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The Governments Secret Wealth Strategy | Keith Weinhold · The Hannah Hammond Show

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  Today I'm sitting here with Keith Weinhold.
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  We're actually on the Real Estate Investor Summit cruise in
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  the Caribbean right now and he had an awesome presentation.
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  He is a single family, one to four unit real estate investor
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  and helps other people invest in one to four unit properties.
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  He is the host of the Get Rich Education podcast and he also
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  serves on the Forbes Real Estate Council.
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  So excited to chat with you on a quick talk today and just want
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  to know why should people consider even investing in real
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  estate? What are some of the values that
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  you found throughout your investment journey?
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  It opens up freedom for you. Freedom is probably what you
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  really want in life. If yes, most people what their
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  definition of wealth is, freedom comes to mind.
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  There are three main types of freedom.
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  Income freedom, time freedom and location freedom A lot of people
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  go for the income, but they forget about the other two so as
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  a real estate investor myself and the way that you could
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  arrange your affairs potentially is I own real estate in multiple
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  United States markets. My property manager sends me
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  monthly statements from these various markets and I just take
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  a look at the statement and I get my owner draw.
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  Now it took a few years to get to this point, but this gives me
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  income freedom because there's no limit to the amount of times
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  that I can do this. It gives me time freedom because
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  I only buy a property if I know there would be income after
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  paying a management expense and also have this location freedom.
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  It's geographically agnostic. I can do it from absolutely
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  anywhere. This really changes one's
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  mindset to buy assets that pay you while you own them.
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  What do most people do? The poor in the middle class.
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  They work for an employer, which is just how I started out.
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  They trade their time for dollars, they sell their time
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  for money. And that's why spending money
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  feels so painful, because I've actually traded away a part of
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  their life in order to get that income instead.
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  When you own assets that pay you while you own them, money does
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  not feel like a scarce resource. It feels like an abundant
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  resource instead. So really, that's the mindset
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  shift and some of the reasons for being a real estate
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  investor. So good.
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  And I mean that was me too. I had no freedom, no money, but
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  I had time and I had to eventually work for money 1st
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  and then as soon as I was able to invest that money into real
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  estate assets and I started in the single family, one to four
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  unit space as well. And that was able to start to
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  create passive income for me and buy back my time and give me a
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  sense of freedom. And then it continues to
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  appreciate. And we talked a lot about
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  inflation in your presentation as well and how could be a
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  really bad thing in people's perspective, right?
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  Because that's all you hear all over the news.
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  Inflation, inflation, inflation is causing all these issues.
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  But you talked about some interesting concepts of how
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  inflation is very good, especially when it comes to real
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  estate investing and for those who own assets.
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  So can you touch on that? Yeah, inflation impoverishes
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  most people, but as a real estate investor, you can take
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  this malady and flip it to your advantage.
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  We all know that during inflationary times, which are
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  most times, you don't want to be a saver because savers savings
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  get debased by inflation. What's the opposite of saving?
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  It's actually not spending. The opposite of saving is
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  borrowing. You can profit when you buy
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  income property with a loan. What is it?
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  And it's just 6 words, Buy income property with a loan.
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  That's the formula. The way you benefit from
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  inflation is a way that you can do it in three different methods
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  at the same time with something I've coined called the Inflation
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  Triple Crown. If you buy $1,000,000 asset,
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  maybe you're not starting off buying $1,000,000 asset, but
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  it's just simple numbers and it all scales.
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  If we have inflation, that certainly pushes up your asset
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  value. Secondly, if you have say
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  $1,000,000 in debt, a lot of people don't understand this
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  inflation profiting concept. The bank doesn't ask to be
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  repaid in inflation adjusted dollars, only nominal dollars.
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  So if you had $1,000,000 in debt, where the payments are
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  outsourced to your tenants, they pay your principal and interest.
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  Imagine paying back the bank in 30 years.
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  That $1,000,000 would really only feel like 300K of debt to
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  you. Because over time, wages go
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  higher, prices go higher, salaries go higher.
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  So savvy borrowers that outsource their debt to others
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  actually profit from this arrangement.
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  And then thirdly, if you have a loan on your property, your cash
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  flow often goes up faster than the rate of inflation.
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  This is because your mortgage principal and interest payments
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  stay fixed. Inflation can't touch that.
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  So really, these are the benefits of having good loans,
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  something that you actually help people with.
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  Hannah, Yeah. Exactly.
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  I know. And that's the great thing about
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  inflation, if you invest it, right.
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  Robert Kiyosaki, who's on this trip with us as well, he says
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  savers are losers. And that video I posted with him
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  on when he was on my podcast went viral with millions of
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  views because so many people are taught to go to school, get a
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  job, save money, da da, da, da, da.
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  But when you invest property, inflation can actually be a
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  really good thing because it helps our assets go up and it
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  helps our debt value actually go down.
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  And this is how the government uses inflation to help with
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  their debt too, to lower the real cost of their debt over
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  time so they actually have the ability to repay it.
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  And that's what leads to them continuing to print money.
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  Yeah, that's a great point and it is special that Robert
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  Kiyosaki is here on this cruise with us.
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  To your point, Robert Kiyosaki gave us the all time bombastic
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  statement, Savers are losers, debtors are winners.
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  And I really just described why. And you know, a lot of people
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  try to make predictions about the future.
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  Well, if you think the future is going to be this, invest that
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  way. But if you think it's going to
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  be 180° opposite, think that way.
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  But here's a new thought paradigm for you.
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  Why don't we just align our financial affairs with the near
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  certainty, something that's almost guaranteed out there, and
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  that is inflation. We know more is coming.
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  The Federal Open Market Committee, the powers that be,
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  they even tell us that they're trying to create more inflation.
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  So borrow in a savvy way and arrange your affairs to profit
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  from this rather than be destroyed by it.
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  Exactly. Yeah, they have an inflation
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  target of 2% a year. So they're targeting to continue
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  to inflate and devalue the dollar to do all the things that
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  we just talked about, right? Reduce the cost of the debt over
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  time, raise the cost of assets over time.
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  So savers are losers because this is just the way the economy
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  works. But yeah.
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  And that's why people invest in real estate, gold, silver and
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  these other assets that will actually benefit from inflation.
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  Inflation is worse than you think.
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  Either you can get mad about it, or you can learn how to be a
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  savvy borrower and do something about it.
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  I gave a presentation here at this summit to see event that
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  was well received where I broke down how price inflation is
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  worse than you think. We have something else called
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  service inflation. We have shrinkflation, where
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  manufacturers often shrink the package sizes of something, but
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  there's not a commensurate decrease in price.
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  We have skimflation, where they skimp on ingredients as well.
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  And all of this conspires to create a higher inflation rate
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  than what's stated in the CPI, which has been between 2 and 3%
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  for a long time. So let's be a savvy borrower and
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  do something about it. And you're uniquely positioned
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  in real estate because you can get access to and borrow large
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  chunks of money. You can't borrow a large chunk
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  of money on your credit card. And on your credit card, you
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  have to make those payments. Tenants can't do it for you.
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  So This is why real estate investors are uniquely
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  positioned to it. Sounds paradoxical, but yes,
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  actually benefit from inflation. Exactly.
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  Well, thanks so much for your insight on all that and what's
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  the best way for our audience to get a hold of you?
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  Follow me on the Get rich education podcast or the Get
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  rich education YouTube channel. We actually talk about how you
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  can use real estate to build wealth.
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  And as you know, Hannah, we even have free in house coaching
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  where we connect you with the exact properties like say 321
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  Mockingbird Lane in Memphis, TN with the exact address that can
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  make a good long term rental property and provide you with an
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  income stream and that inflation profiting benefit.
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  So it's the Get Rest Education podcast or the Get Rest
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  Education YouTube channel. Awesome.
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  Well, thanks so much. Keith, thanks, Hannah.
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  It's been great.