Episode 321:

Everyone wants to make and have more money but understanding all the available financial options and opportunities can be overwhelming. Many agency owners are juggling debt, income, personal and professional mortgages, and complex investment plans, most of which are managed by advice we were given by our parents when we were young. We’ve heard of ways to use our money to make money, but it all sounds a little impossible to believe.

Adam Carroll is one of the nation’s top financial educators and he is here to cut through the confusion and show how viable many of these options really are. Adam is a long-time friend of the Agency Management Institute, and this conversation is his third visit to the podcast and follows his well-received appearance at the Build A Better Agency Summit.

In this episode of Build a Better Agency, Adam and I discuss a lot of the available tools and methodologies available for helping people reach financial security and freedom faster and in much bigger ways than might seem possible. We look at ways to double your money in 3 years, better understand the power of compound interest, and identify the different kinds of legacy. We talk about how we all need to start thinking about wealth differently by starting to ask ourselves bigger, different questions about our goals and dreams.

A big thank you to our podcast’s presenting sponsor, White Label IQ. They’re an amazing resource for agencies who want to outsource their design, dev, or PPC work at wholesale prices. Check out their special offer (10 free hours!) for podcast listeners here.

Make More Money

What You Will Learn in This Episode:

  • Understanding the “Shred Method” for reducing debt
  • How to double your money in 3-5 years
  • Why it doesn’t make sense to hold onto a long-term mortgage
  • The power of compound interest
  • Identifying the 4 kinds of legacy
  • Equity planning
  • How to start thinking differently about wealth
  • The importance of joining a Mastermind
“The goal of reducing debt is to help people free themselves to be themselves.” @adamcarroll Click To Tweet “Once you’ve paymented yourself into a corner, if there’s not a lot of extra income, it’s hard to get out of that debt because you’ve created the ideal situation for your banker.” @adamcarroll Click To Tweet “We’re still working off advice that no longer serves us.” @adamcarroll Click To Tweet “You have to stretch what is possible right now.” @adamcarroll Click To Tweet “Your mind has to create bigger answers when you start asking bigger questions.” @adamcarroll Click To Tweet “You must surround yourself with people who are thinking bigger, who are asking bigger questions, who are asking you questions that you are not asking yourself.” @adamcarroll Click To Tweet “Finance is changing in a big, big way.” @adamcarroll Click To Tweet

Previous episodes with Adam Carroll:

Ways to Contact Adam Carroll:

Tools & Resources:

Speaker 1:

Welcome to the Agency Management Institute Community, where you’ll learn how to grow and scale your business, attract and retain the best talent, make more money, and keep more of what you make. The Build a Better Agency podcast presented by White Label IQ is packed with insights on how small to mid-size agencies survive and thrive in today’s market. Bringing his 25 plus years of experience as both an agency owner and agency consultant, please welcome your host, Drew McClellan.

Drew McClellan:

Hey, everybody. Drew McClellan here with another episode of Build a Better Agency. Welcome back, if you are a regular listener. And if this is your first one, you picked a great one to join us on. So I always try and make sure that our guests are bringing you something new to think about, a different way of approaching your business or your life or your money. And today’s episode is not going to disappoint. So my guest today is actually a three-peat guest. So this is his third appearance on the show. Adam Carroll is one of my closest friends. We’ve been friends for about 20 years. We’ve been in a mastermind for almost all that time and we’ve just had great influence on each other’s businesses because we’ve just been in it in the trenches together for so long. I know he has had a huge influence on the decisions I’ve made around how I run my business. Super grateful for him and his wisdom.

Drew McClellan:

Adam is financial literacy guru. He helps people understand their money. He helps people leverage their money. But what he really does at the end of the day is he helps people get out of debt. He helps people take what money they have and create more money so that they have freedom. So they have freedom to change their family’s lives. They have freedom to change, generationally, their family’s lives. The freedom to change their community, the charities, or the causes that matter to them.

Drew McClellan:

All this freedom comes from being smart about how you leverage your dollars. And Adam’s got it down to a science. I swear by his methodology, he certainly has helped me change my family’s life. He was a huge hit at the Build A Better Agency Summit. People loved his message and many people have now engaged with him to do work around their own sort of legacy building. I wanted to get him on the show, so you all could meet him and learn from his wisdom.

Drew McClellan:

So without any further ado, I want to jump right into this because I have a feeling this is going to be a long episode, because I have a lot to ask Adam. So let’s get started.

Drew McClellan:

Adam, welcome back to the podcast. It’s good to have you.

Adam Carroll:

Drew, it is great to be back.

Drew McClellan:

You’re a three-peat. This is your third time back. But after your appearance at The Build A Better Agency Summit and the way the agency owners just gravitated to your message, I knew that we needed to come on because we really haven’t talked about your business and how you help entrepreneurs build wealth and allow them to create a legacy. So I want to make sure we talk about that because that resonated so deeply, I think with the audience to the point that you’re coming back to the summit as a keynote speaker next year. So it’s awesome.

Adam Carroll:

I cannot wait. It was such an amazing event. And not to too your own horn, but I know that you know your audience is amazing. The tribe is… They’re rabid fans of all the content. They’re super supportive of one another, which is amazing. It was just blown away. I’ve been to a lot of conferences and your summit was far and away the most familial of any I’ve ever been to. And it’s amazing to be in a group of people where there’s seemingly no competition.

Drew McClellan:

Yeah. The community aspect of the work that we do is so strong. Once you get bit by that bug and you realize for every little bit I give, I get so much back. Then everybody is like. Well, crap, I want to keep giving more then. So it’s just snowballs and it’s good. It’s kind and it’s profitable for people. It’s a good combination for sure.

Adam Carroll:

It’s awesome.

Drew McClellan:

So one of the things that you talked about at the summit and one of the things you’ve been talking to a lot of agency owners that met you at the summit is this idea of no matter where you’re at financially, there’s opportunity. So if you’re deep in debt, if you are out of debt, but you have no real equity or cash to do anything with or on the flip side where a lot of agency owners are is you do have some access to cash whether it’s a HELOC or you’ve got some investment money, or you squirreled away some money.

Drew McClellan:

A lot of people aren’t really leveraging the position they’re in as well as they could. So let’s start with the folks in debt. So if somebody’s got debt, personal debt, debt inside the agency. I know that you have accelerators that you apply with your clients to reduce and eliminate that debt so that they actually do have some equity to do something with faster.

Adam Carroll:

Yes, that’s right. The method, the strategy that we use is called the Shred Method, Drew. Essentially what we’re doing is we are… To boil it down to the most basic and ridiculous statement, we are leveraging a simple interest home equity line of credit in most cases, against a compound interest loan. That could be a mortgage. That could be a building loan. That could be student loan debt, credit card debt, car loans.

Adam Carroll:

And the goal of this for me anyway, is I want to help people free themself to be themself. What I found is if people will take on loads and loads of debt, but they’re doing it based on how much payment they can afford. And once you’ve painted yourself into a corner, if there’s not a lot of extra income or big income events, whether that be distributions or dividends or something of like, it’s hard to get out of that debt because you’ve literally created an ideal situation for your banker, which is I’m going to get all my interest up front, and eventually you might own this asset.

Adam Carroll:

But likely not, because you’ll either move on, sell the car, trade up, what have you. So if someone is in debt, the very first thing that I want to do with them is determine how much discretionary money there is. So if there is some extra every month, the key there is what are you doing with it? How efficient is it? And unfortunately for most people, they’ve fallen under the spell of we got to have six to 12 months or more of living expenses in the bank.

Adam Carroll:

For business owners, it’s a little bit different scenario because the agency owners I know that I met at the summit, they have many clients. Many, many clients. So they could get fired by one. It doesn’t necessarily mean that they’re they’re destitute. They can’t afford their bills.

Drew McClellan:

Exactly, right.

Adam Carroll:

So the goal is figuring out what are you doing with the extra income to be able to begin shredding some of those debts right away. Freeing up really valuable cash flow because your income like the flow of money through your household economy, that is the key to this thing working.

Drew McClellan:

I know that you gave some examples in the summit and of how quickly the Shred Method can reduce some… So for example, I have an agency owner that I know you’re working with that built a new home reasonably recently and the mortgages north of 500 grand. After you sat down with their finances, you were like, “Yeah, we can that off.” I think it was three or four years and he called me and he was like, “Oh my God, I can be mortgage free in three years.” Talk a little bit about that because that sounds absurdly ridiculous.

Adam Carroll:

Yes. It’s absurdly ridiculous because of the belief that we have probably from growing up where our parent or some parents said, “Well, you’ll always have a mortgage.” Right?

Drew McClellan:

Right.

Adam Carroll:

There are times drew where I think it’s smart. We should have a big, long, 30-year fixed mortgage. But the reason to do it is not the reason you think it is. It’s to deploy that money into something that generates cashflow.

Drew McClellan:

Right.

Adam Carroll:

For most of us buying a big, beautiful new home. That’s great. It’s wonderful. But it also carries with it two, three, $4,000 a month in payments. I think as an agency owner especially we’re mindful of maybe how much we pay ourselves, how large our lifestyle gets in relation to how big the agency is. When you realize that in three years time with the exact same income that you’re paying yourself right now, you could have no mortgage payment on a half million dollar home.

Adam Carroll:

It’s mind boggling and it’s super cool when you see it in action, because what it does is it creates a tremendous amount of liquidity for the owner, which is then great. Should they need to buy a building or invest, or grow their personnel? Whatever it may be. The liquidity is there and it’s… Though it may be in the equity of their home, it’s completely liquid because we have that HELOC attached to it. And the HELOC just continues to grow as we pay down that mortgage.

Drew McClellan:

Yeah. You know what, I know one of the things that we were talking about is that for a lot of agency owners, their tenacity and their unwillingness to bail on the business over time, basically, they’ve just stubborn themselves to be successful.

Adam Carroll:

Totally.

Drew McClellan:

They’ve just hung in there for so long. And it’s not that they’re not smart or whatever, but they’ve weathered all the stuff that most people would be like, “Nope, I’m out.” And agency owners, for some reason, this is one of the things I love about them is their tenacity and persistence. They are just unwilling to give up. So sooner or later they build some success and some wealth. But I think sometimes they’re so surprised by their own success that they just sort of sit on that success. Right?

Drew McClellan:

They just let the money build up and they let it build up sometimes in the business. So they’ve got too much equity in the business. Then they make bad fat and happy decisions about that. They spend it poorly or they tuck it away in a personal account to your point of like, well, I have to have 12 months of living expenses in the bank and it just sits there doing little to nothing.

Drew McClellan:

I know one of the things that you help your clients do is sort of identify, “Okay. Well, let’s look at what we have.” You could do more with this. You could be a little more assertive with this. You talk about the doubling. So talk a little bit about what, what you mean by the doubling.

Adam Carroll:

So this is such a great question. I want to go back to one of your statements about the tenacity, the persistence they have. I have the utmost respect for entrepreneurs who just will see whatever way through that they need to.

Drew McClellan:

Absolutely.

Adam Carroll:

And the cool part about agency owners I’ve found so far in talking to some of your tribe is that they don’t sell a widget most often. They could reach into their bag of tricks and create equity and value in a variety of things.

Drew McClellan:

Absolutely, right.

Adam Carroll:

They’ll test and tweak and experiment until they find the thing that for most of them, it seems like they go, “Yeah, it took me a while and then I found my sweet spot. Now, we have X number of clients paying us X a month, and it’s all good.” This whole idea of doubling that you asked about. So number one, people put money on the side and they keep money in savings out of fear for the most part. Some people would say it’s practical. I could argue that it is, and it isn’t, but some people will say it’s practical.

Adam Carroll:

I believe that they’re doing it because they’re afraid that at some point in time, the income will stop and they’ll need to tap that money to live. I would begin to question somebody who’s been in business for 10 years, 15 years, 20 years. You’ll never have that ever. Because you figured out the game. That’s for young people. So we’re still working off of advice that no longer serves us. It was advice we got when we were young and we probably got it from our parents who also had no money by the way.

Drew McClellan:

Right. And I think to your point by then, they’ve learned… One of the things I remind agency owners all the time is your business can weather big ups and down. And if you run your business wisely, you run it by the metrics and the numbers, you can always pay yourself what you’re paying yourself.

Adam Carroll:

Right.

Drew McClellan:

You can always be profitable if you have three employees or 300 employees. And if you had 300 and you get down to three, that doesn’t mean you have to pay yourself any less. It doesn’t mean you have to take less out of the business. In fact, I have agency owners that as they shrunk their business, they actually made more money. So again, a reminder to them that if you do this well and right, and if you’ve been in business 10 or 15 years, you’ve done it well and right. You’ve weathered at least one economic downturn. So there’s always going to be money for you.

Adam Carroll:

Yeah, exactly. So when I talk to people about doubling their money, I want to give you a really concrete example. Let’s say you’ve got an agency owner and we could use the case in point that we already talked about. Half a million dollars, new home. Probably making decent money every month, but has done everything. Maxed out 401k, maxed out Roth IRAs. They probably… Whether or not they’re investing in real estate. At this point, I don’t know. But they’re doing everything. And the last thing that they’re seeing is money start to pile up in the business.

Adam Carroll:

They’re making maybe their mortgage payment and a little bit extra. Two, 300, 500 bucks extra goes to the mortgage payment. Well, my stance on that is you’re already doing part of this, you’re just not doing to the extent that you could.

Drew McClellan:

Right.

Adam Carroll:

So if you send an extra 500 in, okay, you’re going to take a 30-year fix down to, let’s say 12, 13, somewhere in there. You’re going to save a pretty significant amount of interest. In using the Shred Method, what would happen is in three years time, you’ll blast away the 500… I think it was 3.8 years. But you’ll blast away the $500,000 mortgage. And then what happens is you’ve got ostensibly $500,000 worth of equity in that home. That’s nearly all available to you on the HELOC.

Adam Carroll:

What I might recommend people do is take 100 or 200 at a time and flip that into an investment that… And we’ll talk out these here in a minute, Drew. I’m sure you’ll ask about it, but flip it into a wholesale type investment where you’re not going to make six or 8%, you’re making 12 or 14% per year.

Drew McClellan:

Right.

Adam Carroll:

And the risk is minimal. And people are like does that even exist. It does when you can write a check for 100 or 200 grand at a time. Even non-agency owners, non-business people, employees, clients of mine that are like… I’m not sure that’s possible in three and a half, four years. Then I show them three years later, they have three or $400,000 in equity in their home. I’m like write $100,000 check, you’ll get a 14% return through this particular investment. The money that you’re going to get monthly will cover whatever interest expense you have and then some.

Adam Carroll:

What happens is when we do this over and over and over again, you end up essentially doubling your money somewhere between the three to five year mark.

Drew McClellan:

Staggering, yeah.

Adam Carroll:

And again, when people are like, “Is this for real?” It is. What else are you going to do with the money? You could go blow it. You could go buy cars and trips and furs and whatever else you want. Or you could create generational wealth that literally changes your family’s financial tree. And you could do it in a short amount of time, 10 years or less.

Drew McClellan:

Yeah, which sounds impossible until you look at the math and you go, “Okay, I’m sitting on a home equity line of $300,000. I haven’t tapped it. I don’t owe any money. That feels great. I don’t owe anyone any money.But what if I use some of that money to make another $100,000?” I mean, the logic of it when you see math is pretty clear.

Adam Carroll:

Super clear. I’ll tell you the common argument I get is… But I like to deduct my mortgage interests. I get that a lot. When I ask them, well, do you itemize? Now if they do and they’re really adamant about itemizing, they do a good job of itemizing deductions, they could maybe get there. Right?

Drew McClellan:

Right.

Adam Carroll:

But the reality is that a couple on a standard deduction write, I believe it’s 25,000. 12,500 per person. So you’re going to take a standard deduction at $25,000 a year. You’re going to have a six or $700,000 mortgage at 4% in order to write off that much mortgage interest. And for most people, it’s just not the case. So the government’s actually done away with that excuse. It doesn’t make sense to carry a long fat mortgage anymore.

Adam Carroll:

And there’s one more point on that, Drew, I want to circle back to you that’s about compounding and compound interest too. We can talk about that here in a minute.

Drew McClellan:

So my dad, who is a banker, I don’t even know if I’ve ever told you this before, but I can remember being a kid and him saying to me, “Drew, do you know what the eighth wonder of the world is?” “No.” “Compound interest.” He would preach that over and over again.

Adam Carroll:

Yeah. Well, and here’s what’s amazing about it, Drew is we put money in 401ks and Roth IRAs and investment accounts in order to get to a point where there’s a big, shiny pile of money in there that then compounds. But for most people, what they’re also doing at the same time is they’re making all these minimum monthly payments on all their other debts, which is nothing but compound interest.

Adam Carroll:

So when I show people the power of what if you drill… Like a laser beam went after the compound debt and then flip flopped and began building compound equity in investments. You can exponentially increase your wealth that much faster by doing that.

Drew McClellan:

Well, it’s sort of double compounding, right? Because you’re not paying the negative compounding, but now you’re getting more on the positive side.

Adam Carroll:

Yeah. All I can say is it’s staggering. When you look at the numbers and you show it. When folks say it’s too good to be true, or what will my investment person say? Guess what? The bankers, investment brokers, nothing against them, but their business model has made them rich. And if you look at the average wealth in America for… Business owners are soon to be retirees, it’s not as high as it could be or should be.

Drew McClellan:

Yeah. What about the people who think this sounds risky?

Adam Carroll:

I’m always blown away by that comment because the people who say, “Well, you’re taking out debt to pay off debt.” And on one hand that is an accurate statement. Although the debt, we’re taking out in the way of the HELOC. A is simple interest and B, we can control how much or how little we take out at a time. So I’ll often say to people, let’s put a guardrail around that. How much would you feel comfortable with?

Adam Carroll:

In some cases, these folks already have 10 or 20 grand in credit card debt. And my comment back to them is that seems risky to me. So you’re already used to taking it out. What’s the difference? You’re just now taking it out to blast away this debt. I’ll tell you what’s intoxicating is when you start to see or more chunk down. You’ve done this a number of times.

Drew McClellan:

Yeah, right. I’ve done it. Yep.

Adam Carroll:

And you see it chunked down. It’s like somewhat intoxicating to like, “When’s the next payment I get to send?”

Drew McClellan:

I don’t know about your other clients, but for me it’s a game. It’s like, “Okay. Once I see it happening, if I buy a new property, once I see it happening, I’m like, “Okay. How fast can I pay? How can I squirrel away even more money to pay it off faster?” It is intoxicating. It’s a little light crack. You just want to get it done and blasted. There’s a thrill to it for sure.

Adam Carroll:

Yeah, no doubt. For those that maybe are a little more visual too, Drew, I always like to envision those big buckets of water at a water park that they fill up and they’re like teetering back and forth and then eventually they fill over. That’s what we’re doing. We’re filling up the bucket and then we dump it. When we dump it, particularly for agency owners, if your income is sufficient, you dump that money into a big investment. When I say dump it, that might mean taking out a big… It could be taking out another mortgage. It could be using in the HELOC.

Drew McClellan:

It could be whole life, right?

Adam Carroll:

It could be whole life policy. Instant banking. When we do that, what we’re doing is creating another hose to fill that bucket up faster. So imagine what happens when you have multiple hoses going into that bucket? All of them generating monthly income and you’re dumping it every three months, six months, 12 months, whatever it is. Even if it’s 36 months, that’s when we’re talking about just massively creating equity and cash flow and freedom ultimately.

Drew McClellan:

Yeah. So I want to talk a little bit about equity planning and the freedom side of it, the legacy side of it. How much money do we really need and why are we doing it? But let’s take a quick break and then we’ll come back and we’ll talk about that.

Drew McClellan:

Hey, there. I’m really sorry to interrupt, but I want to tell you about a brand new workshop that we’re offering on February 17th and 18th. It is going to be taught by Carla Johnson, international speaker, bestselling author. It’s all built around her new book, Rethink Innovation. And the whole idea is how do you build your agency’s idea machine.

Drew McClellan:

Let’s face it. The one thing that we have got to be good at is generating big, bold ideas for clients. And Carla is going to teach us why we struggle with that today. How to reignite it. Not only in us, because in many agencies, you, the leader are the one who has all the big ideas, but not everybody else can do it.

Drew McClellan:

That can be changed. She’s going to teach us a scalable framework that we can take back to our agencies and teach everyone how to generate more reliable, effective, big, big ideas. And it’s going to be a great workshop. It’s going to be very hands on. I’m super excited about it and you are going to love Carla.

Drew McClellan:

On a website, head over to how we help under workshops. You can see rethink innovation and by all means sign up quick, because I think it’s going to sell out. All right? Let’s get back to the show.

Drew McClellan:

All right. I am back with my friend, Adam Carroll, and we are talking about how to use your money to make more money, which is a really cool topic. So let’s talk a little bit about equity planning and sort of… I think a lot of agency owners think, “Well, I’m going to sell the agency someday, so that’s my pension plan.” Even though, let’s be honest, a lot of agencies never sell. They’ve not built enough value in them or they’re not big enough or whatever.

Drew McClellan:

For whatever reason, they don’t sell. So let’s talk a little bit about equity planning and the yin to the yang of this is how much money do we need and why do we need more? I can remember us talking about this almost 20 years ago this whole idea of the legacy of this. And because for you, it’s not really about accumulating wealth just to have more money, but it’s what can you do with that money in a really important way.

Drew McClellan:

Maybe let’s start there. Let’s start with the why would I want to keep making more money which seems like an absurd question, but at a certain point in time, if you have 10 million, do you need 12? Do you need 15 million? So let’s talk that first and then let’s talk a little bit about equity planning.

Adam Carroll:

So making more money is interesting. And I think this is where some of your agency owners, they almost need a little mindset, reset. And I’ll tell you why. They have been in a business. They’ve been in a business for a period of time. They’re making really good money, probably more than they’ve ever thought they could make. And in that moment there was a book by Gay Hendricks called The Big Leap. And the big leap said, “We all have these upper limit problems.”

Adam Carroll:

The upper limit problem is we bounce up against this number. And then it’s like, “Oh, that feels really good. But I don’t know if I should feel that good for this long.” And then we start to make different decisions. Right? I think there are some agency owners out there, maybe some listening that have found themself in a position where they’re making more money than they’ve ever made or ever thought they’d make, and they’re either looking at, do we lifestyle up? Because we have all this.

Adam Carroll:

Parkinson Law says expenses will always rise to meet income. Or do you say, “How much do I really need to live on? Is it insert your number here 5,000, 10,000, 15,000 a month, whatever it might be. If your business is making over and above that, then I would pause it. One of the things that you should be doing with that money is creating legacy, creating freedoms. When we first met, Drew, I had started Four Legacies Mortgage.

Drew McClellan:

Yep, I remember.

Adam Carroll:

And the four legacies are, financial freedom is first. Financial freedom leads to time freedom because those without money, you have time. Time freedom leads to relationship freedom and relationship freedom leads to service freedom. So everything that I’ve done and what I’ve built and what I’m coaching people through is what does that look like for you. If you want to get to a point of some of your owners, some of the listeners who probably already have financial freedom, and they have time freedom.

Adam Carroll:

Now we’re like, “Okay, well, what are the relationships you want to build? Who are they with? How are you doing it? Does that involve buying a short term rental or maybe multiple short term rentals?” And then you taking friends and family to those places as a way of building relationship freedom with people.

Adam Carroll:

When we talk about service freedom, that may be building like you’ve done a scholarship fund in the name of your parents. What an amazing service to provide for other people. So I think the challenge of how much is enough and when do I move on? Listen, my goal is to help everyone get to a point where you’re making what you know you need to make every month, regardless if it’s in your business or outside your business.

Adam Carroll:

So if it’s in the business, wonderful. That’s client revenue. It’s profit. If it’s outside the business, it’s the massive, passive, permanent streams of income you’ve built as you deploy equity in smart ways. Imagine being an agency owner and making 15 grand a month from massive passive income sources. And every dime that the agency makes is going in to build legacy. I mean, think about how powerful that could be.

Drew McClellan:

Yeah. You talk about the scholarship I set for my parents that when I lost my parents, it was really important to me that there’d be a legacy tied to them. I was surprised at how easy it was to do and that I had the money and it didn’t impact my lifestyle at all. I can keep adding to that pot for both. I have a scholarship for each of my parents. There’s enough money now that those scholarships will be given out in perpetuity. I mean, what a really cool way to change a little slice of the world to honor something that matters to you. Everybody’s got that.

Drew McClellan:

It may not be the scholarship for their parents. It may be something else, but I think every has in them, some mark they want to leave on the world. If we’re willing to take the risk of owning our business and work as hard as we do and for as many hours as we do, why wouldn’t we also get to have the privilege of leaving that kind of mark?

Adam Carroll:

Totally. And, and, and at the same time, I think to think along those lines, you have to a stretch what’s possible right now.

Drew McClellan:

Right, right. I’ll tell you some of the agency owners, some of the other clients, and I work with attorneys and doctors. I’ve got a few PhDs on my client roster. Then I’ve got folks who are W-2 employees of companies making 60 to 80 grand a year. They don’t have to make massive sums of money. But some of these folks that have been with me for the better part of two or three years are now at a point where they’re a handful of doublings away of being worth tens of millions of dollars.

Drew McClellan:

When I start going through, and we’ve got a quick calculator that we use with clients where if somebody says, “Hey, my net worth is X.” We’re like, well, at six or 7%, here’s what you’re looking at in terms of doublings over the next 30 years, their mind is blown. It requires that owners today be thinking differently. They really stretch what’s possible because if you’re at a point where you’re already surprised with how much money you can make, look out. I won’t say it can only go up because it could go down. But it will likely go up because you’ve skilled up all of your expertise in owning a business.

Drew McClellan:

And again, you’re not suggesting somebody invest in things that are suspect or shady. You and I have invested in some things not together, but with the same folks, that it’s pretty much a guarantee. It’s like this is stupid easy to make money in these ways. So I think part of what the value you bring to your clients is that you have a lot of stupid, easy ways to make money. But your point is, those stupid ways to make money aren’t available to somebody who can invest $25 a month. You got to have a big chunk of money to put in to get invited to that party, to the stupid easy party.

Adam Carroll:

Yep. That’s right. That’s right. And a big chunk could be 25 grand. It could be 50, but it would blow people’s minds to how fast you can get to that number when you’re using the Shred Method. This is a little tidbit maybe for some of your listeners. If you’ve got young kids or you’ve got grandkids, one of the things I recommended to a recent agency owner who had a young child. I think they were under five years old and we were going through his numbers and he said, “Well, I’m putting two 50 a month away in a 529 plan.”

Adam Carroll:

I said, “What’s your desire there?” And he said, “Well, I’d love if my son had $75,000 or a $100,000 when he is ready to go to college.” I said, “Okay. So I’m going to give you an out of the box idea.” You just need to drop 25 or $30,000 from your HELOC into the 529 plan, and then let it ride because you’ll never have a more aggressive well-managed account than a 529 plan.

Adam Carroll:

Particularly in our state, the Iowa 529 is awesome. I know there’s five or six states that always rank high, but it’ll double at least twice, if not three times by the time that kid is 18.

Drew McClellan:

Right. Then use your 250 to pay down the HELOC. Right?

Adam Carroll:

Right.

Drew McClellan:

Just flip it around. Right.

Adam Carroll:

Yeah. And this particular gentleman he had sufficient discretionary money every month. He’d knock out the 25 grand in no time, four or five months, six months. It’d be gone. So think about the power of that. It requires, we think differently. I think that’s why most people are attracted to what I’m doing. It’s just they’ll say to me, why has no one told me this?

Drew McClellan:

Right. I was just going to say to you, so if somebody’s listening. How do they begin to think differently? What questions do they have to ask? Or what resources do they have to tap into to begin to flip the way they think about money and wealth and the whole idea of doubling. What do they have to do different?

Adam Carroll:

Number one, I need you to realize that you’re or income is the most powerful tool you have. And it should be doing four things. It should pay your expenses. Does that for most people. It should eliminate debt. It does not do that for most people. It should build wealth. Again, people do it, but they do it in drips instead of buckets. And then the last is you should be able to do good and have fun with it. If you’re doing two of those, you’re paying your expenses and having fun. You’re inefficient. And then just by questioning maybe the efficiency of your money, it’ll get you thinking differently.

Adam Carroll:

I pose this question, Drew at the summit and I think it really resonated with people. If you had to leave your house in the morning at seven or 8:00 to go get groceries, let’s say, and you came home right after that knowing that you were going to go to the post office at 4:00 PM to mail something, would you leave your vehicle idling in the driveway all day long?

Drew McClellan:

Right. Of course not. Right.

Adam Carroll:

Of course not. And people said, “No, it’s inefficient. Why would we do that?” Yet we’ll park our paychecks in a checking account for a week, 10 days, two weeks at a time. It dwindles a little bit from time to time. But there’s a more efficient way of doing that. If you find yourself in that boat, I’m going to tell you right now, you’ll be blown away by how fast you could change your situation.

Drew McClellan:

Yeah. Yeah, I love this. At the end of the day, what I love about the work you do is that you do give people those freedoms. You give them the freedom to stop worrying about money. You give them the freedom to spend time doing the things that they love with people that they love. You give them time to invest in the relationships they’re going to last forever. And ultimately you invite them to leave their mark in a way that’s bigger than their professional contributions or whatever. But that they get to decide what part of the world they want to change. When you think about it, that’s a life well lived, right?

Drew McClellan:

When you can do those things and you can do them as you said with the money that you’re making right now today, why wouldn’t we all want that life?

Adam Carroll:

Why wouldn’t we at least investigate it? Right?

Drew McClellan:

Right. I suggest that people ask bigger questions. So the question that some people ask is how would I pay off my house early? The question I want people to ask is how would I pay off my house by the end of next year.

Adam Carroll:

That’s a different question. If you’re asking, how would I take a really killer vacation next year, ask yourself, how would I take a month off and travel to the places my family and I have always wanted to see first class. How would I do that?

Drew McClellan:

Yeah.

Adam Carroll:

Your mind has to create a bigger answer to those bigger questions and I started asking myself those questions some time ago and then Shred became apparent to me and infinite banking became apparent to me. Obviously, I was introduced to all the people we know who have these amazing investments where the risk is almost… It’s 98% mitigated.

Drew McClellan:

Right.

Adam Carroll:

It’s just amazing that when you’re ready to see it, it appears.

Drew McClellan:

Yeah. I am a firm believer when you start asking different, better questions, your brain can’t stop until it comes up with an answer. Because I remember as I mentioned in the introduction you and I have known each other a long time. We’ve been in a mastermind together and I’m sure you’ll remember this, but I set the goal of I want to spend at least one month a year on Disney property and I don’t want to have to pay for it. That sounds absurd. [crosstalk 00:36:10] Right. That anybody would want to spend that much time. I don’t think that’s absurd, but other people might think that’s absurd.

Drew McClellan:

But the idea that I didn’t want to pay for, it seemed absurd now because of the workshops we offer and the fact that we offer them on Disney property. I hit at least a month, a year, if not more. And it’s all covered by the events themselves. So I actually get paid to spend a month on Disney… Not only don’t I pay for it, but I get paid to do it because I ask the question. Right?

Drew McClellan:

I think that’s your point is asking different questions and thinking… I was a wish granter for Make-A-Wish for many years as you know. One of the things that we learned as wish granters is the kids thought really small. You’d say, what do you want in the world? And they’d be like, “Well, I want a bike.” You’d be like, “Really? Is that all you want is a bike? Would you like to go somewhere? Would you like to meet someone?” And you had to help the kids think bigger and understand that there was no limit really to what their wish could be and what we would do to make that wish happen.

Drew McClellan:

I sort of think as adults, we’re the same way. It’s like, “Well, yeah, I’d like a nice car as opposed to something bigger and more impressive and impactful to your life.” I think you’re right. I think it is about asking different, bigger questions.

Adam Carroll:

It’s really important to… I think one of the… Maybe the first episode I did with you was about masterminding and the power of the mastermind. This might be a little off topic for today’s session, but if you are not a part of a mastermind of some kind, you must surround yourself with people who are asking bigger questions and are asking you questions you’re not asking yourself.

Drew McClellan:

Absolutely.

Adam Carroll:

And that’s the advantage you and Mitch have been that for me. I’m constantly seeking out counsel of people who I perceive to be great question askers because the power of that just can’t be… It can’t be overstated.

Drew McClellan:

I agree. And I think surrounding yourself with other people who know you well enough, to trust you, and that you trust that they will ask the hard questions, and force you to think differently. Again, surrounding yourself with people who are doing things that you’re like, “Okay, I need to learn more about that.” And that curiosity around that, I think that… I mean, I think, again, that’s one of the privileges that we have is that we’re surrounded by these people. So why wouldn’t we hang out with them, get to know them, pick their brain, learn from them and then offer them the same thing back. Right?

Adam Carroll:

Indeed. One more quick story, Drew about asking bigger questions. I have a good friend who has $178,000 in student loans. You can feel the anxiety in her body. It’s palpable. So we were talking about her situation and I said, “I really think you should look at the Shred Method.” She had a couple thousand dollars extra every month. She had six months set aside in the bank and she’s like, “Well, I don’t own a home.” I said, “Well, we can figure out another way to do it either a personal line of credit.” Then she mentioned that she owns 75 Ethereum tokens. And if you’re following that at all, that’s about 280 grand right now is what she owns in crypto.

Drew McClellan:

Wow. Right.

Adam Carroll:

Now she will have a massive capital gains hit if she were to sell it. And I said, “Have you heard of defi, decentralized finance?” She said, “No.” I said, “Well, we can stake your coins. We can put your Ethereum coins in a decentralized finance account, and you can borrow money against a light of credit that’s created by those coins.” She was like, “Okay, this is blowing my mind. What’s the number?” She would’ve knocked out $178,000 in 4.2 years.

Drew McClellan:

Wow.

Adam Carroll:

Yeah. And it would save probably at least 150 grand in interest for her to do it.

Drew McClellan:

Yeah, right.

Adam Carroll:

So again, bigger questions surrounding yourself with people who are maybe thinking a little bit outside the box. The bottom line, Drew finance is changing. Finance is changing in a big, big way. I know we’re just probably coming to the end and I don’t want to introduce a new topic with crypto. But if people aren’t paying attention to that, that is a wave that is forming out at sea. And when it crashes, it will take over. My advice to everyone listening is find someone who knows their stuff, listen to them, watch it, study it, and at least have its own in the water.

Drew McClellan:

Yeah. Right. So much good stuff out there, I think. And I’m grateful how you are coming alongside so many of my folks and helping them think differently. And I certainly am grateful that you’ve done it for me for, gosh, almost two decades now. We could talk about this for another three hours and we have done that before.

Adam Carroll:

Indeed.

Drew McClellan:

And I’m sure we will, again. So Adam, if people want to learn more about the work you’re doing, reach out to you to have a conversation around all of this, what’s the best way for them to find you and make that connection?

Adam Carroll:

Yep. So the website they would go to, Drew is theshredmethod.com. And if you want to send an email, [email protected] It’s the best email for me and my team. That will get an auto response back with a scheduling link. We’re happy to have 20 or 30-minute conversations with people just to see how much can we save and how much equity do you have you’d like to deploy or thinking about putting somewhere. There’s no obligation to any of it. It’s really more about thinking differently. I know that at the summit, there were a lot of people thinking differently at the end.

Drew McClellan:

Yeah. I know. It was awesome.

Adam Carroll:

It was such an honor to be there and to share the message with them. So I appreciate you and all the work you’ve done to build this community because they truly are. They’re selfless, loving, caring family.

Drew McClellan:

Yeah. They’re awesome.

Adam Carroll:

You can’t describe it any other way.

Drew McClellan:

Yeah. It is. It is a privilege to do work that you love for people you love that’s for sure. Yep. I’m a lucky guy in a lot of ways.

Adam Carroll:

That’s for sure.

Drew McClellan:

All right, my friend, I’m going to let you go, but thank you for being with us. Thanks for sharing your wisdom. I know that you’re going to change a lot of people’s lives as they follow you and listen and follow your good counsel. So as always, I am grateful for you.

Adam Carroll:

Thank you much, Drew. Likewise. Talk soon.

Drew McClellan:

All right. All right, guys. This wraps up another episode of Build a Better Agency. Do not sit on this information. I’m hoping, if nothing else, now in the back of your brain, you’re like, what are the big questions I should be asking? What if I could do anything with money, and I could do anything with time freedom and relationship freedom, and service freedom? What would that look like? Those are great questions to ask.

Drew McClellan:

And you are in such a privileged position that you have the resources to actually make all those things happen. So don’t sit around and wait. I don’t care how old you are, you can start it today. The younger you are, the better. I wish I had started it when I was 20, but you know what? Anytime is a good time to start. And today is better than tomorrow.

Drew McClellan:

So check out what Adam has to say. Check out his website. I’ll reach out to him if you will. Go create a legacy for yourself and your family because you can and you should. I will be back next week with another guest. Before I let you go, I want to say a thank you to our friends at White Label IQ. They’re the presenting sponsor of the podcast as you know. So head over to whitelabeliq.com/ami. They’ve got some free hours for you to do a project with them. They do white label, PPC dev and design. They’re awesome folks. Many AMI agencies count on them every day. And I think that you’ll enjoy working with them and you’re going to find that they have the chops to do whatever you need to do. So check them out and I will be back next week.

Drew McClellan:

As always, I am grateful that you show up every week. Thanks for listening. And if you need me, you know how to track me down. I’m [email protected] See you next week.

Drew McClellan:

That’s a wrap for this week’s episode of Build A Better Agency. Visit agencymanagementinstitute.com to check out our workshops, coaching packages, and all the other ways we serve agencies just like yours. Thanks for listening.