20:29Jaspreet Singh?

  And so to me, I was like, that's expensive, but I continued buying. And I still am buying, but not as much as I was before because now I've been working on a couple of other businesses. And so what I'm realizing is, okay, when I invest my money in real estate, my goal is to get a seven percent cash on cash return on my money. Meaning for every dollar I invest, I want to get seven cents back in cash flow, positive cash flow every year. If I invest a hundred grand, I want seven thousand dollars of profit every single year. Well, I'm an entrepreneur, right? So I'm working on a couple of different companies, one of which is Market Briefs. And so now I'm in this position where, what do I do with this cash? I can take this money, put it in real estate, get a seven, eight percent return on my money.

• 21:13Jaspreet Singh?

  Or I could put it in Market Briefs, which would be a bigger tax deduction. Because now, you know, if I spend money in advertising, I spend money in marketing, I hire more employees. We have a smaller profit, but then I can grow the company significantly faster than seven percent a year. So what I've been doing now is investing more of my money into Market Briefs because it's something that I'm super passionate about. Like, I love real estate, I love revitalizing homes and buildings and really helping to build the neighborhoods through that. But Market Briefs has such a different value in the sense that we're making financial news accessible. Because, you know, I didn't grow up learning about money.

• 21:50Lewis Howes?

  Right.

• 21:51Jaspreet Singh?

  And CNBC looked cool, but I never understood anything that was happening there. They have all these confusing terms that are going on. So it's a way to make financial education and what's going on with money more accessible to people. Because I'm realizing how important that is to me, because the more and more I talk to people, the more that people listen to what I say. The more I hear, oh my God, I wish I would have learned this when I was younger. Like, yeah, I know, me too. And so it's like, it's important for me to help get that message out there because it's so needed.

• 22:25Jaspreet Singh?

  It's not very complex, but I created this wealth formula, which breaks it down into a very simple, almost mathematical thing, where it's you take your income, you subtract your expenses, and that equals your investments plus your savings.

• 22:39Lewis Howes?

  Income?

• 22:40Jaspreet Singh?

  Plus, income minus expenses equals your investments plus your savings. So if you want to become wealthy, it ultimately comes down to having more investments. Your savings are not there to make you wealthy, they're there to protect you against an emergency. Your investments are what make you wealthy. So if you want to become wealthy sooner, or if you want to become a wealthier,

• 23:01Lewis Howes?

  You need more investments.

• 23:02Jaspreet Singh?

  You need more investments. How do you do that? Well, if it's your income minus your expenses, it's basic math. Either increase your income, decrease your expenses, or do both.

• 23:12Lewis Howes?

  Right.

• 23:12Jaspreet Singh?

  So that's the ultimate formula. So now if we talk about, let's break it down step by step on how do you actually do it? Six steps. And this is, no matter what age you are, these are the six steps that you want to follow.

• 23:22Lewis Howes?

  Before you get into the six steps, what is the mindset that someone needs to think about?

• 23:26Jaspreet Singh?

  Step number one is build the mindset.

• 23:29Jaspreet Singh?

  So step number one is you need to have the right mindset. And so this is why I call myself the minority mindset and, you know, the brand minority mindset, because it's all about thinking differently than the majority of people. Because if you follow what the majority of people do, in eighty to ninety percent of situations, you're probably doing something wrong.

• 23:46Lewis Howes?

  And you'll be in debt and you'll be paying off debts and loans for the rest of your life.

• 23:49Jaspreet Singh?

  The majority of people are broke. The majority of people are living paycheck to paycheck. The majority of people are drowning in debt. The majority of people have zero to no investments. The majority of people are unhappy. The majority of people are miserable and the majority of people do not like their jobs. This is not me exaggerating. These are all statistical numbers where more than fifty percent of people feel this way. And so if now you keep doing what everybody else does, you're going to end up like everybody else. And so this is where now you want to think a little bit different and try to find what's right for you and try to get educated yourself. Because when it comes to the mindset, the first thing you have to understand is that it is possible. Because if you're sitting there saying, it's not possible for someone like me,

• 24:30Jaspreet Singh?

  somebody who has my background, my parents, my whatever, I can't become successful? I hundred percent guarantee that you will not be able to become successful. You cannot.

• 24:41Jaspreet Singh?

  Change your outcome without changing your mindset. Oh, that's big. And in the previous interview we had, we talked about mindset versus toolset. Where most of the times we assume that the reason why we can't become successful is because we lack the toolset. When in reality, for ninety percent of people, it's lacking the right mindset. Because when you have the right mindset, you'll discover that the toolset is right around you. So it's first believing that you can do it. Because once you know and believe that you can do it, that belief is gonna then impact your decisions. Because now if you say, you know what? Yeah, maybe I can become successful. What are you gonna do? You're gonna go onto YouTube, watch videos. How do I become successful? And you start watching videos, maybe you start binging bitchy videos. And now you start to realize, oh, okay, I can start to do this.

• 25:26Jaspreet Singh?

  I can change this about my life. I need to change the way I think. I need to change my actions. I need to do more things in my day. I need to stop watching so much Netflix. I need to do this. Then maybe you start reading books. And now you start reading business books. Because I have read a lot of business books and there's so much wealth in a twenty dollar business book. Just go on to Audible, look at some of the top business books and just start reading them. And you will learn so much. Now you start reading them, maybe you start doing a little bit. Maybe you don't succeed too much, but you start taking some action and you start to learn even more because your experiences are some of the best teachers in the world. Even if you make mistakes, I have learned from my mistakes. I didn't have a mentor, I didn't have guidance, I didn't have investor family members, I didn't have people telling me how entrepreneurship works. I screwed up a ton, just like you.

• 26:10Jaspreet Singh?

  We made a ton of mistakes and that's how we learned. And then, maybe you go and take a class. Now you're like, okay, I wanna learn how to do this. I'm trying to build this business, I'm doing something wrong, I'm trying to get a better job, or I'm trying to get a raise, I keep doing something wrong. You've read books, now maybe you find a class. You invest some money in this class and now you have more education. Now you try more and now you start to see over time, oh my god, twelve months ago, I had no idea, I didn't even believe that I can do it. Now that I believe that I can do it, I started watching YouTube videos, I started reading books, I started taking classes, I started taking action. And then you keep doing it. Maybe you hire a coach, maybe you hire a consultant. I mean, the list goes on and on and on of what you can do, but it all first starts with the mindset. Because if you tell yourself you can't, your mind shuts down and you're never gonna find an opportunity. You're never gonna look for the opportunity.

• 26:56Jaspreet Singh?

  So that's where the mindset is the most important thing. And if you don't have the right mindset, this is where the first thing you want to do is start learning. How do I build self-esteem? How do I build my confidence? How do I believe in myself? And there's, I don't have a ton of videos on this. I know you have a ton of videos on this. Watch Lewis's stuff, right? So start there. Then we go a little bit deeper now for focusing on the finances.

• 27:18Lewis Howes?

  Mindset is number one.

• 27:19Jaspreet Singh?

  Mindset is number one. The second thing now, once you build the right mindset, is you want to create your financial base. And the best way to understand this is just to think, if you wanted to build a house, what do you do first? Well, you gotta.

• 27:34Lewis Howes?

  Foundation.

• 27:34Jaspreet Singh?

  You gotta build the foundation. If you want to build a bigger house, if you want to build a bigger house, you want to dig a deeper foundation. You want to build a tall building, you need an even deeper foundation. So you have to start by building your financial base. And what that means financially is first, you want to save $2,000 at the very least. You want to put aside some cash for savings as fast as possible. Because right now, it's something like 40 to 70% of Americans don't have. Well, 40% of Americans don't have a thousand dollars to put aside. And something close to 70% of Americans don't even have 400%, $400 put aside to protect them against an emergency. So the, you know, most Americans don't have a thousand dollars put aside.

• 28:15Lewis Howes?

  Get a $2,000 base.

• 28:16Jaspreet Singh?

  Start with two grand as fast as possible.

• 28:18Lewis Howes?

  Yep.

• 28:18Jaspreet Singh?

  And then you need to cut the financial bleeding. That means your high interest debts, your credit card debts, your hard money loans, your 0% APR loans, which are now charging you 20 to 25%. These need to be paid off as fast as possible because these are loans that are skinning you alive financially.

• 28:40Lewis Howes?

  So, I mean, it seems like credit cards are one of the biggest things that hold people back.

• 28:44Jaspreet Singh?

  Look, credit cards, right? Credit cards are a tool. They are a tool.

• 28:49Lewis Howes?

  If you're not educated with them, you could get stuck.

• 28:51Jaspreet Singh?

  If you have this tool without the education, it will burn you. I only spend with a credit card. I spend.

• 28:57Lewis Howes?

  You know how to use a tool.

• 28:59Jaspreet Singh?

  Because I know how to use a tool. And now because I know how to use my credit card, what happens? Well, I don't spend more than I would otherwise because I use my credit card just as a medium of exchange. I'm gonna spend this money anyways, might as well use my credit card.

• 29:10Lewis Howes?

  And get the benefits.

• 29:11Jaspreet Singh?

  Gives me perks. It gives me cash back. It gives me fraud protection. It gives me free insurance. It gives me hotel upgrades. It gives me all these things just because I use my credit card instead of paying with cash. And so now, again, it's the financial education. Because now some people will say, oh, my god, these credit card companies are scams. Well, the reason why they're looked at as scams is because we don't have the right education on how to use them. Right? It's a tool without the education on how to use it. And this is where now you have to build that financial education. And many times, you're gonna have to go out and do it yourself. Because a credit card company is not incentivized to give you the financial education because they're gonna make less money. Right? It's profitable to keep people poor. It's profitable to keep people financially uneducated.

• 29:55Jaspreet Singh?

  Because now, if you just keep spending money in your credit card because you have no idea what you're doing, now your credit card company's gonna get rich. The average household in America has sixty-two hundred dollars with a credit card debt. So if you have credit card debt in America, you probably have an average of sixty-two hundred dollars. Now, let's talk about that. Because if.

• 30:14Lewis Howes?

  And what's the interest on that?

• 30:15Jaspreet Singh?

  Well, that's at fifteen to twenty-five, twenty-eight percent.

• 30:18Lewis Howes?

  So every month, every month, you're paying that.

• 30:21Jaspreet Singh?

  You're paying it every month.

• 30:22Lewis Howes?

  So it's not six thousand a month. It's really, you know, over years, if you never fully pay it off, you're just paying more and more and more.

• 30:28Jaspreet Singh?

  And the interest rate on your credit card isn't fixed rate, it's variable interest rate. So as the Federal Reserve Bank raises interest rates, the interest rate on your credit card also goes up. So if you are twenty-one years old right now, and you invested sixty-two hundred dollars, which is the average household credit card debt right now. If you invest sixty-two hundred dollars right now and you got a twenty percent return on your money, and you did that for the next forty-five, forty-six years, you are going to retire with twenty million dollars.

• 30:58Jaspreet Singh?

  Twenty million dollars and you never invest another penny again.

• 31:00Lewis Howes?

  Say it more time.

• 31:01Jaspreet Singh?

  If you invest sixty two hundred dollars today and you never invest another penny again.

• 31:06Lewis Howes?

  At twenty one.

• 31:07Jaspreet Singh?

  At twenty one and you get a twenty percent return on your money, you're gonna retire with twenty million.

• 31:11Lewis Howes?

  Wow.

• 31:11Jaspreet Singh?

  And you're gonna say, Josephine, what in the world am I gonna get twenty percent return on my money year after year? You're right, but your credit card company is doing it every single day.

• 31:18Lewis Howes?

  Wow.

• 31:18Jaspreet Singh?

  They're charging you. And so when you have that sort of credit card debt, that's you making your credit card company richer. Now, you know, whether or not you think it's a scam, look, let's move past and understand what's going on. That way now you can use it to your advantage because I get tens of thousands of dollars worth of cash back every year from my credit card company because I use it as a tool and I understand how to use it. And this is where, look, if you don't want to use a credit card, it doesn't matter.

• 31:45Lewis Howes?

  Right.

• 31:45Jaspreet Singh?

  But just don't, if you have credit card debt, you have to pay that off because that is skinning you alive right now. Understand the financial education aspect. So that's the first thing you want to do is create your financial base.

• 31:55Lewis Howes?

  Mm hmm.

• 31:55Jaspreet Singh?

  So you gotta save some cash and you gotta pay that credit card debt off.

• 32:00Lewis Howes?

  Cut the financial bleeding.

• 32:01Jaspreet Singh?

  Cut the financial bleeding.

• 32:01Lewis Howes?

  What's the strategy if you got three credit cards? What's the strategy to get rid of that debt?

• 32:06Jaspreet Singh?

  So Dave Ramsey is gonna tell you to do something called the snowball method.

• 32:09Lewis Howes?

  The smallest first?

• 32:10Jaspreet Singh?

  Smallest first and then to the biggest.

• 32:12Lewis Howes?

  Cause you're building momentum, right?

• 32:13Jaspreet Singh?

  A financial advisor might tell you the opposite, do the debt avalanche, which is now pay the highest interest rate first and then go down because now you're gonna pay off the most interest first. So it costs you the most money in the long term. The reason why Dave Ramsey recommends the snowball method is because psychologically, when you get those small wins of paying something off, you feel like you're winning and you can pay it off faster.

• 32:35Lewis Howes?

  Yeah.

• 32:36Jaspreet Singh?

  A advisor is gonna look at the math and say, hey, look, these numbers are telling me that pay off the higher interest rate first because it's gonna save you the most money over the long term. Which one's right? Again, I'm not gonna say which one. Do what's best for you. Because I know if I was in a situation, I'm not. I like the idea of paying down the heavy interest rate first because that's how my brain works. I don't need the small wins like that. I can work for the long term. I think, you know, the entrepreneurial mindset where you know, I know how my mind works, so I understand myself. And this is just honestly being open and honest with yourself. If you can't stay true with it, then do the snowball.

• 33:12Lewis Howes?

  Yes.

• 33:12Jaspreet Singh?

  It does not matter. Screw paying it off a few months early, just get it away and pay it off as fast as possible.

• 33:18Lewis Howes?

  But cut out, cut the financial bleeding and have a $2,000 base. That's step two. Okay.

• 33:23Jaspreet Singh?

  That's step two. Now, the next thing you want to do is what I call lead your money. So this is where you want to create a financial system and start investing your money. Because your savings will never make you wealthy. You cannot save your way to wealth. You have to invest your money. Your savings won't make you wealthy because of what we've talked about in previous interviews. Inflation.

• 33:43Lewis Howes?

  You're losing money in the savings.

• 33:44Jaspreet Singh?

  If inflation is higher than the interest rate you're getting at the bank, then your savings are effectively making you poorer each and every day. Because your savings are losing value to inflation. Now, does this mean you should not save any money? No, it means you need to save your money strategically. So you want to save your money for three reasons and three reasons only. Save your money for an emergency. Save your money for a big purchase. If you want to buy a car, you want to buy a house, you want to buy a nice watch, whatever you want to buy, you need cash in order to do that. And then three, save your money for an investment. If you're not saving your money for one of these three reasons, you're saving your money the wrong way and it is making you poorer by saving that money.

• 34:27Jaspreet Singh?

  So now we're focusing on the first aspect of saving your money for an emergency. How much do you save? This is now, again, going to depend on your risk tolerance. You want to save somewhere between three to 12 months' worth of your expenses. And the amount of money you save is going to depend on where you are in life and how much risk you're willing to take on. If you're like, hey dude, I'm, I'm 25 years old, I don't have any financial responsibilities, I don't need that much savings. Fine, save a few months' worth of savings and that's it. Invest more aggressively. If you're like, hey, I have a family, I have kids, I have a spouse, I, I don't want to take on all this risk, then save six months, nine months, a year's worth of savings because now it will give you that peace of mind that you have some extra cash put aside. So it's going to depend on your risk tolerance and, and what you want.

• 35:12Jaspreet Singh?

  But this in this lead your money step. This is where you want to understand that there's more to putting your money aside than just saving your money. You also want to be putting your money to work. And the best way to do this is to create a system where no matter how much money you're making, you are going to proportionately continually invest and save based on your income. So what does that mean? Well, one of the simplest things you can do is follow something like Percentage. My seventy-five, fifteen, ten plan, which means for every dollar that you earn, seventy-five cents is the maximum that you can spend. Fifteen cents is the minimum that you invest and ten cents is the minimum that you save. And this never changes with your income.

• 35:54Jaspreet Singh?

  The only thing that you would ever change is after you hit that savings goal for your emergency savings, you don't keep saving your money for the emergency because you built that whatever months you want. You put that towards your investments. Yes. And now whether you're making forty grand, four hundred grand, four million, forty million, you just keep following the same thing and you're living below your means. And now you're constantly putting monies aside for your investments. Now, again, we talked about this before. This investment money can either be passively invested, all of it, or you can put this money aside to be invested. So you can put this money into a bank account. You're looking for a rental property. You're looking for a business to buy. You're looking for a cheap stock to buy. This now depends on now your investment goals, right?

• 36:38Jaspreet Singh?

  Where do you want to be invested? How do you want to invest your money? And this is that financial education now of what do you want to do and your personal goals? If you don't want to be involved with your money, you don't want to be hey, day to day investing or paying attention to the markets. You hate that idea, just passively invest it. Right.

• 36:57Jaspreet Singh?

  You've become wealthy with your investment money. Your savings are there to protect you against an emergency. Your spending money is what allows you To live your life. Live your life and have the nice things. And so now we'll get into now, how do you live more, live better today by earning more money in a bit? But this is where now the passive investing is the most accessible way for somebody to start investing. And then somebody's going to say, what do I invest in, right? Because we're talking about Well, you can invest in the stock market. There are funds, like there's index funds, ETFs, mutual funds. They all work similarly with some nuanced differences that allow you to invest into a basket of stocks, a group of companies. So, for example, I like ETFs just because they're very convenient. So you invest in a ticker symbol.

• 37:40Lewis Howes?

  ETF stand for?

• 37:41Jaspreet Singh?

  Exchange traded funds. So, for example, if you wanted to invest in the stock market, the general stock market, there's a fund, an ETF called VTI. Now, I'm not telling you what to invest in, just giving you some examples. VTI is a total stock market ETF. If you invest in that one ticker symbol, you're getting exposure to the United States stock market.

• 38:01Lewis Howes?

  You're getting diversified.

• 38:02Jaspreet Singh?

  Getting diversified in the stock market, not across different asset classes, but within the stock market. You could then, you know, pick, oh, I want to invest in, let's say, the S and P 500, which is the 500 largest companies in the stock market. SPY, there's a ETF that gives you exposure to that. Let's say you want to invest in the Dow Jones. That is the most commonly discussed fund. It is a group of 30 companies in the stock market, big, large companies. DIA is an ETF that gives you exposure to that.

• 38:31Lewis Howes?

  You could invest in three stocks, which would be hundreds of stocks throughout those three investments.

• 38:37Jaspreet Singh?

  ETFs, yeah, those three ETFs will give you exposure to hundreds, not thousands.

• 38:41Lewis Howes?

  And all you need to do is invest in those three things and set it and forget it, essentially.

• 38:44Jaspreet Singh?

  And now you can just set it automatic, remember, automatic. So the key here now is you invest when the market's up and down. You don't change it. So when you see the market crash happen, you don't stop. You keep investing. The only thing that you would change is potentially buy more.

• 38:58Lewis Howes?

  Yes.

• 38:59Jaspreet Singh?

  Because when you see these types of market pullbacks, most people are selling and they're running away because they're panicking and getting scared that my investment is going down. That's what you want to become and buying aggressively because now investments are going on sale. And so this is where it's, again, that mindset shift of understanding what is it that you want to be investing in and how long are you investing for? If you're investing for the long term, who cares what's happening in the next two months or next two years? You're investing for the next 20 years. I call it a decade of sacrifice if you want to become wealthy. And seriously wealthy, not like, oh, I have a little bit of money. No, you want to become wealthy. You got to put in what I call the decade of sacrifice where you're working to spend less and earn more. That will you have more money to invest and most people are not willing to go through that sacrifice.

• 39:41Jaspreet Singh?

  Because that means I can't have that Gucci belt today, so I can have more investments today. I can't show off my stock portfolio or my real estate portfolio, the way that I can my Gucci belt. And most people would rather have the show, would have the look than the actual thing that will make you wealthy.

• 39:57Lewis Howes?

  Right.

• 39:57Jaspreet Singh?

  And that, you know, goes back to the mindset, the thing you talk so much about. Your mindset has to be focused on saying, you know what, I want to become wealthy. And that's hard because now for one, you have to be convinced yourself. And now you might have a spouse, you might have kids. And that means you all have to be on the same page financially, right? Because this is a, money is a team game. It's in the house. If you think, you know, I'm going to go and try to build my wealth myself. And then your husband or your wife is going out and spending all this money, they're going to be pulling you back. So you got to be on board where I'm mentally on the same page. My spouse is on the same page, my kids are on the same page, we're going to build wealth. And we're going to build something that we've never seen before. And that's that first mindset where now I believe I can do it, I'm going to do it. Now you start putting in that sacrifice. So we started by the passive investing.

• 40:42Jaspreet Singh?

  Next is active investing. And I also should mention that you can do passive and active investing. I do both.

• 40:48Lewis Howes?

  What's the example for you?

• 40:50Jaspreet Singh?

  So I invest my money in five places. I invest my money into businesses, which are my own businesses and startups that I invest in. Invest my money into physical real estate, invest my money into stocks. Invest some of my money into cryptocurrency, a little bit more of a speculative play. And then I invest a small piece of my portfolio, about 2% of my overall investment portfolio into physical gold. So my gold, my cryptocurrency and some of my stock market investments are passive. Meaning this happens for my stock market every week, for crypto every day, for gold every month. It's the automatic passive and consistent. I don't touch it. It is automatically pulled out of my checking account and is invested.

• 41:32Lewis Howes?

  Interesting. And your bank, you can set up parameters in your bank to automatically do this.

• 41:36Jaspreet Singh?

  Yes.

• 41:36Lewis Howes?

  Two specific places you want to invest.

• 41:38Jaspreet Singh?

  Exactly.

• 41:39Lewis Howes?

  That's nice.

• 41:39Jaspreet Singh?

  It is, technology has made investing so much more accessible.

• 41:42Lewis Howes?

  Do all these banks do this or what are like the top few that you see that?

• 41:46Jaspreet Singh?

  Many banks will allow you to move money from one bank account to the other. These investment accounts, you're gonna have to work with a particular brokerage. There's tons of brokerages out there that do this. You can find whatever you like for, let's just say you wanna invest in the stock market. There's a bunch of brokerages out there that will allow you now to invest your money into the stock market through this passive type of system. You just have to find what's right for you. And this could depend on what country you're in, uh, you know, and just that your, what interface you like the best. And it's become very accessible. There are so many. It is so much simpler now than ten years ago, let alone fifty years ago.

• 42:19Lewis Howes?

  Right.

• 42:20Jaspreet Singh?

  So we are very blessed to be able to do this now.

• 42:22Lewis Howes?

  Right.

• 42:22Jaspreet Singh?

  On the active side, this is where now I invest into my own businesses. I invest into real estate, uh, and then I also invest in some stocks.

• 42:31Lewis Howes?

  Do you do real estate funds? Or do you do your own individual real estate buildings yourself?

• 42:36Jaspreet Singh?

  I have done some real estate funds, but that is the smallest piece. Uh, most of it, probably ninety-nine point some percent of it is actual physical real estate that I'm going on and buying myself. And so now it's, when we talk about active investing, what does this mean first? This means now that you are going out finding investment opportunities to invest in, and then you're putting your money in. And, uh, now this is where the research is important. So like, for example, with business, I invest in my own businesses. I also invest in some startups. Startup investing is very risky. Nine out of ten startups will statistically fail. So I know that when I invest my money in these startups, a big chunk of this money will, I will probably never see again.

• 43:17Jaspreet Singh?

  But my goal is now that a small piece of these startups that I invest in will go big, and then that will make up for the other losses.

• 43:24Lewis Howes?

  Yes.

• 43:25Jaspreet Singh?

  With real estate, my goal is completely different. With real estate, my goal is cash flow. Uh, I call it cash flow because cash flow funds the guac flow. And what that means is now when I own a cash flow producing asset, I'm getting money coming into my account now every month with my real estate that I don't have to actively work to earn. Because I have a property management company in place, I have a system in place. So it's not like I have to go to work to earn this money. I buy the properties, I have the systems where we renovate the properties with the contractors, we do the right inspections. Then I give the keys to the property manager. My job is done. Now every month, I'm getting cash deposited into my bank account. Every month and every quarter, I get financial reports going over what's going on with my properties.

• 44:07Jaspreet Singh?

  So it's hands off. I still review the properties, like I review the financials. I review what the property manager is doing. But I'm not going to work to earn this cash. Now, I should also say, it took me a ton of work and a ton of time and a ton of headache and a ton of mistakes to learn how to do it the right way.

• 44:23Lewis Howes?

  Yeah.

• 44:24Jaspreet Singh?

  Because, you know, I didn't grow up with real estate investors in my family. I had to go out and just kind of do it and figure it out. And it was very stressful, you know. A lot of people on the internet make real estate investing seem like this holy grail. Go buy some real estate and you're gonna be swimming in the dough.

• 44:40Lewis Howes?

  But here's the thing, when you buy real estate on your own, it's almost like a full-time job managing the property, managing, if you're doing the Airbnb or short-term rentals, it's like you're gonna constantly clean and adjust and promote it and market it and deal with the Airbnb stuff. Or you need to find someone to pay to manage it.

• 44:56Jaspreet Singh?

  Yeah.

• 44:57Lewis Howes?

  But ultimately, at the end of the day, you gotta deal with the taxes of it. You gotta deal with the expenses of it. You gotta deal with the fixing of it. You gotta deal with the regulations around it, whatever it might be. So how do you invest where it doesn't become a time suck and an extra job?

• 45:11Jaspreet Singh?

  So.

• 45:11Lewis Howes?

  In that real estate, but it's actually cash flow that is more passive. Is that even possible with real estate?

• 45:18Jaspreet Singh?

  For, I can only speak from my experiences. Because for me, it was a huge time suck.

• 45:23Lewis Howes?

  It was like a full-time job.

• 45:24Jaspreet Singh?

  It was more than a full-time job.

• 45:25Lewis Howes?

  Stress.

• 45:26Jaspreet Singh?

  I couldn't sleep at night because of how many issues I dealt with, but.

• 45:30Lewis Howes?

  So why be, so why be in real estate today if it caused you so much pain previously?

• 45:34Jaspreet Singh?

  Well, see, I, you, you go in with a vision, right? Like entrepreneurs, you have to be a little bit crazy. You don't know how something's gonna work out, but you're, you're putting in countless hours. You're not sleeping at night. You're sacrificing vacations. You're not talking to your family. You're, you're doing a bunch of crazy things because you think this thing is gonna work. That's how it was for real estate. I'm known for being like that stupid person and I've always been that thing. And for me, it's like, I believe something so much that I'm willing to make a lot of sacrifices and keep doing something. And for me, when I invested in real estate, I was 19 when I started. When I bought my first property and I did it kind of all by myself because I told my dad I wanted to invest in real estate. And I grew up in a very traditional Indian house.

• 46:19Jaspreet Singh?

  My parents were immigrants. I'm a state in India called Punjab. So my parents came to this country with very little. And so, yeah, exactly. You got the Phangarhada moves down. That's our dance. We were just talking about Phangarhada before this. It's a traditional dance. But my parents came here with very little and.

• 46:35Jaspreet Singh?

  You know, they wanted me to be a doctor. And it was very like strict that you have to become a doctor. Nothing else is the option. So anything that wasn't medical related was like a big no-no. So becoming a lawyer, you were a failure. I was, yeah, that was a huge compromise for me to become an attorney with my parents. But this is before I even became an attorney where I said, I want to invest in real estate. And my dad was like, and I was actually studying for the medical college admission test. When I had the idea to start investing in real estate and I had some cash saved up because I was working on a event planning company at the time when I was in college. My parents didn't know about that. So I was making a little bit of money and I was like, I want to invest in real estate. My dad's like, you're stupid. Go study, go become a doctor and then worry about all this other stuff that you're doing. So I was like, all right, I'm just gonna do it without telling you. Yeah, you know.

• 47:19Jaspreet Singh?

  So how much was your first deal? It was a small condo that I bought. The condo about three or four years prior to me purchasing it sold for about a hundred and fifty grand. It went through foreclosure. The banks had it listed for eight thousand four hundred dollars. Oh, man, you got the jackpot of that deal, it sounds like. I, I made an offer for four grand. Oh, my gosh. I didn't know what I was doing, right? So I'm, I'm like, well. Did you get it? Well, I put an offer for four grand. They said, we'll give it to you for seven thousand. And I said, no, I'm gonna, I don't know what I offered, something else, maybe less than five grand. Yeah. And then another person came in to potentially buy the property. And so the bank says, we have another offer on the table. Give us your highest and best offer. Now, to put this in perspective, I didn't know this was a good deal because I'm nineteen.

• 48:04Jaspreet Singh?

  I knew nothing about money. Five grand is a lot of money at nineteen, right? It's like all your money. Yeah, so I know nothing about investing. I didn't know what passive investing was. I had only read books about investing. So I'm, I'm reading some books and now I'm just going out doing it because I know nobody in real estate. I didn't even know you could invest in real estate. So I'm like, okay, well, somebody's making an offer. I kind of like this deal because I'd looked at a few other properties. So I was like, well, how about I make an offer for eight grand? We'll see where they go. And the bank took my offer. The other person offered less than what I did. Wow. So I bought it for eight grand. I put in a few thousand dollars worth of work and then I listed it for six hundred dollars a month. And the profit on that was between two hundred and fifty to three hundred dollars a month, depending on the month, which now sounds great, right? This is the, the beauty of real estate.

• 48:49Jaspreet Singh?

  The downfall is it was a big pain because I didn't know what I was doing. I hired a, I don't want to say scam property manager because I haven't been able to validate that, but I don't know if they were licensed. Right. The tenant moved in, we didn't have a lease. The tenant was absolutely crazy.

• 49:05Lewis Howes?

  Ooh.

• 49:05Jaspreet Singh?

  They had my phone number. So now I'm going to class. Like I remember I was coming out of my chemistry classes or my physics classes and I had these voicemails, these multi-minute long voicemails of the tenants talking about how the world is ending. They're like, this property is going to go up in flames. So I was like, oh, what's going on? Like get an electrician out there. We go to the property. And this was like after multiple issues had happened. I went with an envelope of cash. I probably had like fifty dollars of cash in this envelope that I gave to them because I felt bad for the tenant. Electrician's looking at the property. They're like, yeah, your light bulb fused. We can just replace that.

• 49:37Lewis Howes?

  That's it.

• 49:38Jaspreet Singh?

  That was it.

• 49:38Lewis Howes?

  Yeah.

• 49:39Jaspreet Singh?

  There was an instance where they were cutting cucumbers on the countertop. They missed the cucumber. They scratched the countertop. She calls me crying that she needs a brand new countertop.

• 49:49Lewis Howes?

  Oh, my gosh.

• 49:49Jaspreet Singh?

  I gave it to them.

• 49:50Lewis Howes?

  Oh.

• 49:51Jaspreet Singh?

  Because I didn't, I don't know what's going on. So like I dealt with a lot of issues and that was just the first one. I mean, like the first, I would say three were my learning curve where I was like a full time. Like I'm on the phone, talking to people, trying to find contractors. I'm trying to find the right attorneys. I got screwed over by attorneys. I got, I mean, I made every mistake possible.

• 50:12Lewis Howes?

  Why'd you keep doing real estate after the first three failed?

• 50:15Jaspreet Singh?

  Yeah, see, this is where the stupid comes in out of me. Well, I read books and people talk about how investors own thousands of real estate units. I was like, how can somebody deal with thousands of tenants like this? Like, it's not possible. Like, there has to be a system. I just had to figure out how to crack that code. How do I break this system? And that was my journey was learning it. And it was very painful, very expensive and very stressful because the third deal literally depleted my bank account. Um, I was talking to my wife about this the other day where that third deal was so stressful because I made every mistake possible. I talk about this on YouTube. It's my worst real estate deal ever.

• 50:59Jaspreet Singh?

  I bought the deal because my contractor told me it was a good deal. He told me that, hey, we can fix it up for not a lot of money. And because it's such a good deal, you're gonna be able to make a lot of money on it.

• 51:10Lewis Howes?

  Wow.

• 51:11Jaspreet Singh?

  So he's like, don't even worry about getting an inspection on the property. Just go and buy it.

• 51:14Lewis Howes?

  Hmm.

• 51:15Jaspreet Singh?

  So that's what I did. I trusted him, right? Bought the property, gave him the money, he ran away. I didn't know that he wanted the money because he was running into financial problems.

• 51:24Lewis Howes?

  Oh.

• 51:25Jaspreet Singh?

  Then this property, it turns out, had a lot of defects behind the scenes, which I didn't know. We had the city come out and look at the property and it was, the repairs cost way more than what the actual property cost. And so now I was really in trouble because I wanted to get this property rented out. My bank account, that property account, literally went negative and I had an overdraft fee on this account. Uh, which I had no money to pay at the time for that property because I was putting all my cash into this. And like I was saying before, I was in the event planning party business, which was a cash business. So I had like literally a bag of cash in my room. So I went to my last resort was I pulled the cash out of my bag and I gave it to the contractor.

• 52:09Jaspreet Singh?

  I was like, we gotta get this done. I need to get this, I need to get some income out of this property because I couldn't sell it.

• 52:14Lewis Howes?

  Right.

• 52:14Jaspreet Singh?

  I couldn't get a certificate of occupancy. I couldn't rent it out and so it was like, I was so stuck. I was fortunate that I had that cash, but I mean, it was a tough situation. That was my real life tuition. Like that was where I learned, like I say, that one deal. Taught me years worth of real estate in one property because I learned so many things.

• 52:31Lewis Howes?

  Wow.

• 52:32Jaspreet Singh?

  That I should not do, but then from there, you know, I was able to stabilize. I made some more money with other ventures that I was doing because I was making money for one reason, to buy real estate. Like that's all I was doing.

• 52:41Lewis Howes?

  And losing it in the real estate.

• 52:42Jaspreet Singh?

  Losing it in real estate, but I was learning, right? That was my learning process. So I guess I can't, you know, I, I wouldn't change it because I learned a lot from it. Very stressful. Like when I say I lost sleep, I lost a lot of sleep at that time.

• 52:52Lewis Howes?

  So when you're gonna buy a property now, what is the approach that you take? So that it maximizes your return.

• 52:59Jaspreet Singh?

  Yeah.

• 53:00Lewis Howes?

  Saves you time and energy and minimizes stress. If you, like, what is the approach if you're like, okay, am I buying single unit properties? Am I buying apartment buildings? Am I buying duplexes, fourplexes? Am I? What am I working with another investor and buying a bigger deal? What is that thought process into buying a deal?

• 53:19Jaspreet Singh?

  Yeah.

• 53:19Lewis Howes?

  First off, and then how do you set it up so it doesn't take you a lot of time to manage it?

• 53:24Jaspreet Singh?

  Sure. So I would say the first thing is I need to know what my return is going to be. And generally, my general rule of thumb is I need a 7% cash on cash return.

• 53:33Lewis Howes?

  Annually.

• 53:33Jaspreet Singh?

  Annually. And what that means is for every dollar that I invest, I want to see seven cents of cash flow. That's money that's hitting my bank account after expenses. That has nothing to do with appreciation. So I want to look at those financials. I want the 7% cash on cash return. Then I got to look at where am I investing? So I like to invest in areas that are growing, that have more like up and coming-ness to it. So this is now, I want to see populations at least stable, if not rising. Do a quick Google search of any city and Google will tell you what's happening with the population. It's made it so easy.

• 54:08Lewis Howes?

  Wow. What are the top three cities that are rising? That are also not over, I guess, overpriced right now? What are those top?

• 54:18Jaspreet Singh?

  Let's see in 24 months where that actually is because we're going through this correction in real estate right now. So let's see where interest rates go because that's going to influence

• 54:25Lewis Howes?

  That's true.

• 54:25Jaspreet Singh?

  housing prices and real estate prices in general.

• 54:28Lewis Howes?

  Interesting.

• 54:28Jaspreet Singh?

  But keep an eye on interest rates. The general thing is as interest rates go up, property prices will go down. So let's, let's, let's rediscuss that.

• 54:36Lewis Howes?

  What do you think is going to happen in the next 12 months with interest rates?

• 54:40Jaspreet Singh?

  Well, the Federal Reserve Bank says that they're going to raise interest rates. And if they keep doing that, they're going to push this economy into a lot of pain.

• 54:50Lewis Howes?

  Because it came down a little bit, right? Recently?

• 54:52Jaspreet Singh?

  So mortgage rates and interest rates are two different things.

• 54:54Lewis Howes?

  Okay.

• 54:55Jaspreet Singh?

  Interest rates set by the Federal Reserve Bank are called the federal funds rates. This is the interest rate that one bank pays another when they lend each other money overnight. So that, think of it like the wholesale price, right? When, when you go to buy this mug from Amazon, Amazon's buying it from the manufacturer. They're buying it cheaper, then they sell it to you at a markup price called the retail price. So banks have this wholesale price called the federal funds rate. Then they jack it up and sell it to you as the mortgage rate. So federal funds rates, the Fed rate can influence where mortgage rates are going. So interest rates can be different than mortgage rates. Right, they are different than mortgage rates. What's the current kind of interest rate at the time of this interview? Uh, for mortgage rates? For the interest rate versus mortgage rate?

• 55:38Jaspreet Singh?

  So, so, uh, the federal fund rate right now is right around 5%, just under 5% the federal fund rate. Mortgage rates are hovering around the mid 6% for a 30-year fixed rate mortgage. Wow. Now, the question is, where are we going to go from here? The Federal Reserve Bank has a mission to fight inflation. That is a big deal. It is a super serious problem, and we've discussed this in other interviews. I'm not going to go too deep into like, what is inflation, why that's happening? We have an inflation problem, and that is a serious problem. Because if we don't solve the inflation problem, then we risk a serious currency crisis. We risk potential hyperinflation. We risk our, our dollar losing the reserve currency status. So it is a serious issue to bring inflation down.

• 56:22Jaspreet Singh?

  Because, yeah, a recession is bad, a currency crisis is even worse. That's why the Federal Reserve Bank is working to increase interest rates, because that brings down inflation. Mm-hmm. Now- They're looking to increase them. Increase interest rates. And what about the mortgage rates? So that pushes mortgage rates higher. Higher. So now, rising interest rates have a consequence. And that consequence is a slowing economy. Because when you raise interest rates, it makes borrowing money more expensive. And less people want to buy. Less people buy. And now, if you remember what we said just a few minutes ago in our economic system, spending is good for the economy. Higher interest rates, less spending, bad for the economy. Our economic system wants people to spend money. In fact, they want you to be in debt and spend money.

• 57:06Jaspreet Singh?

  Because if you're in debt and you're spending money- They're making money. They're making more money.

• 57:10Lewis Howes?

  I hope you enjoyed today's episode and it inspired you on your journey towards greatness. Make sure to check out the show notes in the description for a full rundown of today's episode with all the important links. And if you want weekly exclusive bonus episodes with me personally, as well as ad-free listening, then make sure to subscribe to our Greatness Plus channel exclusively on Apple Podcasts. Share- This with a friend on social media and leave us a review on Apple Podcasts as well. Let me know what you enjoyed about this episode in that review. I really love hearing feedback from you and it helps us figure out how we can support and serve you moving forward. And I want to remind you if no one has told you lately that you are loved, you are worthy and you matter.

• 57:54Lewis Howes?

  And now it's time to go out there and do something great.