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Mindset & Money | Top Things 2020 Taught Me

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Hosted by
Mike Ayala

On this episode of Investing for Freedom, Mike discusses some of the top lessons he has learned during 2020. Mike speaks about how 2021 can be your best year ever if you take these lessons and grow from them. Enjoy!

“2020 was a big year of change for us, but going into 2021 I’m more clear than ever that we need to double down on becoming a better version of ourselves, leveraging people, money, and resources around us.”

HIGHLIGHTS:

0:00 – Intro
1:03 – Mike emphasizes the importance of being able to adjust
1:56 – Mike explains that 2020 was his and Kara’s best year, even financially
2:37 – Mike’s first lesson is that circumstance and situations you can’t control can lead to growth
6:33 – Mike’s next lesson is that wartime leadership is completely different than peacetime leadership, he explains both and the difference between them
8:32 – Just because you don’t know what’s going to happen, doesn’t mean you can’t make good decisions
14:27 – Mike’s advice for investors with regards to his last lesson is don’t wait around because the world isn’t going to wait for you
15:09 – Mike speaks about how the gap between the poor and the wealthy is getting wider. He advises you to learn how to get on the right side of this gap and figure out how to make passive income
19:01 – Going into 2021 we need to become a better version of ourselves and figure out how we can increase our passive income
20:40 – Mike reminds us about his 1-on-1 mentoring program. If you’re interested in that text “Mentoring” to 4805317519.

FULL TRANSCRIPTION:

Thank you for joining me on the Investing for Freedom podcast. Today, I’m going to take a few minutes and just talk to you about some of the top lessons that I learned in 2020. And as you guys know obviously everybody knows 2020 was a year that caught us all off guard. It was challenging in many respects. For me personally, it really shaped a lot of clarity for me, thinking about where I really want to go, what I really want to do. Some of the same talking points that we’re constantly talking about. I mean, the fifth part of the investing for freedom formula – adjust. If you don’t see clearer than ever the importance of adjusting, and being able to shift your plans, and being flexible as a business owner, as an entrepreneur, as an investor then you’ve been hiding under a rock.

Obviously, 2020 was really challenging and I’ve hesitated talking about this, but 2020 was actually a mine and Kara’s best year ever. And it’s really because we leaned in and we adapted quickly. We adjusted as I’m constantly talking about. I think sometimes when I talk about the five-part formula, what do you really want? Why do you want it? What are you going to do to get it? Measure results and adjust. It’s so simple in concept and in theory that I think people probably just discounted, but when you really start doing the work and working through that process every component of that is so important and the adjusting part again is super valuable. So I’ve hesitated talking about this, but 2020 was really in a lot of respects our best year ever. Kara and I made more money financially in 2020 than we have in any other year. And that was because of some circumstances and in situations that I didn’t see coming and I couldn’t have planned. But again, it really caused us to just hunker down, focus on what we really wanted and adjust along the way. So you know, we’re sitting here in 2021. It’s mid-January and I was just reflecting the other day as I was on a walk, just, you know, how much 2020 really changed the way I think about a lot of things. And so here’s some of the key lessons that I really took away.

Obviously, this is the theme that I was just talking about, but 2020 taught me that, you know, the worst years when it comes to circumstance and situation and things that you can’t control can be your best years. And so if you really lean into, you know, what can I control? What can I do with this? The world is going to throw us situations and scenarios that are beyond our control. And it’s more clear to me than ever how small I really am in the big picture of what’s happening in the world. Between the fed and the financial markets and the treasury and all of that kind of stuff. There’s so much that we can’t control. There’s been this theme that I’ve been hearing, don’t fight the fed. And the reality is starting, you know, back to The Real Estate Guys, being in their mentoring program, going on the investor summit at sea, being able to sit at lunch and dinner with minds like Ken McElroy and Robert Kiyosaki and G. Edward Griffin and Sovereign Man Simon Black, just sitting with Peter Schiff, having dinner with Peter Schiff, just sitting in the presence of these guys really began shifting the way that I think over the last five or six years. And just really understanding, you know, a lot of these guys are battling for true capitalism and personal freedom. Just the idea of Republican and Democrat. And I’m not here to get political about any of this, but there are so many powers at be right now that we just have no control over. So leaning into what do I have control over? What can I influence? What can I do with the information that’s given to me? What can I do with the situations that are in front of me? How can I make the best of all of this is extremely important. And so I learned that the worst years can be our best years.

And as I said, Kara and I made more income in 2020 than we have any other year. We had more family time in 2020 than I think we have had in any other year you know, Dylan, our oldest son, he’s 20 years old. And even though he went out and spent some time touring the country him and his girlfriend really, they lived at our house for most of the year. And as parents that are, you know, close to being empty nesters, I’ve got a 20-year-old and 18-year-old and a 17-year-old. That was just super amazing for us to be able to have that family. You know, I started thinking again, as soon to be empty nesters, you know, there might be a time where Thanksgiving and Christmas and, you know, times when we go visit them or they come visit us are the only times we get to see them. And so to be able to have a year like 2020 where we could lean into that family time. And again, I know that this was really frustrating for a lot of people because you know, a lot of our friends and a lot of you have little kids at home and you became teachers all of a sudden, and you found yourself in situations that you didn’t ask for. But you have to make the best of it. So but for us, you know, that time was just super valuable for us.

We did more this year with less people and less resources, and that’s a double-edged sword in itself because, you know, it’s challenging when you’ve worked so hard to invest in your business and invested resource into processes and systems and, and even people. And all of a sudden you find yourself, you know, having to cut expenses, that’s never easy. It’s always challenging. But it teaches you to do less with more. And so that was a positive outcome. The hard times force you to make decisions that often as business owners, we struggle with. We know certain things that we need to do, and I’m not going to go into the details of this. But it’s challenging when you’re making decisions around, again, resources that you’ve invested so much, it could be a software program. It could be certain initiatives, it could be a new state that you decided you were going to go into, a new division in your business. And all of a sudden you find yourself having to contract. And a lot of times we know that we need to make these decisions anyway, because it’s kind of the theory of loss constraints. You’ve invested so much time and energy into this process that sometimes it’s hard to cut your losses, but years like 2020, help us to make some of the challenging decisions around our business.

On that note, shifting to something else that was really valuable. A lesson that I learned this year, wartime leadership is completely different than peacetime leadership. And I actually heard a podcast where two ex-military people were talking about this and I’m actually a really good wartime leader. So think about this peacetime leadership is often, you know, committees and we spend so much time just in meetings and in rooms and brainstorming, etc., etc. But when something happens like what happened with COVID it really forces us to come out of that peacetime leadership. And we spend a lot less time trying to get consensus, trying to get everybody rallied on the same page, really in wartime leadership, somebody is in charge. Somebody is the ultimate say so, and you’re just making decisions and people are falling in line. And you might be saying to me, Mike, I don’t know what you’re talking about. I’m always that person. Well, that’s the case a lot of times in small businesses in organizations where you don’t have, you know, big teams built out and that kind of stuff. But the bigger an organization gets, sometimes we get into these committees and more peacetime leadership and, you know, everybody’s opinion matters and all this kind of stuff.

Well, when we have something pop up, like what happened in COVID, it takes clear, concise leadership. You’ve got to make decisions quickly. So I learned a lot about myself as a wartime leader. I’m a much better wartime leader than I am a peacetime leader and what this really means for times of peacetime. That means I need to hire and delegate the best of the best around me and let them be the leaders during peacetime. It doesn’t mean I don’t have a say, it doesn’t mean I don’t have input. It doesn’t mean I’m not mentoring them or leading them, but it means that during times of peace, I need to get out of their way. And then during times of wartime leadership, I need to get involved. I need to rally the troops. I need to build confidence in them. I need to instill peace with them. That’s what I really learned about myself in 2020. Kind of on that thread, shifting on you a little bit. Another thing that I really learned is just because you don’t know what’s going to happen does not mean that you don’t need to make decisions. And so I don’t know if you’ve ever seen this or experienced this maybe in your own life or, you know, leaders around you, or even maybe leaders that were leading you when you see someone freeze it’s because they don’t know how to make risk decisions. One thing I’ve always been really good at is making decisions without all the information. And I’ll never forget that. Well, one time I was at, this was 2000, I think it was 2000, and I went to a Franklin Covey symposium. I was in an organization at that point in time, and the leader organized a trip for three or four of us, and we actually heard Norman Schwarzkopf speak, and I’ll keep this super short, I’m going to condense what he actually tried to streamline what he said, but to make a long story short, he had just been promoted to a three-star general and his boss above him had been promoted to a four-star general. And basically, his boss was in charge of the Pentagon.

So it was Norman Schwarzkopf, like first week. And he goes into, there had been a presidency change. And so I don’t remember who it was around that time, but basically, there was a leadership change happening. And his boss Norman went into a meeting and there was some decision that had been delayed for like eight or 10 years. The previous administrations couldn’t make a decision. And so the new president or whatever it was, came in and said, hey we need to make a decision on X, X, X. He looked at Norman’s new boss, the new four-star general, and said what do you want to do? And the four-star general said, I want to do this, this, this, and this. And very clear, very concise something that had taken eight or 10 years to make a decision. They decided that’s what they were going to do to implement, a little brainstorming on it. It was wartime leadership basically. And they walked out, and Norman Schwarzkopf asked his boss. He said, how do you know that that was the right decision? And his boss said to him, I don’t, but here’s what I do know. I know that I’ve made the best decision I possibly can with all the information that I have at my fingertips, which may or may not be enough information, but it’s all the information that I had. And I know that I’ve assembled the right team around me and that no matter what the outcome is, even if it was a mistake, this team will take that and will make the best out of it. And I just thought that was such valuable information. And that just kept coming back to me in 2020, because just because you don’t know what’s going to happen does not mean that you don’t need to make decisions.

We need to make quick responsive decisions when the world is dictating change around us, even if we don’t have all the information. And so that’ll lead me into the fourth and final point of the things that I’ve learned in 2020, the world is not going to wait for you. It’s not going to wait for me. It’s not going to wait for anyone. It is going to do what it’s going to do. We think that what we’re doing matters so much, and by the way, in our own world and our family and our legacy, it does matter. It matters a lot. But in the big picture, when you look at the amount of time that the earth has existed, and you look at history books and you look at legacy and all the people that have come before us, I’m not downplaying your existence and how valuable you are, but the world is not going to wait for you. And as we could see in what happened in 2020 there are so many things that made us just a blip on the radar. If you would’ve told me three years ago that the world was going to shut down the way that it did in 2020, that 30% of people were going to be unemployed for a portion of the year that the United States president, which I’m not arguing for, or against this, I’m not here to get political. I’m just making points. That the United States president was going to get censored and shut down to where he couldn’t communicate with the American people, because the news, the media is so biased that they won’t you know, share what he wants to say. And again, I’m not saying that what he does is right or wrong. I’m not even arguing for that, but when the leader of the free world can get censored way it is, I think all bets are off the table.

And some people would say, you know, when a leader like Donald Trump could get elected, all bets are off the table. I’m not here to argue that I’m just making a point that so much is changing so quickly that in my mind, nothing’s off the table. If you would’ve told me three years ago the Amazon and all the behemoths were going to stop Parler. And again, I’m not here to argue about Parler, but just the fact that they can rally and shut down a platform like that. And dictate, you know, who gets shut down our voices on Twitter. If you would’ve told me 10 or 15 years ago, that the world was going to be as, not only the world but United States specifically, our country was going to be as divided as it is, I would’ve said no way, that’s not going to happen. If you would have even told me in 2019, that on March, I think 13th or 16th of 2020 we were going to be coming home from a trip from Hawaii as a family, and barely get back into the United States before things started shutting down. I would’ve said you were crazy.

Now there’s another part of me that you may or may not know about. I’ve been somewhat of a prepper you know, for a while, not in the sense that I have a, you know, a ranch in New Hampshire and, you know bomb set up everywhere and that kind of stuff, but just always being prepared, water, food in the event of a natural emergency or an actual emergency, or, you know, the power infrastructure going down or whatever. I’ve always been kind of a prepper in that respect. And 2020 taught me that the world is going to do whatever the world’s going to do with, or without us. And so, you know, what does that mean for us as investors and business owners and people who want to become entrepreneurs, who want to own businesses, who want to invest? Don’t wait. The world isn’t going to wait for you. So don’t wait around for the news or the media or your favorite publication. Whether it’s Zero Hedge or Time Magazine or whatever the Wall Street Journal to tell you what to invest in, to tell you what businesses need started, to tell you what the wave of the future stock market’s going to be, to tell you to invest in Bitcoin. Am I telling you not to study? No, you absolutely need to study, but at the end of the day, you need to lean into your intuition, into your gut. You need to spend some time really connecting to your subconscious, connecting to the universe or God, or whatever that is for you and making your own decisions. Because the people that are on the sideline are going to get, excuse the language, but I’m just going to say the way I’m thinking, they’re going to get their ass handed to them.

The gap, and I’ve said this several times I’m going to close up and leave you with this. The gap between the poor and middle-class and the wealthy is getting wider and wider. And I’m not the first to tell you this or say this, but the middle class is being wiped out as we speak. And if you don’t figure out over the next 3 months, 6 months, 12 months, 24 months, 36 months, 5 years, 10 years, if you don’t figure out how to find yourself on the right side of that equation, meaning learn how to make more income and meaning, learn how to take those dollars that you’re making more income, more flow of money coming in, income. If you don’t figure out how to make more income and take those dollars and invest that into wealth strategies, meaning passive income, meaning what is every single dollar of income that you do? What are you doing with those dollars? Are you spending it in frivolous? You know, do-dads and a bigger and better lifestyle, which I’m not opposed to any of that. As you know, I love travel. I love nice things. I love all of that. But if you’re not taking a certain percentage of your income and producing, taking those dollars and making those dollars a slave to you as the richest man in Babylon would say, actually, I think he calls it a soldier. That’s a better terminology, a soldier to you. That dollar is going out and bringing back more soldiers, that’s the passive side of this. And so I don’t want to oversimplify it.

But if you’re not figuring out how to make more income and take that income and put it into wealth-producing assets in this day and age, you’re going to find yourself on the wrong side of that equation. The middle-class is getting wiped out and the simplest thing that you can do, and I’m not telling you, I can’t tell you what you need to do or what your idea is going to be. But what I can tell you is if you lean in and you meditate and you spend time journaling, and you really connect your conscious mind with your subconscious mind and get connected with God, the universe, whatever that is to you, you will get answers and you will figure out how to be on the right side of this. And so that’s what I learned in 2020. There’s never been a more important time for you to lean into what it is that you need to do to increase your income and to increase your passive income. And I’m actually at the school of thought that the next few years, by the way, I love passive income. And I’ve said this a few times in previous episodes recently. I’m all for passive income, but if you don’t already have a stream of passive income, that’s substantial, I’m not saying it’s too late, but the most important thing you can do is figure out how to increase your income.

Passive income literally has a misnomer to it. Passive income is those soldiers that you’ve sent out. You’ve invested passively and it’s reproducing itself. You can create other streams of income, even if you’re a W2 employee. Even if you’re a doctor, even if you’re a lawyer, you can invest with other real estate investors. You can invest in other businesses. You could go out and start a side business. So there’s never been a more important time for you to increase your income in my mind than the next one to three to five years. I’m not saying don’t invest passively. I’m not saying don’t go out and build your wealth. What I am saying is figure out how to make more streams of income as fast as possible. And wealth building is a long-term strategy. We’re in a period of time where we’ve got to focus on short-term strategy, how do we increase our assets? How do we increase our income as soon as possible to keep ourselves on the right side of that gap.

Cashflow Quadrant by Robert Kiyosaki is one of my favorite books. Employee, self-employed, big business, Investor Quadrant. Those are the four quadrants. We’ve got to figure out how to, there’s nothing wrong with being an employee, but while we’re being an employee, how do we get more self-employed income? Or how do we get more investment income, or you know, that could be investing in a big business or investment income in real estate.

So, anyway, I’ll leave you with this, 2020 was a big year of change for us, but going into 2021 I’m more clear than ever that we need to double down on becoming a better version of ourselves, leveraging people, money, resources around us, and really figuring out going into 2021, how can we increase our income? How can we increase our wealth? How can we increase our passive income? Because the world is not going to wait for you to get off the couch and start moving. So hopefully that helps you. Like I said before, I mean, none of this is negative to me. I’m actually as energized coming into 2021 as I’ve ever been. And not because of, you know, all the memes you’ve been seeing or people posting on Facebook about man can 2020 just get over with. I don’t think there’s something magical about the imaginary line between December 31st midnight and, you know, 12:01 AM on January 1st. I don’t think there’s anything magical about that. Nothing has changed.

I’m just energized going into 2021 because 2020 really gave me some time to really focus in on what do I need. And by the way, investing for freedom is the whole reason why I’m here to share this message. You’ve got to double down on your income approach. What really matters to you, get real clarity on that. 2021 could be our best year ever, but I’m telling you right now, you got to double down on the few things that really matter. I don’t know what that is for you. But hopefully, you’ve got some clarity on it. And if you don’t really dig in, spend some time journaling meditating, you got to get clarity on what that is. So I hope that helps you. And by the way, if this is something that you need help with going into 2021, I have a couple of spots available for my one-on-one mentoring program. I’m only taking five spots this year, and I have a couple of spots left. I’ve got some amazing clients who have already signed up. We’re having a great time doing it. If you’re interested in that text, the word mentoring, M-E-N-T-O-R-I-N-G to (480) 531-7519. And we’ll see if that’s a good fit. Cheers to a 2021 that’s hopefully amazing and overcoming for you.

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