economic crisis

Creating Value During Times Of Crisis With Garrett Gunderson

TWS 43 | Creating Value

 

 

Today, more than ever, we all need to learn to create value for ourselves instead of relying on the system to work for our benefit. We need to rethink how we align our personal finances to achieve genuine happiness. For Garrett Gunderson, societal agreements anchored on materialism and consumerism are what hold us back from creating real wealth for ourselves. A keynote speaker, bestselling author, and the Founder of Wealth Factory, Garrett joins Patrick Donohoe in this episode to talk about what truly makes us valuable as human beings and how we can make our finances work towards that end. On top of all that, he also gives sound and practical financial advice to everyone as we brace ourselves for the inevitable economic impact of the COVID-19 crisis.

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Creating Value During Times Of Crisis With Garrett Gunderson

My guest is a great friend. His name is Garrett Gunderson. He’s the Chief Wealth Architect at Wealth Factory and the author of Killing Sacred Cows, a New York Times bestseller. He also co-wrote What Would the Rockefellers Do? and The 5 Day Weekend. He is also a contributor to Forbes. I’ve known Garrett for a long time. He’s been on the show before. Knowing him for the better part of several years, I wanted to have him here to discuss what he’s seeing and his perspective is regarding the current state of the economy, where it is going, what he is hearing, seeing, and listening to? I was also curious about our response to some of his more controversial videos as well as Forbes articles. It’s a great episode. You are going to enjoy it. Make sure you visit Garrett’s website, WealthFactory.com. He also has a great YouTube channel, YouTube.com/garrettgundersontv.

Garrett, what’s up? How are you doing? 

I’m glad you’re still talking to me after I brought you to my house to work out.

I still think about that. Coincidentally, I haven’t had much of an extreme response to a workout because I got into biking. I crashed my bike coming down to City Creek Canyon. The good memories are the most painful.

One of our mutual friends I went with, I did the Wasatch Crest with Garrett White and I broke my elbow on that. I got a concussion.

We’ve got to get this story about the workout. We live close to each other and I don’t even know how it happened. You’re like, “You should come and work out at my house.” I’m like, “Alright.” I go to your house and you have this amazing set up in your basement and then you have this big blackboard. It has times on there and apparently, there’s a challenge.

It’s 60 seconds because it sounds easy when you say 60 seconds.

It’s 60 seconds of Airdyne which is those bikes that have a fan on it. How many calories do you have to do, 30 in 60 seconds?

Thirty to you get a shirt and 40 to be on the elite side of the board.

I have no idea where I landed.

You got a shirt, right?

TWS 43 | Creating Value

Creating Value: We live in an extraordinarily consumerist and materialistic society. The reality is that most of that doesn’t bring genuine happiness.

 

I got the shirt.

It wasn’t worth it but you got it.

I think it was worth it. It’s a good memory. We’re talking about it. I found myself almost passed out on your floor, your dog was looking me in the face and then I had to use the toilet. It was a great experience. Thanks for having me over. I appreciate it. We should do that again.

We are taking it a little easier these days with workout so there’s a lot more pleasant. We realized we didn’t have anything to prove and being sore all the time. It didn’t make a lot of sense. We do some functional stuff and we take it easy.

Anyone that comes in works out at your house, it’s the nature of a challenge. They’re going to do anything you tell them to do.

I did that at 2,000 higher elevation on an Echo Bike, which is worse. It’s a little bit harder and beefier. I couldn’t talk to people for twenty minutes and then when I finally spoke words, I said, “It wasn’t worth it.” That was my final comment.

Garrett, it’s awesome to have you on again. I know you’re on a couple of years ago and I have tremendous respect for you with what you’ve done with your career and your business. As I mentioned, you’re always pushing limits and trying to understand the economy, life, business, and then communicate that to others. I have tremendous respect and admiration for you so thanks for what you do. We live in a gnarly time. We were talking about how the last months have been crazy from the standpoint of change. What’s been your experience through the last couple of months? What do you find yourself observing the most?

The good part of it is my kids are listening to me more. I’m able to use the concern or the so-called crisis as a way to heighten their attention and talk about why they are afraid. If they are afraid, where does that fear come from? Is it in the present moment? Are they worried about the future? That’s been profound that we’ve been having these weekly family meetings, talking about our family mission statement and our values. I’ve bonded especially with my youngest son during this time in a deeper way. That’s been the good side. The bad side is, I called a family member and they work with hospitals and they research this stuff for 6 to 7 hours a day. The level of concern, fear and frustration. I’m like, “It’s time to change the narrative.” I don’t think it’s healthy to let the media control the narrative because their job is to be profitable. When we get clear that that’s their job, they’re not always using headlines that are accurate.

I stopped reading things about COVID for two reasons. One, the governor of California said within 30 days they were going to have 22.5 million people infected. The second thing is I read an article out in New York where it said it was an apocalyptic sight. Using the term apocalyptic is fear-mongering and there’s no doubt there are deaths. There’s no doubt that there’s this COVID and it’s tough on people to get it tougher than the flu. I went to Utah’s website and they have Utah COVID website and they said, “For every person that’s reported, there are 5.5 people that have it.” I want people to extrapolate one thing that it’s the same death rate as the flu if that’s true. If we’re only reporting 1 in 5.5 and we’re looking at the percentage like 6% death in the United States. If we look at that 5.5, it takes it down to less than 1% so it’s real. I admittedly have flown and it felt good.

I wore a P95 mask. I take those precautions especially for other people that are in my family. As much as it was quiet and sparse at the airport, I felt good. I went to this place 200 acres in Nashville, everybody’s out playing and we built a fire. If you could find a way even if it’s isolated, get out somewhere in nature and reconnect because nature has a parasympathetic context to it. When we’re in a sympathetic state, it’s fight or flight. When we’re in parasympathetic, that’s where we do a lot of healing and relaxation. This has created a lot of chronic stress and that chronic stress has people a little bit more agitated. I started yelling at my son about something and my wife was on FaceTime and she was like, “What is wrong with you?” I’m like, “I don’t know. I’ve given in to the stress and succumb to it too much.”

We all have to learn to be value creators. Click To Tweet

It has a massive impact on the economy but I want to assure everyone, this economy was doomed already. 2020 was the year. You can go back and watch any of my YouTube videos. I’ve been saying it since 2018. I don’t know when it’s going to hit, but if it’s not at the end of 2020, I’m out. I will never talk about finance again. That was where my stand was. This exacerbated it. The problems were already there underlying. When it comes down to it, there’s one solution to all this and it’s we’ve got to all learn to be value creators. People think that someone can save them. I’m here to assure you, the government can’t save you, corporations won’t save you, and effort isn’t enough. It’s time for intelligent action. We’ve got to discover who we are, what we’re capable of, how we can serve others, and how we can deliver value. Right now, fear is bringing selfishness where people are thinking in isolated thoughts because we’re physically in isolation.

This has been in a sense from a psychological perspective, a very healthy event. It’s healthy because it’s disruptive and sometimes the system needs a shock. We all get in habits and I caught myself in very similar patterns and habits as you where I wanted things to be the way they were, not consciously, it was more subconscious. I want to go to my office and have those meetings, have my collaboration, and people hear, come home and do this. We want those habits, consistency, and certainty. When it’s not there, we get caught off guard. What’s been challenging about this situation is you don’t know. There’s so much unknown. How long are we going to be home? How long is this going to last for?

What I think it’s done for those that I’ve been speaking to and myself included, I assume you as well, which is we’re learning ways to focus on, things are going well with things that we can control. Simplicity and the essentials of life come into focus. That has been valuable for people. It’s been a breath of fresh air and hopefully, it’s given people a new perspective in a lot of ways. One, what’s happening? How much influence media does have? Where do we find an appropriate opinion so that we can hopefully find our own, not gravitate toward what the common opinion is and stick to that but learn the truth and have our own? There are lots of lessons and lots of principles throughout this entire event, including the financial ones. Everything was fragile and it kept growing and growing. This is something that’s knocked it off-kilter.

I’m happy that I learned my lessons in 2008. I was an optimist to ignorance. 2007 was such a big year for my firm and I was like, “This is always going to get better.” I had a track record since 1998 that every year did get better and it continued to grow. I had this level of ignorance that was making me very susceptible to risk. I was spending money too quickly even though I was calling it investing in my business. You saw the office I had back then, the money I’ve spent on my book, and all this stuff. 2008 hit and it was like, “I’m overextended. I’m redlining.” It was painful for six months to the point where I didn’t know who I was. It crashed my identity. I’m no longer worthy in my mind. I’ve failed my family and I got a lot of gray hair. It was this grind that I got in and what I learned was cash and cash management is so critical. I wasn’t like, “Let’s build six months of savings.” I was like, “Let’s build years inside of cash value insurance that will give me stay in power.”

Let’s be careful with our outgoing cashflow and consistently monitor it just 5 to 10 minutes a week to say, “In a mindful way, is this productive or is it not productive? Do we have enough saved up?” I hired someone right after that that they were brilliant at cash management. It was their gift. I was like cash-in, cash-out, like, “Let’s do it. Let’s go for it.” I became good at spending. This time around, it felt good that when this started to happen, I sent an email out to all my family and I said, “We’re prepared for this.” Everything from food storage makes me sound totally like a Utahn. I always felt weird about it and I’m like, “That feels good.” Having enough cash, I said, “If anyone has financial woes or problems during this, please call on us, we can support.” Instead of being in the grind and in crisis mode to be in like, “Let’s reimagine, let’s recreate, let’s re-engineer everything that we’re up to.”

Anything that I can’t do that I was doing before rather than being in pain about it, acknowledge that that’s not going to happen like I was supposed to give a TEDx Talk in New York. I was supposed to take my son to Asia for a month and do service projects in Vietnam, Cambodia, and take him to South Korea where I taught English. All those plans changed. I looked at it like, “What if this isn’t happening to me, it’s happening for me?” In that context, I now get to spend a lot of time with my wife which there’s only one other time in my life where I was home or around her for 60 days with no travel. That was when we went to Italy. I was like, “This will be our version here to go to our cabin, have a lot of connection, and a lot of time together.” We’ve had more conversations now than we’ve ever had in our life. It’s allowed us to be connected. Honestly, I’ve been doing a lot of righting my wrongs. I look back when I was an ass. I looked back when I was arrogant or stupid. I wrote five letters one time. I find that it gives me a chance to make the whole something through immaturity or whatever like do something different with it.

Life has gotten a lot quieter and you’re able to listen especially to the lessons and focus on what’s the most important. As you are going when we’re still in it, I know that things are getting better but from an economic perspective, we most likely have some challenging times ahead. What would you say are the primary lessons that you’re extracting from this?

The things that are getting concrete for me is that in society we become extraordinarily consumeristic and materialistic. Materialism almost is that feudal times of like, “Look what I’ve got.” “I’m my stuff. I’m my net worth.” Our identity gets wrapped up in this. The reality is most of that doesn’t bring genuine happiness. I had this moment in my office, I’m looking around and I’ve got pictures of my family and my wife, comedy, things that I’ve done, people that believed me from the time I was young, and I don’t have a single award up in my office. There’s not a plaque anywhere. There’s just stuff that were gifts from people or moments that were important. I feel a lot of the pain people have is the definition of societal success. When I went to Italy, the gift it gave me was I used to see my value as my business. If there was a customer complaint, I felt terrible about myself. Not about the complainant but about myself and what that said about me.

If we had a bad month, I felt like less of a human being. I was into materialism. When you and I knew each other for a few years and I built that building, that was my demonstration of like, “I’ve made it.” The reality was I had a hard time making those payments. In 2008, it was like, “We’re going to have to sell this building.” These times, we get to redefine what makes us valuable and what makes us valuable is we’re human beings. Human beings make mistakes, can show love, and in these times rather than pointing out anyone else as like, “You’re wrong with this philosophy,” it’s time to show a little bit more love, compassion, and find ways to connect.

As much as that might sound airy-fairy to the value of significance. All it means is like, “I feel whatever I do to someone else, I do to myself.” One time when I was leaving the airport, the machine didn’t work and I was all pissy with the gate agent. It’s not even his fault and there I am just having to go, “I’m still a human being and I feel bad about it. What can I learn from it?” It’s time to focus on ourselves versus the global economy that we can’t control. It’s overwhelming. When we’re overwhelmed, we check out. We go to escapism and right now is the time to connect.

The lessons that you’re learning, do you see others learning that whether it’s your audience or listeners? I know you do tons of stuff online. You write for Forbes. Do you see these lessons being learned by others?

TWS 43 | Creating Value

Creating Value: These times, we need to focus on ourselves and redefine what makes us valuable as human beings.

 

What’s interesting is my YouTube channel has hit stagnation during this. I had 87 subscribers before and then I’m about 40,000 now. It went up by 8,000 people before the COVID crisis in a month. I had three million views. I’m at a million views and 1,500 subscribers. I was like, “Am I after this for the views, or am I after this for the impact?” What’s been nice is if anyone who wants to go to my YouTube channel and look at the comments, they’re overwhelmingly positive 95% and only 5% negative, smart aleck, called me a snake oil salesman or I need to cut my hair. I see people that are coming forward and going, “I’m ready to learn.” The most positive thing that’s happened from this is people are ready to learn.

Fewer people truly listen when times are good. If I try to point out the problems with the stock market, they don’t want to hear it. If I point out the problems of prepaying a mortgage, they think that’s stupid because you can always sell the home, I’m like, “I got it.” They’re not ready to hear things. The people that are listening are listening so much more intently. Our weekly Q&A sessions are getting hundreds of questions. That’s up big time. We did a virtual Wealth Acceleration Workshop, which we’d only done in person before and we had at the lowest point three times more people online watching it than we’ve ever had in person watching it.

There are some things that are interesting that way. The gift is I’ve been trying forever not to be attached to the road. That didn’t have to be an instrumental part of my business. I think that you’ve done a much better job than me at that. This has created that opening out of necessity where if I don’t go on the road, it doesn’t matter, it’s a choice. It’s not required to feed the firm and that’s a gift. I like being around my family, that’s nice. It’d be nice to not have the kids around all the time. They’re still romance terrorists at this point so I would say my romantic life has diminished.

Our kids are roughly the same age. I can attest to that. In a couple of years, they’re going to be gone. That’s what I’ve seen and observed is people are experiencing the same thing as it relates to their most important relationships. That’s going to change the direction of society as well because things were so busy whether it’s the amount of time we worked and the extracurricular activities that we did. Now everything is simpler which is amazing.

We were a slave to our habits. It’s unchecked and unquestioned.

We were in a sense slaves to material things. Slaves to this has to happen for me to feel and experience this.

I’ve spent so much money and I don’t have any less happiness. I was spending a lot of money in January and February. I had a big December and I was like, “I’m going to buy this and that.” It’s like, “I’m not buying any of that right now.” I feel totally fine. I felt no different.

You mentioned that your YouTube views, the engagement with some of your Forbes articles, what’s received the most response and then how are you characterizing that response relative to the other articles and media you’re producing?

The articles are my best articles. They are the biggest part of who I am and my discoveries are getting very minimal views. They’re very philosophical constructs in the big picture. The articles on Forbes that get the most views are telling someone they’re doing something wrong. Part of it is the people that want to read it so they can debate. The article you know that got the most views is Paying Off Your Mortgage Early Will Destroy Your Finances. The title is a little bit click-baiting. The article doesn’t say that you shouldn’t pay off your mortgage. I’m not the moral authority on whether someone should pay off their mortgage or not, but the methodology of how they do it is instrumental. We’re getting that proven in the COVID crisis because I’m saying if you put too much money by prepaying an amortized loan, that money ends up in equity gel. If you have a time where your cashflow is weak and we’re seeing unemployment on the rise, the banks are never going to lend you the money and you’re going to be more susceptible to being foreclosed on.

People are like, “You could always sell the home.” I don’t think it’s the easiest time to sell a home. I don’t know for sure but I imagine with quarantine, that’s got to be a problem especially if you own one in New York. That got a ton of views so when I said, “Financial planning is broken and then you’re better off to blow your money.” That was the other title. That got a lot of traction like 279,000 views. The articles about the recession and the CARES Act have gotten a decent amount of views. My favorite article that I put out is one of your partners in Prosperity Economics, Todd Langford. I interviewed him and wrote an article on cash value insurance that was all about the problems of universal life. That’s the most pedal product that exists out there. It’s got 8,000 views but that I hope over its lifetime ends up getting millions. It might be a slow go and someone’s going to read it, have it catch on because it’s so important to know. Those articles are very interesting. The bottom line is the title makes such a difference more so than the article itself.

I’d love to understand how you’ve grown with being able to speak and write about hard things especially when you’re telling a person that they’re wrong or telling someone something that is against conventional wisdom. You wrote a whole book about it, Killing Sacred Cows, which is conventional wisdom. It’s what everybody does. Doing that tactfully where you’re able to, not only prove the point but do it in a way in which it helps a person think because you can easily attack in a person who’s going to defend themselves to the nth degree and not learn anything from it but you’ve been able to evolve a lot. Speak to that a little bit about how you approach those challenging topics where it’s telling a person that what they’re doing is wrong but yet you’re doing it in a way where they’re able to learn.

Social agreements are what create the pain of materialism and consumerism. Click To Tweet

In my twenties, I had this attitude of like, “I needed to go after it.” There was almost anger right to it and I don’t think that that was effective. This mortgage article I lead with when I was in high school in a math class. I saw the math of what happens when you do a 15 versus a 30-year mortgage. When I came home, I’m like, “Mom, are we on a fifteen-year mortgage?” She goes, “Of course, we are. We’re saving all that interest.” I’m like, “Thank you.” I went to college and I had this class from Professor Hamlin on Economics and he taught me the opportunity costs and cost of money. I was like, “If you could earn the same interest that doesn’t matter but you have more flexibility and potential tax about it, then you have more control of your money.”

The big argument people give me is like, “People are going to blow that money.” I’m like, “Let’s say that’s true. They’re going to put themselves at risk if they’re going to blow that money by trying to prepay a mortgage because they’re going to blow the rest, get into it high-interest rate credit card debt. I’d rather see them pay off the credit card.” You get the picture. I admit my initial limited thinking. I start with self-deprecation of saying this is how I thought it was too. I have no dog in the fight. It doesn’t matter what the solution is. If it’s a fifteen-year mortgage and that’s the most beneficial thing for someone, I don’t get paid more or less forgiving that advice. If I use Suze Orman as one example, she is a sell-out that gets paid by sponsors. She’s been paid by the FDIC. I believe she’s been paid by Starbucks because she went from, “You shouldn’t do it,” to “You do it.” She always had a cup of coffee on her show.

It’s hard not to bring bias. Dave Ramsey says, “Everybody should do everything they can to pay off their credit card debt.” How to do it? I’m okay with all the advice on that. I’m not okay with once you do that, you put your money in the stock market because of the things that we deserve a little bit better thinking. That’s been over-promised and under-delivered. There’s too much volatility. People don’t do well handling it. It creates unnecessary stress for them. One of the articles I wrote that didn’t get nearly the traction that deserved was The Stock Market is Still Overvalued. That was when we start to see it. Here’s why. Eighty-four percent of the gains in the stock market go to 10% of the investors. What people don’t understand is, let’s say the market is done 6% over the last twenty years, and that’s more accurate than when people think it’s done ten. Ten comes from the ‘90s, what it did better than that to boost it up to ten and that’s a pipe dream. It’s never happening again because too many companies are going to go out of business through disruption. Here’s why it matters that 84% of the gain goes to 10% of the investors is because of hedge funds, options, and derivatives.

It doesn’t mean that all investors average to 6%. It means that some people got 30% and other people got nothing because it went to the few that were in the hedge funds that were selling short. I don’t think people get that. They’re investing in companies they don’t believe in. They’re taking risks that are unnecessary because the world has done a good job in making stocks synonymous with investing. I have this whole comedy bit I’m starting to work on which is about Wall Street. If we surveyed the world and said, “Do you trust Wall Street? Yes or no?” It’s got to be 90% would say no. You don’t think warm fuzzy feelings with Wall Street. Every movie about Wall Street, Gordon Gekko, Wolf of Wall Street, Jordan Belfort, there are these terrible movies about harming people or stealing money and yet this is what people are doing. My premise is, would you let someone from Wall Street babysit your child?

The answer is no because you’d come back and be like, “They’re missing 8% of their body. We lost some toes. Hopefully, they’ll grow back and recover.” It’s like, “Why do we do that with our money?” It’s because of social agreements and social agreements are what creates the pain of materialism and consumption. Social agreements have a spill less worthy than we are. I feel like we need to have what someone else has. It creates jealousy and this is, unfortunately, the consumption-based system that we’ve got into. My problem with it is capitalism has become more about taking than giving. It’s become more about competition than creation. That’s why I’m more like a free market. We’ve got to stop having an agenda for someone and telling them what to do and they’ve got to discover things. They’ve got to make mistakes, they’ve got to learn lessons, and anytime we try to so-called protect them, then we rely on a government that’s not capable of protecting anyone because they’re not functional themselves. That’s my little diatribe on that.

That’s human nature. There are so many things that we consistently observed but never understand the nature of the root. My oldest daughter was like, “Why did Donald Trump come up with Make America Great Again?” We were having this competition of questions where you have to answer a question with a question. I asked her, “Where did the word America come from?” That sparked a cool tangent. The point is, most people do not know where that word comes from but you look at it, it’s our country. It’s on Donald Trump’s hat. Everybody talks about that all the time. With the stock market, what you do with your money, there haven’t been enough questions asked around it. Why does it exist? Why do we do this? Where did it come from? What’s the end objective? It’s been preplanned for us, therefore we don’t have to think about it and can focus on other things.

The biggest issue that we face as a nation and as a world is that we’ve lost sight of how to create a vision. The vision exists within a box of well-intentioned preachers and teachers and not so intention governments and the corporations. If we left money on the side for a minute and realize that’s a byproduct and you said, “What do we want to do?” What some people want to do won’t pay as much as other things. That’s the nature of value, what people value, and what people are willing to pay for it because that’s part of a free economy. If we don’t identify ourselves as our money. If that’s only an indication of the value we’ve created in the past and a ledger of that and that snapshotting, what that means is it doesn’t dictate the value we create in the future.

What’s been lost upon people is there are two more precious forms of capital. One is our mental capital, and if we develop that by investing in ourselves to gain knowledge, insight, wisdom, tools, and strategies. The second thing, which it’s an unprecedented time to build is relationship capital. We can build relationship capital because when people are in fear, they’re looking for leadership. Here’s the secret that I’ve had a hard time learning my own life. The secret is not knowing everything. The secret is listening and then what you did with your daughter. Asking questions that moved the narrative to one that’s productive. If you could ask great questions and listen, you’ve got the keys to wealth. I feel like now is the time to ask better questions and ask different questions.

I don’t know if you remember this. This was when Killing Sacred Cows came out and we went down to Vegas and you spoke. That was the first time I heard Keith Cunningham. I love him. He’s such a cool guy.

I remember when I was speaking at that event, he walked into the room. From the back of the room while I’m speaking, “I love Killing Sacred Cows. It’s a great title. What a title.” I was like, “That’s cool. Let’s speak of it. That’s who I love.” He tells it like it is.

He’s big on principle. He’s big on questions but there’s something that he talks about all the time which is thinking. It’s the idea of listening, asking questions, but then taking time to think. This has given people a lot of time to think.

TWS 43 | Creating Value

Creating Value: People are taking unnecessary risks because the world has done a good job of making stocks synonymous with investing.

 

Is this in his new book, The Road Less Stupid?

Yes. If you’ve heard him speak before, he’s like, “You read the book.” Hear his voice. It’s hilarious because he has this thick Texas accent but the point is this is at least for me, I never asked why am I doing this? What am I trying to achieve? Sometimes we ask those questions but we only go one or two layers deep. If you keep asking yourself questions about, why do I want to do that? If I had that, why would that make a difference? If I didn’t have it, where would I be? What would I think? What would I feel? The end-objective is way more important than sticking to a status quo and gain the same end-objective as everybody else. Those are the simple deep questions. Help us understand why we’re doing what we’re doing, what we want and hopefully give us direction as to things to adjust or get rid of to get what we want. I’ve gravitated and I’m not sure what your opinion is toward Ray Dalio but some of the stuff he says is amazing.

Risk management staying with a beginner’s mind, learning, and not learn it. A lot of that is so profound.

It’s so simple but it’s the Pareto Principle, the 80/20 rule where you get 80% of everything off and 20% of effort and information. I was reading that and it hit me. I’m like, “This is like COVID where we’re getting way more satisfaction with so much less noise, activity, and busyness.” It’s profound and those are valuable lessons. I know you’re always pushing the limits, growing, and trying to be more valuable. What would you say is your intention behind some of that writing? What are you hoping people will gain by understanding more about their mortgage and market? Also, more about the idea of value and where value comes from, purpose and legacy, the stuff that you are clearly passionate about? What are you hoping others take away from that? What’s the ideal outcome you hope for them?

The one thing that’s always at the core of it is a personal responsibility. The only way that we grow. With that accountability and personal responsibility, we become less duped, less reliant, and we can learn. There’s no learning. For me, without personal responsibility, there’s no way to have a relationship with someone. If I can bring that to them because I can help them think and learn. In doing that, I continue to write in a way that is simpler and simpler. Simple does not mean discounted, it means understandable. If you look at Killing Sacred Cows, people can understand the book but even when I did the audiobook, it was too elaborate at times. The sentences were too long and they become redundant that way. I’m using vocabulary that why did Make America Great Again work as a campaign is because everyone gets to define what great is subjective. Everybody could understand it even if they were in third grade.

If I write to sound intelligent, then I’m not connected. I’m not giving the reader the resources. If I could take what feels complicated and make it understandable, they’re empowered. I don’t write for everyone to agree, but if I can at least get them to question at least one thing and go, “That’s a valid point.” The one article that has the most views, half the reason it has the most views is that it’s very polarizing and people will defend their life that paying off a mortgage is the best thing you could do in the world. My grandfather said, “You can’t be the man who has paid off his mortgage.” I’m like, “I don’t even know what that means,” but obviously, he cared about his grandfather and so it’s a way to honor his ancestors.

I think we’ve got to shake loose ancestral damage. We can honor our ancestors and be free moving forward. We have a lot of ancestral knowledge that was limiting based upon the consciousness of the time and the situation. As situations change, the context changes if we keep the content the same, then we create unnecessary pain and we don’t honor ourselves. Too many people rely on everyone else. If I can get them to rely on personal responsibility, I feel like I’ve done some good in the world. That’s where I come from.

This is profound because I look at what’s been done in the past and this is a general statement. There were good intentions and they wanted something as an end result. What’s most important isn’t the way they did it. What’s important is the end result of why they did it. I’m not sure if the result has changed that much. We live in such a modern society where things are easier. They’re quicker. They’re more efficient and they take less energy. Going into the method and then the objective, the objective is way more important to understand and be clear about before you get into methods. You’ve always preached that. What’s been awesome is to observe you over the years and how consistent you’ve been to the principles you believed in pre-crash and then post and you continue to write about the same things but it’s different.

That’s where I realized people need a certain environment to absorb that information. Be able to rewire their methods but then also understand at a clear level what the objective is. People are now somewhat humbled and I include myself in it. There are a lot of valuable lessons I’m learning through all this. When you’re in that state, that’s when you start to think about what you were doing and ways in which you can improve it. The beauty of humanity is solving problems.

We’ll make mistakes along the way. It’s part of the learning and that’s okay. A lot of pain and humanity is perfectionism. That’s why we get so stuck in what’s right and what’s wrong. It’s my way or the high way. I get it. You don’t want to make a mistake and you don’t want to admit it if you made a mistake because it shows vulnerability or whatever it is. If we can acknowledge that then we can learn from it and move on. Anything through my career is when I had a strong belief in something and someone showed me evidence of why that might not be the case. I remember my business partner, Les, and I was sitting down analyzing 401(k)s. We’re like, “If this thing got 15% in investment, nothing could beat it.” With the tax deferral and then we started going, “What’s going to get 15% long-term?” I could understand for a year because we used to think of hard money lending at that time and it was going nuts.

You thought he was being conservative. We start looking at like, “What were tax rates?” We sat in a hotel room and after three hours we were like, “These things are riddled with fees. They have penalties that keep people stuck inside of them. They haven’t managed their cashflow appropriately. How much more powerful if you’re economically independent and have cashflow to cover your expenses, then every dollar you earn can be reinvested versus only 10% of it?” This world unfolded and I’m like, “I’ve got to admit that I was wrong. I’ve got to tell people that I’m cashing out my 401(k).” That’s not comfortable. I didn’t want that news but I think that intellectual integrity is the key to the evolution of our financial world. If I learn new things that are different than what I believe, I have to be willing to say, “I was wrong.” In real estate, I’ve done wrong. I’ve made mistakes with investing.

The most positive thing that has happened from this is that people are ready to learn. Fewer people listen when times are good. Click To Tweet

The good news is I haven’t in the last decade. People could point out that I could have gotten better returns, but the reality is my returns came in my business and I captured and transferred that into personal wealth through my cash value. That is very simple to me. I’m sitting on it because I’m going to buy some businesses through this crisis. That’s going to be good for those employees. It’s going to be good for the business owner that might’ve gotten nothing instead he got something. I feel like I’ve got a clear value system.

What advice are you giving the most or the things you’re talking about the most with your audience? What are some of the things you are advocating not to do, things to do and be focused on and things not to do and not be focused on?

It’s too early to allocate capital to investments. We don’t know how long it’s going to last so get access to cash. Do refinance and get equity. Put that in your bank account. If you have a line of credit, tap into it. Pay the interest for a few months. Put that in cash because the banks are going to cut that down. Unfortunately, I have been giving advice on how to get money from the CARES Act and the EIDL’s and the PPP because we paid the tax, they’re offering it, and it’s important for the smaller businesses. I was frustrated to find out 80% of people got the loans were big businesses and hopefully they are returning the money. There are a lot of big businesses that if they went out of business, I wouldn’t miss them for two seconds, but there are a lot of small businesses that I would care about that would suck to see them go out.

Refinancing to get lower outgo. I’m telling business owners that they should move to production-based compensation where they give minimal salary and they give a lot more upside. What happens is during good times, business owners make a disproportionate amount of money and during downtimes, they lose a disproportionate amount of money. If you can create a structure where everybody’s in the boat and they understand when it’s sinking and they all need to work towards being it rising or when it’s rising, they all benefit from it rising. That’s a big game-changer and it’s better for nowadays economy. It was okay to pay people time for money in the Industrial Age, but we’re not in the Industrial Age anymore. You can get more out of people and they can get more out of what they do too. You work together in a team format.

Those are cash-and-cash management, compensation, and making adjustments quickly. Don’t wait until it’s too late like I did in 2008. Everybody got paid but me. I wrote an article in Forbes called Are you the only one not getting paid right now?. That’s a problem because sacrifice leads to destruction. It’s important to take care of yourself during this time. Otherwise, you have nothing to give. You don’t want to run out of the room because you tried to get everybody else to be okay. When I have partners, we hemorrhaged money because we had 42 employees. I didn’t even have to tell them what to do because I didn’t have time. I didn’t have the bandwidth and I lost two people that would normally delegate that stuff. What I should have done is take a week off, sit down with everyone, figuring out what they were going to do, whether they were going to stay. All I did was pay people to mourn than be confused about what to do and then take on a burden that cost me years of my life when it came down to it.

That’s great advice. It’s advice that doesn’t come from information. There’s a difference between information and experience. One of the greatest lessons that we learned was during the times when things went haywire, we lost, and we’re not prepared. Now you’re going to protect yourself from not doing that again. It’s an example of how long the bull run was and how quickly things started to unravel which is going to continue. Let’s end with you talking about what’s exciting for you. What are some of the things you’re working on, you’re doing that lit up about?

One thing I’m doing is a one-man show. I had this dream where I was directing a one-man show, and I don’t know if you’ve ever seen the one-man show that Bo Eason did call the Runt of the Litter. That’s one of the first ones I’ve seen. Mike Tyson did one called Tyson that Spike Lee directed. Billy Crystal did one called 700 Sundays. I feel like entertainment is the gateway to transformation. If I could bring entertainment into a normally tough dry topic of money that I could help with giving people new confidence and give them an experiential way to learn how to create value. I act in it, that’s where I’m going to practice it, do a full run-through. I played four characters in it. I dance at the end of it. It’s this full expression to give people permission to have the freedom and engage in a way that delivers value. I have a director, screenwriter, and comedic writer. It’s been a big collaboration but it’s one of the most fun things I’ve ever done.

Are you filming it?

It’s a practice. We’ll run through it from beginning to end. We are recording and I’ll start listening to it. We’ve been working on stage direction, props, and the characters. I do acting. I had never acted before. I’m doing everything from a little stand-up in it to playing my guitar while I run people through an exercise. In the end, I dance as a sign of expression and I’m not a dancer. It’s like, “Let go of what people think and let’s be ourselves,” type of thing.

When is that due to?

I was going to perform it for the first time in June 2020.

TWS 43 | Creating Value

Creating Value: There are two precious forms of capital: one is our mental capital, and the other is relationship capital.

 

Is this something that’s videoed or something that’s done in live performance?

It will be live. I’m hoping I got someone on the board of Hale Centre Theatre that saw me do stand-up and said, “I would love to have you do a Hale Centre gig.” When this COVID thing is over, I’ll film it and do a full production and they’ll be right here in your backyard. I love to get a bunch of people. For me, it’s my love bomb on humanity.

Garrett, how can the readers tune in to you, your YouTube channel, your social media, follow you and keep learning from you?

YouTube channel is the way. You’re going to go Garrett.live in an internet browser or you can go YouTube.com/garrettgundersontv. Either way, subscribe, I’m doing videos there. That’s the best way to stay connected. I respond to almost every comment.

This has been enlightening, to say the least. I expect nothing less. Garrett, thank you for your time. I appreciate it. Thanks for sharing your wisdom with the audience. I can’t wait to see the one-man show.

You’re always out there as a symbol of abundance. You have always been a man who has been abundant and sharing. You are willing to tell people how you’re doing things, what you’re up to, what mistakes you’ve made, and how you do it differently. I appreciate that about you because not a lot of people are willing to share at that level. Thanks for who you are and how you show up.

Thanks, Garrett. That means a lot. I appreciate it. Take care.

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About Garrett Gunderson

TWS 43 | Creating Value

Garrett B. Gunderson has dedicated his career to debunking the many widely accepted myths and fabrications that undermine the prosperity and joy of millions of hard-working, honest business owners. Gunderson’s company, Wealth Factory, empowers its members to build sustainable wealth through financial efficiency and organization leading to clarity, peace of mind and financial confidence. You may recognize him from his appearances as a guest contributor on CNBC, Fox News, ABC, and many others.

Gunderon is the New York Times bestselling author of “Killing Sacred Cows: Overcoming the Financial Myths That Are Destroying Your Prosperity,” “Portal to Genius,” and “What Would the Rockefellers Do?: How the Wealthy Get and Stay That Way … And How You Can Too.”

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