[00:00:04] Speaker A: Welcome to the Wealth Builders podcast. I'm Billy Epahard, and on this show you're going to hear from industry leaders in business, real estate and investing. Our wealth builder coaches and myself are excited to teach you how to make sense of making money for making a difference. Okay, let's get started.
[00:00:25] Speaker B: Welcome to this week's Wealth Builders podcast. I am very happy to tell you we have got our founder and the CEO of AWM, Andrew Womack Ministries and Keras Bible College with us, Mr. Billy Epperhart, who is going to continue talking about the Triple X Factor. And in particular, he's going to continue on the four steps on getting to the first x. So, Billy, welcome back. And we can't wait to dive back into this subject.
[00:00:59] Speaker A: Well, thank you, Karen. I just want to clarify. I am the founder of Wealth Builders and Tricord Global, and I am the CEO of Andrew Womack Bible College. Andrew Womack is the founder of Andrew Womack Ministries and Keras Bible College. So just want to make sure that's clear for people.
[00:01:20] Speaker B: That's really good.
[00:01:23] Speaker A: And so I'm excited today. We just finished, Karen, in our last podcast where we really came back and talked about, we began to introduce, just in real brief concepts, the Triple X Factor, which is really the tool that God gave me many years ago. I explained the beginning of that a little bit in the last podcast.
But if somebody really wants to see it and know it, you can either get the book, the money mastery book that it's called Money Mastery, or where we talk about making sense of making money for making a difference, or you can go to the book, God's road to financial freedom. And in there we have the explanation as well. There's four steps that we were referencing. We didn't share all four. In the last podcast, we talked about one, which was step one, which was learn to become more valuable. And in fact, one of the statements I didn't make, and I love this one, is that you are becoming the average of the five people that you spend the most time with. That's powerful coming the average of the five people that you spend the most time with. And so what happens there? And a lot of people don't realize that, but most people live within about 20% of those five friends wages. And so what I say to people is, I'm saying this tongue in cheek jokingly, but many people need to learn. They may have to plot and scheme just to get around the right people, around the wrong people. And I'm saying that tongue in cheek, but to make a point, right? Sometimes you have to be very intentional to be able to get around the right people. So to become more valuable, association really matters in what you do. And that was step number one. Now, today, the step number two, which I'll cover here in a minute in more detail, is you learn to live on 80% of your income, and I'll come back and talk about that. And then step number three is truly knowing the difference between assets and liabilities. And I'll actually talk about bitcoin. People want to know about bitcoin. So remind me, when I get to step three, to talk about bitcoin and knowing the difference between assets and liabilities. And then in another podcast, we'll cover step number four, which is eliminate debt. And I mentioned to you, and we'll tell you how to do it for free right here in the podcast.
One of the things I think that those that are listening need to understand that it's actually possible to eliminate debt. And actually, in five to seven years, we call it the debt snowball. You can actually get out of debt on your cars and on your mortgage, in your house if you follow the rules that we teach you, if you follow that. But I want to encourage people to understand that at wealth builders, this is not just learning how to get out of debt. We teach you in great detail how to build wealth. And we talked a lot about wealth in the last podcast about seeing wealth from a 30,000 foot view. We're going to continue with that as we continue to do some of these podcasts, at least when I'm back on with you, Karen, we can talk about those things. So there's four steps, right? First one is become more valuable. The second one is learn to live on 80%. The third one is know the difference between assets and liabilities. And step number four is eliminate debt out of your life. And so in this one, let's talk about step two, learn to live on 80%. And then we'll hopefully have time to get to step three at least.
[00:05:24] Speaker B: Great.
[00:05:24] Speaker A: Know the difference between assets and liabilities. So step two is really learning to live on 80%. I made the statement in the last podcast that most people continue to live from the center to the left side of the first x, where if they get to the center, that means they're just breaking even. In other words, what that means is when I say breaking even, they have just enough income to pay for their expenses and debt at the end of the month, but they don't have anything left over. There's other people, if you're really on the way on the left side of the first x. And again, you may have to go to wealthbuilders.org and pull up the graphs and things we have so you can see this. But with that said, what happens to them is that many never even progress to the center of the first x. They don't even get to that point because they continue to actually have more money going out every month than they do coming in. Now, we're taking it to the next level here, where you're actually learning. You're actually making progress. You're not just surviving. You're not just at the center. You're moving. Right? And part of that moving toward being financially free is you learn to live on 80%. And what that means is this, is that you can spend, for example, up to 80% for your expenses, your mortgage payment, with many probably listening, your rent payment, your groceries, those kind of things. And then you have 10% that you tithe, and then you have 10% that you invest. Now, one of the things that I practiced in my life early on that really was important is I actually did this to learn to live on 70%.
There's a book that I want to recommend that's written in parable form. This is not one of my books, but I have it in the bibliography of the money mastery book, and it's called the richest man in Babylon.
It's an older book that many people, even today, still aren't aware of. One of the best books ever written. It's written in parable form. And in there, they actually talk about learning to live on 70%.
They talk about 80%, then 70% learning to live on 70% of your income. So I want to recommend that book to people listening. It's an easy read. It's a very good financial book. And I just want to put that caveat in now. And I think you can actually go to wealthbuilders.org. And I think somewhere in there, if you just type in richest man in Babylon, we reference it. Or of course, you can go to Amazon or some of the others to be able to get the book.
[00:08:20] Speaker B: Yeah. And I think Harrison House, who is your publisher, they just reprinted that.
[00:08:25] Speaker A: They did. As a matter of fact, they asked me to do a commentary on the richest man in BABYLON. And so I have to find time to be able to do that. But they want to publish the book and have my commentary in there on it.
I think the book is actually controlled and owned by Sound wisdom, I think, which is a part of the publishers that we're part of and what we do. And so I think as we're talking about this, you have 80% that you can use. And in this case, LEt me just jump right to the 70%, because I can make. It allows me to kind of shorten here, this discussion. If you can learn to live on 70%, then you have 10% that you tithe, you have 10% that you invest, and then you have another 10% that you invest.
Here's how I like to say it. There's 10% that you personally invest, and then there's 10% that is professionally invested for you.
[00:09:34] Speaker B: That's good.
[00:09:35] Speaker A: That brings you to a much quicker place in your financial journey. Now, if you want to go back and you say, Billy, there's no way I can do that right now. I'm living on 100%, and I don't know if I have any money to tithe. I have any money to be able to invest. So what I want to say is that the first thing you should do is tithe. No matter what you do, you need to learn to tithe, and that means give to God. Right. And however you choose to do that, I'll let you listen to the Holy spirit and what God's telling you to do, but you learn to tithe, and then you learn to invest. It's just simple as so, but the amount that you invest is that there should be money that you invest personally. In fact, what I hear in many of the conferences and, you know, Karen, we have workshops, conferences, and what I hear from many people that have actually reached retirement, and all they did was professionally.
They. In fact, I've even recently had somebody come up, and, you know, I gave it over to my financial advisor, which I believe in doing. We have wealth builder investments to help people. But what happened was they never got themselves educated, even though they were smart in handing it over to their professional financial advisor. But what happened in the process was they didn't learn anything themselves. And they had set themselves up to make about 100,000 a year in retirement from their investments, which is really, I told them, listen, I commend you for that. And they said, yeah, but what we didn't realize was that we didn't have as many tax write offs. Our houses paid off, and we didn't have a business to write off. And so we ended up only getting about 65,000 a year to live off of, out of the 35,000.
[00:11:29] Speaker B: Wow.
[00:11:30] Speaker A: And I said, well, that's where learning to personally invest not only helps you to learn how to invest to make money. But it helps you to learn how to invest where you have more tax advantages in order to lower your tax bill in order to do that. So you not only learn how to handle your money, but you also learn how to invest from a tax advantage standpoint. But we get back to living on 70%. 10%, you tithe, 10%, you invest, 10%, you professionally invest. And so that is the most aggressive way I know to get you from point a to point z in the process of reaching financial independence. So if you learn to live on 80%, then there's things in your life, in other words, where you are and how you think that matters there. But here's the good news. Are you ready for this? If you're learning to live on 70% now, this is good news. If you're learning to live on 70 cent, you can spend the 70% on anything you want to.
[00:12:34] Speaker B: That's freedom.
[00:12:36] Speaker A: That's freedom. And even if you want to go back to 80%, that means if you want to go buy a pair of shoes or case of gun, you learn to live on 80%. You have. It's coming out of you, 80%. The good news is you can go do what you need to do. Now, most people will say, listening to me, look, if I did 80%, not 70, but 80%, I'd be spending all the money I have. I understand that. But as you begin to develop the discipline of this, it's amazing how freeing it is.
There are christians that follow us a lot, born again believers, bible believing christians that actually will come and say, well, Billy, where do you give your offerings? Well, you learn to give your offerings out of the 80%. Give your offerings out of the 70%, depending on what the approach is that you're taking. Now, that sounds real aggressive. So, as you're listening to me teach you this, you have to find out what your rhythm is. You have to figure out your recipe. I'm just strictly giving you some guidelines that if you're really serious about getting to the point where you're headed toward financial freedom, these are some good values to follow in your life. And so there are people that have built wealth without getting out of debt. There are people that have built wealth without living on 80%, for example. But I'm trying to show you, if you want to follow the progression of it and develop those disciplines on the four steps to the first x, then step number two is learning to live on either 70% or 80% and then learning what to do with the rest that we've shared with you today.
[00:14:16] Speaker B: That's so good. And, Billy, if I could just say, you're actually laying out, like, a wealth building journey. And this is, I think what we look for is we know God wants us to prosper, but how do we take the practical steps? And this is great. If I could just add something to. You have a term that you use when we hear budget. A lot of us were like, no, I don't want a budget. And you call it a spending account.
[00:14:42] Speaker A: You have a spending line.
[00:14:45] Speaker B: There you go.
[00:14:46] Speaker A: Your spending line is, you can't spend more than this. 80% we're talking about, for example. The good news is you can go spend it on what you want to. I can hear people say, well, I got a car payment, I have a house. That's all I have. I understand. But I'm saying, once you exercise the discipline, you don't have to feel guilty about buying things for yourself if it falls within those percentages.
[00:15:08] Speaker B: That's awesome.
[00:15:09] Speaker A: That's very freeing, actually.
[00:15:11] Speaker B: Very freeing. That's so great. All right, number three.
[00:15:15] Speaker A: Number three really is about. Step three is about know the difference between an asset and a liability. And so let me just say this, and then I'll give you some illustrations. That asset, a real asset, really brings you money it pays you. A real asset will bring you money. It actually pays you. And a liability cost you money. So if we take a piece of real estate that has a positive cash flow after your principal, insurance, taxes, excuse me, principal, interest, taxes and insurance, then what happens is that, and you have a positive cash flow after you make that payment, you still have some costs for vacancy and repairs. But as you begin to value that, then the house actually is worth it, becomes an asset to you. And then every year or so, as the real estate cycle turns, those properties appreciate. Now, we happen to be living at the time that we're recording this in 2024, the beginning of 24, where we've seen some prices really escalate in 2022. We saw them begin to tick down a little bit in 2023. We're seeing that a little bit more now in 2024. But over time, property always goes up. In fact, you can just figure that it's going to go up somewhere between 4% to 6% annually. Now, I didn't say it's going to do that every year. Some year you may have a downturn of 3%, and the next year it may go, or two years later, go up 12%. But if you just value it across a period of time, it goes up somewhere between that four and 6% annually.
The value of the property does. And I always tell people, if you want to make money in real estate, you need to be able to bigger money. You need to ride out two cycles up and down in real estate. And if you want to sell, you could sell on the second up. And typically that's a really good bump, especially with those that own one to four properties. And really, right now, even multifamily is doing well.
But here's what I want to get to here, is that if you subtract your liabilities from your assets, remember, assets need to bring you money like a piece of rental, state of real estate, rental property. Then if you subtract your liabilities from your assets, that's where you get come up with your net worth earth. And so we give you guidance on how to do that in the book, money mastery. We explain that in great detail. And it's also in the book, I think, God's road to financial freedom. This is in there as well. Now, here's what I want to say. Let's talk about assets for a second. So, when we talk about assets, the one thing that you have to remember is an asset is something that actually pays you. And so when we start talking about that in a way that's really meaningful, some of the things that Billy calls an asset are things like rent from real estate. That's a big deal, right? Or what I call distributions from a business. You own a business. It's not just paying you a salary, but you get some kind of annual or biannual distribution out of that business, then that's an asset that's paying you. That's what you're looking for, is assets that pay you, or you can even own something like in the stock, in the stock market, or an ETF, which is an exchange traded fund, something like that. I'm not a major fan of mutual funds in this day and age, but what happens is the dividends. If you have dividend paying stock those dividends, then that makes that stock an asset. Because here's why. The dividends aren't based on how the stock goes up or down in value. It's based on the earnings of the company. And whatever share portion that the company declared in dividends are going to pay, either quarterly or biannual or annually. So the point is dividend paying stock interest from bonds and cds, for example. And right now, interest is up. But also you can have royalties from intellectual property, you can have royalties from oil and gas and minerals.
And what we're talking about here, when we talk about assets is the difference between fruit and vegetables. In other words, if I want to eat some broccoli, I got to go chop the broccoli off and then replant it next year. The difference with the fruit would be like an apple tree. I get to go pick, as long as I take care of the apple tree, go pick the fruit every year, and the next year I come back, the tree is still there. If I took care of it, the apples are there now. They're new apples, and I get to eat them. And the idea is not just to have one fruit tree, but have several fruit trees. And then if you're really prospering in assets, you have a whole orchard of.
[00:20:24] Speaker B: That's such a great analogy of trees.
[00:20:28] Speaker A: That are producing for you. And that's an asset I want people to hear that is something that's actually putting money into your pocket. And so when you understand that, talking about bitcoin, I said I talk about bitcoin or any kind of cryptocurrency, what happens in this day and age. And by the way, just so I have full disclosure, I own some bitcoin and some crypto. I also own an exchange as well that deals in that. But I'm investing in those things with play money.
In other words, it's money. I could afford degrees, because what most people don't understand, investing. When we're talking about an asset, you need to invest in assets that actually have intrinsic value.
And what that means is people say, what does that mean, intrinsic? It means that they have a value. So, for example, if I take an apple from an apple tree, there's a lot of things I can do with that apple. I can eat it.
I can bake an apple pie with it and eat it, or I can sell the apples to other people who need food to eat. It has intrinsic value. It produces something other than. It does something other than itself looking pretty on the tree being red. It actually does something for value to someone. Well, that's what real estate is. It gives someone a place to live.
It also has intrinsic value to me as an investor because it actually pays me right if I have positive cash flow. So the reason I'm bringing that up is that, for example, people say, well, Billy, do you believe in crypto, or do you believe in bitcoin? Well, here's what I believe. I think, for example, bitcoin. I believe in the technology that lies underneath bitcoin, and I believe that is not going away and the way they have come up with that among you, there are some others now that are coming out that are strong as well. So the technology, at some point, will be very important. That technology actually can have intrinsic value in time as we move forward. But what we're talking about right now is know the difference between an asset and a liability. And just to keep it really simple and really direct, an asset is what pays you, and a liability is what cost you money.
[00:22:55] Speaker B: Wow.
[00:22:55] Speaker A: So an asset pays you money and a liability cost you money. Now, I want everybody to know that's listening. Real estate can end up becoming a liability if you haven't managed it right, ends up costing you money as opposed to making you money.
But assets and the same thing can happen in a business.
The business goes sideways. But the point of this is, as you're learning this, you want something that's putting money in your bank account. That's what you want. That's what you're looking for. And I don't need to teach on this because we're already out of time. But what happens is you're looking for something that will put money in your bank account. And in itself, that asset will go up or appreciate in value. If you can get both of those to happen, then what you end up with is a true asset because it is increasing in value and it's also paying you. So step two is learn to live on 80%. If you want to be aggressive, learn to live on 70%. And then step three is know the difference between an asset and a liability. And this will help you begin to think right toward moving in your journey from the left side to what I call the right side of the first exit. If you're not real clear what I'm saying about that, remember to go to wealthbuilders.org or get one of the books that we have that have that in there. It'll help you understand what we call the triple X factor.
[00:24:25] Speaker B: Wow, Billy, that is amazing. I know. One of the things you teach, or you share with us, too, is to put a demand on your asset to produce.
[00:24:34] Speaker A: That's correct.
[00:24:35] Speaker B: I just thought that was so.
Know, if you own real estate, a lot of times we're just like, well, it's going to appreciate. And you're like, no, you want cash flow, too. And I know you go in depth with that. And I just want to share with everybody listening that Billy has got his first legacy teaching out. That's called the triple X factor. This is a power packed 14 session teaching on the triple X factor. So you have video teaching. We've got a workbook that goes along with it. We've got a laminated triple xxx chart with the markers and the colors that Billy has shared and even a devotional. And this is just an amazing product. This is so much of what Billy and Becky have learned over the years that he is sharing with us. So you'll want to take advantage of that product. You can go to wealthbuilders.org and go to the shop. And if you want to learn a little bit more about this before you take that step, or if you get that product and you want to go in deep and have some really good teaching and training, we've got the wealth builders boot camp coming up in March, and you can register for
[email protected]. Bootcamp we'll have five consecutive sessions where we're going to unpack this in more detail. You'll have an assignment each day and you'll be able to connect with other people in the wealth builders family that are on this journey of getting out of debt and learning how to build wealth. And so, Billy, any final thoughts you want to share with people today?
[00:26:12] Speaker A: Well, I just want to say that I appreciate those that listen to the Wealth Builders podcast. I appreciate your leadership in wealth builders. I couldn't do what I do without you, and that's a fact. And so I just want to say I'm excited about where we're all headed together, that I believe in our lives together. There's challenges that we face. But I believe with God the best things are yet to come.
[00:26:37] Speaker B: Amen. That's encouraging. So thank you, Billy. Thanks to all of you, our wealth Builders family, God bless you and make it a great rest of the day.
[00:26:46] Speaker A: Thanks for listening to the Wealth Builders podcast. If you've enjoyed this podcast, please rate and review the show. You want to learn more about who we are, visit our
[email protected], and check us out on Facebook. We'll see you next time.
