How to Become an Automatic Millionaire | A Powerful One-Step Plan to Live and Finish Rich with 9 times Best-Selling Author David Bach

Show Notes

What if you could decide today to become an “Automatic Millionaire” by simply making a few small one time decisions with where an how you spend your money? 9x New York Times best-selling author and Oprah guest, David Bach joins us to share his secrets for becoming an “Automatic Millionaire.”

Watch today’s Fox Segment also.  https://www.foxbusiness.com/personal-finance/most-women-make-this-crucial-financial-retirement-mistake

Useful Links:

https://www.youtube.com/watch?v=Z5YF0dtmaPM

https://www.cnbc.com/2017/10/25/heres-the-trick-to-becoming-wealthy-says-tom-corley.html

Books By David Bach

    1. The Automatic Millionaire, Expanded and Updated: A Powerful One-Step Plan to Live and Finish Rich – https://amzn.to/2Ci44GN

 

 

 

Learn More about David Bach by going to:

  1. www.davidbach.com
  2. https://wealth.advisorsexcel.com/

Check Out David’s new book In May of 2019, The Latte Factor

David’s Book Recommendation – The Alchemisthttps://amzn.to/2CkUBhO

NOTABLE QUOTABLE – “Wealth Isn’t Built In Days, It’s Built In Decades” – David Bach

  1. Ladies and gentlemen, on today’s show we are interviewing a 9 x New York Times best-selling author who is best known for his Finish Rich Book and the Automatic Millionaire Series of financial books and he has just recently released his 20th Anniversary Edition of his mega-bestseller, Smart Women Finish Rich. David holds an undergraduate degree from the University of Southern California. Throughout David’s career he has appeared on The Today Show, CNBC, Fox Business, Live with Regis and Kelly, The View, Larry King Live and The Oprah Winfrey Show and anywhere on the planet where you’ve seen a TV. David welcome onto the show, how are you?
  2. David, I saw where you were interviewed by CNBC, where you shared how much money you should have saved by a certain point and where you also recommend that all of our listeners would save at least 1 hour per day’s worth of income (minimum). David explain to our listeners why it is so important to start saving 1 hour per day of income regardless of how much money our listeners are earning right now?
    1. MYSTIC STATISTIC – Why half of Americans can’t come up with $400 in an emergency
      1. https://www.usatoday.com/story/money/personalfinance/2017/10/06/why-half-of-americans-cant-come-up-with-400-in-an-emergency/106216294/
  1. FUN FACT: The chart displayed on CNBC Interview:
    1. By the age of 30 you should have 1 x your annual salary saved.
    2. By the age of 35 you should have 2 x your annual salary saved.
    3. By the age of 40 you should have 3 x your annual salary saved.
    4. By the age of 45 you should have 4 x your annual salary saved.
    5. By the age of 50 you should have 6 x your annual salary saved.
    6. By the age of 55 you should have 7 x your annual salary saved.
    7. By the age of 60 you should have 8 x your annual salary saved.
    8. By the age of 67 you should have 10 x your annual salary saved.
    9. https://www.cnbc.com/video/2018/09/20/david-bach-use-this-formula-to-figure-out-how-much-you-should-have-saved-at-every-age.html
  1. David, you once wrote, “The number one financial mistake is not to have your finances on automatic.” what do you mean by this?
  2. David, I saw an interview you did with Marie Forleo where you were quoted as writing, “We need to start with our values because your values can determine how hard you are willing to work to achieve your financial goals, how much money you currently spend and how much money you will actually need for retirement.”  I would love if you could start by walking us through the importance of knowing our values?
    1. MARIE FORLEO & DAVID BACH: HOW TO LIVE AND FINISH RICH
      1. https://www.marieforleo.com/2016/01/david-bach/
  3. David, you once wrote, “Before you pay the government before you pay taxes before you pay your bills before you pay anyone, the first person that gets paid is you.” What do you mean by this, my friend?
  4. David, I’d love for you to share with our listeners about The 7-Day Challenge and the history of the latte factor?
  5. David, my understanding is you are releasing your 20th Anniversary Edition of your mega-bestseller, Smart Women Finish Rich, can you share with us about why this book has been so powerful and practical for women all around the world?
  6. David, “how did a man end up writing a book for women and money?”
  7. David, I understand that you first learned about money from your Grandmother Rose.  Then I understand you were actually teaching classes for women and money back in the early 90’s, I’d for you to share with us about this?
  8. David, in this book you talk about all the “new good news for women and money but also the not so good news”. From your experience, do women really face unique challenges when it comes to money vs. men?
  9. In your mind, how much has changed since you wrote this book originally 20 years ago?
  10. You say one of the biggest mistakes women make is not knowing where all the money is – and delegating their financial lives to their husbands?  Can you talk about that…
  11. You talk in your book about ROR- return on retirement. Can you just briefly share a little about what this means?
  12. David, I’d love if you could share with our listeners about the kind of updates our listeners can expect to find in your updated 20th-anniversary edition of Smart Women Finish Rich?
  13. David, whether you are writing to male or female readers you’ve written, “My core philosophy is to spend less than you make. Don’t waste money on little things.” I’d love for you to expound upon this?
  14. David, I’d love to have you break down your notable quotable where you wrote, “In fact, what determines your wealth is not how much you make but how much you keep of what you make.” David, this concept is so powerful I want to embroider it on my head, please share with our listeners why it is not about how much money you make, but that it truly matters how much money you keep?
  15. David, I’ve heard you say that “People always inflate in their mind how much money they make and they underestimate what they actually spend.” David, why is this such a powerful concept for our listeners to understand?
  16. David, I love your quote from The Automatic Millionaire where you write, “Remember, inspiration unused is merely entertainment. To get new results, you need to take new actions.” David, I would love for you to hammer home the power of what this statement truly means for our listeners?
  17. David you once wrote, “The number one financial mistake is not to have your finances on automatic.” David, in this fast world we live in why is it so important that all of our listeners take the time to slow down and to actually automate the saving of money today?
  18. I love your quote where you wrote, “People who automate their financial life build financial security. If you start at a young enough age, you can become a millionaire. I have spent nine years at Morgan Stanley managing hundreds of millions of dollars for individual investors – what I got to see from first-hand experience is that unless it’s automatic it’s not getting done. What’s automatic, gets done.” Break this nugget of knowledge down for our listeners?
  19. When it comes to car buying you once wrote, “The car industry doesn’t like me for that: bottom line is, you can buy a used car that has been leased or hasn’t been driven a lot. It’s 2009, you buy a 2007 car with low miles, you buy that car for 50 cents on the dollar.” David, talk about why wealthy people tend to drive a car until it quits working as opposed to leasing a new car every few years?
  20. David, you once wrote, “Learning to save is a lot like running a marathon – you need to build up to it by training gradually. It’s too overwhelming to go from saving nothing to saving $2,700 a month, so you need to start slowly and keep it simple.” David, what is the best action step that our listeners can take today to begin getting into the habit of becoming good and consistent savers?
  21. David, you unapologetically once candidly wrote, “The American way: The more we make, the more we spend. And if we’re not careful, the more we owe.” Why is it so important to recognize that this is what Americans do by default?
  22. David, it’s shocking, but in you’ve written, “Did you know the average American family has about $16,000 in credit card debt? That translates to a lot of money wasted on interest payments.” David, talk to our listeners about the dangers of massive credit card debt?
  23. David, you really focus on teaching solid financial fundamentals and you once wrote, “For most of us, debt can be a trap that forces us to work longer than we should have to. What puts us into debt are bad habits such as running up balances on our credit cards and then paying them down slowly, if at all.” David, break down the importance of our listeners committing to pay down their credit card debt?
  24. David, once upon a time you wrote, “Many of the success stories people have shared with me over the years focus on how homeownership has been the key to their financial security. I’m confident these essays will inspire millions of renters to work toward their first home and millions of current homeowners to consider second homes or investment properties as a road to building financial freedom.”  How has homeownership proven to be key to the financial security of so many people?
  25. David, so the vast majority of our listeners are entrepreneurs who need to embrace the profundity of your statement, “The truth about business is that it’s normally very tough. It’s very rare that you will start something and succeed right away and if you do succeed, you might not make a lot of money. Most businesses take at least two to three years to show profits.” David, why is it important that business owners embrace the reality that most businesses do not produce a profit until around year three?
  26. David, our listeners are always curious about the habits and routines of the world’s most successful people and so I would love if you would share with us what the first 4 hours of your typical day looks like?
  27. David, my final question for you is this. You are a best-selling author whose work is respected all over the world, what does your actual process for writing books look like?
  28. What does the area you do all of your writing look like?
  29. Other than your books, what are some books you believe all entrepreneurs should read?
  30. David, you have written multiple best-selling books, but for all of our listeners out there who have women in their lives, why do you believe that Smart Women Finish Rich has resonated with readers so well over the years?
  31. David, I appreciate you for taking the time out your busy and intentionally focused schedule to share with our listeners you words of wisdom. Where can people learn more about you and your books? www.davidbach.com and www.finishrich.com

Post Show

NOTABLE QUOTABLE – “David Bach is the one financial expert to listen to when you’re intimidated by your finances. His powerful and easy-to-use program will show you how to spend, save and invest your money to afford your dreams.” – Tony Robbins

Business Coach | Ask Clay & Z Anything

Audio Transcription

What if you could decide today to become an automatic millionaire simply by changing just a few daily habits, and the good news is you only have to make the decision one time and then you could be 100 percent certain for sure that you would in fact retire as an automatic millionaire. Well, on today’s show, the nine time New York Times bestselling author, Mr David Bach, joins us to teach you his secrets for becoming an automatic millionaire.

Yes, yes, yes and yes. Thrive nation. Ladies and gentlemen, on today’s show, we are interviewing a nine time New York Times best selling author who’s best known for his finish rich book and the automatic millionaire series of financial books. He’s just recently released his 20th anniversary edition of his mega seller, smart women finish rich. David holds an undergraduate degree from the University of Southern California and throughout his career he has appeared on the today show, CNBC, Fox business live with regis and Kelly, the view Larry King, the Oprah Winfrey show, and anywhere on the planet that TV’s are sold. Ladies and gentlemen, David Bach has impacted my life in a profound way with this thing he calls the latte effect. Let’s welcome on. Without any further ado, Mr David Bach. Welcome on, sir. Wow, I love. It was great to be on the show with you. Thank you for. I don’t know, just a totally awesome the production.

I love your energy. David. Years ago, my wife and I, we were getting this book called the automatic millionaire because I don’t do road trips unless I have an audio book and then after if I listened to the audio book and I like it, I buy the physical book, so I picked up the book called the automatic millionaire and at the time I had a company called Dj connection, which I later sold, but before I sold it we were doing 4,000 weddings or corporate events a year and it still exists to Dj connection.com. And you said you challenged me. You said you, Mr Clay Clark, you, Mr. Listener, you, Mr. whoever you are, you have to save at least one hour per day of income regardless of how much money you’re making and at the time I was making a copious amount of money. Can you talk to us about the importance of beginning to save one hour per day of income regardless of how much money we’re making? Yeah,

I mean I would love you because honestly this is what should be taught to you before you get out of like the eighth grade. So let me start by saying this, the average person in America is going to work 90,000 hours. That’s a lot of hours, right? So you know, if you’re, if you’re both working, which many families both work, right? You could have a family that the two of you combined will work over 200,000 hours during your lifetime. So if you just take that math and the ego will, cheese will. So I guess if people are working so hard, then they must all end up with a lot of money, right? Because their trade, your time for money when you go to work. So are they. And that’s really the core issue. They’re not right. So one out of two Americans right now, according to the Federal Reserve, can’t get their hands on $400 in case of emergency purposes.

True. Four hundred, $400. Right? So like, so the follow up book to the automatic millionaire was actually a book called start late, finish rich. And when I wrote start late, finish rich, the thing that blew my mind away with the statistics said that 60 percent to 70 percent of Americans live paycheck to paycheck. So what I started saying to people is, look, here’s the deal. The entire secret to building wealth is that you have to fight for your paycheck and you have to keep the first hour day of your income. And what that means, super simple. As you got to work at 9:00 and you work until five on a typical day, you need to keep whatever you earn the first hour. So from nine to 10, let’s say you make $20 an hour or $50 an hour or $100 an hour, whatever that first hour being committed, it’s got to go straight to you.

And the only legal way to have it go straight to you or it doesn’t go to taxes or social security or state tax. I live in New York City, right? I’ve got federal tax, I’ve got state tax tax, I’ve got social security tax. When I earn a dollar all over forty cents on the dollar has gone before I can ever see it, right? The only way I cannot pay those taxes in the keyword here is it legally is if I take money that first hour day of my income and I put it in a deductible retirement account. So for someone who’s listening that’s got a job, it’s going to be like a 401k plan or if you’re a teacher, it’s going to be a four o three b plan. Or if you’re a government worker, it might be a tsa plan or if you’re self employed like you probably you know you were self employed right when you had this dj connections.

It’s a self employed retirement account. It’s like a Sep Ira account and many entrepreneurs don’t even fund these accounts because they don’t even know about them. So the whole concept of pay yourself first, one hour to have your income is that if you do that, you’re saving 12 and a half percent of your gross income and that’s a really good starting number. Now I gotta be honest. I’m starting to try to get Americans deserve more than that, you know, 15 to 20 percent of your gross income is even better and I taught that in the automatic millionaire, like if you want to get rich faster, it’s 15 to 20 percent, but getting people to focus on one hour, do you have your income? I really do think it’s been a game changer. Like when I wrote, when I put out the automatic millionaire, we launched the book on the Oprah Winfrey show and this is back in 2004 and this idea of getting people to think about it in terms of why would you go to work and not keep the first hour day of your income? I think it was like a light bulb moment for people. Like obviously it reached you write like you remembered it and it got other people to kind of go home and think about that and talk about it with their wife and talk about it with their family and make that a goal. And it’s a great goal.

One thing that uh, uh, and I, I mean this in a positive way, so if you, if you, if you don’t like this complex, do you feel like this is a backhanded compliment? You can feel free to hang up and I’ll know I’ll pick up with a subtle cue, but you are not Yoda, you know, you’re more of a Broda. I mean you are like the way you write, the way you write is like, I feel like it’s my brother from another mother riding on a third grade level that I can understand. You don’t talk and financial jargon, you’re books are very easy to read, easy to understand the real page turners. I mean they’re very easy to read. And I, and one of your books you wrote, you said the number one financial mistake is not to have your finances on automatic. And I wrote that down.

Am I man, journal manager. I wrote down and I wrote down. I go automatic. I mean everything about my company, Dj connection was automatic. Every dj had a checklist for their shows. After the wedding, we sent the brightest survey based on their survey. We determined how much the DJ got paid and so if a DJ got a bad review, he made very little money. If you’ve got a great review and made a lot of money and everything in my life’s automatic checklists, systems, processes, why aren’t my finances automatic? Can you explain to our listeners what it means to have help us help us get our finances on automatic?

Yeah. Well, here’s why needs to be automatic. I mean, I, I learned this by being a financial advisor, working with people in the real world. What I saw is that when someone says, you know, I’m disciplined David, I’m going to write a check. I’ll bring you the money every month to save. Nobody get it right? Like they might, they might do it for two months. The record was six. So what I, what I saw firsthand was the only way people will, will really save money for whatever it is, retirement, buying a home, college savings, wanting to start a new business. The only way people are successful at investing and saving is when they save automatically. And when they had the money moved automatically. So the automatic millionaire was really about simple idea and nothing’s changed because it’s timeless principles. First of all, don’t try to have a budget because budget suck.

Like you know, people who have been told for decades and generations, you need a budget. Nope, it budgets work that everybody would be wealthy. I mean they, they don’t, but you go on a budget, they’re totally and set up. Couples fight over their budgets all the time. What works is saving money automatically. So I taught him the automatic millionaire, throw the budget out. I learned my clients forget to budget. Let’s just make sure you’re taking 10 percent off the top of 20 percent off the top. Let’s move this money automatically. Every time money comes in, let’s move it automatically into the places it needs to go. And that’s Kinda the next part of automation is where does the money need to go? And when you get into real financial planning, if you were to simplify it, which is what I, I lived to do, is make it simple because the problem with money, if people make a new complicated, true. If you were to simplify money, there’s like a handful of things that you need to make automatic. You need your bills made automatic, you need your emergency account and made automatic you. You need your retirement account made automatic and then you need to dream account managers.

Oh yes. David Bach, I want to put this all in the show notes. Will you just. I’m my passive aggressive attempt to book you on the show again. I mean, you are so good. You’re, you’re preaching this automatic, automatic, automatic. Somebody. Others go, I want to make it automatic. What do I do? Why do I do David?

And here’s the thing that’s incredible, was like this used to be so hard. This didn’t use to be easy to do, right? Like 20 years ago, I got in this business in 1993. I think about this for a second. So you know, back in the day if you had come into my office and I was at Morgan Stanley and I wanted to just automated savings account for you, I’d have to have you fill out like six pieces of paperwork. It was a huge process right today when somebody wants to do anything automated. Now with technology, you can literally open up your iphone, go click, click, click, and most financial service companies today are at a point where you can have fun in your financial life in some cases automated in less than 10 minutes. You can open up a savings account in less than 10 minutes online. You can odor, you can have an automated retirement account. What the diversified portfolio in less than 10 minutes like it’s things that have been made really simple and by the way, that simplicity is also making it so that now more and more people are are saving money automatically. There are no a lot of people who are building real wealth because of automated savings

and by the way back in 1993, a lot of our listeners probably couldn’t focus on their finances because they were listening to whoomp. There it is. Oh, now people have the ability to focus. That sun was hot back in 1993. Just a little Dj. Fun factoid for you. I want. I want to ask you this because I know there’s somebody out there who’s a big fan of Marie forleo and I saw you on an interview with her where you were. You were quoted as, as, as, as having written in the past. You wrote, we need to start with our values because your values can determine how hard you’re willing to work to achieve your financial goals, how much money you currently spend and how much money you will actually need for retirement. Could you talk to us about the importance of knowing our financial values? Yeah, absolutely.

Truly. I mean, first of all, love Marie Forleo and I love that you watched that video. It’s a great video and they can. People can go and find that David Bach, Marie forleo on the show notes because that was a great interview and I love her and she’s here in New York City also and we’ve become good friends and you know what I, what I’ve. I’ve known Marie for over 10 years and I think, you know, what I, what I’ve always talked about since the beginning of my career is that all financial planning is personal, but it should be based off your values and if you can look at what’s really most important to you, why do you want money? Instead of just saying like, oh, I want a million dollars. Why? Why do you, what, what, what, what is it that you want? Why do you want money? Well, she doesn’t want to be financially free.

Well, what does that mean to you? You know, I’d like to go start a new business or I’d like to take my family to y or I, you know, I want to make sure that my, I have security. Um, I want to be able to give back to my community. If you can drill down deeper into what your values are. And I teach in some of my first books like smart women finish rich, um, which we just put out as a 20 year anniversary edition. That was my first book, smart women finish rich starts by having you look at what your values are and once you’re clear on your values, you make your financial goals based off of those and then you do your financial planning around

quick confession real quick because this is. This might get weird jump. This might be weird for the listeners out there and sometimes it does. I mean that’s. I’m sorry. I know we’re just meeting each other. I feel like I’ve known you forever because I’ve listened to every interview you’ve ever done. Here’s the deal. I actually read smart women finish rich in preparation for today’s show and we had the 20th anniversary and it was like it was. It wasn’t, you know, it wasn’t super woo woo. I mean you didn’t tell me. Clay, make sure you get estrogen injections. I mean, it wasn’t super weird, but the thing is there’s so many women in my, in my case and my family, my wife and I, we were, we have five kids and we worked together on everything. We work together on every business and I’m offense, my wife’s defense and the service we offer, or the product we offer for the company is, uh, the, the, the special teams on the offense.

I do the marketing, the advertising, that kind of sales and my wife does the accounting, the financial planning, and when I picked up the book, that’s what my wife does. Vanessa does the financial planning for our family and I think there’s a lot of women out there who have their head down and they assume that their husband is doing the financial plan. They assume that they’re doing something, they go through a divorce, they go through a medical issue, their husband passes away, something terrible happens, and then they discover that their husband has not been actually saving money. Can you talk to the ladies out there? All the single ladies, all the married ladies, all the sophisticated mamas out there who are finding themselves totally unaware of what’s going on financially and why they should pick up smart women finish rich.

Yeah. Well, I’m absolutely so smart. Women finish rich was the first book that I wrote and whether you read it, because I, I give that book to a lot of my guy friends back when I wrote it. Very helpful. I think the thing for women to know is this, if you’re in a marriage right now and you have a good marriage, that’s great, but what you need to know is you’re going to outlive your husband. Oh, so, so, so, so, but now I’m going to, I’m going to like cut to the chase here because there’s really three core issues that women face. In most cases, women outlive their husbands. Eighty percent of women die, widowed and 80 percent of men die. Married. So the average age of widowhood when I wrote the book originally was 56. Today it’s, it’s, it’s gone up, it’s 59. That’s still, that’s still really young.

And, and for you know, the family in and that people will. How is that possible? Well, because women tend to marry men that are older men pass away first. So the first thing you need to know is I always tell her this, I don’t care if it’s a local bank president, some at some point, there’s a very good chance you’ll be the one in charge of the money, the time to be in charge of not just paying the bills, but knowing where all the money is is today. So knowing where’s the will, where the life insurance, do we have life insurance? Where are the retirement accounts? Are we putting enough away in our retirement accounts? Are the beneficiaries up to date? Um, you know, where’s the college savings plan? All these things. There’s like 17 things I list in the book that there’s like a little, what I call the finish rich quiz.

And you go through all these questions to take a look at it. Like, what do you know or what don’t you know, since you can get on track with it. But the thing women need to know is you’re going to be in charge of the money at some point. So the best time to be in charge of Mondays. Now, second thing to know is you’re going to live longer in retirement than most men do. Women are often retired, five, 10, 15, 20 some cases 30 years longer than their husbands. So you need more money set aside for retirement. And the third thing you need to know is that a lot of women are earning less than men, which women know this, but the reasons wire. Our, our haven’t changed a lot over 20 years. One is, first of all, they’re not paid in many cases, but then they’re also taking.

They take time off from work to be full to be full time moms, which is a full time job and on average women take somewhere between seven to 11 years off from work and prime earning years. So when they have children, and you know, I don’t know, I don’t like your wife, didn’t just, but when a lot of women have children, that’s becomes their fulltime job and therefore they’re walking away from work or they’re having to leave work because of their situation in their prime earning years, which impacts their income and impacts how much money they have in savings and savings. It’s insole security and it’s in pension plans and women have less money and social security and pension plans. So what smart women finish rich was all about was empowering women to wake up to what it is you specifically need to do to fix this.

What’s called a retirement gap. How do you protect yourself? As a woman? And My, my mission, my mantra for 20 some years has been, I don’t care if you’re a woman, I don’t care if you’re married, single, widowed, divorced. You have to be the one in charge of your financial life. And you know, I learned about money from my grandmother, Rose Bach. She was a woman who started with nothing with auto college education. She became a self made millionaire. She was broken 30, she learned how to do this and you pass the lessons for and she taught my father how to do it myself, my sister, and really when I started teaching seminars for women and money back in 1994, it wasn’t an effort to basically pass along these lessons from my grandmother because I had seen so many women hurt through widowhood and divorce financially and I just wanted to do something about it.

And you know, the crazy thing is here until you’re 24 years later, I smart women finish rich and sold a million copies. It’s one of those popular books for women in mind. It’s ever been out and when I’m psyched that you just read it because when I went to go update it, you know, the message was timeless. I just had to update things like the tax rules and the different retirement accounts are available and the different financial service companies. But the message is timely is timeless and it’s timely. So I think more women today are waking up to, you know, the waking up to the fact that you want to be in charge of your life, be in charge of your money.

David Bach, just for the listeners out there who will listen to our show regularly, I want to, I want to share this with you. Um, when I was building dj connection, my wife and I, we got married. We were 20 years old. You, we’re 20 years old. We started our company. We didn’t. Everyone kept saying when’s the baby due? We were pregnant. We just got married early. We went to oral Roberts University in Tulsa, Oklahoma. We started DJ connection. We decided, you know what, we want to have five kids. We want to be married for a few years. And so we ended up having, were married about four years and then we had five kids under the age of seven. Boom, boom, boom. And then twins at one time, boom. And so my wife did peace out. She did leave. She did exit the daily operations of the company, but every week she would look at our finances and she would say, baby, are you saving some money?

And I would say, because I’m the spender in the family, David, go baby, I just want to buy a little bit opinion would just a little bit of a nice limestone rocks for my backyard. I just want. I’m the guy who always wants to buy one more accoutrement, one more piece of decor. You know what I mean? I’m the guy who likes to buy speakers, new microphones. I’m kind of an audio file, but my wife would always rein it in and say, this is how much you can spend this week. And when, when she first started presenting this to me about your two of our marriage, I thought she hates me, she hates me. I thought that because my wife would tell me, you have definitely exceeded your $1,000 per week discretionary spending budget or whatever, and so next you can spend 200. And I’m like, Oh, you’re unbelievable. Why? Why do you hate my dreams? But I think there’s somebody out there in the family talk to the couples out there. Maybe the husband’s, the one is locking down the, you know, locking down the automatic savings. Maybe it’s the wife who’s doing it. Can you talk about why the person who’s being financially prudent and who sets up the. The automatic millionaire process is not actually the enemy, but they’re actually the hero.

Well, let me ask you, because this happened to you. I’m glad she did this.

Yes, yes. But I was so pissed. I thought she hated me every week that it was happening the next week.

So let’s talk about you because you’re living a living, breathing example of this. When did you turn the corner and realized, you know what, actually this is a pretty good idea. I’m glad we did this.

A little kid fashion. I know you’re not a priest, but you could be the financial coaching priest for people out there. I’ve been married 17 years. I’m 37 and I think when I turned 27, I finally said, thank you because I’m a horrible person.

It’s interesting, right? Because it’s seven years. So I think what it is is that here’s the truth about saving and investing in doing these things really, right. You don’t notice the impact, the positive impact always right away. You might notice the pain at first, right? Like, oh, I don’t have the money. I’m not being allowed to go up. Like my grandmother, my grandmother box, she realized at 30 she was broke, living paycheck to paycheck and was never going to be able to get ahead unless she changes things in her life. And so she started saving fifty cents a week, fifty cents out of her paycheck, fifty cents out of my grandfather’s paycheck. In order to do that, she had to go. She worked at gimbels department store, Milwaukee, Wisconsin, and she had to brown bag her lunch and when she went to gimbels with her brown bag of lunch and her girlfriends would go out to lunch, they would tease her and be like, Oh rose, you’re so cheap.

And she’d say, you know what? I’ve made a decision. I’m going to start saving money because I want to have. I want to retire down to the beach at some point and they laughed at her. Well, you know, later on in life she wasn’t spending the winters in Waukesha, Wisconsin, where it’s freezing. She was at the beach and Laguna Beach, California. And you know, putting that took four if that took like four decades. Right. So where I go back to for you is like seven years, right? Like, it makes sense to me that you say, well, the seven years I started going, wow, you know, this is pretty good because what happens is over time that you know, you wait for some people if they’re in debt, but they got two, three years later, all of a sudden they’re, they’re out in debt. If you, if you’re automatically paying your debt down early and I teach you in the automatic millionaire book how to do that, but all of a sudden your debt’s gone or all the sudden you’re like, wow, you know, I never had any emergency money set aside and now I do.

Or you turn around seven years later and this is what happens. I get people stopping me on the street and in the airports and sending me emails. Seven years later you turn around and I get people come up to me like David Bach, I have. I have $100,000 in savings now, or I have a quarter of a million dollars now, or I’ve got somebody just put on Amazon the other day that, you know, the latte factor they found they now own three homes and they were a renter. Well, they didn’t go from stopping drinking coffee to own three homes in 30 days. What happened was they read the automatic millionaire in 2004 and we’re sitting here in 2018, and so over 14 years of doing all this, their whole life is completely different. So what I would say to somebody, you know back to your question, is that if someone’s like really trying to get your financial act together, instead of fighting it, go with it, go with it.

Because here’s the thing you’re going to get. You’re going to be older, right? You’re going to blink. Your eyes and 10 years are going to go by and you’re either going to be 10 years old or older and still broke or you could be 10 years older and in much better financial shape. And uh, you know, one of my things in the book I say is that, um, what else is in built in debt? And Dave, it’s built in decades and most people who are a lot of times I, you know, you’re in the podcast world, right? People so often. It’s all about this whole get rich quick scheme. Like I got, I got this thing for you and this is an opportunity and you know, I don’t know anybody who’s, who’s gotten rich quick. Well I know a whole lot of people who spent their whole life trying to get rich quick and they just, they stay broke. Fast danger to get rich quick. Actually, if you look at the math there and takes so much longer. And the weird thing is like, you know, the, the, the compound interest charts that you see in these books where they show you like, Hey, if you save $5 a day or $10 a day and you invested it, it could be worth hundreds of thousands of dollars or it could be worth millions. It all comes true.

I’ll work. I knew this would happen because I have like 31 questions prepared for you. I’ve probably gone through seven of them so far. And you are like the world’s number one financial coach. If I had to give an elevator pitch, David Bach, world’s number one financial coach, and really listen to the show, they go. Clay’s not that smart. He took Algebra three times and his act three times, but he’s kind of funny. So we listened. So I want to break down three notable quotables and then I want to tell people about the most current project you’re working on. And I want to allow time for you to share with the listeners your most recent project and why they should check it out here. You have said in the past that people basically inflate in their mind how much money they actually make an under me and they almost universally underestimate what they actually spend. What do you mean by this? All

the time. So if someone here with a buddy and your body’s like, yeah, I’m making 100 grand, 100 grand a year, and then you open up the tax return. It’s like, because is the thing about being a financial advisor? You actually get to see the truth, right? So someone says to you, I make 100 grand a year, boom, and then you open it up and you really look at the tax insurance. No, they don’t. They make $85,000. They rounded it up, right? Nobody says, oh, I make $83,000 a year. They’ll go and make 85 or 90 people round up what they make. They tell other people and they tell themselves, I’m actually making. So someone’s making 85, they’ll still say to people that are making 100. Okay, that’s number one. Number two is that then people, when you tell, ask people, how much do you spend, because I always would do this with you, how much do you think you spend a month? Very little at all. I absolutely always

very conservative. I’d never always spent. I’m huge.

They give you their number right now I’m spending, I think you know, we probably and people sort of know, right? They go ahead and think we’re spending, let’s say $7,000 a month. I’m just giving you around them around them. Number. Okay. And then again, I’ll go into the math and if they said they’re spending $7,000 a month, once I go into the real numbers, they’re not. They’re usually spending eight or $9,000 a month. It’s always more so what happens is it’s just if it’s just off by 10 percent of a person inflates in their mind what they’re making by 10 percent and then they spend 10 percent more than they think they are. There’s a 20 percent difference. Twenty percent difference there. Right? But this is why people go, I don’t understand what’s wrong with me. I’m working so hard and I’m making good money and I’m still broke. One of the things is often wrong for people is that they’re not telling them the truth to themselves about what they really make. And here’s the other thing I’ll say there. People take their gross number, right? So I make $100,000 a year. Well, no you don’t. After taxes you made 55,000.

I moved to that via. I have expatriate of my money. I don’t want to pay taxes. I am in trouble with the irs right now, but okay, you’re right.

So I mean, that’s, that’s, that’s one right there. And I think, um, you know, mom is funny because you made the point about Algebra and geometry. By the way, I hated those classes. I always tell people now the good thing about money is it’s super basic math and like if, if you can take a 10 number 10 and subtract one and realize it’s nine, you know, all you need to know, need to know about money not to make $10 and you save a buck. You’re in pretty decent shape. Much better than most people. And they go what? Like, yeah, that’s a good place to start. You make 100 bucks, you save $10. Can you figure that out? Yeah. Okay. Then. Good start there.

You know, I want to respect your time and I want to ask you two more questions here. The American way, the more we make, the more we spend and if we’re not careful, the more we. Oh, who said that? David Bach, you said the American way. The more we make, the more we spend and if we’re not careful, the more we. Oh, I circled that. I highlighted that. I wrote that down. I thought about embroidering it on my face. I thought that might be kind of intense, but I decided not to, but I mean, talk to me about that, the American way. Why is it so screwed up by default?

Well, I mean we, we created the concept of a consumer society, right? So the American dream is to have a lot of stuff and it’s never been easier to market to us to have more stuff. Right. So you’re on your phone and now and it’s an instagram ad, click, click, click, buy something, boom. It’s never been easier to spend money than it is today. It literally, it’s never been easier. You can just click and buy. And so everything around us, we’re used to be, we’re bombarded by tens of thousands of messages a year and now we’re bombarded by hundreds of thousands if not millions of messages a year to spend more money. And I, you know, I went on this tirade the other day on, um, where was, I think it was CNBC or might’ve been, yeah, I can track, have done so many interviews lately, but it was at a tirade about the insanity of buying new cars every three years.

And the American way, the American system, the American marketing machine has us programmed to buy new cars every three years and has this program that if we come into any money, we should buy a new car. Has this program that if you get a tax refund is time for a new car. And so Americans go out and they buy new cars and they borrow the money and there’s just, there’s no worst place to put your money than into a brand new car. And yet there’s a one point $5,000,000,000,000 in car loans. We have more money in car loans and credit card loans and student loans and a lot of those loans, like people, they just keep going out and you buy a new car, you buy a $50,000 new car and you’ve been focused on the monthly payment because that’s how they marketed to you.

And you drive that car off the lot and that car has gone down in value by 10, $15,000 a moment. You drive it off the lot. You borrowed money to buy an asset that immediately goes down in value. It’s not an asset liability. So w, the, the whole key to really building wealth and America is this. You can either be somebody who spends money or you can be. And you can be the consumer where you can be somebody who owns things. Owners get rich, right? So like you can go to starbucks and have a coffee and spend five bucks or if you’re going to not give that up, then at least own starbucks stock. Right? Because if you did, you could imagine

to quote Kanye West, he had a meeting. We’re here with Mr Donald Trump and they shared their dragon energy together and Mr a Kanye West. He said it’s important for us to own lands and not brands. I missed that part of the interview. Yeah, you gotTa Watch you gotTa Watch it. The fifth time I heard about the superman hat, I was like, I didn’t know when you watched it the fifth time. If you stare at the picture long enough, you will find the notable quotable. I want to ask you this here. Um, you said one of your, one of your books, and again I’ve got highlights everywhere and I add it into a big doc that I look at. It says, the truth about business is that it’s normally very tough. It’s very rare that you will start something and succeed right away. And if you do succeed, you might not make a lot of money. Most businesses take at least two or three years to show profits and my mind, you are America’s number one financial coach. Why did you say that?

Well, I mean it’s the truth, right? Most, you know, a lot of entrepreneurs that make money their first couple years. I mean, I know entrepreneurs have been in business, unfortunately five, six, seven, eight years and they still haven’t made any money. You know, they went there hoping is that the, as their top line grows, they’re going to turn around and sell the business and that’s where their money’s going to come from. Right? In fact, the entrepreneur fantasy is I’m going to build a business and I’m going sell it, and then that’s how I’ll have money to retire. And today with all these billion dollar Unicorn businesses, you know, it seems like it’s easy, but that’s the small, small percentage. In fact, most businesses don’t do a million dollars a year in revenue. I think it’s less than five percent of businesses do more than a meal. I’m might have that wrong.

I’m don’t tell chuck whether it’s like less than five percent of businesses do over a million dollars a year in revenue. I was in a group called Entrepreneur’s organization for like 16, 17 years. Yup. It’s one of the leading entrepreneurial organizations and you had to do a million dollars in revenue to be in the organization. You have to be the founder of the company and that was like that line in the sand that you had to do a million dollars or more weeds out. Most entrepreneurs, so most entrepreneurs don’t have big businesses and many entrepreneurs, you know, they’re constantly putting their money back in the business to grow and they’re not taking money out for themselves or what they’ve been trained to do by their accountants is run all their expenses through their business and when they do that, they get to the end of the year and then they have no profit and then if they have no profit, what it really means is they actually don’t have any money. And do you like that sound you just made? I’ll do that from stage in front of entrepreneurs. We’re all on diagram. What that looks like, I’ll literally do the math and they told you to run all these expenses through and now you’ve got the end of the year and you’re a zero and they go through these, Greg, you pay no taxes and then I go, so where’s your money?

Oh, the thing is, you know, there’s a sound effect that really typifies it, explains what you just said. That’s how we, that’s how we feel. A lot of accountants are coaching us to be poor, but you’re coaching your clients, your listeners, your nation to be successful. And I would like for you to share with the listeners what is the most recent project you’re working on right now because I’m an absolute homer for you. And not because I’m delusional, not because I’m delirious, but because I’m serious about success and you have blessed me profoundly and I only paid you in my lifetime. 80 dollars that I know of. There’s four of her books because I’m a bad person. I, I need to pay you more. And you know, really

if you bought about eight over the books, it means that I’ve made about probably 2:50 in royalties, right?

I’m going to set up a pay pal. Go Fund me account for you. We’ll see if we can support David Bach, America’s number one financial coach. Seriously, you’ve helped me so much brother. I mean, and I just want the listeners to know what you’re working on right now because they need to go check it out. Hey, super

grateful to you. It’s been really fun and I would love you to show the again. So this was a blast. I enjoyed it. First of all, come visit me over on my website. Go to David [inaudible] dot com and you can join our newsletter, which is free. And I bought every two weeks I send out, you know, ideas and tidbits that can help you live and finish rich for the rest of your life. Um, so that’s David Bach dot com. The new book is smart women finish rich just came out about two weeks ago in stores now. It’s updated 20th anniversary edition. We also brought an updated edition of smart couples finish rich, that’s a brand new updated book and it’s in stores now. It’s all on my website. Automatic millionaire has been updated, so three of my books we’ve updated in the last 18 months. All brand new available for you.

Also. I’m I just from an entrepreneur standpoint, I’m a co founder of a financial service company. The name of it is a wealth management and we have financial advisors all over the country and so that’s been my entrepreneur passion project the last three years. We’re the second fastest growing Ria in America according to investment news and we’re really growing fast and having a ton of fun doing that. Help and retirees all across America. And then the last thing is I am working on finishing my next book which I’ll come back and talk to you about which is coming out May 7th, 19. Yes. It is called the latte factor and it is a parable. It’s like a who moved my cheese for personal finance. That for written for people who probably normally would never read a financial book. I’ve put my best wisdom, simple nuggets into a little story that you can read in like less than an hour, and hopefully that’s a book that my dream is. It will translate all over the world and we’ll spread the message of these simple ideas that pay yourself first, find your latte factor, saved money automatically, but will spread it in a way that, especially young people will begin to realize that you don’t need to be rich to live rich. That’s really my next big.

She want to sneak in a bonus question that you can hang up here. Yeah. Why? Because you are so successful. You’ve been a nine times New York Times bestselling author. You’ve been on Oprah, even on the view, and by the way, you didn’t go on Oprah to confess something. I’d be going to open a second time because you have a new book the second time to confess. You’ve been on regis and Kelly. You’ve been on Larry King. Go ahead, Carla. You’ve been on the today show, CNBC, Fox business. I mean you are the WHO’s who. You are, the financial coach for America. Why are you so passionate about helping the listener listening right now, not the listeners, but the specific person listening right now, why do you care so much about their financial future?

It’s such a good question and I got to. I’ll be like totally open and honest with you at this very moment because I’m at a point in which there’s been a long. Dad had a computer crash and I’ve had like four interviews and then I’ve rewritten the copy. The actual copy that’s going to go on Amazon for this new book. The latte factor. We’ve been rewriting the copy for three weeks. Hopefully this is not your worst interview of the day and funding as I’m as I’m, as I basically looked at this document, you know, 45 minutes ago before I got on this interview, you and I thought to myself, why am I still torturing myself with this work like, and, and the answer the answer is, well, I don’t know what the. It’s like a disease, right? Like I just deeply still care about what I teach.

I love talking to people like you before we did the interview and finding out I wrote a little book and that message somehow reached you and it helped change your life and I still absolutely positively love that, that feeling that I get from knowing that I’m making an impact with my life and for whatever reason I think God put me here with this gift. This is like my gift. And I keep saying to God like, am I supposed to keep doing this? And, and, and here’s the funny thing like the Latte, like I just watched his interview with Tim Ferriss and I remember when Tim Ferriss reached out to me before he put out his first book and I was watching this interview with Tim Ferriss and he was talking about, you know, how does he choose to things he works on? And he said, you know, when I go to bed and I kind of thinking about something and I wake up and I’m still thinking about a lot of times I know that’s something I have to get.

I have to work on and I’ll take the latte factor as an example. This book I’m working on finishing right now, I’ve had that voice in me for 14 years in 2004. I wanted to do that book after the automatic millionaire and for 10 years I do random house was my publisher. I would bring it up every year I want to do this book and they’d go down and I’ll do a different book. Right? And so finally I said, you know what? I’m going to go write this book and then I’m going to go sell it to someone else. They don’t want to buy it. And literally like this book I went out, first time I wrote the book, designed it exactly how I want it, and it’s going to come out with Simon and Schuster and so, you know, 14 years there was that voice inside of me that just said, you have to go do this book.

You have to get this message out. And I don’t think I’m unique in that way. Right? That’s the way entrepreneurs are. There’s always something know, I think when you were called to do something, it’s your, you know, your call from a higher power. I’m Paulo Coelho, calls it your personal legend and you know, I love to read. If you haven’t read the alchemist, everybody should go read the alchemist. It’s like the greatest book ever show. Alchemists. Yeah, the alchemist. Paulo Coelho and um, yeah, I went out and met with Paulo Coelho in Geneva because he’s like my idol, uh, in terms of authors. He’s sold like $150 million books and his stories of translated all over the world and we were out having dinner and then we were out having a lot of drinks and I think it was around two in the morning and Paulo turned to me and said, what, what, what is the book that you haven’t written that you need to write? And I started telling him about the latte factor. I go, Paulo, I want to write this book that will translate all over the world and spread this message to more people. And he looks at me and he goes, well then David, you must write that book.

So that was 2012. So you know, it’s gonna come out, it’s going to come out in May seventh, 2019. So I have a Bible verse I want to give you that you’d probably don’t want from me because I’m certainly not a biblical prophet, but

Colossians three, 23, 24 to me explains the career of David Bach. Whatever you do, work at it with all your heart as working for the Lord, not for human masters. Since you know that you will receive an inheritance from the Lord as a reward. It is the Lord Christ you are serving David. Thank you for serving. Thank you for helping. I appreciate you so much. And we’d like to end the show with the boom which stands for big, overwhelming, optimistic momentum. And so we’d like to count it down. Are you ready to cut it down? Let’s do it. David, are you ready to bring to bring the boom here? Yeah. Here we go. Here we go. Three, two, one.

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