As a reminder, the Millionaire Money Mentors Black Friday sale is still going on. Click the link if you want the details. FYI, there are only a couple days left in the sale so don’t put it off if you’re interested.
Yesterday I shared Five Amazing Things I Love about the Millionaire Money Mentors. Today, I’m going to add to those thoughts by sharing five big money moves I’ve made with feedback from the forums’ members and mentors.
To note, the thoughts I’ve received have been in the form of direct responses to my questions as well as knowledge gained from reading, responding, and interacting with threads of various kinds. That’s the cool thing about the forums – you can learn something while you think you’re just hanging around reading other people’s conversations.
Before I get into specifics, let me summarize what might be obvious to many of you. I am a fairly advanced money manager. I have been working on growing my net worth for over three decades, I’ve been writing and coaching about money for 30 years as well, and I have studied books, speakers, articles (thousands!), and all sorts of videos (now that YouTube is popular) on various money management topics. As a result I have amassed a multimillion-dollar net worth and feel like I’m fairly sophisticated at managing money.
I didn’t just say that to build myself up, but to actually do the opposite. Even with this extensive background I have a lot to learn. And thankfully I have the Millionaire Money Mentors (MMM) forums to educate me.
I’ve noted many times in posts that the main financial benefit I’ve gotten out of blogging hasn’t been the money I’ve earned, but the education I’ve received (from writing – you learn as you write about something, the conversations with readers, and the accountability resulting from putting your finances out for all to see) and the money moves I’ve made as a result. These have literally netted me millions over the years.
The same is true with the MMM. I’m there mostly to write and respond to threads but along the way I have been learning a lot.
This is because the members and mentors have extensive experience and knowledge that I don’t have. So even for a sophisticated money manager like myself, the forums have delivered tons of extra value and new information that I can apply to make my finances even better.
And that’s what this post is about. Specifically, it’s about five specific steps I have taken as a result of listening to others’ feedback and suggestions – and as a result my finances are better and so is my life (mostly because I’ve been able to save time and eliminate aggravation).
With that said, let’s get started reviewing the list…
1. Sold rental properties and invested in real estate syndications.
About the time I started the MMM forums, I became very frustrated with my rental properties. Not with the properties themselves, they were doing quite well, but I was increasingly frustrated with my management company.
There were several reasons for this, but the main ones were that they seemed to be price gouging me for services while also not being proactive in many tenant-related issues.
I explored opportunities for switching to another management company, but after talking to my real estate mentor (who was in the town where I rented the properties – 1200+ miles away from where I live), I determined that other management companies had their own issues and probably wouldn’t be any better than what I had. So I was kind of stuck.
Then along came the Millionaire Money Mentors.
One of our largest forums threads is on real estate syndications (FYI, this thread alone is worth the price of admission and is certainly much more valuable than a class or something similar a person could take to learn about the subject). I had heard of syndications from other websites in passing but really hadn’t investigated them because I didn’t know anything about how they worked, who to trust, and so on.
Thankfully the forums took care of these issues for me because we have several sophisticated, long-term real estate syndication investors who are willing to share their experiences and expertise. In addition, we reached out to several syndicators who were recommended by members and had them do an “Ask Me Anything” session in the forums.
As I became educated on syndications and identified a few syndicators I was willing to work with, I started to see a solution to my frustration with my real estate properties.
It went something like this:
- I could sell the properties for much more than I paid for them (it had been several years since I bought them and they had appreciated nicely).
- I could then take the proceeds and invest much of it into real estate syndications.
- This way I could still earn as much income as I had been from my own properties and the management issues would be someone else’s problem.
So that’s what I did. I contacted my mentor, told him I wanted to sell my properties, and he handled that for me. Even after paying all the taxes and depreciation recapture, I was able to net about twice what I had put into the properties. This means I could invest about two-thirds of the proceeds from the sale of the properties into syndications and earn as much money as I was earning with my own properties.
That left the other third of the money for me to ultimately buy a house in The Villages for cash.
FYI, it took me several months to deploy all the money into syndications. This is because I wanted to diversify my investments by syndicator, type of real estate (multi-family, storage, land, mobile home parks, etc.), area of the country, length of investment cycle, and a couple other factors.
But once that was done, I was set. Now I actually have even more income than I did from my properties with zero time commitments related to managing them (plus the associated headaches – those are now someone else’s problem). In addition I don’t have the potential liabilities that I had when I owned the properties.
So overall it has been a win-win for me and something I’m thankful for.
This has been by far the biggest financial step I have taken as a result of the forums as it added up to well over a million dollars by the time everything was said and done.
2. Invested HSA money into stocks.
The next item is something I should have honestly taken care of a long time ago. But for whatever reason I decided to leave cash in my HSA fund. Maybe it was because I wasn’t sure if I was going to spend the money and clean out the account (there’s not a significant amount in it and having a health share, I can’t make additional HSA contributions). Or maybe I was just being lazy and not getting around to it. But for whatever reason I had about $30,000 cash in an HSA account that I had accumulated over the course of several years.
Someone on the forums started a thread about what to do with HSA funds. There was a lot of conversation back and forth but the general consensus was that if you were going to use your HSA funds relatively soon you want to leave them in cash – but otherwise you should invest them so that they could grow over time. Many mentors and members were not going to spend their HSA funds for the foreseeable future and simply let them grow for a decade or two before they did anything with them. As such they had invested them, most putting them in index funds.
I was thinking about investing my funds as well when along came the coronavirus. And I think we all know what happened to the stock market when that happened. It tanked. I initially didn’t do anything with my HSA funds because I was wondering what was going to happen with the market. But as we kept discussing the topic I thought this might be the perfect time to invest these monies because the market was low.
So in March of 2020 I invested all of my HSA funds except for $1,000 in an index fund. It’s been up and down since then but mostly up. Currently that $30,000 I invested is now worth almost double that amount. From one simple tip in the forums I was able to realize $30,000 in gains. That’s a pretty good return. Makes the annual cost of the forums seem like a bargain, huh? 😉
The old adage about you being the result of the five people you hang out with most was certainly true in this situation. Sometimes simply hanging out with wise people rubs off on you and helps you benefit from their thoughts. This is yet another great benefit of the MMM.
3. Bought dividend stocks.
At the same time I was considering what to do with my HSA funds, I also saw that the time was right to get into dividend stocks. This is something that I had been following for quite some time but hadn’t taken any action on since the market had been so high (so I couldn’t find stocks that had both the growth opportunities and the dividend yield that I wanted – they were simply too high priced).
But after the market drop in March of 2020, I saw an opportunity. Others in the forums had talked about which dividend stocks they liked and there was ongoing discussion on the subject. I used their wisdom to determine a hit list of stocks I was interested in, then ultimately to purchase several dividend stocks.
Those stocks have performed well over the past few years with growth at or above that of the market, plus additional income generated from dividends. Personally, I look at dividend stocks as a substitute for holding bonds (something I don’t like to do). So given that these stocks have performed as well as the market plus provided income is a big win for me.
4. Loosened up the purse strings.
There’s an ongoing discussion in the forums about how to handle wealth once you have enough (or more than enough).
Believe it or not, those who have grown their wealth to high levels often have trouble spending it later in life.
This is because one of the key factors that makes people good at accumulating wealth is their ability to save money. It’s a fundamental part of anyone’s net worth growth no matter how much they earn or how great of an investor they are. They still need to save money at some point in time in order to fund investing.
Part of the savings equation is having the ability to put off current desires in order to save money now. In other words, you must spend less than you earn to grow your net worth. Having this ability is how millions of people have become wealthy through the ages.
However, this amazing trait becomes an issue once you get to financial independence, and especially as you retire and look forward to enjoying some of your wealth. What was once considered a positive trait (frugality/self-control) now becomes the thing that holds you back from spending your money and enjoying it in your retirement/old age.
In short, coupon clipping and the other multiple ways to save money don’t die easily. They become built-in habits over the decades. As such many wealthy individuals have trouble moving from being a saver to actually spending some of their wealth to enjoy their golden years.
In the forums we talk about this extensively. A lot of the thinking behind the discussion has been detailed in my guest post on ISE. But the general consensus is that there needs to be a mind shift from being frugal and saving to being a little more intentional about spending and not worrying about every penny.
Many of the mentors in the forums are excellent at challenging the thinking of others when it comes to this point. I am probably among those that are still more frugal than I need to be. So as I listen to the mentors talk about being a little less frugal, I have started to consider what they’ve said and apply it to my life.
I do admit that this has not come easily and I am still a recovering saver. Hahaha.
But I’m making progress and I have taken a few steps to spend money where in the past I would not have done so. A few examples of this include:
- Spending money to play pickleball inside (even in the summer when many play outside)
- Taking a first class flight on a recent trip
- Spending money to snowbird in Florida (earlier this year)
- Making more decisions based on time than on money (for example, buying something NOW, in the store I’m currently in rather than driving 10 minutes down the road to save $5).
- Not necessarily looking for the best deal but looking for a decent deal that can be done quickly (thus saving my most precious resource – time)
There are few more examples but probably the biggest is our recent purchase of a home in The Villages. This is something we would probably not have done if we were still caught up in our frugal lifestyle. But now we’re trying to loosen up a bit and have done so to purchase a second home without selling our current residence.
I’m still a work in progress but the positive steps that I have made so far are the result of many people in the forums commenting and giving encouragement on spending and enjoying the money that they’ve accumulated in life.
5. Giving more and with a plan.
And finally, this point is a bit of a contradiction to the previous point (though in a way it’s a complement).
In addition to spending more money on ourselves we’ve also decided that we want to spend more money on others. We want to be sure that our wealth is not simply benefiting us but also helping others as well.
Getting to this point has been a journey which has involved a few elements in the forums.
The first started when we featured The Wealthy Gardener as a book of the month. I read it along with the members and really loved it.
One of its points really hit home to me — the idea of creating a five-year plan. Basically it was talking about being intentional with your life and making plans for the next five years to accomplish what you wanted (as opposed to simply letting life happen to you).
Reading the book was then coupled with an Ask Me Anything session with the book’s author. This allowed me to dig a little bit deeper into his philosophy, get some specific guidelines, and create tips on developing a five-year plan. By the way, he’s working on a new book that deals with this subject specifically – though I believe he plans to change it to a three-year plan.
Anyway, I took his feedback and applied it to a few areas of my life, creating plans for the next several years.
For example, I developed plans for what I want to accomplish from a business standpoint. As such, I have outlined my goals for ESI Money, the Millionaire Money Mentors forums, and potential future businesses. I have plans for all of these and I’m working on them currently. Stay tuned as I’ll update you on progress when appropriate.
But another area where I wanted a more intentional plan was our giving. I wanted a thoughtful path set for the next five years.
I started asking the forum’s members about how they gave to different charities, what they gave, how they evaluated charities, and so forth. I got a tremendous amount of feedback and suggestions. I started acting on these suggestions and developed a process for identifying charities that were both ones we wanted to give to and were effective in their efforts.
At the same time I was working through the ISE notes above. We kept discussing the topic in the forums and basically what I initially took as a “spend money on yourself” sort of philosophy was really more of a “spend money on something that makes you happy” philosophy. I realized that spending more on myself after a given point would not make me happier, but that spending to help others would.
As a result of all these events, my wife and I came up with a five-year giving plan which you will soon be reading about in a post here (it goes live in December even though I wrote it a few months ago). The short version of it is we are committed to giving at least $100,000 away each year for the next five years. If we spend more than $100,000 we plan to give that amount away instead.
It took some time for us to get here, but in the end I think this will help us enjoy our money much more than we would have otherwise, so I am thankful for the forums in directing us.
Oh, and they have helped me even recently build upon these plans – but that’s for another, future post. 😉
Overall, I’m very thankful for the forums’ members and mentors in helping us address each of these topics. As you can see, collectively the issues involve millions of dollars and I feel making the moves above have made me wealthier plus will result in a higher level of happiness.
This is the sort of support that any forums member can expect. I hope you consider this strongly and eventually take advantage of the current sale. I look forward to seeing you there soon.