Episode 42: Investments to Avoid at All Costs

ABOUT THIS EPISODE

There are some things you should never do with your money. On today's episode, financial expert John Browning shares a few of the investments you should avoid at all cost.

Welcome to the build your life podcastwith John Brownie. Build your life as a relaxed and unedited conversation with financialexpert John Browning. John's the founder of Guardian Rock Wealth, with offices inHawaii, Colorado and Illinois. John's also the author of the book build alife, not a portfolio, a guide to your financial future based on yourpersonal values, which you can purchase on Amazon, or stay around to theend of today's show and I'll tell you how to get a free copy meldright to your door. I'm Michael Dlan, your host for the next few minutesas we chat with financial expert, business owner and author John Brownie.Well, hello, John Browning. Hell, is your day going? Sir?My Day is going fantastic. It's beautiful day here and we are wehave at nothing made you go wrong the spark, so that's a good thing. That is a great thing. It's fall. We're in what I'm want? Member? Early. No. member. Is that false, Delle, itisn't. I live in a little...

...rock. I took a walk earliertoday, just crunking through the leaves and I thought that is such a coolthanks, though, and you probably have to crunch on the beach or something. I'm but crunching in the fall is all good, but that's not whywe're here to talk. We are here to talk about finances and building alife, not just a portfolio. And so today, John, what Iwant to talk about is, are there any investments that I should avoid atall costs? Yes, yes, there are investments out there to avoid atall costs, and some of them are not, not even investments. Butsome people like to make the argument that their investments right. So what ifsome of them, some of them will not be surprising. Some of themare going be like all, of course, of course, and and then theremight be a couple in here in my list that are like Oh,I hadn't thought about it that way. So so stay tuned, right.But so my my first one is anything...

...that you use for essentially enjoyment.So the idea that I'm going to buy the Ferrari and it's going to appreciatevalue is generally a not a great idea. Okay, I mean I know thatthere are some people that do it as collectors and they supposedly make money, but car, boat, plane, worst investments aver right, terrible.Yeah, now, of course the idea behind the car right or boat orplant is they're depreciating assets. So why would you invest in them? Theysaid, well, collectors value and all that kind of stuff. And andthere are some, if you really know what you're doing, that that couldbe that, but very few and the very expensive to maintain and when youadd all that up, you're not going to come out ahead. Most likeyeah, so it's okay to buy them if you want to have fun andmaybe break you come. I mean you ride motorcycles, I've heard forever.You Might Harley Davison. You get to...

...write it and when you sell ityou're probably going to get maybe close to what you paid for it. Soit's not an investment necessarily. Yeah, but you're not. I'm not buyingit for the investment part. I'm buying it for the fun I happen toget, and that's the building your life portion of what my whole philosophy isbuild around, or what the book is about. So building your life,not just in the future but now. If you really enjoy it and youcan't afford it, then having that Ferrari corvat or that boat or that plateand might be just perfect for what for what you want to build today,as long as it's not be reeling what you want to build in the future. Right, that's right, that's right. So I shouldn't tell my wife Ican go buy my Ferrari now, John says. So, yeah,John, I'm going to get a call from your wife, aren't that's nota good thing. Okay, so investments, like all right, so thanks.The first thing that came to me...

...actually was a big camper trailer.Right at Church, we're in a small group and everybody wants to go camping. I'm like, I I'll buy a camper that'll be a good investment.So, no, probably not. They're probably now. Okay, other categoriesoutside of a yeah, automobile stuff. So now this wouldn't be come asa surprise to some people, and I might get some comments on this.That all you're absolutely wrong. But but hear me out here, and anotherbad investment to look at it as an investment, with a lot of peopledo, is your primary residents. So you absolutely can, you know,make money, especially if you're willing and able to hold it for ten yearsor more. But I can show you, based on what you end up payingin insurance and maintenance updates, real estate brokerage fees when you buy itand when you pay and when you sell...

...it. Legal fees serve a feast, title fees, Home Inspection Fees and of course nearly every home inspection comesup with something that you again have to repair by the time you get donewith all of that throughout all of the years and you add it all up. Yes, sometimes you are in the right location at the right time andyou make some money net of all that, but in general you want to viewyour primary residence as a roof over your head, as a very functionalthing that hopefully you don't lose money paw. And if you had ever talk tosomebody who had to move during the two thousand seven, two thousand andeight housing crisis, they will remind you of that. And it wasn't justthat crisis where you have that same issue where people you know either the housingmarket is stagnant or whatever. And the thing about your primary residences you don'tget a statement every month showing that it...

...went up or went down or whatever, but it does. Just because you don't get a statement on that doesnot mean that it's not moving. It's so true, and not only isit not moving? You many times don't understand how much it moves. Rightexactly, and this is generally a very large portion of your portfolio. Inan addition to that, it's usually leveraged and that you have a loan outstandingon that. And the other thing that I learned, and I may havebeen reading your book, I'm not sure, is that went if you're planning onthat, has been part of your portfolio. What happens? Like you, I guess you kind of refer to when I'm getting ready to sell inthree years and retire and the market crashes in two and a half years andI'm now lost forty percent of my housing value. What does that new?So that yeah, so would you say that your present your residence, yourhome, residence number one for roof of your house and be icing on thecake? I mean, if you get money, yes, but then don'tyou have to if you make money,...

...if you make money, don't youhave to like reinvest that in two years or do something with it? Aren'tthere like rules? There's there's rules in terms of when and how much youpay the taxes and all that, and that should be part of her financialplan as well. But you talk about, you know, reducing fees in here. Investment Account. This, your primary residence, is a very expensivething. When you buy it, your paying fees usually around that five percentlevel and then again when you sell it's another fires that ten percent on eitherside. And think about how much your house is worth. It's usually oneof the bigger investments that you have. So it's not a low fee investmenteither. Wow, that's number two. Okay, you got another one.I have more. I have some anyone more? And we might have comeback to this, because I was a big one there. Yeah, that'sa big one and and this one again might come I let me give youtwo and one of them going to be obvious, the other one nuts.So obviously I hit the I'll hit the obvious one that most people already knowthis, but if you're ever especially for the younger investors out there, timeshares maybe the quintessential worst investment ever concocted...

...of all time. I have nevermet a single person who has ever made, actually made money on a time shareand they're expensive. So that would be the that would be the worstof all time. But here's the one that might be a little bit moresurprising, and I see this because I hear it all the time, becausepeople tend to try and time the market, and I'm here to you. Canyou can hear me? I believe me later. There is no one, regardless of what you might hear in the financial press or anywhere else,they can time the market. So your worst, one of your worst investments, is cash. Is Cash, cash, and so many people hold onto thatbecause they're so scared of losing the money that they don't invest in theysame think cash is is the safest place,...

...which yes. However, you haveinflation eating away at that cash and especially now, as I talk toyou, at hopefully the tail into this pandemic, we've got interest rates onthat cash that are essentially zero if you're holding a cash in the bank,not a so it is one of the worst investments that you can have.Interesting, yeah, I'm I have a little, you know, we havelike liquid assets and in a bank of staving savings account, I looked atthe interest rate the other day and is like, you're kidding me right,because the same bank wants the long Ramoney at like nine and a half percent. I'm like, well, no one are. You're a bank right,right, that's how they make their money, right. So and and again,this is not you know, the podcast here, building your life podcast, is not to give individual personal investment advice. However, there are goodreasons to hold cash. There are good reasons to do that, but makesure those are the right reasons and talk to somebody about that that can ofunderstands the market and understands you person.

That's great. Yeah, because thereare and that thing I love about your booked on about how you do things. It's a it is a portfolio. You need pieces and parts because,yeah, there is a need for some liquid cash, but probably not asmuch as I might think, because I can get cash pretty rapidly through someother things. And but talking with somebody like you, and that's what Iwant to in encourage people to just reach out and call John and talk aboutthese things, because building a life and a portfolio is very complex and forthe average guy like me it gets crazy. And what happens as I stagnate andI procrastinate, I don't do anything and then I wake up when I'msixty four and I'm going, oh right, so don't wait. Called John andask him about the other infrestments you should avoided all cost and I willthrow the fifth one in there. John. The thing you should do at allcosts is, or the thing you...

...should avoided all costs is not callingJohn. How about that? Oh, there we go. I like that. We do like to help people out. It is a you know, itis truly great fun. So I don't work at day in my lifebecause I really do truly enjoy putting the puzzle pieces together for folks. That'sawesome. Well, reach out to John Guardian rockwealthcom. You can get acopy of his book, you can request a phone call with him, azoom call, and just begin the dialog of how you can build a life, not a portfolio only because you'll be building a portfolio, but you're goingto be enjoying life and maybe driving that Ferrari or that Harley Davison or havingthat boat, but for the right reason, and John's going to help you dothat. So, John Browning, thank you so much, sir,for another great episode. I'd learned a lot once again, so I'll lookforward to talking with you on the next one. All right, sounds good. We'll see you next time. Money really is a big part of ourlives and John Browning can help you and...

...your family learn how to keep moneyin the proper perspective. It's important, but it's only a tool that couldhelp you build the life that you want. If you like, John Emili afree copy of his book build a life, not a portfolio. Goto John's website, Guardian rockwealthcom, and click the contact US link and sendyour request. John Will Mell a copy of his book right to your doorabsolutely free. Thanks for listening to building your life podcast with John Browning.Be Sure to subscribe to this podcast so each new episode will be sent toyou automatically when it's released. Have a terrific day.

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