E53: What is the Best Investment You Can Make

Holly: He’s Nate, he makes sense out of money. This is Dollars and Nonsense. If you follow the herd, you will be slaughtered.

Nate: So Holly, we’re talking about the best investment you can make. We get asked that question a lot, don’t we, as far as where do you invest money? Where can I get a high rate of return? All these types of things. How do you answer those questions about, where should I put my money, what’s a great investment? Really, what is the best investment someone could typically make?

Holly: I believe the best investment anybody can make is investing in themselves, actually, and having the perspective that everything I do is making me a better person or a happier person or educating me to actually be able to achieve a goal of financial freedom. My dad used to say all the time that the only time he ever lost money was when he gave his money to somebody else that he thought they could do better with it than he could.

We are always looking for that next gold mine of an investment. Our ears are tickled or we see that oh, it’s got this great rate of return. It’s not that risky, but in reality, if we’re not working on ourselves and we’re not educating ourselves on what we want to invest in, we actually are losing money because we’re giving it to somebody else versus letting us control it. And I know you and I have said even in the past on this podcast, invest in something that interests you, but I would also say invest in yourself because you make the best decision for you.

I mean, who are you going to bet on, somebody that you’ve just met who says there’s this great rate of return, or are you going to bet on yourself?

Nate: I agree with you. Investing in yourself is fundamental at becoming financially free and it’s very rarely done. Everyone’s trying to find the best place to get the highest rate of return. The highest rate of return you’ll ever get is by increasing your value to the world. Whether that’s training to go boost up in your career or something like that, getting a better job by increasing your value, increasing your work ethic or your discipline. It could just be learning how to invest. I’ve heard it said many times. I’ve said myself, there really is not a lot of good investments and bad investments out there.

Nate: There’s mainly good investors and bad investors. That’s really what it is because I know a lot of people who have done extremely well in real estate and I know a lot of people who’ve lost a lot of money in real estate. In other words, the real estate itself is not good or bad necessarily. It’s how good you can be. It’s those who have spent the money and the time and energy to become good and investing there. You know, it doesn’t matter what the investment is. There’s typically not just a good investment, the best investment out there. It mainly has to do with, are you willing to become a good investor?

Invest in yourself, increasing your knowledge, increasing your value, and choosing to improve yourself. I would never, and I think Holly you’d agree, want to put in money someplace just because a guy told me the rate of return is expected to be good. I would want to know what it is I’m about to get into and know it pretty well.

Holly: I mean that goes along with even, how many of us are just making contributions to a 401(k) or an IRA, and we’re doing it because we basically feel like that’s our only choice or option, and yet we don’t actually go and find out about that 401(k) or about the IRA contribution and the pros and cons to it. I mean, I’ve had so many people, about the only thing they can tell me what their 401(k) who it’s with maybe and that they get an annual statement. But other than that, they don’t really know about it.

I really believe we’ve got to change our mindset and start doing things that actually build ourselves up but create whether it be experiences, like you said, or coaching that really we go out and we research.

Nate: Yeah, you’ve got to take ownership of it, I think.

Holly: Yeah, instead of passing the buck to somebody else. Well, everybody else was doing it.

Nate: People ask me all the time, “Is a 401(k) a good place to put money?” That is the most subjective question I’ve ever gotten because I cannot answer that question. I don’t know. You know, what’s it going to be invested in when it’s in there? All these sorts of things. My dad is unfortunately a decent example for this where for 20 years, he was a part of this. It was a 403(b), which is like a 401(k) for non-profit organizations. The market did pretty well. It was like 1992 to 2012 or something like that where he was a part of this.

There was some really good years in that time and there were some bad years in that time frame too, but the average was like eight percent and his average was like four percent. So the market average, eight, he did four. In other words, the market may have not done bad during that timeframe, but he did bad where he was at in there because he wasn’t a good investor. He just trusted somebody. He gave him money every month, put it into this account, and hoped it did well, and it didn’t do very well.

The key is not, is it a good place to put money? It’s, do you believe in it? Does it interest you? Are you willing to put some energy and effort to making sure that it does well? I don’t care if it’s the stock market, real estate, infinite banking. I don’t care what it is, but the question is, are you willing to invest in yourself, improve your understanding of it, and be able to invest? The only horror stories I ever hear regarding this are the people who trust somebody else, just like you mentioned with Ray, your dad. Trusting somebody else, giving them the money because they said it was going to be a high rate of return, and they come around and the firm that they put it with goes bankrupt and everyone loses most of their money.

I hear that story more often than I care to admit. Don’t hand money over to people just because they said it was a good return and because you know a little bit about it. Take complete ownership of it and makes sure that you yourself know how to work with money. For me personally, I don’t really trust other people with my money. I want to make the moves myself and invest the money myself as often as I can.

Holly: I’m very much the same. I want to control my money. I want to make those decisions. What are we going to do with our money? How’s it gonna work and what does it benefit us? And I think along the same lines of not just investing in yourself, but some questions you should be asking yourself are, what are some things you can do on a regular basis to add to your education of whatever it is you’re doing? Whether it be real estate, oil wells, stock market, or just, hey, maybe you just do loans or you only do banking.

I tend to say I really only invest in one thing, and it’s not even an investment. I just buy life insurance because it makes me feel good and I know that I’m leaving a legacy for my family. So for me, my education is, how can I train myself better? What do I need to know more about? Is there somebody that can mentor me or coach me? Things that I can do that actually will make me better in explaining it or helping other people?

So I think you have to start asking yourself, what is something you can do on a regular basis? We have a client who says he watches a video a day on infinite banking because he’s one of our clients and we have an educational series. He says a video a day keeps his mind focused and helps him learn and grow on what he’s doing. I think we’ve got to get out of the mentality of expecting somebody else to educate us, and we’ve got to take our own education into her own hands and do our own research.

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Nate: And that’s one of the reasons why you kind of mentioned why I like infinite banking and why I believe that IBC can help you become a better investor. Because so many people are out there putting money and having to take risks with all their money because the “safer” places to put money just don’t give a return like a bank account or like a savings account or checking account. Like the places you want to kind of have be liquid and safe aren’t returning money, so you have to always go out and try to find the next thing, and stuff money in the stock market and all these things. Even if you don’t understand it very well, you just don’t really have a place for it to hold.

And that’s really why IBC, I believe, has made me a better investor overall is because I know that all my money goes into my policies first, and is earning a good high quality return in there, and I’m using the policies but I don’t have to invest money unless there really is a good opportunity come along that I understand and then I can pull money from the policies to take advantage of. But I don’t want to have a whole bunch of cash in a bank because then I have to go out and try to find somewhere else to put it because I’m not earning anything on it.

So I think IBC, by getting started with it, especially for those of you who are already doing it with us, it can help you be a better investor. You still got to take time to become a better person, invest in yourself. Use the policies to do that. With this at your centerpiece, you’re always going to be earning money, you’re always going to be growing your wealth regardless if you make any investments, that way you can be more selective. You don’t have to get your ears tickled. You can take your time finding things because you’re doing well anyway. You only need to take advantage of the things that are really good, that you understand after you’ve taken time to understand it and improve your own knowledge, and whatever the investment world that you’re going to enter into.

Holly: Well Nate, I was even talking to a client the other day who was saying how he’s trying to educate his sons. He said, “I’m putting the money into policies for them and letting them take it out and put it into the stock market or whatever they want to do. And I told him, “Take it one step further.” Find something that they’re passionate about and let them actually take a loan out and pay it back and see what that’s like, just on earning money. Now, not everybody is at an age where your kids can work or have a job, but typically we do have allowances or something like that that they can do.

But I find that if it’s something that the child even is interested in, then it gives them more ownership of something that they want to do and what they want to watch it grow and learn. I don’t care if it’s a trip to Disneyland. It’s the experience that they’re enjoying, but if they want to go on the trip to Disneyland and they’ve saved the money, let him do that and watch what happens when they pay it back. But like Nate said, our money goes through a policy first, and then we take it out and use it.

So the next time they want to go to Disneyland, that money’s right back there to use again. I really, really just believe that also, if you really look at what you’re investing in, if you considered every investment a business opportunity or a business you were investing in, you’d look at it a little bit more closely because you wouldn’t just throw money into a business you knew nothing about.

Nate: Typically, no one would get into business in a world that they did not investigate or have some sort of experience in. Not normally the best idea to just go open up shop, invest a whole bunch of money to get it open when you have literally no idea what you’re doing, but that’s what people do in the investment world all the time. Instead of investing in the new business that they’re starting, they invest in somebody else’s business and they also have no idea what’s going on. They didn’t take any time, and they’re just hoping it turns out okay.

In essence, don’t be afraid to invest in yourself. There’s so many people that I met that said, “My best investment was hiring this coach, or my best investment was going to this leadership event,” or something where they improved as a person. They were able to earn more money, make better decisions to become a leader. Those are the best places to put money. Don’t put money in places just because someone else told you to. Become a better investor by investing in yourself.

Remember, there’s no such thing as a good or bad investment. Overall, it’s mainly just good or bad investors. So if you want to know, if you ever want to come ask, calling Nate, “What should we put money into,” my answer is always, “What interests you and what are you knowledgeable in already? What are you good at?” If you’re not good at anything or you don’t know much about the investment world to begin with, then I’m going to tell you, go get some education. Then we can talk.

Holly: What can you do now to better yourself? What can you do to educate yourself? Because my answer, just like Nate, is always going to be, what is your experience in? What is your knowledge in? What do you really enjoy doing? You’re not going to probably ever see me, and I’ll be honest. I will probably never do a real estate investment. My house is where I live, and it’s my home, but I just really don’t want to manage other things like that. That just doesn’t interest me at all.

If you asked me if this is a good investment and it’s real estate, I’m going to be honest and say, “I don’t know because that’s not an area that interests me.” And I really like what Nate said, is there’s people that have done really good in real estate and really bad, and it’s not the actual real estate. It’s how well, in my belief, they’ve educated themselves and how passionate they are about what they’re doing.

Nate: So remember guys, do not follow the herd. You will get slaughtered if all you ever do is do what the herd is doing and never take any ownership of your own financial situation. Take ownership. Find ways to invest in yourself. Get interested in some things, whether that’s infinite banking, whether that’s real estate, whether that’s the stock market, cryptocurrency, and then learn and get good at it. Don’t just throw your money in there hoping for the best just because a buddy told you.

I remember one of my buddies was riding the wave up in the crypto currency world. He comes and says, “Nate, you really have to put money in. You don’t have to put a ton, just put something in because everybody’s making a ton of money, and they just throw some money at it.” I almost did. I went through the steps. I opened an account at this one place. I can’t remember what it was.

So back in December of 2017 when everybody was just making a killing. I almost put money in and I was like, no, I don’t know much about it. I haven’t researched it. I haven’t done my due diligence yet. I’m not just going to fall on the hype train, and I was very thankful that I didn’t because I know that it’s crashed this year. It’s went way down in value since the peak in December. So I was very thankful that I didn’t do it.

Be diligent. Don’t just hand your money over to people just because you hear it’s a good idea. Be diligent about it, become a better investor. Take some ownership of the money. I think that’s the best thing you could do ever for yourself financially.

Holly: And I would say just remember some questions. Are you passionate about this? Is this something that interests you? What is your knowledge or education about it? Start asking yourself today, what can you do now to better yourself? What do you want to do to invest in you? Whether it be to add to your education, whether it be to make yourself a better person. If it’s hiring a coach, if it’s doing a course, if it’s going somewhere and having an experience, it really is based on what you’re passionate about. And don’t let somebody else tell you, “Hey, you should be passionate about this and go invest.” Really ask yourself, do you have any interest in even doing this?

Nate: The things you’re interested in are the things you’ll want to spend more time thinking about and learning about and you’ll probably be better at it. So exactly right, if it’s something that you think you can have fun looking at … If you love to remodel houses, and you’re really artistic, and you know how to design, maybe you should look into some real estate or something like that, maybe flipping houses because you can have a vision for what can happen to that property. That is not my strength. I’m not a home decorator.

Nate: Anyway guys, it has been Dollars and Nonsense. If you follow the herd, you will get slaughtered.

Holly: For free transcripts and resources, please visit livingwealth.com/e53.