A Magical Life: Health, Wealth, and Weight Loss

5 Easy Steps To Building Wealth with Gordon Stein

December 28, 2022 Gordon Stein Season 1 Episode 157
A Magical Life: Health, Wealth, and Weight Loss
5 Easy Steps To Building Wealth with Gordon Stein
A Magical Life: Health, Wealth, and Weight Loss +
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Show Notes Transcript

Gordon Stein is with me today to talk about building wealth with minimal effort and minimal sacrifice.  He will share with us how his approach to finances in his Cashflow Cookbook is able to help reduce stress, grow wealth, and develop habits that can carry over into other areas of your life.
Gordon will share about:

  • Many of your regular bills can be reduced
  • Apply those savings to your debt or savings goals
  • Increasing your credit score can mean thousands of dollars in savings
  • Finding any scholarships that are available
  • Diversifying investments and working with a financial advisor
  • Having 2 checking accounts - one for bills, one for discretionary spending

Gordon's book "Cash Flow Cookbook" has hundreds of ways to grow your wealth with minimal effort by being more efficient with where your money goes.
Connect with Gordon at https://cashflowcookbook.com/
Instagram: https://www.instagram.com/cashflowcookbook/
Twitter: https://twitter.com/cashflowcookbk
Facebook: https://www.facebook.com/cashflowcookbook/
LinkedIn: https://www.linkedin.com/in/gordonstein/detail/recent-activity/shares/

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Online: https://wholisticnaturalhealth.com.au
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Magic Barclay:

Welcome back to A Magical Life. I'm your host, magic Barkley, and today Gordon Stein again joins us. He's the author of Cash Flow Cookbook. Welcome Gordon.

Gordon Stein:

Listen, it's great to be here. Thank you. Magic.

Magic Barclay:

Now, in episode 1 56, we kind of touched on wealth creation and some really easy ways to create wealth. Mm-hmm. What are five easy steps to building wealth? Cuz I'm sure many listeners are going, well, I'm broke. I've been broke for ages. How do I do this? How do I do it without changing my life completely? So what are some really easy ways that people can get started?

Gordon Stein:

I think, uh, I'll speak generally. The first place to start, as I talk about in Castle Cookbook is this idea, I call it broil a bill, and really what we're talking about is. Any bill that you pay on a monthly basis, make a list of all the bills that you pay, car insurance, house insurance, property taxes, you name it, and they can all be reduced. And in the Book Castle Cookbook, I show you exactly how to reduce each and every one of those bills. So there's a total of these 60 recipes. So, There's lots of examples and some are, you know, relatively obvious things like car insurance and home insurance, life insurance, those can be easily shopped around, either through a licensed insurance broker or you can do it with some of the online comparison engines in your particular geography. And as an example, here in the United. I tried this with my own car insurance and we had three vehicles and three drivers, uh, in my household, and the prices ranged. Uh, a difference of about$310 from highest to lowest. So something as simple as that, takes about 10 minutes. You go online, do a comparison to your car insurance, uh, costs. In my case, the difference was hundred dollars. A single person, one car. I would bet they'd still be able to find a difference of a hundred dollars. So something like that is a really great place to start. Um, lots of other examples of those kinds of things. Magic, we can come back to those. But then once you free up some cash from reducing one of these bills, it doesn't take yelling. There's no haggling, no negotiating. It's all very straightforward. Once you do that, you wanna savor the savings. You wanna apply that to either paying down. If your biggest issue is debt or if you wanna increase your monthly contributions for investing. So that's the starting book. We can talk about more of these bills that we can boil down, or I can get into more of the broader tips. Magic,

Magic Barclay:

I think we can start with some more bills, if that's okay, Gordon, because many people just have these incidental expenses that add up and I know mm-hmm. From my own experience, there's ways that you can shop even just for your groceries or you know, you can start growing your own veggies. That is a lot more cost effective. So I know for me, starting to grow my own veggies, not only have I got organic produce, but by the time mm-hmm. I calculate how much water it needs, the good soil, the organic seeds to start with. It still costs me less. Than if I was say, buying broccoli at the store. So what are some more tips you've got?

Gordon Stein:

Sure. And there's so many of these. it depends on the categories. So if you think about, uh, I group these kinds of bills in a different categories. So one would be things like, Uh, house utilities, you know, gas bill, uh, electricity, bill, uh, water bill, all those kinds of things, they can all be reduced in that case. Most of those is about conserving. So you might wanna get an energy audit in your house. Done. Local utilities often do that. you know, identify ways to reduce air that's flowing into the house. You know, setback thermostats, programmable thermostats to. Uh, you're heating at night. So there's a lot of those kinds of things that are conserving kinds of things. those Would be some examples of that. Then there's other ones that are really, kind of innovative. You take advantage of, uh, new technology. So, you know, one example would be, um, if you take a look at, you know, people have cable tv. Cable TV programs on the go. So then I have a subscription there. And if you might look at something like YouTube tv, which is typically about half the cost of a cable TV subscription, and people might be paying, you know, for a comprehensive package, 200,$220 a month, and depending on your geography. Uh, you know, you can get into YouTube TV for well under half of that, or even less. So that's where things have changed or evolved. There might be a smarter way of doing it. And then there's other ones that are really, they're a bit self, the things that people don't think about. Great example of that, and one of the most powerful ones to take a look at his credit ratings. And people often don't know their credit score. You know, why would they need to know that? Not that interesting. It's actually very interesting. So if you learn about your credit score, and it's not hard to find out your credit score for free. So companies like Experian will provide that, for people. And you know, the scores will range, the five hundreds up to as high as 800. And the higher that credit score, it affects so many things. It'll affect the interest on loans. You could have a swing of 70% difference in interest costs for somebody with a. Credit rating versus a lower credit rating. It affects your home insurance cost, it affects your car insurance cost. It is often used as a screener for jobs or for renting an apartment. People look at your credit score and there's some simple steps you can do to improve your credit score, but it can make a difference to people of thousands of dollars cuz it's kind of a hidden, thing that people really aren't looking at. So there's, you know, there's another example of things that, um, Worth taking a look at. Um, when you think about college, you know, if you have children heading off to college or university, there's dramatic changes you can make there. And those costs are really shopping. The available scholarships, there's billions of unpaid scholarships every year all around the world. And so working with the student financial aid office and the scholarships for every. Situation that you can imagine people who have disabilities, people who have particular skills in sports, people who've been part of Girl Scouts, you name it. There's scholarships out there and that can, those can be savings. Tens of thousand dollars over the course of college. and there's other ones, you know, going back to college funding again. Um, there's generally tax advantage savings programs that are available. And for example, in the United States, it's called a 5 29 plan. with terrific tax savings as a way as you save up for your child's college, but only 20%. Of students head off to college with a 5 29 plan, even though the government is chipping in thousands of dollars of tax savings. So it really goes across the board. We can get into things like foreign exchange. Uh, often people need to change their currency for a trip. They'll do it at the airport. As I show'em the book. If you change your currency from, let's say, US dollars to Euros back and forth twice. If you did that at an airport currency exchange, you might end up with about 600 of your original thousand dollars. If you do it at a bank, you might end up with about$850. If you do it at a discount for an exchange firm, you'd end up with almost all of your money, so you could be taking a haircut on your money every time you change it. So these go on and on and on. We could be we could be here for hours with the ideas. In Castle Cookbook, there's a total of$13,000 of monthly savings ideas.

Magic Barclay:

That sounds fantastic. Now, once we've looked at some of our expenses and things like that, you mentioned investing. Mm-hmm. what do people invest in? Mm-hmm.

Gordon Stein:

I think it's a great question. I think for most people, I think the best way to go is to work with a financial advisor, because you know, you wanna make sure you have things optimized from a tax perspective. Are you properly diversified? And probably the biggest thing is that a financial advisor is gonna stop you from wanting to pull your. Out of the market at every turn of historical events, you know, so an interesting is that people who are invested in funds, Themselves, they tend to earn about two or 3% less than the fund itself earns, which sounds impossible. And the reason for that individual investors, something will change. You know, there's a war going on right now in the Ukraine, or there'll be a, an election. With a, a new president coming in or a new Prime minister, depending on your country or, you know, COVID comes or nine 11 happens, or there's a war, whatever it may be, an individual investors will panic and they'll say, oh, oh, you know, this time it really is gonna be bad. I gotta pull my money. The market, and as always happens, the market will recover. And now they're gonna buy back in an even higher price. So they'll tend to grind their way outta their own money. And for that reason, I would recommend people work with a financial advisor to get you into the right kind of conservative investments. I think, you know, investing on your own is fine if you have the discipline to stay invested. And if you're not picking up, you know, tips from your Uber driver. On hot stocks. That's a, that's a good way to have a little bit of money after shutting off with a lot of money.

Magic Barclay:

And don't Uber drivers seem to have the most interesting tips,

Gordon Stein:

Well, they do and they're fantastic. I've had some great conversations. I just, I don't think it's a great source for investment advice.

Magic Barclay:

Definitely not now, what is something that we haven't covered, Gordon, that you think the listeners really, really should know about

Gordon Stein:

Wealth? Well, I think, you know, the really, the keys are this business of freeing up the bills, applying it to something useful, um, and really taking a look at, you know, is debt your issues. So if you have a lot of high ends of debt, that's probably gonna be a priority if you have credit card debt. At 20%. That's much like having a government bond that pays 20%. So we would all be scrambling for a tax-free government bond to pay 20%, but people are very lax paying off their credit cards. So getting rid of that high interest debt is really pulling people backwards. That's typically the biggest priority. And once that's in. Um, then I think you can shift the focus to, uh, building some wealth with investing. And then, you know, like we talked to me before about this idea of monitoring your weight as an analogy, understanding your wealth and monitoring that over time I think is, uh, Another really important thing to do because I think it changes your mindset. Um, we should chat a little bit about discretionary spending. So up to this point, magic, we've been talking a lot about these recurring monthly bills, and they're all different in terms of how you should treat them and how you can reduce them. Um, but the discretionary spend is really interesting as well. One of the things I recommend for people is that they actually have two checking accounts. They set up one that pays those monthly recurring bills, the cell phone bill, car insurance, house insurance, mortgages, credit lines, all those things. And a second one, um, that's just used for, uh, regular discretionary kinds of expenses. Things that come up. Dining out and all that. I think when you do that, first of all, you're a lot less likely to be overdrawn because those recurring bills tend to be fairly fixed, month to month bills keep coming outta the other account. So now you can just focus on managing, you know, groceries and dinners out and clothing and some of those sorts of things. So separating those is really important. The ones that are recurring, you're gonna really work those down on the discretionary one. I think that's where you've gotta work on some habits and going and analyzing where are you spending money. You know, there's some people who just can't pass a fast food restaurant, they've gotta have a treat snack, a lunch, or whatever. It's, which doesn't seem like a big thing. It's$20,$30, there's a couple of you, it's$40. But if you're doing that every day, In 30 days, that's more like$1,200 a month. It starts to become material. So spotting those habits and what are the things that you wanna change on the discretionary spend. So that's a few more thoughts, things that people can work on.

Magic Barclay:

That sounds fantastic. Now, listeners, I do urge you to contact Gordon. You can find him@cashflowcookbook.com. He's also on LinkedIn at Gordon Stein Facebook at Cash Flow Cookbook. He has so much more to teach you that we really don't have time to cover in this episode. This was your episode 1 57 in 1 58. We have Leah Pinelli talking about cracking the code to overeating. Gordon, thank you for all your time with this episode.

Gordon Stein:

Oh, real pleasure. Thank you so much. Magic. It's great to be here with you.

Magic Barclay:

Thank you, listeners. Thank you for your time. Go forth and create your magical life.