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Episode · 10 months ago
Episode 42: Investments to Avoid at All Costs
ABOUT THIS EPISODE
Welcome to the buildyour life fudgestwith John Brownie builds your life as a relaxed and unedited conversation withfinancial expert, John Browning Johns, the founder of Guardian Rock Wealthwith offices in Hawaii, Colorado and Illinois Johns. Also, the author of thebook build a life, not a portfolio, a guide to your financial future, basedon your personal values, which you can purchase on Amazon or stay round to theend of today's show and I'll tell you how to get a Frea copymill right toyour door. I'm Michael Delon, your host for the next few minutes, as we chatedwith financial expert business owner and author John Brownieg. Well, hello, John Brownie, Holi Yorday,going sir my day is going fantastic, it's beautiful day here and we are, wehave had nothing made. You go wrong, thus spark! So that's a good thing.That is a great thing. It's fall we're in what inmemver early Nomember is thatfull sill? It isn't. I Live a little...
...rock. I took a walk earlier today, justcrunking through the leaves I thoughtts such a Ole thing, so you probably haveto crunch on the beach or something I', but crunching in the fall is all good.But that's not why we're here to talk. We are here to talk about finances and building a life, not just a polt Fullal,and so today, John. What I want to talk about is: Are there any investmentsthat I should avoid at all costs? Yes, yes, there are investments outthere to avoid at all Costom, and some of them are not not even investments,but some people like to make the the argument tat their investmentsright so e, some of them, some of them, willnot be surprising. Some of them are going to be like of course, of course,and and then there might be a couple in here in my list that are like. Oh, Ihadn't thought about it. That way so so stay tune right, but...
...so my my first one is anything that youuse for essentially enjoyment. So the idea that I'm going to buy the Forariand it's going to appreciate value is generally not a great idea. Okay, Imean, I know that there are some people that do it as pelectors and they supposedly make money, but car boat, plaine, worst investmentsever right, terrible yeah. Now, of course, the idea behind a car right orboat or plant is there depreciating assets? So why would you investn themIy said well collectors value and all that kind of stuff, and- and there aresome- if you really know what you're doing that that could be that but varyt yew and they're very expensive to maintain and when you add all that up,you're not going to come out ahead, bost like yeah, so it's okay to buythem. If you want to have fun and maybe break you ECOMANG, you ride motorcycles.I've heard forever you by Harley...
Dadison, you get to write it and whenyou sell it, your probably going to get maybe close to what you pay for it. Soit's not an investment necessarily yeah poinbutyou're, not I'm not buyingit for the investment part, I'm buying it for the fun I happen to get and that's the building your lifeportion of what my whole philosophy is build around on what the book is about.So building your life, not just in the future, but now, if you really enjoy itand you can afford it than having that Forari corvet or that dot or that planean might be just perfect for what for what you want to build Teday as long asit's not be realing what you want to build in the future right! That's right!That's right! So I shouldn't tell my wife: I can go by my Fera right now,John says so: Jons, I'm Gon givecall from your wife, Nota, good thing, okay, so investments like all right sothink. The first thing that came to me...
...actually was a big camper, trailerright, Wena, church Wer in a small group, and everybody wants to gocamping. I'm like I I'll, buy a camper that'll, be a good investment. So, noprobably not the probably now okay other categories outside of yeahautomobile stuff. So now this one mecomes a surprise to some people- andI might get some comments on this- that Al you're absolutely wrong, but buthear me ot here and another bad investment to look at it as aninvestment. But a lot of people do is your primary residents. So you absolutely can you know, makemoney, especially if you're willing and able to hold it for ten years or more, but I can chow you based on what youend up: Paying in insurance in maintenance updates, real estate,brokerage fees when you buy it and when...
...you pay and when you sell it legal feesurvey, these title fees, wile, Inspection, peas and of course nearly every home inspection comes upwith something that you again have to repair by the time you get done withall of that throughout all of the years, and you add it all up. Yes, sometimes you are in the rightlocation at the right time and you make some money net ofle that, but ingeneral you want to view your primary residents. Has a roof over your head asa very functional thing that, hopefully you don't lose funny Pon and if you hadever talk to somebody who had to move during the two thousand, seven twothousand a D, eight housind crisis. They will remind you O of that, and itwasn't just that crisis where you have that same issue. Where people you know either thehousing market as stagnant or whatever, and the thing about your primaryresidence. Is You don't get a statement...
...every month showing that it went up orit went down or whatever, but it does just because you don't get a statementon that does not mean that it's not moving so true, and not only is it not movingyou many times, don't understand how much it moves right exactly and sgenerally a very large portion of yourport fully on an addition to that.It's usually leverage and that you have a loanoutstanding on that and the otherthing that I learned and I may e been reading your book. I'm not sure is thatwe, if you're planning on that as being part of your Portfolo, what happenslike Yo, I guess you kind of refer to when I'm getting ready to sell himthree years and retire, and the market crashes in two and a half years and I'vNow lost forty percent of my housing value. What does that do so that yeah?So would you say that your presenyour residence, your home residen, is Nemberone for roof? OEF, your house and B I seen on the cake. I mean if you getmoney, yes, but then don't you haveen.
If you make mone, if you make money,don't you have to like reinvest that in two years Ordo something with it aren'tther like bure, there's there's rules in terms of when and how much you paythe taxes and all that, and that should be part of her tinancial plan as well.But you talk about you know, reducing pes in your investment account n thishere you priary residence is a very expensive thing when you buy it, you'repaying fees, you sal rund, that five percent level and then again, when yousell it's another Fiveis that ten percent on either side and think abouthow much your house is worth. It's usually one of the bigger investmentsthat you have. So it's not a loafy investment, either wow you that's number two, okay, yougot another one, a worany one more and we might have to come back to this,because that was a big one. There yeah that's a big one and, and this Wunagain might come. Let me give you two and one of the's going to be obvious.The other one that's whoobwe so hit hippty obvious one that most peoplealready know this, but if you're ever especially for the younger investorsout there time Chares, maybe the quint...
...essential, worst investment everconcacted of all time. I have never met a single person who has ever madeactually made money on a time shit and there expensive. So that would be thethat would be the worst stuff all time, but here's the one that might be alittle bit more surprising, and I say this because I hear it all the time,because people tend to try and time the market and I' You tothat, you can. Youcan hear me now believe me later. There is no one, regardless of what you mighthear in the financial press or anywhere else they can time the market. So yourworst one of your worst investments is cash is cash bat, and so many people hold on to that,because they're so scared of losing the money that they don't invest in theysame thing. Cash is, is the safest...
...place which, yes, however, you haveinflation eating away at that cash, and especially now, as I talk to you it,hopefully the tale into this pandemic. We've got interest rates on that cashthat are essentially zero. If you're holding a cash in the bank, not Anso,it is one of the worst investments that you can have interesting yeah, I'm wehave a little. You know we have like liquid assets in a bank of staviunsamons account. I looked at the interest rate the other day and it waslike you're kidding me right because the same bank wans to Londry money atlike nine and a half percent, I'm like WHETL, no wonder you're a bank rightright, that's how they make their money right. So and and again this is not.You know. The podcast here. Building at like podcast is not to give individualpersonal investment advice wel ever there are good reasons to hold cash.There are good reasons to do that, but make sure those are the right reasonsand talk to somebody about that that...
...that kind of understands the market andunderstands you person- that's great yeah, because there are Nand. Thisthing I loe about your book Don about how you do thing. It's a it is aPortfolo. You need pieces and parts because yeah there is a need for someliquid cash, but probably not as much as I might think, because I can getcash pretty rapidly through some other things and but talking with somebody like youand that's what I want to and encourage people to just reach out and calledJohn and talk about these things, because building a life and a portfoliois very complex and for the average guy like me, it gets crazy and what happensis I stagnate and I procrastinate I don't do anything and then I wake up when I'm sixty fourand I'm going. Oh right. So don't wait, calld, John and ask him about the other infrestment.You should avoid at all cost and I will throw the fifth one in there John. Thething you should do at all costs is or...
...the thing you should have. woinded allcost is not calling John. How about that O there we go. I like that. We do like to help people out UST. Itis a great you know it is truly great fun. So I don't work a day in my lifebecause I really do truly enjoy putting the puzzle pieces together for Foks.That's awesome well reach out to John Guardian rockwealthcom. You can get acopy of his book. You can request a phone call with him, a zoom call andjust begin the dialogue of how you can build a life, not a port folio onlybecause you'll be building a pofolio but you're going to be enjoying lifeand maybe driving at Ferrari or th, Harley, Davison or having that boat,but for the right reason and Johns going to help you do that so JohnBrowning. Thank you! So much serf for another great episode. I'd learned alot once again, so I'll look Ford to talking with you on the next one. Allright sounds good. We'll see you next time. Money really is a big part of our livesand John Brownin can help you and your...
...family learn how to keep money in theproper perspective, it's important, but it's only a tool that can help youbuild the life that you want. If you like, John Amell, you frea copy of hisbook, build a life, not a portfolio, go to John's website, Guardian Rockwealthcom and Click. The contact o US link and send your request. John WillMella copy his book right to your door. Absolutely free thanks for listening tobuilding your life, podcast with John Brownie be sure to subscribe to thispodcast. So each new episode will be sent to you auto magically when it'sreleased have a terrific day.
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