The 7 Pillars of Wealth

Transcript

Chris Rodwell: Hello. Welcome to episode seven of WealthTalk. My name's Christian Rodwell, the membership director for WealthBuilders, and joined by Kevin Whelan, the founder. How are you today, Kevin? 

Kevin Whelan: I'm great today. I'm looking forward to today's episode.

Chris Rodwell: Yes, and before we get stuck into today, let's just quickly recap on what we talked about in episode six, which was wealth dynamics and finding your personal flow. We shared a link in the show notes to go and take that assessment. So if you haven't listened to the episode, please do check that out. Really, really important and it's leads on nicely because once you've found your personal flow, then it's about really getting into the meat of what WealthBuilders is all about, which is the flow of wealth.

Kevin Whelan: The flow of wealth, so the flow of cash and the flow of capital.

Chris Rodwell: And how can this be done, Kevin? There's seven ways. Seven pillars as you like to refer.

Kevin Whelan: Yeah. If you just try and take stock of where we got to, I think, we've had a really good job of describing the foundation. And that foundation is that combination of financial foundation ... We talked about the debits.

Chris Rodwell: That was episode four.

Kevin Whelan: Episode four, yeah. And we also talked about mindset, which was just the recent one we did, and the difference between being an employee mindset and entrepreneur mindset. So they're the foundation elements there. Later on, we're going to talk about the roof. So we're imagining a building here, a foundation and a roof. The roof is going to be the area where we talk about getting your finances watertight, so in the sense that when we're going to talk about protecting wealth.

But the real exciting bit is neither in the creation stage or the protecting stage in the building stage because the building is when everything starts to take shape and it starts to look fantastic, and the money flows and the capital flows. The great news about this, Chris, is there are only seven ways to do it. There are no more ways to do this, believe me. I have tried hundreds of times and I've made offers to anybody out there. If you can find me an eighth asset that you can use to build your wealth ... and that means I really should remind our listeners about the definition of an asset. But if you're out there and you can find me number eight, I'll send you a case of champagne and I'll give you a credit in the next book because they'll force me to rewrite it, won't they?

Chris Rodwell: That's right.

Kevin Whelan: So shall I do the reminder?

Chris Rodwell: [crosstalk 00:02:44] that definition, yeah.

Kevin Whelan: This is not an accountant's definition, so those of you who are [steel 00:02:50] in your mindset, the wealth dynamic steel, who like the technical definitions, this is not a technical definition. This is my definition. So an asset, Chris, is something you own that is not you. It's an asset that's a thing that creates cash and puts money into your bank while you're asleep. So it happens automatically. You can pass that money on to good causes, people you care about. In other words, it's there for you to control. You do not have to be there for the money to keep flowing. So the money shows up; you don't have to show up. That's my language generally.

And what's interesting about that is as there are only seven, you can really learn it and you can apply it. And while we've done a video on the seven assets ... which was can direct people to in the show notes?

Chris Rodwell: Yeah, they're all accessible for free within the WealthBuilders membership area, so we'll link again in the show notes.

Kevin Whelan: Okay. So we need to give something different here, right? So maybe if we're going to be talking about the assets, we could see what people generally ... where they do it wrong maybe?

Chris Rodwell: Some of the biggest mistakes maybe, the most common mistakes.

Kevin Whelan: Oh, okay. Okay. So let's imagine then for the sake of our listeners because we know you could be doing this while you're running, [but you should 00:04:09] do this safely or in your car, but just imagine a square. And we've got three lines going to the right of the page and four lines going to the left. So we're going to talk about seven assets.

The three to the right, I call the parked pillars. The pillars of why most people, why 95% of the population simply do not make it to a place of financial independence is because their life is parked. Their money is parked and it's parked in three assets. Asset number one is their home. Now, let's be clear. I am not saying your home is an asset because your home generally for most people doesn't put money in your bank account while you're asleep, Chris.

Chris Rodwell: No, it costs money to maintain a home.

Kevin Whelan: It takes money out. 

Chris Rodwell: You're right.

Kevin Whelan: So, Kevin, what are you saying to me? A property is an asset. Well, I need to make another definition here, Chris. There's the difference between an asset that generates flows of cash or capital and a latent asset, which could do if you apply a different strategy. Something that's got the power within it. Like a seed, it's got the capacity to grow. But you could kill that germination by doing the wrong things. Get the picture?

Chris Rodwell: Mm-hmm (affirmative).

Kevin Whelan: So in a home, then, most people just live in their home. The biggest mistake I see made is they only crystallize any value when they downsize, and guess when that tends to come in their life?

Chris Rodwell: Pretty much towards the latter years.

Kevin Whelan: Towards the latter years, right. So they tend to be in their late 50s or 60s when they realize, "Oh, dear. The amount of money that I've got coming in from my assets is not going to be able to support me and my family" - usually husband and wife, kids have long gone by then - "for the rest of our life." So they downsize and they overestimate so significantly the value of the downsize that they tend to get to a place where they think, "Oh, my house is worth a few quid." Hope you're not selling it when Brexit occurs by the way. But they sell their house.

Let's say someone sells their house and they bank £300,000, and they move to somewhere else as they want to live somewhere. And they move to a smaller property let's say but with no mortgage, which is great, so they've got some security there. But they've then banked £300,000. But because they've invested no time in their wealth dynamic, they've invested no time in the building of the skill to create and master the art of building wealth in seven pillars, they've only stuck with the one they had, what do you think their appetite for risk is or their willingness to get involved and start acting like an entrepreneur when they haven't done so at any point in their life up until then?

Chris Rodwell: Very unlikely. That's money is probably sitting in the bank earning diddly-squat.

Kevin Whelan: Okay, that's a technical term, right? So earning very little. If we put a number of that diddly-squat and call it diddly-one, so they're getting 1% on their money, and now they've moved house. They've incurred a bunch of costs, upheaval. They've made £300,000. They've put that money in the bank because they want to support themselves, and it generates 1% - £3,000 a year, £250 a month taxable. How's that going to change their life? It just really doesn't, but they think it will; and that's the huge, huge mistake.

The second mistake I think I see people make in property is they can see often that if they own a property for a long period of time, the bricks and mortar are building value. But they're only building the value as in the increase in value. It's not generating any cash for them. So what it's often possible to do - and while we must always be cautious about how we do this - is you can tap into that value of bricks and mortar and use that as a source of leverage to then create assets that are worth more in terms of a return than the cost of borrowing the money from the asset.

So if I can borrow the money at, say, 2% or 3% and let's just say scientifically ... We're not saying what people should do. They could invest that money in a portfolio of property or in a business or in some other asset that suits their wealth dynamic and they're getting, say, 6% on that. They're doubling their wealth and learning something and creating some value from that. So I see most people just making that huge mistake in not really understanding the difference between good leverage and bad leverage and also significantly overvaluing and leaving too late the issue to downsize.

Mind you, one of the things I've noticed in recent years - and some of our own mentees have done this, Chris - is they've started to use their home in an Airbnb capacity.

Chris Rodwell: Absolutely.

Kevin Whelan: And we see many of our students who will go on to create annexes and create additional ways they can generate income from their property while they're living in it. I don't mean surrounding themselves with an army of tenants or students but just creating where it's possible and where it's right for them the ability to use their home and the capacity within their home to create an income stream.

Chris Rodwell: I've had some experience with that. When I was finishing off my book at the end of last year, I went down to Dorset for a week and the family there had built what they called a snug out in the back garden looking out over the fields with the sheep walking by. But again, making use of some of that space in the big garden that they had, renting that out, and there's an income stream.

Kevin Whelan: Yeah. And, of course, that ties in also if you remember the exercise we did on the freedoms, your choice to have freedom of location, and we talked about one of our WealthBuilders members as well who took her business and basically lived in Cape Town but rented her property out while she was going through that process. So it's possible to create a lifestyle if you can get your wealth in the right place where you can genuinely use your home as a source of income in many, many ways, not just the ones I've mentioned.

Chris Rodwell: That's very interesting.

Kevin Whelan: Does that help for number one?

Chris Rodwell: Yes, it does.

Kevin Whelan: Most people don't do that. So consequently, they don't generate really significant income. Certainly today, if someone's 40 today, their home is generating zero today. So from a wealth building perspective now, they're definitely out of flow.

Chris Rodwell: Mm-hmm (affirmative).

Kevin Whelan: How about number two?

Chris Rodwell: Yeah. What's asset number two, Kevin?

Kevin Whelan: Asset number two is the most undervalued, overlooked asset of all, Chris, and it's the word that most people start to shrink away from and go, "Oh, no," all gray and dreary. It's that pension word. And the pension is the biggest part in the UK where people rely on putting their money in order to create their future retirement wealth and the big mistakes there ... whoa-ho-ho. The big one there is they simply ignore it.

Chris Rodwell: Well, they feel so disconnected.

Kevin Whelan: Yeah.

Chris Rodwell: One statement a year.

Kevin Whelan: One statement a year and then they get the statement, they read it, they file it and they hope that the next six months, the statement is going to be bigger. But they  absolutely have no control whatsoever. And because they have no control and they feel that level of disconnect, they just drift on the ebb and flow of the market because almost all pensions are invested in the stock market, and that certainly makes the pensions industry very wealthy but doesn't do very much long term for the wealth of clients.

When you think about the fact that whenever you have ... We talked about debits. You remember debits? We talked about costs and trying to-

Chris Rodwell: Yeah, that was episode four.

Kevin Whelan: We're talking a lot about episode four. We're looking to try and help people create money where money simply is underperforming. One of the areas that's overlooked is the fees and charges that are levied in pensions almost always are opaque. They're not really truly disclosed. So if something's not disclosed and it's not in your view, you're less likely to challenge it. If I've got a utility bill, how easy is it for me to go switch that? Whichever company you would care to use, you could just go and do that. Can you do that with your pension? Can you just go switch? It's not really that easy. It's more complex or it feels harder. So we spend a lot of our time particularly with entrepreneurs, Chris, educating them to take control of that. And when they take control of their pension through a special kind of vehicle that we refer to as the director's pension because you have to be an entrepreneur to have one, but more technically the SSAS, the Small Self-Administered Scheme-

Chris Rodwell: That's S-S-A-S.

Kevin Whelan: S-S-A-S. Not the S-A-S, Chris. But you have enormous control. It's what some people call the best-kept financial secret. It's just that ability to take control and drive the return to whichever asset you want. Because if you're the owner of your own pension, then nobody's telling you where to park it. You can make that money work by using it in the entrepreneurial pillars, which is on the other side of our box. And we're not there yet.

So we have to deal with number three, Chris.

Chris Rodwell: Oh, we do. And I know what that one is.

Kevin Whelan: Oh, you do, right?

Chris Rodwell: Yeah, okay, that's investments, isn't it?

Kevin Whelan: That's investments. What I mean by investments is money parked in a different place, usually in cash, and that is in two different ways. We see big mistakes in cash. One is people park their money in cash. Now, we know everybody needs an emergency fund and that's fine, but having large amounts of money in the bank is not really a good idea.

Chris Rodwell: There's no flow.

Kevin Whelan: Well, there is, but the flow is to the bank because the bank-

Chris Rodwell: They're using that money.

Kevin Whelan: They're using the money. So they get wealthy, the individual clients don't. But if they're nervous, I understand the reason why the money's in the bank. 

But the other big area where money's in the bank, which it shouldn't be, at least it could be worked, is business owners themselves often. You know, those ones who get caught up and they're wearing all the hats, and they've got decent accounts in their business; but they just don't want to pay the tax on the profit they've paid, the corporation tax on it. And we're seeing business owners now stockpiling cash in their businesses and not necessarily using it inside the business, and there's many ways that that money, too, can be used to invest in ... Well, I'll cover what you can do with those later in the podcast, but definitely put that money to work at often 4%, 5%, 6%, 7%, 8% - so several hundred times the return that you would be getting just leaving the money in cash.

But it's not the cash that worries me. Yes, it's important to make cash work if you don't need it for emergencies. But the big one for me is the risk that people are taking when they tell me that the money they've got in their investments and their [ICEs 00:16:02] and their stock market investments is their financial safety net.

Chris Rodwell: Let's rewind back to 2008, and if you were coming to retirement then, for example ... And as you say, everything's connected to the market. So the property market, 30% or so in some areas the stock market massively dropped and then the pensions in the stock market as well. 

Kevin Whelan: Well, of course. So you get a double whammy. Your pension goes down and your investments go down.

The safety net people often refer to is really quite naïve in the sense that when you look at the stock market - and again just a visualization, Chris, here - is that stock markets tend to rise slowly, almost like walking up a hill, and then they fall quickly. So they drop off a cliff. Now, we know this happens. The problem is we don't know when. But if we know it happens, there are things that we can do, things that we can put in place so that if we knew there was a cliff edge and we were a solid, stable pair of mountaineers, Chris, what we would be doing is we'd climb the mountain.

Chris Rodwell: Well, we'd be taking some harnesses and points to-

Kevin Whelan: Right. We'd be hammering in some anchors so that if we fall, we don't fall and kill ourselves. We fall a little. We might feel a bit uncomfortable and maybe a little bit in pain, but we don't fall all the way. You could do that with stock market investments, but that invariably means you have to take that control and learn how to do that. And it isn't difficult to do. It's not difficult to do at all. But the number of people I meet who take any kind of risk mitigation strategy - and I mean strategic involvement with their money in the stock market - is almost none. What they tend to do is they act on the advice of the industry, which is hang on, hold on, hope it's all going to be okay. And if it isn't, they still get their fees. They still collect their payments, and that opaque structure means it's in their interest to keep saying hang on, hold on and hope; but it's not really a great wealth building strategy.

So if you combine, Chris, the ownership of a home, the ownership of a pension without control and the ownership of investments without risk mitigation, you're almost certain to be doomed to the 95%. And that's a tragedy, yet there are so many really enriching things and simple things that you can learn and apply with the other four entrepreneurial pillars, the pillars that I often will refer to on the left-hand side. It's almost like crossing a divide between the right-hand side and the left-hand side, like a bridge between the two, crossing a Rubicon of moving from being uncertain and cautious in your life to having and creating that certainty by creating the flow that comes from the ownership of using all the assets in the right combination that suits you. 

And I'm sure you're curious about the other four assets, Chris.

Chris Rodwell: I am indeed. It's making me think back to episode five when we talked about the mindset, the entrepreneur's mindset and the employee mindset. Traditionally, we've been brought up, haven't we, with the thought process of buy a house, get a pension. Certainly, for the generations of the past, that served them very well. But times have moved now, and we've identified there that that's not a safe place to be.

Kevin Whelan: And also, I think the other point we made in that episode was the entrepreneur is looking forward and the employee is looking backwards. You cannot build wealth in the rear-view mirror. You simply cannot do it.

So let's talk about the other four. Let's give our listeners a chance to see where their money and their time and their dynamic could like a laser point towards. Let's talk about number four, which is probably the most popular in the UK certainly, and that is building portfolios of cash-flowing or capital-flowing property.

Chris Rodwell: [inaudible 00:20:16] love property.

Kevin Whelan: Property is a great asset. Now, we're not saying this is for everyone, nor is any individual asset right for anyone. But there are some very interesting dynamics in property that might be useful to share, Chris, rather than just say property's an asset, so go do it. Property's a multifaceted asset. There are many ways and shapes you could get involved in property, but there are some things that I really like. One is there's a disconnect between the capital value and the income flow. 

Now what did I mean by that? Well, if we go back to our stock market investment and our pensioner who's got 100,000 in their pension in the stock market and what they're doing actually is drawing the money from their pension pot, which is called a draw down, and if the stock market falls by 30% like it did in 2008, what happens to their income? It falls. And maybe, if they keep spending what they were taking before, they're reaching into their capital even more quickly. So that sustainability virtually disappears and you can never recover from that. If you have a portfolio of property and the property value falls but you're receiving rental income, the income flow is still pretty much the same. So there's a disconnect then and you create more certainty.

Chris Rodwell: Sometimes you even find that rentals go up when there's a-

Kevin Whelan: Absolutely, but at least you're never going to zero. You never fall in the same way as the stock market falls because you've only got capital there. You're only measuring the value whereas with property you've got two values, the value of the property and the value of the income flow because there's a natural flow there.

The second thing which is really important from any wealth building perspective about property is you can add value to property. You can create and do something that transforms the value of a property asset today and make it worth more by doing something yourself.

Chris Rodwell: What would be a great example of that, Kevin?

Kevin Whelan: Well, let's give two examples of that. One might be I'm thinking about investing in property and I know the easy thing to do would be to find a property in the estate agent's window, I'd go buy it, I'd find a tenant and I'd do that.

Chris Rodwell: Like a typical buy to let.

Kevin Whelan: That's a buy to let, right. Now, was I really intelligent? Did I apply any wisdom? Did I create any real value? I've just bought an asset and I've rented it out. You'll get a reasonable return on that. Nothing wrong with that. Maybe 5%, maybe 6%, maybe if you're lucky a bit more than that, but that sort of ballpark figure.

Look, I've had three kids at university, and I've seen some of the properties both my clients have had as well in university towns where the students are living in a property. You don't have to love students, but if you imagine a property which was a three-bedroom property let to a family for a thousand a month but you convert it into six student rooms and you create the right infrastructure for the students to study, the right Wi-Fi, the right kitchen facilities and so on and get mommies and daddies to act as guarantors - all very nice- it minimizes your void so you get maximum occupancy at the highest level of rent - often three or four times the value of a traditional buy to let. Now, I'm not saying it's right for everyone. I'm just giving the example because you asked me to do that.

The second one might be we look around and we can see lots of commercial properties that are tired, run-down maybe even empty. They can be bought. Commercial property costs less to buy than residential property foot for foot, meter by meter. So you can buy a commercial property and you could turn that into something that could solve the housing problem by creating apartments and get help to buy from the government as well to make the whole thing, not depending on Brexit because you're not in the top in the market. You're really playing to the entry level of the market and you can create commercial-to-residential conversions, which are what the WealthBuilders clients do by the bucket load and are making lots and lots of intelligently created money. Yes, mitigating risk; yes, understanding what they're doing. All part to the education, the support, the connections and the due diligence that we talk about in the wheel of wealth before they take that action. 

But if you spend the time to do that, which might be a few months in the preparation, you can completely transform the way your money works in property. And you can use your pension to do that. You can use your investments to do that. You can use your home to do that. So if you're curious about that, there's ways that you can learn about that. Now, we're not saying we're the teacher in that, but we certainly know all of the experts or have all the experts to hand for any individual property strategy that someone might be interested in. And that's a really great asset, Chris.

Chris Rodwell: So you're leveraging some of the assets that are parked-

Kevin Whelan: Correct.

Chris Rodwell: ... and really turning them into something with much greater returns and really activating them.

Kevin Whelan: Exactly. So it's taking money from the right-hand side to the left-hand side, crossing that entrepreneurial divide and recognizing that you have to be part of that. It's not a passive thing. You have to put time, energy, money into that process. It's definitely not passive. You should not just do that and say, "Well, I'm parking my money in a piece of property." You must not do that.

But the bigger and better our clients have become, the more they can automate the management of that - back to wealth dynamics. They would have somebody who takes care of the management of their properties. So while they're responsible for it, they're not day to day involved in dealing with tenants, fixing toilets, managing smoke alarms. They're not doing any of these things because the work is being done as a business because they see themselves as a property entrepreneur, not somebody who's parked their money.

Make sense?

Chris Rodwell: It certainly does. So that was pillar four.

Kevin Whelan: Pillar four.

Chris Rodwell: And we interchange between pillars and assets and ...

Kevin Whelan: The reason we call them pillars is because the visualization of the WealthBuilders logo is a foundation, seven pillars and a roof popped on top. So if we use the terms interchangeably, maybe you could just create a link in the show notes to remind them what the logo looks like so they can see that.

Chris Rodwell: I sure will.

Kevin Whelan: Pillar five ... This is Kev's favorite.

Chris Rodwell: Oh, yeah.

Kevin Whelan: Oh, yes. Five is business. And the reason I love business is because you're restricted by nothing. There are no markets and you can create as much value as you like, and the opportunity to use your own wealth dynamic if you're creative like me and find solutions to problems, you can make hundreds and hundreds and hundreds of times the return on your money. And the more you can create streams of recurring income in your business, that's a good thing because if you create a recurring-income business, you're forced by integrity to create great value that has to last for your client. Otherwise, they'll stop paying and then you don't have that recurring income. So I love looking for businesses where there's that potential for an outstanding form of recurring value, which means you get recurring income in the business. And that's my favorite type of business.

Chris Rodwell: And we touched on it in a previous episode of sometimes the failure to really start with the end in mind when it comes to business, and so many people who move or transition from employment into starting their own business but then just own the job. So we're talking about really a business here with systems and people and as you say recurring income that doesn't rely on you trading your time for money and being there the whole time.

Kevin Whelan: Yeah, and what's interesting, if you go back to the point about wealth dynamics where you need the creativity, you need the people, you need the delivery mechanism and you need the measurement and the performance and the evaluation, you need all four dynamics covered. So you can't really be a true business unless you've got those covered, and rarely would that be one person.

Chris Rodwell: It would be exhausting.

Kevin Whelan: Well, not least you'd have to be a perfect square in the wealth dynamic, and I don't see that very often. But you'd have to have the energy to do everything. So it doesn't really work. Business is fascinating. Again, it's not for everyone because not everybody's an entrepreneur in the sense of owning a business. But owning a business that works without you is the key to creating real wealth. And there are many ways to do that, and I'd love to share that on another podcast on how to do that and the seven or eight different ways to create that recurring income in a business. Often when I go and talk to a business who perhaps don't come from the same creativity and myself, I can see recurring income in that business that they don't even see for themselves. 

Then that does two things. One, it gives them an immediate injection of cash flow. But guess what else it does, Chris? A business has value.

Chris Rodwell: So if they were looking to sell ...

Kevin Whelan: You can sell that value, or you could sell a portion of that value, or you could pass that on to the next generation, or you could create an MBO or an MBI. I could keep going. But you can do so many different ways where you can tap into some of the value, all of the value in any combination of ways you want and dice and slice the ownership of a company because it's basically shared ownership shares, which you can't do with a property. You can't slice a property up into more rooms than there is rooms, but you can do that with a business and you can create much more value.

So those people who find themselves naturally energized around business, do connect to another episode when we talk about how to create recurring income inside your business and not be stuck trading time for money. You think you're a business owner, but you're not really. 

Chris Rodwell: That will be a good one. So we've got two more assets.

Kevin Whelan: Time for two more?

Chris Rodwell: Let's just mention them so we can know what they are.

Kevin Whelan: Okay. Well, we've got time for intellectual property, which is number six. Intellectual property ... Remember we talked about intellectual property as an employee. You're giving your intellect and you're trading it for X pounds an hour.

Chris Rodwell: A wage, yeah.

Kevin Whelan: A wage, yeah. With intellectual property expressed as an entrepreneur, you're creating and capturing your own intellect and you're packaging it and repurposing it in a way that allows you to sell [that on 00:31:05], create books or products or delivery mechanisms where you don't have to be there to do the work. You create it once and get paid forever. Now, we're not saying everybody's going to be a best-selling author selling millions and millions and millions. We're not saying that. 

But the creation of royalty income through the intelligent use and packaging of your own skill ... And the faster you build your wealth, the more IP you create because you become so much smarter than you were when you parked your money in your house, your pension and a few quid in the bank. So you're building that IP, not just for you, not just to create value for you but when you get to the legacy piece, the highest level in the wealth building levels of wealth, level five in the five levels of wealth, then you have to create the wisdom. So whether you sell it or whether you pass it on to your kids, you're creating IP that has lasting value. And that's an incredible one.

Chris Rodwell: And once again, it complements wealth dynamics again because if you're a creative type, then products and books and maybe music, anything that can pay those royalties. But if you're more a detailed systems person, then maybe you can create a system, a franchise.

Kevin Whelan: Exactly.

Chris Rodwell: So it's really understanding where your value is best served and then creating your IP from there.

Kevin Whelan: Number seven is joint ventures. Now, this again is a wealth dynamic point because you can only joint venture if you understanding your wealth dynamic and the dynamic of the people or the person with whom you're collaborating. So joint venture is about collaboration. It's about saying somebody's got time, somebody's got money, somebody's got skill, somebody's got the right opportunity. You're mixing and matching your wealth dynamics and the opportunities that always present in all of those different facets. So somebody could create an idea, but you didn't have the idea. Somebody could create an opportunity, but you didn't have the opportunity. But you can participate in an opportunity.

The biggest way that's done in the WealthBuilder community, at least at this time, is the lend and learn. Perhaps I'll give you an example, Chris. So let's say we take our student [inaudible 00:33:26]. And I think, "That sounds like a great idea. I don't know how to do that." What if you could take money locked in your pension and you lend it to somebody who is outstanding in that field, tried, tested, due diligenced in our community and then you lend them some money, which gives you a great return on your investment, decent return - 6%, 7%, 8% on your money. But in addition to that return, they share and show with you what they're doing. So you begin to absorb those lessons so that in the next turn of your wealth wheel you can do that yourself. So you're building capability but at the same time getting a higher return than you get in the stock market typically and potentially, if you take the right security and do the right due diligence, at a lower level of risk.

It's not uncommon for WealthBuilder clients to lend money, get a 12% return on their money, backed by a first legal charge on a property worth a lot more than the value of the loan they've made and bank a whole bunch of lending and build connections for the builders, the decorators, the whatever tradespeople that it might have taken this particular wealthy client decades to find and discover.

Chris Rodwell: It's almost priceless.

Kevin Whelan: Well, that's what happens within this whole process of seeing that there is so much incredible value when you connect. And you remember in a previous episode, almost as a parting thought, I said one of the most pleasurable ROIs to think about when you're on your wealth building journey is to recognize you're only one relationship opportunity or idea away from a complete transformation.

Now, let's contextualize that. One relationship away, where does that sit, Chris?

Chris Rodwell: Joint venture.

Kevin Whelan: It's in joint ventures [and blaze energy 00:35:31]. Opportunity, where does that sit? It sits in the tempo energy of being grounded and seeking timing opportunities. So you get the idea. The whole point about relationships, opportunities and ideas are all reflections of the wealth [dynamic 00:35:48].

Chris Rodwell: And the creators are probably the ones that have all the ideas as well.

Kevin Whelan: Well, that's true. But anyway, I hope it's been a useful share of the seven pillars of wealth and how you can build wealth on your terms, choosing the right combination of pillars that work for you, trying to make sure you don't make the mistakes on the right-hand side, get as much of your money and your own intellect and skill across to the left-hand side. And even if you're highly steel energy, recognizing that building and collaborating with others is an important part of creating real wealth.

Chris Rodwell: It has been wonderful today. Thanks for sharing that, Kevin. And a reminder that it's really worth checking out the videos which are in the WealthBuilders membership area, completely free. So hit the link in the show notes and check those out.

Kevin Whelan: What are we going to cover next, Chris?

Chris Rodwell: That's a good question. Let's have a think about that and we'll surprise everyone on the next episode.

Kevin Whelan: Okay. I look forward to that one then.

Chris Rodwell: All right. Thanks, Kevin.

Kevin Whelan: See you.