Feb, 2024

Shocking: Why The Wealth Bucket Model Retirement Plan FAILS!

What you do not know about your own Retirement Plan might just shock you! Most workers invest in a traditional 401k Wealth Bucket Model. However, that just may not be right for you, the savvy investor. Think about it. What if your bucket of money runs out before your retirement years are over? When you rely solely on that bucket of money, the ensuing expenses can drain it over time. Those funds could dry up before you pass away, and then you may have to go back to work. Definitely not what anyone wants in their twilight years. Read on for further explanation and a much better way for you to save for retirement!

The Wealth Bucket Model Retirement Plan is Broken.

Just like Steven Covey’s book The Seven Habits of Highly Effective People outlines, we are going to begin with the end in mind. Although small details will vary between us, we all want the same thing out of life. We want freedom! More specifically, we want the time to do all the things that will fulfill us. Hopefully, we can make that time before we are too old to actually enjoy them to the fullest.

Rob outlines the means to this system as your Wealth Operating System, also known as your CORE Fund. This fund will form the base of your financial freedom. Eventually, your CORE Fund should start to generate Horizontal Income, totaling 1.3-1.5 times the amount of your Vitality Number.

This is how Rob Rowsell encourages the members of his financial community to approach their retirement planning. However, almost every American will foolishly lean on a Wealth Bucket Model. We will explain that model next.

What Is The Wealth Bucket Model, And Why Should We Not Use It Exclusively?

What is the big picture we want to paint about the Wealth Bucket Model? Most of us American citizens will contribute regularly to a 401k retirement fund throughout their career. There is absolutely nothing wrong when you use a 401k fund as a nest egg. However, when we rely on it exclusively, then we run the risk of running out of money before we are ready. We may have to go back to work in order to pay our bills. Rob outlines more below on the biggest expenses that are holes in the wealth bucket model.

Ignorance Is The Number One Leak In The Wealth Bucket Model

When we move on from our businesses, most of us will inevitably want to try new endeavors. We often make the mistake of thinking that our new ventures will come just as naturally as our pre-retirement ones. Many a successful investor has fallen prey to this trap. If you insist on investing funds in a new business or property, then you have to do your homework! Make sure that you partner up with some trusted experts in those fields.

Taxes – How Tax Drag Drains Your Wealth Bucket Model

When you reduce your Tax Drag, it can create a huge income stream! Rob preaches this point again and again to our community, and with good reason. Does your CPA recommend ways that you can legally reduce your tax burden? Well then, do it! Then, you can invest the difference in assets in accounts which will return compound interest.

Find Out What Your Vitality Number Is

Your Vitality Number refers to the annual cost of living which you want to live within. You should always live within your values, and not within your vanity! This is the biggest number that you can possibly get wrong! You want that trip around the world that your favorite billionaire influencer took on Youtube so badly. Geat real! You are not at their level yet. Unless you wait until you absolutely are, then you will blow your Vitality Number right out of the water.

Avoid Fee Drag By Consulting With Wise Financial Advisors

The task of employing wise advisors is mission critical. However, you need to keep a close eye on what they are charging you. You should also keep evaluating it annually. At some point, the value may not be there anymore from their side. Maybe they are not working as hard as they did in the past in order to achieve the results you need. It is so important to shop around, so you can avoid suffering Fee Drag from these providers.

Inflation – The Silent Killer of Your Wealth Bucket Model Investments

You do not need a wealth expert’s advice in order to know that inflation is bad. In fact, it can be a real wealth killer! Keep this in mind as you are calculating your personal Vitality Number. Create a written or printed report of your own Personal P and L. Then, you must examine it in order to find out what that number is. When you stick to that number, then you can never go wrong.

Join Our Community

Do you own multi-family properties? If not, do you aspire to do so one day? Then you should consider joining our online discussion group, the ATL Inner Circle Community! Each month, Rob Rowsell will teach you what you must do in order to build wealth in the real estate business. It’s not as easy as it looks! Property taxes, liens, and legal fees can all be hard to navigate, so having a successful guide in your corner like Rob is a must! Sign up today!

Feb, 2024

Win At Wealth! Expert Teaches Financial Terms & Formulas

Do you want to win at wealth, but find all of that financial lingo confusing? Learn the glossary of money words from wealthy real estate investor Rob Rowsell. Sit under Rob’s learning tree! Find out how to make smart investments with your money by applying these financial terms and formulas.

Financial Terms You Should Know For Wealth Wins

Rob jumps right in by explaining a few key financial terms every investor should know. Then, he outlines his wealth glossary. The definitions, as well as a few useful formulas, are outlined below.

Your Net Worth Defined

When we simply put it on paper, your Net Worth is the measure of everything you own, minus everything you owe. What is the net worth formula, then? Your assets minus your liabilities equal your net worth.

Income: Active And Passive Categories

Rob groups Income into just two main categories: Active Income and Passive Income. He defines each of them as follows:

What Does Active Income Mean?

W2 Income, 1099 Income, and Active Business Income are three specific types of Active Income. Basically, if you work directly in order to earn that money, we classify it as Active Income.

Passive Income Defined

Rob then defines the category of Passive Income as money that you earn, even though you did not directly work for it. If you received Capital Gains income from the sale of one of your real estate assets, that is one example. Appreciation of one of your assets will also count as falling in the passive income category.

What Is Passive Residual Income?

Some property investment experts refer to this income category as Horizontal Income. Passive Residual Income could possibly refer to your dividends earned from investments, the rent paid from your properties’ tenants, or royalties you have earned from your own Intellectual Property. Regardless of where the money came from, this can be an outstanding income source. Everyone should seek it out, since it is literally mailbox money that arrives regularly in your bank account.

Financial Terms Continued: Vitality Factor

Rob then fills us in on a financial formula he calls the Vitality Factor. This calculation is hugely important to know if you really want to understand the nuances of the financial world. A specific formula must be used in order to arrive at your Vitality Factor. You must add your own Personal Expenses to your Deductible Business Expenses. These factors will add up together to produce your TRUE Cost of Living, before you subtract your taxes and your charity contributions.

An example of deductible business expenses Rob has written off in the past is auto repair. Years ago, when Rob owned several independent auto repair shop locations, he could write off his own automotive repair expenses. That is to say, if he had to get his oil changed or install new tires, it counted as a write-off when one of his shops performed the task. However, he sold all of the automotive shop businesses, so those expenses are solely personal ones. He can no longer write off those expenses.

How Do You Calculate The Horizontal Income Score?

We talked about the concept Passive Residual Income earlier, which is also called Horizontal Income. The Horizontal Income Score is a formula that we use to best measure your ability over time to convert your Net Worth to your ultimate goal, Horizontal Income. When you divide your Horizontal Income amount by your Net Worth, then you will arrive on your Horizontal Income Score.

Do you want an example? Here it goes. Let’s say that you currently have a Horizontal Income that adds up to exactly $100,000. Your Net Worth, on the other hand, is an even $1 Million. When you divide those numbers, you will then arrive at a score of 10. That is a great score. In fact, it is twice the average score! The higher the number the Horizontal Income Score totals up to, the better. Remember this: if you do your homework and you exercise your advantages, then you will reach your ultimate retirement scenario, which is Passive Residual Income.

What Is The Nest Egg Theory? Financial Terms Part 1 Concluded

Rob talks about the Nest Egg Theory a lot in his videos. This financial approach powers the most common retirement plan that people subscribe to. This defines freedom as a number, specifically a big bag of money that we are filling up via our 401k’s and other conventional retirement plans. Rob reminds us that there is a very real fear hiding behind this theory. What if we live long enough that the money will run out, and then we will have to return to the work force and earn w2 Active Income in our old age. This is why we should work over time in order to invest our Active Income gains into sources that will generate passive mailbox money in our twilight years.

Join Our Financial Discussion Community

Do you own multi-family rental properties? If not, do you aspire to do so one day? Then you should definitely consider joining our online discussion group, the ATL Inner Circle Community! Each month, Rob Rowsell will teach you what you must do in order to build wealth in the real estate business. It is not as easy as it looks! Property taxes, liens, and legal fees can all be hard to navigate. A successful guide in your corner like Rob is a must have! Sign up today!

Dec, 2023

Win the Money Game Act 3: Shift to Passive Residual Income

Rob Rowsell reviews the third act in his Winning the Money Game series. This focuses on the shift to Passive Residual Income (PRI). This involves changing your mindset and strategy for earning and investing your money. Transitioning to exclusively PRI revenue streams is a crucial component to your financial exit strategy.

Passive Residual Income Explained

This third stage of the Money Game focuses on a transition, meaning a “mental shift”. Many of us have an aversion or fear of growing wealthy. We have all heard that “money is the root of all evil”, but did you know that saying is actually a misquote of the Bible? 1st Timothy 6:10 says For the love of money is the root of all of evil: which while some coveted after, they have erred from the faith, and pierced themselves through with many sorrows (emphasis in bold by this blog’s author). When we put money in the proper context, we can make that shift in our mindset. Money is a tool to help us live the life God intends for us to, not a false idol.

At this stage of the Money Game, we are shifting from a combination of Active Income and Passive Income to strictly Passive Residual Income. There is a difference between Passive Income and Passive Residual Income. An example of Passive Income is buying a property, fixing it up and holding it awhile, then selling for a profit. Also, you could call that specific situation earning “Capital Gains”. PRI means regular dividends you received from an investment passively – true mailbox money!

As we transition to Passive Residual Income, we need to plan our exit. How and when will we achieve financial freedom? This means no longer being dependent on a job or passive income investment to pay the bills. It also does not refer to the “bag of money” you’ve been saving from your career for retirement. We want a regular check arriving in the mail that will outlast that 401k, and give us the freedom to live comfortably and help others.

Join Our Community

Do you own multi-family properties? If not, do you aspire to one day? Then you should consider joining our online discussion group, the ATL Inner Circle Community! Each month, Rob Rowsell will teach you what you must do in order to build wealth in the real estate business. It’s not as easy as it looks! Property taxes, liens, and legal fees can all be hard to navigate, so having a successful guide in your corner like Rob is a must! Sign up today!

Oct, 2023

Best Wealth Building Books For Investors Seeking Financial Wisdom

What are the best wealth building books for your shelf? Rob Rowsell, successful multifamily real estate investor, reveals what material you need to read in order to increase your financial IQ!

Best Wealth Building Books – The Wealthy Code

Rob starts the video clip by introducing the book The Wealthy Code by George Antone. Specifically, he covers the three levels of affluence it covers, relative to financial independence. Each level (Rich, Wealthy, Job) centers around businesses. Rich Dad, Poor Dad author Robert Kiyosaki defines a business as an entity that can operate independently if you, the owner, were physically absent for a year. If that statement isn’t true for you, you have a job, and can’t be financially independent. A job requires your time and attention for a minimum of ten hours per week.

If wealth building is your goal, then you must develop passive income. Anyone with a job that pays above their means can start small, investing that extra money into investments that appreciate in value. Eventually, those properties will generate cash flow. Cash flow is wealth. Learning that fact and amassing the knowledge on how to properly redirect those funds was a game changer for Rob Rowsell.

When Rob first started his house flipping business, he was not setting himself up for regular passive income. A mentor advised him to keep every third or fourth property and collect rent from the tenants, rather than selling it. This meant that he could gradually decrease the work hours he invested in his real estate business. Over time, that business became less of a job, and more of a passive income engine.

Best Wealth Building Books – Money: Master the Game

Next, Rob shares a page from Tony Robbins’ book Money – Master the Game. This is one of the best wealth building books, cited by countless successful investors. The page features an illustration of a mountain, outlining a wealth journey. The peak of the mountain, labeled “Critical Mass”, represents the point where we retire. As we climb the mountain, we are accumulating money for our retirement. The de-cumulation phase occurs on our way down from the peak.

The “Nest Egg Theory” says we should have a big enough bag of money saved up to last us the rest of our lives when we retire. However, life happens. The nest egg may not last us the rest of our lives. We may have to work another job in our golden years in order to make ends meet. Ideally, we have a passive income stream instead that ensures that we make it through.

Join Our Community of Investors.

Do you own multifamily properties? If not, do you aspire to one day? Then you should consider joining our online discussion group, the ATL Community! Each month, Rob Rowsell will teach you what you must do in order to build wealth in the real estate business. It’s not as easy as it looks! Property taxes, liens, and legal fees can all be hard to navigate, so having a successful guide in your corner like Rob is a must! Enroll today!

Oct, 2023

7 Investment Tips for Business Owners

Multifamily real estate investor Rob Rowsell outlines the 7 Investment Tips for Business Owners. You can take total control of your finances when you invest profits intelligently! Compound interest and your own unique advantages are just two facets of your wealth building journey. Make sure you also have an exit strategy…from life itself! Pass your estate on seamlessly to your heirs, but not all of it. Most of it should be given away to good causes.

Breaking Down 7 Investment Tips for Business Owners

You want to build a business, and not a job, right? Of course you do! These are the seven investment tips for business owners who want to grow into a passive income and out of the rat race.

Tip 1: Grow Your Business

If you want to have money to invest, you have to grow your business. How? Stack cash! In order to stack cash, you must increase your gross sales, gross profit, and net profit.

Tip 2: Intelligently Invest Your Profits

Once your cash is stacking up, investing it wisely is key. Set aside spare time for education outside of your business. When you look at yourself from an outside-in perspective, you can identify your advantages in the marketplace. Some business owners, such as Rob, have found their fortunes in real estate investing. Other investments may play more to your strengths. Over time, the money you put away for your outside investments will overtake your annual salary.

Tip 3: Control Your Personal Spending and “Leakages”

Live within your values, not your vanity! It’s hard to fill a bucket with water when there are little holes all over it. In much the same way, you can nickel and dime yourself out of untold wealth with unneeded purchases. Think of how much that former smokers estimate they save each year after quitting. Now, think of your daily candy bar or Starbucks habit. How much spending can you avoid each year by giving that up? Better yet, what if you invested all of that money in a mutual fund with high yield compound interest?

Investment Tips for Business Owners – Advanced Steps to the Finish Line

Tip 4: Actively Reduce Your Tax Drag

It’s not what you make, it’s what you keep! Saved taxes is an income bucket. If you find (legal!) ways to save on taxes, investing that money can equal huge cash returns over time! Remember, you are the quarterback of your finances. Nobody will care as much as you should! That includes your CPA and investment strategists, so don’t just blindly trust them to do the right thing every time. You’re not their only client, and everybody makes mistakes, so keep an eye out.

Tip 5: Avoid Stupid Capital Losses

We’ve all been tempted once in a while by new financial trends promising big short term returns. Hopefully, you have not been conned by cryptocurrency schemes or other random investments with no due diligence. Everyone (including Rob!) has fallen for this kind of snake oil. Don’t get fooled into thinking that you can successfully invest as easily as you can run a profitable business. Line your pockets, and not a con artist’s!

Tip 6: Let Time Compound My Net Worth and My Advantages

When you put the previous tips into practice, the goal is to build an additional wealth engine. This engine is independent of your business. The longer you work at establishing it, the less work you will need to put into it, as the engine will start running without your help. How? Once again, remember that the keys to starting this engine and keeping it running are using the education you’ve acquired in the marketplace to gain experience. Nobody starts out as an expert in any given field. If it were easy, everyone would do it. Putting in the work over time will both compound your net worth and your advantages.

Tip 7: Build My Estate Plan and Philanthropic Legacy

As you approach the finish line of your career and life, money will be less and less of a worry. Since you have built passive income over time that will serve you in retirement, you should turn your thoughts to what that money can do for others after you die. After all, you can’t take it with you! You invested your wealth both to provide a comfortable retirement and to help your survivors.

A staggering 70% of all wealth transitions do not end well! Regarding inheritances for your family, Rob recommends the book Preparing Heirs. It’s a game changer! Bottom line, choose an amount of money that can help your heirs live comfortably. This shouldn’t be an extravagant figure. Then, you should pick an age when your heirs will be mature enough to wisely invest that money. You should give the majority of your wealth away to philanthropic causes. We all know that helping others through scholarships, church mission funds, or other good causes will do exponentially more good than just giving it all away to our kids.

Conclusion – Investment Tips for Business Owners

That was Rob Rowsell’s quick and dirty outline of seven investment tips for business owners. These are the same strategies Rob has used for years, literally working his way up from nothing. From a homeless drug addict to working in an auto repair shop, to then owning multiple shops, to finally selling those businesses in order to concentrate on real estate investing. Most importantly of all, he also teaches others to build wealth like he has. That means you! If Rob did it, then you can too! Why not join the ATL Community and let Rob guide you personally? Sign up today.

Jul, 2023

Wealth Advantages Development

Rob Rowsell talks about his strategy for Wealth Development with investments in real estate and beyond. Develop an asset allocation plan and invest your surplus earnings into buckets that will generate passive income streams. This is how you build wealth in the real estate industry to replace your business earnings for retirement.

Wealth Development With Real Estate – Growth Advantages

This ATL All-In Community Gathering clip opens as Rob discusses his strategy for continuous cashflow. He is always studying to improve his techniques to supplement his retirement bag of money. How does he use that knowledge? He intelligently invests the surplus income from his businesses into ventures that will generate regular cashflow. It can take several investments in order to eventually replace the income brought in by your business.

Rob’s mentor suggested he work on this wealth development strategy about 20 hours per quarter. During this time, Rob sets goals and determines what buckets he allocates his investments into. He makes sure to calculate what his investible net worth is before he invests into those buckets.

There are so many choices on what to invest our funds into, such as the stock market, bonds, and real estate. It make take time, as well as trial and error, for you to find your niche. When you don’t have a wealth development advantage, such as Rob’s knack for real estate, spread your investment out. For example, Rob is not a stock market expert, so he makes long term investments in Index Funds. This simplifies his strategy, as well as minimizing risk.

When you are stacking cash from your business, get educated. Then invest that cash into diverse buckets that will yield mailbox money over time.

Join Our Community

Do you own multi-family properties? If not, do you aspire to one day? Then you should consider joining our online discussion group, the Addicted To Life Community! Each month, Rob Rowsell will teach you what you must do in order to build wealth in the real estate business. It’s not as easy as it looks! Property taxes, liens, and legal fees can all be hard to navigate, so having a successful guide in your corner like Rob is a must! Enroll today!

Jun, 2023

Cash On Cash Return Explained

In this clip from our Addicted To Life Community Gathering, Rob Rowsell lays out the Cash On Cash Return Real Estate Formula. If you are an aspiring cash flow investor who is looking to replace your business income with recurring passive earnings, then this video is a must watch!

Rob Explains His Cash On Cash Return Real Estate Formula

Rob starts the clip out with a review of two real estate deals he is raising money for. Both of them would qualify as momentum plays. Over time, each investment will yield an average of 7% cash on cash return. Through renovations and rent increases, these properties’ values will increase. When he sells these properties, Rob uses a formula to calculate total returns. The back end equity earned, plus the cashflow from the five to seven year ownership will equal the total.

Rob then explained the principle of the 2X multiple, which is his goal typically with real estate holdings. In order to reach his stated goal of doubling his money, Rob may need to hold the investments longer than he had originally planned. For example, let’s say you had invested $100,000 in a property, kept it for six years, and earned back $140,000. Then you would divide $140,000 by six in order to arrive at around $23,000 profit per year. You will have roughly gotten a 23% return on your initial $100,000 investment after six years. That cash on cash return may sound too good to be true. However, in reality, it’s not!

Join Our Community

Jan, 2023

Bathtub Analogy – Income Streams Ideas For Business Owners

Rob paints a picture of a bathtub for our group members. The faucet has several income streams ideas coming from it. Rob lays out several examples of passive and active income. The “nest egg” plan of the IRA isn’t the best retirement investment plan. If you combine regular passive income and other investment strategies, along with your 401k, then you have a solid plan.

Income Analogy – Passive and Active Income Streams

Once the attendees draw up the bathtub running the income streams, Rob has them make blanks below with “active income” and “expenses” headings. He then lays out several categories of income sources by how they are taxed. W2, rental, capital gains are all different examples.

Active Income

Rob starts the discussion on active income by clarifying that the term could have different meanings to different real estate investors. To him, active income streams are defined by investing more than ten hours per month into them.

Active income streams obviously include conventional 9-5 jobs taxed with a W2 tax form. If you invest in rental properties, and do not employ a property manager, this investment is likely qualified as active income.

Passive Income Streams

In Rob’s businesses, spending less than ten hours per month on an investment qualifies it as passive income. For example, you could buy a plot of land, do nothing with it for over a year, then sell it. Whatever profit you make is passive income, since you put no work into clearing the land or building a property.

Passive Residual Income

Finally, Rob details passive residual income. He provides the example of investing in a single family home or apartment complex. The owner may not spend much time on maintaining the property, but it is a consistent, passive source of income.

Passive Residual Income Streams For Retirement

Rob goes on discuss passive residual income streams as part of a retirement strategy. Most of us contribute to an IRA account for our retirement plan. Ideally, you sock away enough money to live off of during your golden years, drawing a necessary amount each month.

He does not subscribe to this “nest egg” theory. The passive residual income streams of his properties, as well as interest from his retirement investments pile up to cover his living expenses. In the end, the main goal is passive income streaming in each month to provide security when he can’t, or just doesn’t wish to, work full time hours anymore.

Lastly, Rob provides the example of a business owner who owns a successful laundromat. It does much more business than its competitors. Rather than using the extra cash to educate himself and create passive income streams, he just spends it on a more lavish lifestyle. When he feels ready to quit, he sells the laundromat, and has a bag of money to retire on. This may or may not suffice to maintain the lifestyle he is used to. Without the passive residual income to supplement the money from the sale, his future is uncertain. He could outlast the nest egg and be a burden on his loved ones.