When Rich the Kid told me he was thinking about blowing $70K on a Chevrolet Corvette, this is what I told him.
When you’re 40 years old, nobody is gonna remember the car you drove in 2020.
Look, we’ve all heard that story of how a rapper, an actor, or an athlete went from making millions of dollars to broke again. And it really doesn’t take a genius to figure out why that happens.
It’s simple — they waste their money on dumb sh*t. Lambos, parties, watches, and all the other nonsense.
But you see, the Lambos or the watches are not the problem.
The problem is they have a bunch of cash sitting around and they don’t know what to do with it.
This is why I always like to stay broke.
Here’s the thing, I’m not telling you don’t buy fancy stuff, ‘cause I’m buying the same stuff as well. The only difference is how we’re buying it.
Rich the Kid wants to buy the car out of his earned income. And I’m buying the cars out of my passive income.
You know what I do with my earned income? I buy buildings that provide me with cash flow. Then — and only then — do I buy something stupid.
How stupid can you go? You can go as stupid as your cash flow / passive income.
So, long story short, take your earned income, invest it in real assets, then live on the passive income that those properties provide.
If only I could get rappers and athletes to do this, I promise, you ain’t never gonna hear another story of how a famous guy went broke.
Featured image source: Frank Schwichtenberg, CC BY-SA 4.0, via Wikimedia Commons
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