Latest / Money Grows on Trees / #210 - $500k Cash Or No Bills For Life?

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#210 - $500k Cash Or No Bills For Life? · Money Grows on Trees

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  No bills or retirement at age 35. I'm choosing...
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  Free healthcare. You know what's really hard about this? I feel
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  like healthcare is a bill. So I feel like if you get this one,
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  you get this one. $25 million. Ooh, now
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  it's getting juicy. Own a home debt free or $25 million. What
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  if the home I chose was the $200 million home in
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  Florida that just went up for sale? $500,000 cash or no
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  bills for life. And the winner is... No
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  bills for life. Why would I choose this option over this option? Because I'm
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  Lloyd James Ross, seven-figure investor and entrepreneur, and I've helped thousands
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  of business owners and professionals turn financial stress into
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  success. If you're stuck in old money habits, overwhelmed by investing,
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  or unsure where to start, this is for you. I'll give you the mindset
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  and strategies to take control, grow your wealth, and achieve
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  financial freedom. It's time to make your money work for you. Welcome
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  to this episode. This is super fun. I actually kind of don't know what's happening, which is
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  even fun for me. The mystery. What's going to happen is we're going to
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  bring in two different financial options, and I'm going to commentate which
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  one would be most effective. So buckle up. Let's have some fun. So
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  we got $500,000 cash or no bills for life. So
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  if you're the average person, look. People's
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  bills on average are around four grand a
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  month, and four grand a month's about 50,000 a year. So
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  if you chose this option, it means you're saving 50,000 a
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  year, right? Which is great, but if you took this option
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  on the right, 500,000, it's about opportunity cost. So if
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  I took this one, I'd have to somehow invest this, and
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  get cash flow from it that would cover all
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  my expenses. So what can I invest in here that
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  produces enough cash flow to actually cover 4,000 a
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  month? And the reality is, could you do it? Yes, you
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  could. Is it gonna be sustainable? Unsure. So if I took 500,000, I'd
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  have to generate about 50 grand a year cash from this particular investment.
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  And what that means is I'd have to find some sort of piece of
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  real estate or some stocks in a company that was
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  producing 10% yield, meaning
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  it would throw off 50,000 a year in cash flow from dividends, which
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  is from stocks, or rent, which is from real estate. And
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  to do that in today's market is flipping hard. But there
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  is opportunities out there. Like I just bought stocks in a mining company,
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  coal mining company. It's probably paying a dividend of
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  around 10%. In fact, there's a very famous Australian iron
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  ore miner that you can buy that's paying about 10 to 11% in a dividend. arguably
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  tax-free based on the imputation credits in Australia. So you could probably put
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  this in there and you get about 50 grand a year, but
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  is the dividend sustainable? Will the company continue to pay that is
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  up for debate. So there's a lot more risk in doing that one and
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  more effort. Whereas this one's like, bill's gone,
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  so that's an instant 50 grand a year back in your pocket, you don't have to worry about,
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  there's no risk, there's no worry about sustainability, and you can scale
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  your bills beyond the four grand, because all your bills are paid for. So
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  hey, rack up the bills, get on the first class flights, buy a different car,
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  all that stuff, because the bills are looked after, right? Including your taxes, I hope. This
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  seems like a very good option. Is it possible to do that with this? Yes,
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  it is, but there's a risk to this. You have to have some know-how, education,
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  and that's why If you're gonna choose, even if you're the everyday person,
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  especially if you're the everyday person, you choose this one. Perhaps
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  if you're Warren Buffett, and you could compound this at 20% a
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  year, which is 100 grand a year, maybe you could choose that.
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  But there's a risk that comes with that too, so. Ready for the next
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  one? Was that fun or what, guys? You ready for the next one? All right, bring
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  it in, let's go. What have we got here? Retirement at
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  age 35. So what would I choose? No bills
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  or retirement at age 35? I'm choosing... No
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  bills. Why? Because I would not want to retire at 35. I
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  guess that retirement means leaving the job that you hate. And
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  so... Yeah, if you hate your job, and
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  you want to have enough money to retire, then I guess you're choosing this
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  one. But what I've learned about retirement, because actually, I
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  actually left the workforce when I was 36, I was probably maybe even 35. So I
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  actually retired myself from regular nine to five at
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  the age of 35. So I have lived this, and all I can tell
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  you is you can only sit on a beach for so long before you get bored shitless. So
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  I would not wanna just do nothing at 35. I think that's what this means is
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  leave the job that I hate at 35. And I guess if that was the case, and
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  you didn't have to do any effort to do that, a lot of people are choosing this, all right?
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  But at the same time, this appeals to me because I
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  wouldn't wanna retire, I think. That's probably why. I wouldn't
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  wanna do nothing. I'm not a big believer in
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  retirement. Like, why?
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  For what purpose? I guess you can go
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  sit on the beach and figure it out for yourself, but I'm still choosing this one just
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  because, again, I can scale these
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  bills. I can get Stan and
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  binge and Netflix at the same
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  time and not worry about it. Whereas retirement at 35, doesn't
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  even say in this one whether I've got any income, right?
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  So I could be retired, but how much is my income? Are my bills
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  all paid for? The answer's no. So I'm still choosing this one, no
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  bills. Oh, ching. Just quickly, if you're ready to take control
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  of your finances, but feel stuck on where to start, I have a
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  solution. My book, Money Buys Happiness, simplifies investing
• 5:34
  and wealth building with practical steps to help you achieve financial peace.
• 5:39
  Get your copy via the link in the show notes and let's get your money working for
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  you. Now back to the episode. What do we got? What's the next one? Free
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  health care! You
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  know what's really hard about this? I feel like healthcare is a bill, so I
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  feel like if you get this one, you get this one. That's
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  when my brain goes, I'm like, actually healthcare is a bill, so I just
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  take all the free bills here. This store is my favorite, no bills, no Williams, free
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  healthcare. I guess this is good, but living in Australia, I
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  actually happened to get sick once, it was my fault, and
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  I went to the hospital, And they were really good there and it didn't cost me any
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  money because we have a pretty reasonably good health system here
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  in Australia. So I get a lot of free health care. So
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  I think still for me, if I was going to choose in Australia
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  right now, there's a lot of bills and the health care is
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  pretty good. So I would still be leaning to my
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  favorite navy blue of no
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  bills for life. I still think even people that
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  are sick would want this one. Hope
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  that makes sense. We've still got this one as the winner. It's Ching. Free
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  bills for life. All right, coming up next, no bills is winning for life. What
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  have we got? Drum roll. Drum roll. $25,000,000. Ooh,
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  now it's getting juicy. $25,000,000 or
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  no bills for life. So, so far we've had no bills for life
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  winning this race. I'm just gonna do that because it's falling out there. Okay.
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  No bills for life or $25,000,000. I'm
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  just going to assume that that's US dollars too, so that's exciting. It's probably like
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  $150 billion Australian dollars, which is great. So $25 million or
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  no bills for life. And which one would I choose? It would be $25 million.
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  I'd choose $25 million because the reality is you
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  can do a lot with $25 million that aren't just bills. And
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  so, for example, if I took $25 million and invested it,
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  I could probably generate $150,000 a year in income
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  with that, and that would easily cover my bills, but...
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  You'd also be able to grow the money at the same time as getting the cash flow. So
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  for example, this 25 million would compound to potentially 50, 100 million
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  into the future because you're starting with a massive amount of cash. So
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  you'd actually be able to do both. With this option, you could pay
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  your bills Plus, you could scale your wealth on automation without
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  touching it, and you'd have the best of both worlds. You'd have all the firepower of
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  having the choice that 25 plus million gets you
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  if you ever needed it. Plus, you get the passive income off this that would pretty
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  much cover your bills for life anyway, and potentially, depending on how
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  much your bills are, would cover other bills for your friends and
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  your family if you had this option instead of this option. buyer
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  beware, this option requires you to have more financial education because
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  a lot of people I know, if they got that chucked into their bank account today, they
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  would be broke tomorrow. Well, maybe not tomorrow, but you know, they'd be broke in a few years because
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  how many sports stars or celebrities have been paid that and
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  you hear a story of how they got nothing left, right? They won the lotto, got
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  nothing left. So with great power, comes
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  great responsibility. And the responsibility is, you gotta
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  educate yourself financially to wield the power of this. Most
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  people wish for the sword, which is the money, but few people
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  wish for the power to wield it. All right, so this is a get
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  agile free card that's pretty good, but if you have the power, this one
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  wins. Okay, so
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  far 25 mils winning the show. What do we got here? Drum
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  roll. Let's have a look. Oh, own a home debt free. Okay.
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  Own a home debt free or 25 million.
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  Depends what home I guess you could say. So let's have a look at this and let's
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  think about this critically. What if the home
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  I chose was the $200 million home in Florida
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  that just went up for sale? All of a sudden I can have this $200 million
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  home debt free or I can have $25 million cash. Guess
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  which one I'm choosing? That one. Because I can sell that
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  property and put my hands on 200 milli and that's way more than 25 milli.
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  If you're talking about just a regular home here, average price is about a
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  million bucks. What's fascinating is a lot of
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  people would probably choose that because
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  there's a psychology bias that happens in their mind that
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  compels them to go for security. So as
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  soon as someone says, debt free home, they see security. That's what they
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  see, and that's what they play for is security. And they may not know what
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  to do with 25 million, because you do hear stories that people win the lotto, 25 million,
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  and it wrecks their life. their family wants it, it's all about money,
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  they buy racehorses and cars and lose it all, and they go, I wish I'd never won it. So
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  if you think about it, a lot of people would actually like to have a debt-free home
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  and have the responsibility of how to deploy $25 million.
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  So again, I think if you have the education, this makes
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  a bit of sense. If this is a regular home, this one still wins. If this is
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  a Florida home, this one wins. And if you don't have a financial education, and
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  you're swayed by society's need for you to have a debt-free home, you're probably choosing
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  this one. Which one am I choosing? Well, I'm an optimist, so I'm going to
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  say this is a $200 million Florida home, and this one wins. Thanks for
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  coming. Hope you enjoyed the show today, and that's another
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  episode of Who Compares Wins? Financially.
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  See you soon, next episode. Click the follow button. Comment
• 11:06
  below, which was your favorite Comparison. Thanks
• 11:10
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