Episode 21

FROM $30K IN DEBT TO 7 FIGURES: MONEY, MINDSET, AND MUNGER

Episode Description

In episode #21 of The Big Bo $how, Big Bo (a.k.a. Jason Blumstein, CFAⓇ) shares his story of going from $30K in debt to a 7-figure net worth. 

Financial freedom can feel like a pipe dream. But no matter where you start, you can build life-changing wealth.

You just have to know what steps to take.

Today, Big Bo shares those steps through actionable advice and mindset tips for anyone looking to grow their net worth.

You’ll also hear about:

• How to evaluate risk/reward in your career and income potential

• Why personal values can make or break your perception of wealth

• Why legendary investor Charlie Munger believes investing is “so simple”

• The financial lessons all investors can learn from those who don’t come from money

Hope you enjoy the $how! 

Episode 21 Key Takeaways:

• 00:00 - The story of the 10-year-old investor

• 04:00 - A frugality lesson from NBA superstar Giannis Antetokounmpo

• 06:47 - The mindset that separates those who make a living from those who grow wealth

• 12:45 - Investing shrewdly and the benefits of the entrepreneurial spirit

• 19:19 - How a toxic environment can be a drag on your wealth

• 23:03 - Why investors must get comfortable with deferred gratification

• 25:28 - Bo Know$: Why tough starts to life and the NFL season don’t mean disaster

Episode Transcript

“It's so simple. You spend less than you earn, invest shrewdly, avoid toxic people and toxic activities, try to keep learning all your life and do a lot of deferred gratification. If you do all those things, you're almost certain to succeed. And if you don't, you're going to need a lot of luck. And you don't want to need a lot of luck. You want to go into a game where you're very likely to win without having unusual luck.” – Charlie Munger, Vice Chairman Berkshire Hathaway and Warren Buffett's right-hand man.

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  In Episode 21 of The Big Bo $how: From $30,000 in debt to 7 figures: money, mindset and Munger, I'm gonna go over this quote and the steps I specifically took in my journey that makes me the adviser I am today and the person I am today and what differentiates me from others. But first, let me give you a little bit of a refresher of the 10 year old investor. You see when I was younger, I came from a divorced home where we ended up losing our home and luckily my grandfather Julius who I named Julius Wealth Advisors after was able to purchase my family, my mom, my brother and my sister, a home and he used to come over my house and turn off my cartoons turn on CNBC, and taught me finance and investments and math from a very young age. He bought me five shares of Goodyear Tire and five shares of Pepsi, which got me hooked when Pepsi doubled, split and spun out YUM brands. I made $300 and I was hooked. I then read my first book about Warren Buffett, when I was 14, and I loved what he was about with him and Charlie Munger’s philosophy. I played football and I got a full scholarship to Lehigh University. And I majored in finance. I worked at many major corporations, Price Waterhouse, Morgan Stanley JP Morgan managing portfolios from nothing to over $20 billion and top rated funds. All the time, I was focusing on my long term vision of starting my own firm one day to bring what I learned to others. To do this, I knew I had to build my net worth, which literally started with $50 in my bank account, and $30,000 in debt to north of 7 figures. But you might be mistaken, thinking the $how was about me and my story. It isn't about me, it's about you. How can I share my history lessons and knowledge with you to propel you forward? Because at the end of the day, to me, that's what life's about: giving and sharing with others lifting other people up. So in Episode 21, I'm gonna go and break down this quote from Munger and the points that you can take away, and how I intertwine each into my life thus far. So sit back, relax, and welcome to episode 21 of The Big Bo $how. 

  All right, let's get after it on episode 21 of The Big Bo $how, we're gonna break down that quote, money, mindset and Munger, we're gonna break down the quote from Charlie Munger. And the first part of that quote, is to spend less and by this, to me, is all about learning to say no. As you start to make more money and get discretionary income, it's tempting to say yes, to every opportunity, expensive dinners, bigger houses, buying that brand new Mercedes, but the only thing that spending money on luxury goods does is prove to the outside world how much money you had before and no longer do. You see, I think that's kind of comical. Everyone sees people driving those flashy cars, wearing those nice clothes. And when people say oh, wow, look at what this person has. My comment is you aren't proving what you have, you're just proving that you just spent $60,000 on a car and now you have $60,000 less. You see, when you grow up without money, it gives you a greater appreciation for frugality. You've heard me talk about the Miami Heat before, but I always think about Giannis Antetokounmpo when I think about wealth and frugality. So Giannis grew up in poverty in Greece, and today he has an NBA contract worth $228 million. However, there was a funny video floating around the internet a few years ago, showing Giannis rating a fridge of free water bottles provided by the NBA when they were in the COVID bubble in 2020. And my Miami Heat, we made it to the finals, but we lost. And a reporter asked him about this and he said, “There is a fridge with free waters. And in the hotel room, I had to pay $7 for water. Why would I not get free waters? I had to get those waters man.” So it might seem comical that Giannis multi, multi multimillionaire is getting free waters versus just taking the waters from his room, they're going to cost him $7. However, he understands what it's like to come from nothing. If you say yes to everything, you'll never get a handle on your spending. You don't want to say no to everything. But you want to be very constructive on what you say yes to. And I'm willing to bet that that high priced item won't fill your happiness void, it'll be very hard for you to see a good return on that investment.

  And that brings me to point two, that you spend less than you earn. If you break down that quote. And this also relates to but don't take no for an answer. Learn to say no. But don't take no for an answer. Well, it sounds obvious. But it's worth noting. Yeah, you can spend less. But again, listen, we all have one life, we have to enjoy life. But the most important thing that you can do to build your wealth is not to increase your savings rate or reduce your spending. It's to make more money. You see, after my football career ended, I landed a solid job at a big four accounting firm. Could I have just switched on cruise control and put together a decent life on an okay salary? Sure. But this is a story about how I went from $30,000 in debt to 7 figures, not how I lived a comfortable life. In my professional career. I always push for more, always push for more. I kept my eyes peeled for better opportunities. I network like crazy. I spent years studying for what is known as a very hard exam and the CFA because I knew how much it would help my career, my earnings potential and my family. I worked my way up the corporate ladder making more and more with each promotion. But on the way I faced plenty of friction. I faced a lot of noise, a lot of doubters, a lot of rejection, a lot of uncertainty. But you know what I did? I pushed through it. I don't take no for an answer. And I'll give you a perfect example. When I worked at a large investment firm, we created one of the first wealth management platforms out there. I was the fourth person that was hired, I learned everything I could about it. And then another large wealth and investment firm wanted to build it, I hopped on this opportunity. I was one of four people in the industry that actually knew how to build this, took it from nothing to $20 billion in assets and still face doubt, constant doubt, constant friction. I wanted to manage a portfolio, networked, showed people what I know, took on extra opportunities that weren't necessarily in my job title, but opportunities to prove to people that I actually know what I'm doing, to give me a shot. I took on managing those portfolios, then I wanted more. I always had a dream of managing a fund for a large investment firm. But whenever I'd ask people, hey, I want to do this. They'd say, you don't have the background. You don't have the pedigree. Well, I said, Well, how do I get the background? If you don't give me the opportunity? So I kept on networking. I said, What do I need to do? Go get your MBA, go get your CFA and ended up getting my CFA network more met, people constantly kept my eye on the prize. Then an opportunity came and I got to interview for my dream job. And in that role, I ended up getting it. I talked to the head of the fund. We hit it off. I knew I knew stuff. He also liked me as into football, fantasy football, and I ended up landing that role. I did not take no for an answer, I did not take the doubters, the people that said I didn't have the background and didn't have the pedigree. I didn't take that for an answer. I kept on pushing for more.

  You see, when you come from nothing work ethic isn't an option, and your back is against the while you can only go forwards. A lot of people, unfortunately, the second they hit some sort of friction, they stop. If someone tells them they can’t do something, they accept that. This is especially true when you have a safety net or a cushy Plan B. Maybe there is a plan B, but you have to act like there isn't. What the other people know about you that they can think you can't do something. Prove the doubters wrong. Listen to their feedback, but prove them wrong. Have a chip on your shoulder. Success and financial gain in your career requires a certain amount of hardheadedness and perseverance. Always push for the next thing. Get back down nine times and get up 10. Life-changing life doesn't fall into your lap. It starts with your own mindset. So there are the first two points — spend less than you earn as Charlie Munger said in the beginning, learn to say no, but do not take no for an answer. So now we're going to take a quick break. And when we get back, I'm gonna go over three more points breaking down these quotes and how I intertwine them into my personal journey to help you move forward.

  All right, welcome back to Episode 21 of The Big Bo $how brought to you by Julius Wealth Advisors. Let's move on to the next part of that, quote, invest shrewdly. And what I mean by this is the embrace of the entrepreneurial spirit. You see, my path to wealth has been filled with calculated risks. When you come from nothing you're acutely aware from an early age and no one is going to come save you, you have to do a lot of this work on your own to make it in life. You have to be collaborative with others, but a lot of times it's you taking that initiative and drive to do it on your own. Generally speaking, outsized rewards require outsized calculated risks. Key word being calculated, always be thinking about ways to improve your financial situation. Many times, investing truly doesn't mean investing in a stock or a business or what have you and hoping it grows. It also means investing in yourself. Let me share some examples of how I did this on my own personal journey. The first was when I had to make the tough decision to play football over baseball. Growing up, I was a two-sport athlete, and I loved baseball. Baseball was by far my favorite sport. However, my goal was to use sports and my athletic abilities to get me a full scholarship to a great school. And baseball was not going to do this for me, especially when I started playing football and I made varsity my freshman year and the coaches came over to me and said, essentially keep your grades up. Stay out of trouble. You're guaranteed to get a scholarship somewhere in this country. Baseball's much tougher to do. So what did I do? I chose football over baseball. The next was when I moved from my public high school to going to play football at St. Thomas Aquinas, which is a powerhouse football program. This was a big decision for me, going from my public high school and all my friends that I grew up with, being Jewish going to a Catholic school was a huge decision for me. But I knew if I went there, I was essentially guaranteed to get a full scholarship to a great school. So I invested in myself and invested in the situation and chose to move schools. Next was my decision to go to Lehigh University. You see, when I was playing football, I would get letters from good programs that didn't really have good educational programs. They had good football programs, but not good educational programs. So I didn't even really return their calls or their letters. And when I would get that opportunity to speak to a program that had not only good football, but also great education, I pounced on the opportunity. And that was Lehigh University for me. Then you switch into saving and investing after I graduated college, most people want to go out, you make good money, you're spending money, you're having a good time, not me. I knew you needed to invest shrewdly. So I started saving and investing my money as a mandatory expense for my first real paycheck. The more money I made, the more I saved. The more I made, the more I invested, there were years where I was putting away almost 50% of my salary into saving and long term investing. Then I got my CFA as we discussed prior, and why Wall Street tries to think they can always outsmart people. When you saw the financial crisis, people telling you to do this or do that, I would always focus on investing shrewdly. And the philosophy of Buffett and Munger to just own great businesses at fair prices, or highly profitable businesses, and putting that money away from time and having the discipline to do it and following that investment philosophy, investing shrewdly and blocking out the noise is what helped propel me forward. And this allowed me to get to the point of my ultimate calculated risk of starting Julius Wealth Advisors. For me, this is where not only does my earnings potential really change, but I can set up other people, I can share my knowledge with others, and also, more importantly, help out my family for generations to come.

  So let's go through this decision making process because a lot of people when I started, a lot of the biggest thing people said to me is like, well, how can you leave a nice salary and a nice opportunity and start something on your own and literally go from making what you're making to nothing? First of all, I saw the need in the marketplace for a firm that delivers advice on the total picture of planning, investing, and behavioral coaching. What I saw from day one, when I was working on Wall Street, is what was being sold was an investment, a product, not a trusted service, not the total picture, trying to fit a square peg into a round hole. So I saw this opportunity, I saw this opportunity in the marketplace. And when people said, well, how can you leave the corporate world? To me, I saw it more as how can I not? The risk-reward is heavily skewed to the reward for people, my family, and myself. How can I live the next 50-plus years of my life knowing I have so much to give and the opportunities I saw I was setting myself up and my family up to take this opportunity. And you see not everyone needs to be an entrepreneur and start their own business. But everyone could do well to embrace the entrepreneurial spirit. Because at the end of the day, what I try to focus on teaching people when it comes to their mindset, is when you're investing in not investing in this fictitious thing of the quote unquote, stock market, you are investing in businesses, you have to embrace this entrepreneurial spirit, in my opinion. Always be thinking about ways to improve your financial situation. How can you invest in yourself and have money to make money on your money?

  Now let's move to number four. Avoid toxic people and toxic activities while learning your whole life. And to me this is all about being adaptable. While I always played on teams, and people told me to put your team first. I always live by being team first, but make sure that team aligns with your goals. It's okay to be team first and be on a team. But if you're on a team that's not going to move you forward and is holding you back while you have to understand that this team is not going to align with your ultimate goals. Additionally, from my experience, great learning comes from getting comfortable and being uncomfortable. Now let me explain from my personal experience how this all relates. Again, going back to St. Thomas Aquinas, my local high school, I had great teammates. But that team's goals didn't align with mine. I was starting both ways on varsity as a sophomore, playing offensive tackle and defensive end. But ultimately, the team wasn't going to get me to where I needed to go, I was a big fish in a small pond, big deal. I embraced learning, I embraced growth, I wanted to go to a team that I knew was better than me to lift me up, and then have myself move that team collectively forward. So I ended up switching to a much better team and a much better opportunity. When I stopped playing football. I got two herniated discs in my back. And they wanted me to have back surgery to correct this when I was at Lehigh. However, that didn't align with my goals. And they showed me that they weren't necessarily great teammates with the way that I got injured. Having major back surgery when I was 18 years old. At this point in my life, I realized, listen, you have two herniated discs in your back, you're going to Lehigh the odds of you making the NFL at this point is not great. However, you ultimately came here for the great education and my grades when I was playing football, honestly, they were slipping. I mean playing football and going to a good school, it's like having two full time jobs at once. So I ended up making the decision to stop playing, not have that back surgery and focus on my education. And doing this. I ended up going from having not great grades to making Dean's lists, every single quarter post. The next example is leaving my last two opportunities, my last two jobs, to start this firm. Not some of my immediate teammates, but in a lot of those situations, there are people that I interacted with, and in my opinion were toxic, their values did not align with mine. Their goals did not align with mine. And to me, it didn't matter how much money I was making. I was miserable because I was with toxic people doing toxic activities that brought me down. So you have to be adaptable, you have to get comfortable being uncomfortable. Uncertainty breeds creativity. When you come from significant financial means you can afford to sit back and potentially be comfortable or simply put life on cruise control. But being comfortable often leads to bad habits that quote unquote, expression, fat and lazy, Embrace being uncomfortable, you might not be quite sure of what's next. But if you stick to your core values, your goals and attach yourself to people in situations that are aligned with yours, you're most likely to succeed, then fail. As Charlie Munger pointed out, this is what I have experienced.

  So let's move on to the next point, point five, deferred gratification. Or to me it's adopting a long-term perspective, when you don't have money, you don't have the luxury of squandering your assets on short term gratification. You have to constantly look to build, because you're starting from such a place that is so much further below everyone else. And you cannot play the short-term game, I talked about how I own my first stock shares at 10 years old. Pretty early on, I realized the long term potential of these investments. As in the Pepsi example, as I mentioned, those shares doubled and split and spun out YUM brands. That was over the course of three years. When I was younger, I thought it was three months. But when I look back, it was three years. That's a long term perspective, to grow your wealth as an investor do you need to take on the long view. And I'm not talking about days, I'm talking about decades. Much of my practice of Julius Wealth Advisors revolves around these strategies to build long term key sustainable wealth. The key is sustainable. For people who don't grow up with money, sustainable wealth is the key. You know what it's like to have not had anything. And you want to make sure that it will never happen again. And this is why I have adapted the philosophy about Buffett and Munger of simply keeping it simple, and focusing on owning the most profitable businesses and owning those businesses for decades over days. So I'm going to take another quick break. And when we get back, we're going to have a Bo Know$ segment and I'm going to relate the early goings of the NFL season to some of these lessons that I have been trying to teach throughout the show. We'll be right back.

  All right, welcome back to Episode 21 of The Big Bo $how from $30,000 in debt to 7 figures: money, mindset and Munger brought to you by Julius Wealth Advisors. We're gonna go to our final segment, a segment we all know and love, the Bo Know$ segment. And I'm going to relate all the five points that I talked about earlier about the early season in the NFL, we're two weeks in, and we're going to talk about the importance of not writing off teams, just like it was the importance of not writing off yourself, investing in yourself, investing shrewdly saying no, the five points that we talked about earlier. So let's look at a few teams in the NFL. And the first I want to talk about are the Jets. And again, mind you I'm a Dolphins fan. So I'm a little bit biased because I grew up, let's just say not liking the Jets very much. So I'm a little bit biased with this one. I'm going to try to be as partial as I can. And we all know if you're following the season, if you're an NFL fan or probably not even that you probably know that Aaron Rodgers was brought to the Jets to try to win them their second title. There's a lot of hype surrounding this and what happened and literally the fourth play of the season before Aaron Rodgers can even complete one pass as a Jet, he blows out his Achilles and the season is over. Now is this the end for the Jets? Living up here in the Northeast everyone as a Jets fan says the season's over. You don't want to write them off in my opinion. In my opinion, the season is not over for the Jets because it's a team. They have a good defense. They have good receivers. They have good running backs and is Zach Wilson their new quarterback Aaron Rodgers? Of course not. But to me. Neither was Mark Sanchez anywhere close to as good as Aaron Rodgers. And they won with him. They almost went to a Super Bowl with him. And you're telling me Zach Wilson can't be as good as Mark Sanchez when the team is essentially built the same way as when Mark Sanchez took them almost to the Super Bowl with a strong D and a strong running game. Give me a break. I think the Jets will probably do just fine. Hopefully they still go 0-1 against my Miami Dolphins though. So here you go. You see the importance of not writing someone off early and thinking about the long term. The next is the Vikings. The Vikings started off 0-2 after going 13-f4 last year. They were one of the better teams in the league from a record perspective. However, if you broke down their wins last year, 12 of their 13 wins were by less than 7 points. Yes, you heard that right. 12 of the 13 wins were by less than a touchdown. They won all their close games last year. And so far, they lost both games by less than 7 points. So all they're doing is losing their close games. Pretty simple in my opinion to reverse that which they have done before. So do not write off the Vikings early in the season. Adapt that long term mindset defer gratification. On the flip side, and you heard it on my last episode, episode 20 where I made the bold prediction of my Miami Dolphins going to the Super Bowl for the first time in my life. On the flip side, the Dolphins are 2-0, they need to stay focused. 2-0  is nothing special. They need to stay focused and not avoid toxic people and toxic activities and continue to learn from their mistakes to continue on this path to getting to the Super Bowl which I predicted. So you see it's the same with people and wealth. An NFL season is long and so is life. We all start at different times. Start with different advantages ,start with different disadvantages and experience momentum at different times. The important part is to not write off yourself or others around you based on what they say and their backgrounds. Don't get discouraged if you hit bumps in the road. Stay focused, invest shrewdly, invest in yourself, deferred gratification, trust the course ,trust your game plan, trust your core values and find a good coach who can get you through.

  So let's wrap up episode 21 of The Big Bo $how, $30,000 in debt to 7 figures: money, mindset and Munger. And what did we learn? We learned to break down a quote from Charlie Munger to learn to say no and his quote, that means spend less, but don't take no for an answer. Spend less than you earn, that’s the earn part. Embrace the entrepreneurial spirit. Invest shrewdly. Be adaptable. To me, that's avoiding toxic people and toxic activities by trying to keep learning all your life and importantly, adopt a long term perspective. Do a lot of deferred gratification. If anyone has a similar story. I'd love to hear about it. And I'd love to learn about your experiences. I'd also love to learn how my experience is propelling you forward. So reach out to us at Julius Wealth Advisors info@juliuswealthadvisors.com 201-289-9181 or visit our website www.juliuswealthadvisors.com.

  So that concludes episode 21 of The Big Bo $how. And I'll end this $how as I end all the other shows. Always live a life of integrity. Always obtain knowledge, learn as much as you, can keep learning. And always live a life that you're passionate about.

  Until next time, all the best.

Disclosure:

The content is developed from sources believed to be providing accurate information. The information in this podcast is not intended as tax or legal advice. Please consult legal or tax professionals for specific information regarding your individual situation. The opinions expressed and material provided are for general information, and should not be considered a solicitation for the purchase or sale of any security. Julius Wealth Advisors, LLC (“JWA”) is a registered investment adviser located in Englewood, NJ. Registration as an investment adviser does not imply a certain level of skill or training. The publication of The Big Bo $how should not be construed by any consumer or prospective client as JWA’s solicitation or attempt to effect transactions in securities, or the rendering of personalized investment advice over the Internet. A copy of JWA’s current written disclosure statement as set forth on Form ADV, discussing JWA’s business operations, services, and fees is available from JWA upon written request. JWA does not make any representations as to the accuracy, timeliness, suitability, or completeness of any information prepared by any unaffiliated third party, whether linked to or incorporated herein. All such information is provided solely for convenience purposes only and all users thereof should be guided accordingly. JWA is neither your attorneys nor your accountants and no portion of this podcast should be interpreted by you as legal, accounting, or tax advice. We recommend that you seek the advice of a qualified attorney and accountant